In the second part of the interview, Geoff Lawrie, NZ country manager at Cisco Systems, talks to Reseller News NZ on how the Internet of Things can improve productivity across important sectors in the country, and thereby assist with economic growth.
Q: From your assessment, when do you see these projects taking off?
GL: We are talking to a number of things like that. There is nothing at a mature level, but there is a lot of recognition of where we want to go. So there is quite a bit of government interest, industrial interest in making the things that will enable it. We are involved in a number of conversations there, but nothing that is at a stage where we are like wow look at this – look what’s happening here.
There is a bit of industrial automation starting to go on now. So you are starting to see some of the power companies starting to connect elements of their production and distribution bridge into that, so that they can get better real time control. Fonterra doing quite a bit of work in connecting up their milk trucks and route optimisation – all that stuff is starting to happen.
Even on industrial production lines we are moving from previous generation industrial control protocols to IP, and getting into standard IP networks.
Initial agricultural implementations are already underway. When will it be mainstream? Two or three years I guess.
We are seeing a lot of interesting activity with the mines in Australia as an example. Transportation is interesting in NZ. Lots of trucks are doing telemetry stuff now, which is a lot of what this is about. Connecting up the elements and really accurately starting to measure time on road, average speed, breaking, engine, service requirements, driver productivity, driver weariness and all those things are starting to be done now.
There is a lot of interesting stuff going on. People are taking the connectivity concept and seeing how it can be used to drive the next level of productivity.
Q: How does the security side at Cisco fit into your overall growth?
GL: It is starting to go very well. Couple of years ago we had some gaps in our security portfolio. Now through a process of focused R&D and acquisition we have done a good job of coming out with a very comprehensive security portfolio. And I think we have got a very mature philosophy of how we approach security and the technology that we use to back it up.
I acknowledge that quite a bit of that is coming from acquisitions. We bought a company called ScanSafe recently which does internet filtering as well as a service. We have been very successful with that product in NZ. And then more recently, we bought SourceFire, which makes an open source, Snort protocol open applications set, and has a cloud based security product that we have put into our portfolio.
Quite a bit of work going to consolidate and streamline all those acquisitions, so you get a coherent portfolio that works overall. In every element of security, filtering, intrusion detection and prevention, we have got a good portfolio now.
It is starting to go very well for us. It is a very competitive part of the marketplace but I think we have got ourselves into a position where we have a very comprehensive portfolio. Security is not about a point solution, it is about understanding the different elements of security and making sure you have got that covered in a coherent way. Cisco is one of those companies that is at that point.
Q: What are the challenges that face Cisco in the country?
GL: There are a number of challenges for our industry, not specific to Cisco. I think the biggest disruptor is the Cloud. Not for the technology, but for the implications it has in the way consumers are going to access, and consume and pay for technology that we sell. That’s the biggest sea change that we have seen in this industry- that customers want IT as a service.
Every IT company, Cisco included has a business model that is based on the transactional model. There are a few new entrants like Amazon, who have built from scratch around the service proposition. But for most companies, their balance sheets, revenue reporting – all of that is based on the transactional model.
And that means a couple of things. One is enormously disruptive to organisations in that space – us, our core competitors like Juniper, IBM, HP – in terms of how they transition all of their systems and processes and balance sheets to accommodate that.
Secondly, it opens up the market to a whole lot of innovation and disruption. New players can come in and win business without making any investment whatsoever. They can come and compete like a NZ company – offering a service out of a datacentre in California or Singapore – at aggressive price points.
Fortunately, we recognise that, we understand it, we are evolving our model as quickly as we can to do that. But there will definitely be some companies that do not manage that transition and so we are going to see some big names consolidate and disappear in the marketplace in the next five to ten years.
There should be no engagement with the government that you cannot do online.
Q: What do you see as the role of the government in this changing marketplace?
GL: The government has a significant role. People tend to look at the government and say the government needs to do this stuff. The current debate around the copper pricing for instance. They are looking to the government and asking how are you going to fix my problems. I am not of that view. But I do think they have a significant role to play.
One, in terms of being a leader in terms of how they purchase and consume services themselves. They are doing some very interesting things in terms of the syndicated procurement model and their use of IaaS. Good leadership is the first thing.
Secondly, I think they have a very strong leadership responsibility in how they offer citizen services – how they offer to connect citizens in NZ and a big obligation to transition all of that capability to be online and real-time for every citizen in NZ.
There should be no engagement with the government that you cannot do online. The government has a productivity responsibility and a leadership responsibility that services are offered online. There are some great examples are where they have done fantastic things, and other areas where they need to shape it up, the laggard departments and get them online. Fortunately for us there are some great highlights to follow in different parts of the world. There are some governments that are doing some very interesting things.
I'm very optimistic about what the sector can contribute to this country. Technology increasingly has a part to play in how we prosper as a nation. It’s a really good market here. Largely straight forward, honest kind of market to do business in. but it is going to be very disruptive in the next few years. Mobility and cloud are the two big things that is going to drive that.