Telefonica models the transition of a traditional telco to a digital service provider

Telefonica represents a prime model of the opportunities and challenges telecom operators will experience as they evolve into digital service providers. The digital era will enable telecom operators to become more agile and profitable as they transition away from more costly legacy network technologies and business models. The digital era will place greater expectations on telecom operators, however, as customers will turn to digital service providers to support a broader range of services and use cases.

Telefonica will benefit from recognizing that it is just a single entity competing in a vast digital ecosystem composed of a multitude of players, including other telecom operators, webscales and OTT video providers. Collaborating with the broader technology industry will enable Telefonica to reduce the cost of developing in-house solutions while enabling the company to more effectively support customers’ digital ambitions.

The 2019 Telefonica Industry Analyst Day showcased Telefonica’s (NYSE: TEF) evolution from a traditional telecom operator to a digital service provider (DSP). Telefonica is positioning as a leading global DSP through its progress in virtualizing and cloudifying its network and IT systems as well as the company’s capabilities in emerging technologies, including AI, machine learning (ML), big data and edge computing. Telefonica’s digital transformation initiatives are yielding significant cost savings as the company modernizes its network infrastructure and customer service platforms while creating new services to enhance user experience and support advanced use cases. Telefonica will face challenges in the digital era, however, including growing competition from webscales, regulatory hurdles, and unproven demand for use cases in areas including 5G and edge computing.

Enterprises leverage disruptive emerging technologies within their operations to improve processes and accelerate digital transformation

Extension remains the most natural jumping-off point for digital transformation (DT) initiatives, as enterprises can experiment with disruptive technologies within familiar business operations, see their value in generating new business insights, and then use those insights to re-imagine processes. TBR’s Digital Transformation Insights Report: Voice of the Customer shows that vendors need to orient toward development of pointed, industry-centric solutions to retain mindshare. This report, authored by Senior Analyst Boz Hristov, shares survey results across a spectrum of DT issues as well as excerpts from extensive, in-depth discussions with clients currently purchasing DT services.

Additional assessments publishing this week from our analyst teams

While trailing 12-month IT services revenue growth decelerated from 4Q18 to 1Q19, according to TBR’s IT Services Vendor Benchmark, year-to-year growth in 1Q19 of 2.6% surpassed that of 1Q18, which was 2.2%. Vendors are investing in niche digital design areas and industry expertise to drive advisory services activities with C-Suite executives. They are also leveraging established footholds and trust with new buyers to pursue managed services around clients’ application and infrastructure estates. Improving profitability provides vendors with flexibility to invest gains in high-growth and high-value technology-enabled solutions. — Elitsa Bakalova, Senior Analyst

In TBR’s 2Q19 Accenture Initial Response we continue to assess if scale and appetite for innovation still define and shape Accenture’s success as it becomes a solutions broker. We will also look into how platforms supporting omnichannel architecture will underpin Accenture’s efforts to capture custom work and reach $47 billion in sales by 2020. — Boz Hristov

In 1Q19 Dell EMC’s Infrastructure Solutions Group faced year-to-year revenue declines across all segments, including storage, servers and networking, due to a combination of seasonality headwinds and go-to-market challenges. As Dell EMC’s cloud revenue is largely tied to hardware sales, these same challenges compromised its cloud top-line performance. An increasingly strategic partnership with VMware coupled with the new Dell Technologies Cloud portfolio will help boost performance in coming quarters. — Cassandra Mooshian, Senior Analyst

TBR’s Hyperconverged and Converged Market Landscape explores the vendor landscape of these two markets, including leaders and laggards, and the existing and emerging disruptors in the space. This report details recent announcements in the space made by key vendors as well as the disruptive dynamics of emerging hardware trends from nontraditional vendors, such as Amazon Web Services (AWS) with its AWS Outposts.— Stephanie Long, Analyst

TBR’s Hyperconverged Platforms Customer Research surveys hyperconverged customers to analyze purchasing patterns, spending habits, adoption trends and the evolving drivers behind vendor selection. Key highlights of this report include customer desire to leverage hyperconverged infrastructure (HCI) for private cloud environments and the ongoing shift to consumption-based pricing. We also surveyed current HCI customers to determine their likelihood of adopting AWS Outposts, along with where customers will pull funding from to support this new hardware model. — Stephanie Long

SAIC officially began its integration of Engility’s nearly $1.9 billion in revenue and 7,500 employees in 1Q19, aiming to leverage Engility to accelerate its expansion with a more balanced, diversified and lower-risk portfolio and an enhanced competitive stance in markets adjacent to its core Department of Defense and federal civilian sectors, particularly space and intelligence. A new leadership era is also beginning at the top of SAIC’s executive management, as CEO Tony Moraco will retire effective July 31 and will be succeeded by COO Nazzic Keene, who was elected to the CEO post by SAIC’s board of directors in March. Keene has already implemented numerous changes during the CEO transition period as part of the broader initiative she has spearheaded to flatten SAIC’s management pyramid and streamline operations amid the integration of Engility.— John Caucis, John Caucis

TBR’s 1Q19 Booz Allen Hamilton (BAH) report details how the company completed its fiscal 2019 with strong top-line expansion and record revenues, better-than-anticipated earnings, and its largest quarterly dividend increase in years. BAH’s performance throughout its last fiscal year reflects a soundly differentiated market position and multilayered alignment of the company’s technology and advisory portfolio with the primary missions of its federal customers. In May 2015, when BAH launched its Vision 2020 strategy, industry and company observers criticized the plan over concerns BAH would be investing ahead of demand, which had yet to materialize. BAH has sustained a top-line growth CAGR of nearly 6.2% and an average operating margin of 8.5% (both in excess of peer averages for these metrics in TBR’s Public Sector IT Services Benchmark) since Vision 2020 was enacted, affirming the strategic framework was well conceived and has been well executed. — John Caucis

Tune in Wednesday at 1 p.m. EDT to hear Stephanie Long share highlights from TBR’s HCI research including exclusive recent findings from TBR’s Hyperconverged Platforms Customer Research. The webinar will highlight how the HCI market has shifted over the last few years and where TBR sees it headed. Additionally, this will be a great opportunity to ask our analysts your questions about the HCI market. Sign up today!

Atos at the edge of technology

With the launch of BullSequana Edge and investments in quantum computing, Atos takes a pragmatic approach to executing digital transformation initiatives

For a few years, the impact of big data has created ebbs and flows in buyers’ behavior in end-consumer interactions and IT purchasing patterns, as is typical with any technology. Consumerization of business applications, demand for data quality and governance, and the adoption of connected technologies compel vendors such as Atos to explore opportunities around managing customer data and to invest in solutions that can help them protect their competitive edge.

During the Atos Technology Days 2019 opening keynote, Atos CEO Thierry Breton announced BullSequana Edge, the company’s first edge server to power AI everywhere. Built with the goal of delivering lots of power, including 165-teraflop capacity, that is stored locally, the appliance enables Atos to address the upcoming shift in data localization. Breton stated that while 80% of data globally is stored in data centers and in the cloud, that percentage is expected to shrink to 20% by 2025 as clients seek ways to analyze data in real time at the edge, where it is created. The addition of AI capabilities amplifies Atos’ position as an end-to-end services provider within the IoT space and closes gaps in the asymmetrical relationship between IT and operational technology (OT) departments.

Additionally, BullSequana Edge helps Atos address challenges of exponential data volumes and heterogenous data complexities due to the advent of AI and machine learning (ML), necessary blocks supporting the data economy foundation. With optimized security capabilities including infusion detection, disc encryption and secure boot, the BullSequana server enables Atos to alleviate common pain points of IT and OT, especially as the company builds and offers vertical-centric solutions with the hardware. Although offering a hardware appliance drifts Atos further from pure systems integrators (SIs), which typically manage asset-light portfolios, it brings Atos closer to key IT buyers, which remain the centralized governing body of the final IT purchases, even in discussions that include the C-Suite.

Atos also continues to enhance its quantum computing capabilities. As TBR wrote in its May 2019 Digital Transformation Insights Report, which focused on quantum, “Atos took its strengths in design computing for appliances and programming and emulation environments and announced several quantum research initiatives, including the opening of a global R&D lab in Yvelines, France, and Atos Quantum Learning Machine (QLM) implementations in Europe and the U.S. to enable clients to experiment with disruptive technologies, tackle the explosion of data and accelerate the number of practical use cases across industries. Additionally, about a year ago, Atos developed a consulting practice around quantum computing to educate and advise clients on whether it is possible to use quantum to accelerate business applications. During Atos Technology Days 2019, Atos announced myQLM, a light version of a QLM, which is an on-premises environment designed for quantum software developers. Users can download myQLM on their desktops and use a set of algorithms to train remotely, at home, at universities and research centers, and simulate the actual QLM. A Phyton-based language, QLM allows students and researchers to develop and share code within the community, creating additional entry points for Atos’ broader services portfolio. With customers ranging from universities and research centers to high-performing computer ecosystems and commercial clients, Atos, is building one use case at a time. For France-based oil and gas company Total, Atos is using a QLM simulator to accelerate the analysis of seismic activities, helping Total stay ahead of competitors. Atos is also working with Bayer and RWTH Aachen University in Germany to evaluate the use of quantum computing to research and analyze human disease patterns.“

Our analysis further states that we expect Atos to “monitor the underlying scientific and engineering breakthroughs of the competing architectural investments and accelerate the commercial utility through its development of leading-edge use case applications” in concert with its business partners as it looks to quantum to gain a competitive advantage. For Atos, partner ecosystems, such as with Fujitsu, 1QBit, Rigetti, IBM Q and D-Wave, will play a critical role in its ability to accelerate the development of business use cases.

Navigating the dynamics of the IT services markets demands vendors demonstrate innovation, which allows them to gain trust with new buyer personas. While many of Atos’ SI peers have invested heavily in areas such as marketing services to better appeal to the CMO buyer for customer experience opportunities, the company relies on its full technology stack to expand its addressable market. While some investments, such as in quantum, may not have sizable, tangible impact on its performance, Atos will benefit from being first to market once economic advantage is achieved.

According to a TBR special report on quantum and economic advantage, “What we do not know is how fast quantum computing will take off and what impact it will have on our knowledge as a society. What we do know is that it will take off — algorithm by algorithm, as economic advantage is achieved incrementally — and fundamentally change what we know.” TBR’s Digital Transformation Insights Report further states, “As vendors continue to battle business process and technological hurdles across all three phases of digital transformation — substitution, extension and transformation — quantum will be the one technology that will fundamentally transform enterprises and the way they go to market and sell products and services,” placing Atos in the spotlight through its innovation investments.

Atos Technology Days 2019, held in Paris on May 16 and 17, displayed myriad practical applications of emerging technologies. Held alongside one of the largest events centered on startups in Europe — Viva Technology, with 124,000 attendees, 13,000 startups and 3,300 investors — Atos Technology Days presented an excellent platform for Atos to showcase its innovation capabilities across its entire portfolio stack, including hardware, applications and services. Running under the theme Welcome to the Post-cloud Era, the presentations walked over 200 clients, partners, executives and industry analysts through Atos’ vision of the IT of tomorrow, centered on the edge, quantum, IoT and cybersecurity as well as Atos’ ability to stitch it all together to deliver business outcomes to its customers. Data is exploding, and Atos is preparing to accommodate this phenomenon by effectively managing, storing, securing and analyzing data.

PTC’s innovative outlook, robust solution toolbox, and legacy in CAD and PLM make it a valuable IoT partner

Strategic findings

Shift in focus to AR/VR

In our 2018 LiveWorx EP we suggested a shift from an emphasis on PTC’s ThingWorx IoT platform to PTC being more vocal about Vuforia, its AR/VR solution, and its wider product portfolio. TBR believes that shift has continued with much of the messaging centered on the business implications of augmented reality as well as how its entire product base works in symphony, and less focus on ThingWorx as its tip of the spear into digital transformation.

This shift makes sense. The IoT platform space is saturated with established vendors, along with several smaller entrants, offering some shape of IoT platform. PTC has the key components for an IoT platform, but so do others, including the giants Amazon Web Services (AWS), Microsoft, IBM, Oracle and Google, and OT stalwarts such as Bosch and Siemens. It is hard for PTC to stand out by messaging its IoT platform alone, despite a robust offering, as the IoT platform market is busy. TBR believes the shift could also indicate IoT is not growing quite as fast as PTC hoped.

Instead, PTC has increased its messaging around AR/VR. TBR believes PTC is positioning AR as a new differentiated niche to bring customers into its wider ecosystem, positioning it as a “wow” factor and distinct from peers’ offerings, as well as enhancing the value of other products such as Creo, Windchill, and ThingWorx. Based on the compelling presentations, messaging, and customer lineup using Vuforia, TBR believes PTC has a competitive AR/VR product.

PTC’s pitch is that AR helps customers add the human element to an IoT solution — instead of getting insight from dashboards in the board room, insight is delivered in real time on the factory floor. Conversely, in PTC’s view, AR/VR helps feed data into the IoT solution. Information around what workers see, such as a fire, a faulty part, parts that need to be replaced as well as unsafe conditions, can be fed into a centralized IoT platform, much like a sensor inside a machine. Ultimately, PTC seeks to “decorate” the industrial world with real-time information, and extend the value of IoT data through AR. It remains to be seen how well AR contributes to feeding data into an IoT solution. TBR believes AR is not there yet, but believes PTC did a good job of showing how AR can provide an actionable UI and lead an IoT solution to be more operationally effective.

Key outcomes PTC messages around AR/VR include reducing complexity by allowing workers to always have information on parts and machines; ensuring quality control and compliance using step-by-step checklists; and improving efficiency through gamification. It also offers a drastic reduction in training time as the Vuforia Expert Capture (formerly Vuforia Waypoint) solution allows expert employees to transition knowledge to novice workers or a machine or solution vendor to train a new customers’ IT or OT team.

PTC has a lineup of customers leveraging its Vuforia technology as proof points. Customers seem to adopt in two ways: by leveraging PTC’s polished tools Vuforia Expert Capture and Vuforia Studio, such as Howden and Aggreko, or by building upon PTC’s foundation, such as Fujitsu and Caterpillar, which are leveraging Vuforia Engine to build a proprietary solution.

How well Vuforia is performing monetarily is still questionable to TBR. TBR expects many Vuforia customers are in the pilot and proof-of-concept stages, which could indicate Vuforia is not yet being fully monetized while in multiple trials. However, in speaking about PTC’s strategic partnership with Rockwell Automation, PTC CEO Jim Heppelmann noted 40% of Rockwell Automation’s IoT wins have included AR with joint customers particularly interested in Vuforia Expert Capture. According to Heppelmann, Vuforia contributes 7% of PTC’s current software revenue, a respectable amount compared to its larger legacy PLM and CAD businesses, with growth of 80% year-to-year (TBR expects from a very small base). He also noted the AR-IoT combo is a core growth business for the company and expects the combination to contribute one-third of its sales moving forward, with continued growth of nearly 40% year-to-year.    

An interesting thread we have not seen PTC talk about, publicly or privately, is offshoots of Vuforia to the consumer market and leveraging Vuforia Expert Capture for consumer self-help applications, e.g., instead of a YouTube video on how to tie a complicated knot, a VR experience guiding people on how to tie a knot could be more impactful. This could be expanded to cooking guides, exercise guides, or sewing guides as examples within a huge pool of opportunity. Microsoft and the HoloLens team could be a good partner for these applications, such as leveraging the Xbox install base to reach consumers (if Microsoft is not already moving in this direction alone), and could help foster a content creator network. It could also be leveraged by consumer-focused businesses to educate its end customers, such as sporting goods company Coleman delivering a VR walkthrough of setting up a tent.   

In a day of personal stories, EY showcases the results of corporate commitment to talent recruiting

A small but influential group from EY’s leadership team, including incoming Chairman and CEO Carmine Di Sibio, were on hand in a newly redesigned wavespace to recognize the winners of the EY NextWave Data Science Challenge. An extension of the program deployed in Australia last year, this global challenge resulted in 12,000 submissions from 4,500 participants from 477 universities in 15 countries.

The basic challenge: Predict human traffic patterns

The overarching goal of the project was to take a data set provided by EY partner Skyhook of citizens in the greater Atlanta area. The challenge was to take the citizens’ locations as of 3 p.m. and predict where those citizens would be located at 4 p.m. EY Global Analytics Program Director Antonio Prieto, who spearheaded this effort that will be expanded on in November, stated the intention was to connect students to a challenge that resonates with EY’s mission of building a better working world, which can be done through analytics-optimized smart cities.

Participants were allowed to enter multiple submissions as their models evolved and as they generated new “what if” scenarios. The award winners received cash prizes, EY badges and EY internships. The winners and their locations were:

First Place: Sergio Banchero is studying electronics in Australia and is a native of Brazil.

Second Place (shared): Katherine Edgley and Philipp Barthelme shared the second-place prize and are both studying applied mathematics at the University of Edinburgh.

Third Place: Chia Yew Ken of Singapore has an affinity for natural language processing and finds the parallels to AI pattern recognition interesting.

Each participant presented their basic findings and discussed the underpinning mathematical calculations and manipulations in ways that challenged this mature worker with a liberal arts background to comprehend. The incremental improvements on the algorithm scores seemed slight until put into context by Banchero, who translated his algorithm’s net improvement over the average of all submissions as ultimately capable of reducing 3,200 pounds of CO2 emissions, which would require rain forest acreage equivalent to 16 football fields to remediate naturally.

The State Of Cloud Profitability Has Never Been Stronger

More than a decade after taking a leap of faith, cloud vendors prove profit possibilities

For vendors such as Microsoft (Nasdaq: MSFT), Oracle (NYSE: ORCL) and SAP (NYSE: SAP), offering cloud solutions required them to leave the safe and profitable confines of their traditional software businesses, where they were confident in the business models and drove consistent double-digit operating margins. Even for born-on-the-cloud companies such as Salesforce (NYSE: CRM) and Workday (Nasdaq: WDAY), the lack of short-term profit required them to adjust funding requirements and sell this new business model to potential investors. All vendors that chose to participate in the nascent market had to take on the cloud financial risk without a clear picture of when or how their businesses would reach sustainability and profit.

More than a decade after the initial cloud transition, nine of the leading providers in the space, which come from a variety of business backgrounds, are proving out the benefits of cloud business models. It has taken adjustments to almost every major category of financial and operational strategy, but profitability has improved significantly and is gradually approaching the levels seen with traditional software businesses. In summary, the state of cloud profitability has never been stronger.

Gross profit gets little attention but delivered most of the improvement to cloud profit

The direct costs of delivering a solution — and their inverse, gross profit — get little attention in the cloud business model discussion. Although shifts in sales and marketing strategy may be more attention-grabbing, gross profit and cost of goods sold have made the bigger impact to overall cloud profitability. As shown in Figure 2, the “big nine” cloud vendors have increased cloud gross margin by 5 basis points over the last three years. At 65%, cloud gross margin is still lower than the traditional software gross margin of close to 85%, but it has improved significantly for the cloud businesses. The improvements have been driven by a variety of factors, most notably:

  • Increased scale of data centers: For IaaS vendors that own and operate core data center locations and infrastructure, their growing scale has led to greater cost-effectiveness. The cost of IT infrastructure has gone down, and automation allows vendors to operate data centers more efficiently. Additionally, there is a greater availability of third-party services such as colocation, which allows cloud providers to cost-effectively scale to new regions and expand capacity.
  • Professional services cost declines: As vendors across all cloud service types initially rolled out their services, most of the professional service needs were met by the providing vendor out of necessity. However, as these platforms and services have scaled, the level of third-party skills has expanded, shifting a lot of responsibility and opportunity for service engagements away from the cloud vendors. The result has been a shifting of professional service opportunity to the partner ecosystem, allowing cloud providers to focus on the higher-margin cloud solutions.
  • Declining acquisition-related costs: Acquisitions played a large role in the establishment of cloud computing leaders. IBM (NYSE: IBM) buying SoftLayer, Oracle purchasing NetSuite and SAP buying SuccessFactors are just three examples of the purchases that have shaped the market over the past decade. Many costs of those purchases are borne out in the acquiring organization’s cost of goods sold. As the scale of cloud businesses has grown following the large acquisitions, the overall gross margin has rebounded.

Deloitte’s willingness to go into unorthodox markets supports growth

“Broad-based investments including low-cost resources and platform-based solutions are among the recent examples of Deloitte’s efforts to expand its addressable market, resulting in improving non-management consulting revenue performance,” says Senior Analyst Boz Hristov.

“While Deloitte is far from reaching revenue diversification compared to the likes of Accenture, the firm is making inroads in unorthodox markets such as outsourcing services. To succeed, though, Deloitte will need to showcase pricing flexibility as it deploys new ways of engaging with clients.”

In his recent assessment of Deloitte’s management consulting practice, Boz noted that augmenting legacy services through investments in legal services, as well as technology partnerships with the likes of Google and ServiceNow, will play a critical role in building and solidifying trust with new and existing buyers, especially as the majority of them fall within the Extension stage of Deloitte’s digital transformation initiatives. Teaming consulting and analytics experts with solutions architects as a core go-to-market strategy will likely not differentiate Deloitte much from rivals. However, the firm’s dedicated investments in regions such as Germany, where consulting sales revenue share surpassed that of legacy audit services, will help build the globally integrated, diversified portfolio Deloitte needs to protect its No. 1 position among TBR’s benchmarked vendors.    

Additional assessments publishing this week from our analyst teams

In 1Q19 VMware experienced another healthy quarter of revenue growth, which increased 12.8% to $2.3 billion. Late 2018 acquisitions helped buoy revenue, as did double-digit cloud management bookings and the reported success of CloudHealth in the quarter. — Cassandra Mooshian, Senior Analyst

In its 1Q19 Hewlett Packard Enterprise Cloud report, TBR discusses the company’s modest 2.8% cloud revenue growth, to an estimated $1.9 billion, and how that underscores Hewlett Packard Enterprise’s (HPE) focus on and commitment to cloud-based hybrid and emerging technologies. HPE GreenLake continues to play a crucial role in HPE’s success, as GreenLake orders grew a reported 39% year-to-year in 1Q19. — Cassandra Mooshian

TBR’s Dell Technologies report deep dives into the performance and strategies of the vendor’s Client Solutions and Infrastructure Solutions groups, while painting the picture of Dell Technologies’ bigger overall strategy. Deeper analysis of some of the announcements that emerged from Dell Technologies World will also be highlighted as well as the ongoing strategic positioning of VMware. — Stephanie Long, Analyst

And sign up now for TBR’s next webinar, Where will hyperconverged infrastructure fit in the modern data center?

Bosch is a things company at heart but will leverage new capabilities to capitalize on emerging data opportunities

Bosch takes off its tie

To achieve its current position, Bosch self-admittedly had to transform from a traditional components manufacturer to an evolutionary technology and services company. Bosch CEO Volkmar Denner characterized this transformation as the “taking off of the tie” as the company evolves from a stiffer, traditional mindset to one more like that of Silicon Valley, which focuses on agility, innovation and attracting young talent through corporate flexibility. Denner suggested that while this was indeed a technological development, the path to transformation necessitated a culture change. To help, in 2018 Bosch brought Dr. Michael Bolle on board as chief digital officer, tasked with organizing companywide digital transformation efforts, corralling shadow IoT efforts, and breaking down business silos to share resources, knowledge and capabilities.

Denner indicated Bosch has been implementing proto IoT, often termed telematics, for decades, but its evolutionary journey started in earnest in 2014 as the company began realizing the disruption IoT, AI and other emerging technologies would cause within its business and wider market. To outmaneuver peers and expand the reach of its business, Bosch began taking steps toward transformation:

  • Bosch’s journey began in 2008 when it acquired Innovations Software Technology. It was the foundation of the newly founded Bosch Software Innovations and was positioned as corporate Bosch´s IoT software and system unit and was leveraged to begin building a horizontal software foundation to link together Bosch’s vertical businesses’ efforts in connected equipment.
  • From 2014 to 2016, Bosch began focusing on enabling IoT inside its larger business. This included making strategic acquisitions to build a stronger horizontal software footing, building the Bosch IoT Suite, establishing the Bosch Center for Artificial Intelligence, and setting the goal for all of the company’s electronic products to be connectivity-enabled by 2020. By the end of 2018, 52 million IP-enabled products were sold by Bosch.
  • Starting in 2016 Bosch began to emphasize the digitization of existing ecosystems and the scaling of IoT within those ecosystems. Bosch also started leveraging its Bosch IoT Suite to corral data from a client’s entire operations and using AI to generate elevated insight.

To help speed its transformation, Bosch acquired inubit AG and ProSyst early in its journey to enhance its IT foundation in the application and platform space. But Bosch has also been investing organically in technical talent. Bosch leadership indicates the company had 69,500 associates in R&D as of 2019, a significant jump from when the company began its journey (though an exact compare was not provided); 27,000 software developers, which is a sizeable pool for a manufacturing company; and more than 5,000 dedicated IoT developers. Denner indicated AI is a cornerstone of Bosch’s IoT strategy and that the company has over 200 dedicated researchers in the field. Bosch is leveraging all of this talent to not only improve its verticalized products and services but also to grow its capabilities horizontally, akin to an IT company. The Bosch IoT Suite, which is examined in depth in this report, aims to serve as a foundational layer to support customer deployments across multiple verticals, in addition to enhancing the company’s own capabilities.

Bosch ConnectedWorld is an IoT and digital transformation conference hosted annually in Berlin. It stands out in the sea of IoT conferences due to its emphasis on operational technology (OT), with sessions often headed by industrial partners talking about industrial challenges, and its use as a platform for EMEA-based technology and industrial companies to highlight their products and strategies in a technology area that is sometimes dominated by U.S.-based messaging. Bosch ConnectedWorld has grown from 500 attendees in 2014 to nearly 5,000 in 2019, indicating customers’ increasing interest in digital transformation, as well as the power of Bosch’s messaging around connected products.

Technology Business Research, Inc. announces 3Q19 webinar schedule

HAMPTON, N.H. — Technology Business Research, Inc. (TBR) announces the schedule for its 3Q19 webinar series.

July 24          Quantum computing leaps into customer’s transformation-centric conversations        

Aug. 14        The evolving background for winning private cloud customers

Sept. 11       Leading webscales tackle the connectivity problem; CSP business model under threat

Sept. 18       Cloud pairs well with partners

Sept. 25       IoT in 2019: New strategies, new ecosystems

TBR webinars are held typically each Wednesday at 1 p.m. EDT and include a 15-minute Q&A following the main presentation. Previous webinars can be viewed anytime on TBR’s Webinar Portal.

For additional information or to arrange a briefing with our analysts, please contact TBR at [email protected].


Salesforce to acquire Tableau as the market moves to no-code and low-code environments

Salesforce’s acquisition of Tableau Software would make additional data visualization and analytics capabilities available to business users

Salesforce announced its intent to buy Tableau Software in an all-stock deal valued at $15.7 billion, in which Salesforce will exchange 1.103 shares of its common stock for each of Tableau’s Class A and Class B common stock. Salesforce has been improving its Einstein analytics capabilities with functionality such as preconfigured templates and drag-and-drop analytics that enables users to create data visualizations without code. Tableau would expand Salesforce’s data visualization and analytics capabilities, as its data sorting and no-code and low-code data visualization capabilities will enable business users to manipulate data and create new data visualizations without a data scientist. While Tableau would continue to run as an independent company, TBR expects Salesforce would create integrations between Tableau and Customer 360, Salesforce’s app that connects data from its sales, service, marketing and e-commerce offerings. Since data from Customer 360 can also be pulled into Einstein analytics, the integration of Customer 360 with Tableau would enable Salesforce customers to leverage Tableau’s technology from a central touch point. If finalized, the acquisition would also increase Salesforce’s value proposition as a front-office provider for Tableau’s 86,000 customers, creating new cross-selling opportunities.

Salesforce’s front-office provider partners and competitors develop no-code- and low-code-enabled data visualization analytics as the industry trends toward codeless data manipulation

Salesforce’s announcement comes four days after Google announced its intent to acquire Looker, an analytics and data visualization company. While it is unlikely that Salesforce’s planned acquisition of Tableau was in reaction to Google, these developments further highlight the increasing importance of data visualization in the public cloud market. TBR does not expect Salesforce’s partnership with Google would be significantly impacted by the vendors’ recent investments, as Salesforce’s broader SaaS portfolio still targets a larger front-office audience and Google remains a strong IaaS partner. However, Salesforce’s acquisition of Tableau would improve Salesforce’s position against Oracle in the front-office space. Oracle is improving its own analytics capabilities and unifying its data through CX Unity, its offering akin to Salesforce’s Customer 360. Additionally, the same day Salesforce announced its intent with Tableau, Microsoft announced AI Builder, which makes it easier for its PowerApps and Microsoft Flow customers to manipulate data to create AI models. Microsoft’s Power BI is in the same Power Platform product family as PowerApps and Microsoft Flow, showing Microsoft is trying to make it easier for customers to manipulate data as well. However, Microsoft’s Power Platform solutions still require a layer of coding and technical knowledge that exceeds the skill set of the typical business user. Given Salesforce’s and Google’s announcements, TBR expects Salesforce competitors such as Oracle and Microsoft may acquire data visualization companies to quickly enhance their capabilities in the space and level the balance of power in the public cloud front-office market.