Evolution of IOT sector and the Impact – Pramod Dhakal & Stephen Gold

Device connected to the internet fundamentally serves a very specific purpose, and its called “Efficiency“.
The device doesn’t get smarter on its own however it can gather data which can be analysed and further actions can be planned.

Around the context of Internet of things , Pramod Dhakal form  Hitechies &  Stephen Gold  From  HZO goes through a very interesting conversation.

In this conversation :

  • Device connected to internet has evolved in few different phases. 
  • 127 new devices are connected every second to the internet.
  • What does that mean to the power usage ?
  • At the rate of increase of IOT devices , How are we going to remain Sustainable 
  • How does the market adapt within the present context of covid 19 
Stephen Gold : Evolution of IOT sector and the impact

Evolution of IOT sector and the Impact

How's the tool on the business overall you know with this present situation?
You know, it’s obviously for an individual level for a lot of folks working from home is a relatively new experience and I think the transition has gone well I mean we were well positioned in terms of technology with teams and everything else and being able to communicate. I think people have really grown more comfortable with video so, we do a lot more, I’ll say video than certainly we did prior to pandemic from a business point of view outside I mean our customers are a bit of a mix. We have customers that have been more I’ll say directly impacted by the nature of the products that they manufacture and others have done fine so you can imagine if you’re working from home you buy laptops and displays maybe you don’t runout and buy a new cell phone and so we’ve seen a bit of mixed implications among customers in terms of whether or not you know COVID was a game changer I can’t honestly say, I don’t think anybody would tell you it’s better with the exception of may be some of the communication providers WebEx, Zoom, Teams I’m sure their traffic and business is up but by and large I think at best in these trying times if you have status quo over year you’re probably pretty happy.
Indeed. I think it's the same story everywhere you know pretty much also here in the European region we have a similar situation we are trying to get back to the normal but it's hard and people don't want to go back to the office because, why would they want to do that. So, there are challenges which we didn't think it would appear in this way....
I can say better to be in the business as we are then I would hate to be in the travel and entertainment segment, right?
Oh, yes every morning I hear stories that you know x amount of people were let go...
Terrible.
Yeah. It's terrible.
And I think about all the service businesses that obviously they don’t have a demand in the meeting but movie theaters. I think about people who supply movie theaters or clean movie theaters and I don’t know about you but I can’t imagine right now going into a movie theater.
No, definitely not because we normally have vacation around April right so we had plans to go to Greece and enjoy our vacation as such and by January we knew that we are not going there so we had to cancel by January and then we hope that by July everything will be fine but it looks like you know July of 2021 it would be [Laughter] so that’s what I think it would be a bit of a normal by then.
I hope you’re right and a little bit earlier it would be fine but you know my daughter is supposed to get married in October and she’s pushed out now till next April and even there I mean who knows what the world will be at that time.
No, I met my physician recently and I asked him “when do you expect of action to be available to the public” and he said “If you're lucky by December you would get it”. So, that's the kind of timeline that we are hoping that it would be ready.
Well, I never thought about it, there was a really interesting article there are 164 (one hundred and sixty-four) companies that are trying to develop a vaccine and they said the thing that people don’t realize it’s not just about getting a vaccine that’s safe to market but it’s also about efficacy and they said very likely the first vaccine out, won’t be the most effective and you know we’re not even thinking about that, we’re just thinking about a vaccine in binary we have it or we don’t and I’m like wow, and that’s depressing.
Yes, that's the way we think in this technology space right? So, we only think in binary terms. So, how did you get into this technology space?
I’ve always been in some form of technology I mean my background is engineering and you have a certain disposition I think towards science to begin with but then, obviously the whole proliferation of devices computers, laptops, mobile devices just fortunately I do mean fortunately I kind of fell into it mostly on the digital space, mostly on software, and I did a lot of work in AI, I know you guys read a lot about AI. I was one of the early architects for Watson and spent seven years focused on Watson and bringing it to market and so really the power of data and data analytics and machine learning and all of the derivatives of that and that really showed me what was possible? When you really applied technology in a way that could have a meaningful outcome and the current business that I’m in is technology for certain it takes a different form because it has a physical property and with digital, it’s fluid in terms of design and development and feature and it’s constantly changing with the physical less so, but what’s different about physical is that you can apply it to so many different things and so with digital it’s still purpose-built it has an intended user and outcome and that’s fine with our product. I think it’s fascinating that we start to look at what we do, you know first I would tell you it’s probably not all that well understood people don’t really think about it until something happens and we’ve all been there that something happens when you know the phone slips out of the pocket into the pond or the pool or you know as I did, you get the hot tub of your bathing suit, the phone is in your trunks and pretty much we’ve all seen what happens it’s catastrophic and things have gotten a little better but, by and large not really because electronics take a lot more forms I mean between personal devices like Bluetooth speakers and wearables and hearables and health care, huge changes in the healthcare environment. You know, we’ve seen with the way in which something as simple as how do you monitor a diabetic production of insulin and yeah these continuous glucose monitoring it’s a wearable and it’s subject to all of the things that we experience in life, sweat and rain and spills and it’s got to work and then we get into autonomous driving and before our dependence on driving was on our own physical agility. You know we accelerated, we broke, and we turn with cars that can manage those aspects and then much more, you know the electronic can’t fail if the electronic fails bad things can happen and of course you know, the whole number of things, the whole proliferation of devices and manufacturing devices out to the edge and the idea of edge computing, so, adding technology to relatively traditional mechanical things valves, pumps, motors and so, we’ve seen electronics show up in places that we never design never intended them to be and then all of a sudden you know there’s really two things if it were me that you have to be concerned about:

1. Security, because you typically don’t want the device to be compromised. and
2. Durability, you don’t want the device to fail.

Well, you know most of the environments that we’re pushing electronics into are challenging environments and you know the technology that we work with Nano coating type technologies play an amazing part I think in the resilience of society to be able to function. So, it’s it may not be top of mind, it may not be as well understood as we’d like it to be but it is critical to, I think how we function.
What does that do, when you are coating that? What does that do to the device overall?
You have to actually design the coating with an intended purpose meaning if it’s simply to repel water there are number of different options and materials that you would likely deploy and then to your question you have to think about depending on the material it may in fact create a thermal issue, so if you put certain materials on electronic because they’re relatively thick these would be more of the traditional, what they call conformal coatings so like putting a bunch of silicon on top of a semiconductor tends to get hot. Heat on electronics don’t go really well especially if they’re in a confined space so, you have to think about that you have to think about what they would call the electrical property, the dielectric. So, is the coating going to be conductive? You typically don’t want that to happen you don’t want it to carry current or a signal across the device. And the nice thing about I think this next generation of coatings where we’re really focused what we call thin film, the characteristics of them really lend themselves in a way that aligned to the need. They are terrific products from a water protection, water repellent point of view, they can be resistant to the various gases and solvents, you think about an automotive you want to resist things like petroleum products, gasoline oil they got to hold up to relatively harsh conditions in terms of temperature fluctuations, and so these thin films depending on the material we choose have terrific characteristics from an electrical, mechanical, thermal and protective property I think the key takeaway it’s not a simple one-size-fits-all type solution it’s actually matching the technology to the particular need.
So, it means like it has to be coated during the manufacturing process itself?
It does and there is everything that we do, occur during the manufacturing process and for a number of reasons. I think the quality control and uniformity it’s best assured during that cycle number two; most of the work that we do tends to have relatively large scale associated it’s not ones and two’s, it’s really hundreds of thousands and millions of pieces and to be able to protect at that level of scale you know it’s best suited to do during the manufacturing cycle. There are organizations that have attempted to protect devices after the fact once they’re shipped in the market and for obvious reasons they don’t have the scale. It’s hard to maintain the consistency within the technology and they really have fallen I think far short of expectation both at a consumer and a commercial level. So, I’m not aware of anyone any particular technologies that have done well in what we’ll call the aftermarket from a protection point of view.
It makes sense. So, in generally we are connecting a lot of devices to the internet and you know bigger challenges are the security, how do you see the security being handled in the near future?
You know the number today is around 125 (one hundred and twenty-five) new devices connected to the internet every second and it’s an incredible challenge just to keep up with the number of devices being connected, but when it comes to security, there’s both the physical security and the digital you know obviously the digital aspect and the good news is I think based on our a society our familiarity with technology and the fact that technology is vulnerable to nefarious activities to being hacked and compromised and clearly you got to preempt to prevent those things from happening I think certainly for the most recent past we’ve seen manufacturers become much more diligent and in corporative safeguards and data is now always encrypted, there’s no back door anymore typically to these type of devices. The devices themselves in some cases the authentication required and often a two-step authentication required, prevents any type of independent unauthorized type access so I think societally we’ve gotten much better at securing these devices, clearly it will continue to be an important part of the design cycle and it’s going to be an important part of the operational cycle in terms of monitoring these type of devices and this is why worldwide these security operation centers called Com-soc that have been established that continuously monitor devices that are connected to the internet and look for patterns and the beautiful part about connected devices is they do one thing unilaterally is, they put out data and data is able to tell a really important story not only about the device itself it can be situational where the data is simply about the device and is it on or off or location based and maybe it’s a sensor taking a temperature or moisture reading. But, part of the data helps whether or not from an operational security point of view it’s performing ideally as designed, whether or not it’s in fact been attacked and we’ve all heard about these denial services and other forms you know I think the big difference in those type of stories that you read and the general devices that get connected. Is the general devices IOT devices that get connected are typically purpose-built, we mentioned a moment ago with sensor and sensors probably the most common form of device being connected and very little value comes from hacking a sensor that’s collecting temperature data so, when you hear about these situations where securities become a concern, typically it’s around information that is of a personal nature; your name, your address, your driver’s license number, etc. and so I think that you still have to protect them and I think we are also doing that and I think they are doing a much better job at securing them and I think they’re a lot less interesting for hackers to go after to be candid.
Yes, I mean this is one of the thing that we are quite sensitive here whenever we talk about privacy or security and especially to do with the data GDPR I’m sure you're aware of those, and that's where the question is coming from because indeed like at one side IOT is providing you with lot of information’s and a lot of data that helps you to make smarter decision at the same time you also have the threat of being hacked and so forth?
But, I do think that. The bigger challenge is when you look IOT and you think about smart cities, you think about smart homes things like cameras, doorbells, door locks, you think about industry connecting robotics and other manufacturing apparatus heavy equipment and you think about connected help as we talked about a few minutes ago you think about connected cars I think that common theme through all of those at least maybe it’s a different way to think about protection but it’s really as HZO focuses on. It’s the protection of the device itself in terms of its operational integrity, it’s the durability, and it’s providing this protection so the electronic can survive and you can only imagine going home and trying to access your front door with this with the smart lock but it doesn’t work, why? Well, because the electronic wasn’t coated and it corroded and electronics typically do corrode if they’re not going to be protected from the elements you can imagine a security camera outside for the public safety. It’s only as good as long as it continues to record but the electronic becomes corroded pitted and it no longer serves a purpose, and I can’t emphasize strongly enough. I think about HZO  as someone as the guardian of the IOT that’s really know what we do and it’s not kind of a household dinner topic or cocktail conversation until something happens but McKinney put out a report and there’s variations of this. Accenture had a similar report that talked about the economic impact of IOT and roughly it’s somewhere between 04 and 11 trillion dollars by 2025. So imagine this huge investment and as a byproduct it creates this incredible sub-economy, but that sub-economy is volatile it’s exposed if it’s not being protected and I’m amazed at our willingness to accept status quo and this is something where I think when we get more into mission critical as are certainly dependent today on electronics and become more so as cars become autonomous as health continuous proliferate and embrace IOT and these things are all mission critical these are things that you know arguably cannot fail. You know when my phone dies it’s frustrating and it’s expensive what I can expect when my car disengages the adaptive breaking that’s a little bit scarier so we’re downwind from where we’re going and more and more of the things are becoming mission critical.
You’d have seen the evolution of IOT sector more closely than myself I guess, how can you so see this into different phases if you have to see like when it was started, let's say when people actually started connecting any devices to the internet to where we are like how can you actually see this in different phases?
I would tell you it’s almost where we were talking about earlier is where I think the early phase, first the application was obvious. You know, it was purely transparent you understood that the minute you hit send, it create a connection and inevitably you know the laptop and other devices create a connection and you could physically see it and go back to put in perspective go back to 2015 there was about 15 billion connected devices at that time but I think what we realized is that it doesn’t necessarily have to take the form of that transparent of that obvious type activity so maybe that first generation was inherently obvious it was the type of things that you know it was binary, I’m connected or I’m not connected I think we became comfortable with that. I think more of the consumer type applications where we as individuals experience to our professional environments we started to think about, well what would be the benefit of connecting the things that I work with you know caterpillar is a great example and connecting heavy machinery and they started to do this I mean these are big pieces, earth movers and back loaders and these heavy pieces of equipment are really expensive and often work in very remote areas. What if you started to equip them with sensors? What have you started to connect those sensors so that you can continually monitor the health of that piece of equipment what if you can anticipate when a particular piece of machinery is likely to fail you and I think we got very comfortable because of our own personal experience with the internet of thing that we began to propagate ideas of how to move it into our professional worlds and in the particular case the caterpillar. I know they reported an uptick of 45 % efficiency based on a connected piece of equipment. You think about agriculture never would have thought about it before never really dawned on me but you start putting connected things into the soil that can report out on things like the soil moisture all of a sudden crop management took on a whole new meeting and based on a lot of learnings that have happened there are forecasts that by 2050, we could cut food costs in half due to the efficiency, the productivity, due to the information I mean who doesn’t want to make a data-driven decision you know given the choice go to your doctor and you said what’s wrong with me he said you want me to guess if you say no absolutely not you know I want you to use facts, I want you to use data to determine why? Well data driven decisions are better decisions and so I think if that first phase was the obvious, was the transparent second phase was the introduction of what we learned into our professional capacity. I think the third phase is scale up, so we talked about 15 billion connected devices in five years i.e. 2015. 40 billion connected devices by 2025 and that’s I think are relatively conservative number it’s I DC’s number but you can see the rate of adoption the rate of proliferation so this is a linear adoption curve we’re getting more and more comfortable with being connected. We’re getting more comfortable with the data it’s being generated we’re getting smarter about using that data but again that only happens if we protect the device from a security point of view and we protect the device from a durability point of view.
Yes, I was talking to one of the founder the other day and he is also into the IOT space and intelligence and so forth so, he said “It's the biggest challenge that we will face forward is the scalability and also resourcing right so, you may find resources but you may not find great resources to work in this extremely complex environment and how do you match that like how do you get there?
Yes. You know it’s true, but I don’t know that’s a challenge that’s unique to this generation. I think at the end of the day in any vocation you certainly look for excellence I mean if you can go see a cardiologist, you want to see the best cardiologist so, I think the same holds true certainly the vocation is different, but data has always problem, bad data is bad data garbage in garbage out. Honestly as a world we used to believe that big data would solve the problem turned out big data is kind of the source of the problem. It makes sense so, the numbers out there by the way when you we say big data it always amazes me again depending on which study you want to subscribe to. You know Cisco had a report out that IOT was going to generate upwards of 800 ( eight hundred) zettabytes and that’s a mind-numbing number because I’ll put it in the context of something I understand a gigabyte, I get a gigabyte I understand that well a zettabyte is a trillion gigabytes and you start to realize the massive amounts of data so I do think obviously education becomes a critical linchpin to unlock the benefit of big data, I think for years we’ve heard about stem science technology engineering and math, I think it’s orders of magnitude probably more important that we think about that holistically for all individuals going through education. I do think it’s a matter of training I think it’s a matter of understanding that’s the other thing too which we forget is that there’s a lot of firsts here autonomous driving it’s going to be a first robotics in many cases is going to be a first and so you can start to look at a lot of the first I think the next generation, we’ll feel much more confident and comfortable and working with technology and working with information because it would have at least been seated and I think today that’s the that’s a problem it’s exciting because there’s so many first. I was a kid didn’t have a cell phone generationally that will never happen again right the next iteration of communication devices will always be present. Now I can’t imagine it going away. So, I think we’re now probably one of the biggest challenges is just working through all the firsts but it’s also the most exciting.
Yeah indeed and when I look around as we connect more and more devices to the internet I’m sure there's a finite amount of energy that is available to at least at the moment. What do you think about the consumption part of the energy and what do you think about the efficiency there?
So, you really touch on two points I think which is one that this notion of powering the internet or the internet of things and probably relatively recent, we’ve become more sensitized that this notion of always on. Isn’t necessarily always needed, and so these devices have gotten much smarter at first I think a lot of the planning behind this you know wasn’t thinking about making these smart devices but these truly have become devices that are intelligent, they’re certainly well instrumented and you’re connected and so that the point being is I think when it comes to power management they are much more at tuned to that aspect but the other side of the idea of energy if you think about our environment we’re cautious because we don’t have unlimited source of energy and even, if we did the by product has been challenging we’ve seen that effects globally on climate change and we think a lot even about as we protect these devices, what are you protecting with it, it is a green process, it is sustainable throughout the manufacturing, throughout during the disposal much of what we do with electronics gets incinerated at the end well if you’re not thinking about the products that go in and when you incinerate those products come out I know so for certainly for HZO and what we do when we think about protecting the internet of things the guardian of sorts is to think about sustainability, think about green using materials that don’t pollute, don’t contribute to the problem that we have so I think it is about consumption but I also think it’s about good corporate citizenship when it comes to all these devices that are getting out there.
The more we connect to some kind of power source it means like we are burning somewhere. So, as soon as we burn something that has a direct contribution towards the climate change and then I guess somewhere we need to find a balance there on how we are protecting our environment together with investing on technology as such. And, what's the future for your company?
So, when we think about what HZO does you know we’re in a good place that we have a huge tailwind. We talked about the growth of electronics when we talked about the growth of IOT and as more and more devices are presented to the market more and more devices need to be protected and there is real science behind that protection and the traditional ways that organizations would think about it, they would to protect something put in an enclosure and they put a seal around it, a mechanical seal, a gasket. We’ve all seen these things you know walk outside your house and look at your electrical box or your cable box or your internet provider communication. It’s these boxes that are sealed, the problem is those seals don’t hold up too well and the more that devices service the quicker they break down and we saw the world advance at least our world advanced to things that were more traditional in terms of coding types urethanes and silicones and epoxies and these things were okay, you know when there wasn’t as much electronic they were okay, when electronics were relatively big they were okay, when weight didn’t matter but talk to an airline and ask them if weight matters of course it does, talk to auto manufacturer, does weight matter absolutely. Well you can’t bulk these things up by putting all these heavy conformal coatings on it. So, the combination of more electronics coming out miniaturization, consideration for tighter tolerances, lighter devices, aesthetics all really present a strong wind for us, a tailwind for us in terms of people adopting in the film type coding. So, you know we’ve had record growth year on year and it’s a type of growth honestly more associated with software companies and we clearly are a physical products company and I think it has everything to do with the things I just described about the marketplace and so we’re very bullish about what the future looks like.
If I were to understand this correctly the coating is not subjective to just the electronic, could be a car as well, right?
Yes, well in fact it’s a really good point because we started in consumer in electronics but we have advanced into the medical field automotive field, the industrial field. IOT in general and even there we start to see now our customers starting to look to apply these protective coatings to things other than electronics and you’d asked about this earlier but they really do serve other purposes they make for a great insulator, but they prevent the transference of electrical signals in many cases they can provide a protection without trapping heat I mean so there’s a lot of other applications that we’re starting to see where organizations are asking about applying these types of thin film and in many ways it’s kind of the insurance industry maybe it got started with providing insurance for a home and then extended to an auto and extended to a business and extended to life and now there’s lots of forms of insurance like there is lots of forms and ways in which these thin films are starting to be applied.
Yes, interesting because, I can imagine it cannot be limited to one particular sector.
I would say there are early adopters both within industry and within a particular application consumer electronics I think it was out fast when it came to this for a variety of reasons number one is I think consumers have a relatively low tolerance when devices fail and so just from a consumer satisfaction point of view I think the adoption rate was much faster for consumer electronics to protect devices if you go to buy a device today you’ll often see it heavily promoted to be splash resistant or water protected or waterproof and so they clearly were an early adopter, I think of the technology. In some markets it’s really been a factor of regulatory considerations so, there may have been a desire but it just takes time you know that the health care industry is one where most devices and not all devices are basically rated there’s typically a rating system class one two and three rating system for medical devices depending on the particular rating, depends on the particular level of testing and that has to occur so it just by factor of the industry. We’ve seen health devices maybe we have a bit but I think they’re quickly catching up I think they’re well down that path and healthcare may be one of the biggest areas of growth that we experience. Automotive is another one but it’s not a regulatory issue, it’s really a design cycle issue, you know cars last longer the models don’t change every year right in consumer, you know we get a new model pretty much every year with cars it’s every seven plus or minus and so because of that it takes a little bit longer for some technologies to cycle into the automotive sector and so, you’ll start to see more and more applications I think with an automotive but that’s really a byproduct of the design cycle and I think the industrial is a bit late, in industrial sector we start to think about oil and gas refineries upstream downstream, we think about factory, automation and machinery. You know they have been a little bit slower to adopt and I think it’s also an industry that has been well embraced with mechanical and mechanical devices. You know electronics is a relatively new phenomenon to that industry where a lot of things that were never ever before connected or becoming connected so I would tell you when we see the industrial sector really take off, we pretty much pulled everybody through. We still see it in other industries, we see it in the marine space and agricultural space and aviation but those are relatively smaller markets for electronics so, it’s probably harder to characterize them. So, consumers out in the lead I think healthcare will probably be the next big burgeoning growth area for IOT automotive, no question as we move through the various levels of autonomous driving from no 1 to 2, then 3, then 4, then 5 as we become fully autonomous, fully dependent upon a car we’re going to have to ensure that it’s protected and so that’s what we see.
Yes, I can imagine due to this present situation there's a lot of talk about telemedicine, you know previously people only used to talk a little bit here and little bit there but now it's a big subject there. And I'm sure there's going to be a lot of devices people will require keeping at home and I’m sure there's a market for telemedicine.
No, not a question I mean we’ve seen the commercials we’ve seen numbers of telemedicine pre-COVID was nascent at best; hundreds of thousands of sessions every day I mean it’s crazy.
It was more of a novelty right? So, if you say okay I want to talk to a doctor today and you know the doctor would find the time and then just did this talk over the phone. Now it has become a compulsion because the doctor doesn’t want to see you right, if you are coughing. [Laughter] And if you have devices outside which would you which you are able to self-diagnose first of all and then send the results to the doctor then that's great, right?
Absolutely and it’s a great example of some of the growth areas of these companies who are creating these kits that have the particular instruments that you can use at home so the doctor can look down your throat or in your ears they can take your blood pressure, they get your temperature I mean it’s pretty incredible and honestly why would you go back. Of course there are still reasons to physically be there but generally speaking if you become accustomed to telemedicine and you’re comfortable, why wouldn’t you continue it as long as it’s applicable.
Yes, unless there is a need for a physical requirement but otherwise I think of the time you don't need to actually visit a physician. That’s pretty much all the question I had for this particular session. Thank you so much for this particular time I definitely want to wish all the best for your company.
Ok, Pramod I will tell you this is truly been enjoyable, one of the most enjoyable discussions I’ve had in a long time. Very thoughtful and thank you for your time and the questions and to you and the family please stay healthy and I seriously do look forward to hopefully having a chance to continue our conversation.
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