ANALYST Q&A - VERTICAL HORIZONS: HOW CONNECTIVITY IS TRANSFORMING MARKETS


Reid Morrison

US Energy Advisory Leader, PwC

Timothy Kuder

Senior Industry Analyst for Aerospace, Frost and Sullivan

Roger Lanctot

Director of Automotive Connected Mobility, Strategy Analytics

Yiru Zhong

Lead Analyst for IoT and Enterprise Research, GSMA Intelligence

Top analysts from the aerospace, automotive and energy sectors shed light on how smart manufacturing and other new connected technologies are changing the game in different industries, and what other transformations are on the horizon.

1) How are smart manufacturing/connected technologies already changing the way companies in your industry get things done?


Reid Morrison (RM):

Many companies involved in minerals extraction are already well advanced in the uptake of connected technologies to enhance automation in search and extraction, pipeline and asset maintenance, and energy efficiency. There are many use cases already in play, with others being developed, and these are helping speed, productivity and workplace safety. During COVID, many operations were able to be managed remotely (employee homes) because of the investment in infrastructure, applications and connectivity.

Timothy Kuder (TK):

Technologies like Additive Manufacturing, IoT and sensors, as well as digital applications have already changed many aspects of the aircraft manufacturing business. Additive manufacturing is diving into the applications of sending a “digital part” to the end user who can print or have the part printed.

Roger Lanctot (RL):

Car makers are using smart manufacturing technologies to anticipate and identify component flaws before parts reach the manufacturing process stream. Prognostic analysis is allowing manufacturers to increase yields and reduce downtime and end-product recalls. This applies to everything from semiconductors to software and takes into account cybersecurity vulnerabilities.

Yiru Zhong (YZ):

From robotics and ERP systems to edge computing and IoT platforms, manufacturers have a large group of smart manufacturing technologies to orchestrate. The goal is always about achieving operational efficiency and productivity increases. IoT technologies provide the connectivity and data that allows auto manufacturers to make better decisions, quicker or more accurately. For example, our Enterprise in Focus survey showed that the top IoT solutions adopted by manufacturing companies centre on data to control for quality, enable automation and facilitate the management of supply chains, systems and machinery.

2) What future 5G-enabled capabilities are companies in your industry most excited about? Which are most in-demand and why?


RM Quite a few. High and secure throughput over wireless is key for enabling more cloud-enablement at the drilling or exploration face, for example. Also, low latency of 5G networks will enable better automation of driverless vehicles.

TK

Cabin connectivity and IFE [in-flight entertainment] increasing end user customer satisfaction.

RL

The higher capacity and greater reliability of 5G represent the greatest attractions of the technology, but the promise of direct inter-device and inter-vehicle communications holds the long-term promise of collision avoidance and savings lives. There is standards work and testing yet to be done to realise the full capability of 5G – but direct device-to-device communications represents a revolution in vehicle connectivity.

YZ

5G enables new ways of working that previous technologies (4G or Wi-Fi or fixed) could not facilitate. For example, 5G gives the ultra-low latency and bandwidth capabilities that support the size of datasets from CAD systems or digital twins for the technician to resolve a problem with one visit. This saves money and time, which in turn maintains production systems uptime. Our Operator in Focus survey showed that 70 per cent of operators see manufacturing as the most attractive industry for private networks.

3) In what other ways can connectivity make companies in your industry safer, more efficient or more profitable?


RM Increasing the availability of real-time monitoring and the speed of processing data to enable insights is the next frontier. Much of the operational data (e.g., measurement sensors, distributed control systems, etc.) is constrained to the site due to volumes of data and remote locations, so improvements in connectivity to allow the data to move to the cloud for real-time processing securely will be impactful.

TK Cockpit connectivity and its effect on possibilities of moving the traditional black box to the cloud through digital twin technology. Total airport management systems are going to use connectivity technology and establish protocols of big data between digital platforms, thus increasing efficiency in several process such as aircraft turn-around, airport asset locations and terminal management.

RL

Wireless technology is intertwined with data when the question is the creation of value. Wireless technology creates and liberates data, which allows the development of new applications intended to make vehicles safer, driving easier, and transportation cleaner and more efficient. Wireless enables both direct and indirect value creation opportunities.

YZ

Connectivity is never a single technology. For the automotive industry to use connectivity, they require seamless roaming across different types of devices, across private and public networks, and across different types of connectivity access. This also means the connectivity must be secure in order for manufacturers to rely on the data to make better decisions.

4) What’s the biggest barrier to adoption of new smart manufacturing or other connected technologies in your industry?


RM A key barrier is creation of an ecosystem for new ICT products which are enabled by 5G technologies. This ecosystem is still in the early stages of being built, and a lot depends on how effectively industry, components manufacturers and mobile operators can deepen their collaboration to bring products to market.

TK

Cost. Many companies, especially post COVID, are reducing budget to survive. Regional barriers [are also an issue] as the connectivity technology is not available, consistent or reliable in many markets around the globe.

RL

Suppliers of smart manufacturing solutions need only prove a return on investment and, in most instances, car makers are receptive. While car companies are coming to grips with the integration of wireless technology in their vehicles they are simultaneously coping with a transition to electrified powertrains and new vehicle architectures. In this context, manufacturing processes are already being disrupted and re-invented creating fertile ground for innovation.

YZ

Our Enterprise in Focus survey revealed that the top three barriers to adoption of IoT continue to be related to integration challenges, security concerns and cost. More than half of respondents report that integration is a key challenge where IT specifically is the most difficult area. Where security concerns are also a barrier, the survey also reveals that although a majority of respondents (84 per cent) have changed their security practices as a result of their IoT deployments, the minority (16 per cent) have not done so. This inaction from a minority poses a system-wide security risk – the survey showed almost 50 per cent of those who have not changed assumed that IoT solutions are already secure.

5) What message would companies in your industry send to mobile operators and other connectivity providers about their unique needs and how best to serve them?


RM We need better and more industry-aligned partnering to understand and solve our specific problems – the opportunity to do so is now. Because of the 24/7 risk of operations and continual focus on safety, new solutions must address complexity and dynamics of operations which requires engineering a solution with redundancies and fail safe mechanisms.

TK Straight-forward communication. Satellite connectivity abilities, which close up black holes in communication/connectivity.

RL

The single greatest point of departure between the wireless industry and the automotive industry is the issue of product life cycles. The typical design process time to market for a new car is three years. For this reason, car makers must have more reliable time lines for the launch and introduction of new wireless networks and services. To compound this challenge, the average life span of a car is more than 10 years, which means a connected car will be impacted by changes in available wireless networks. These differences may be irreconcilable, but the first step in achieving alignment is understanding the requirements of the industry.

YZ

Based on the security risks of inaction from a minority, the overall message to operators and equipment vendors is to enable automotive manufacturers’ ability to manage and respond to cyber security risks during production and post production (over the lifetime of vehicle). To the extent that automotive manufacturers aim to grow incremental revenues from their customers through connected car services, the ability to give individuals control of their privacy and security considerations will also be very useful.