Game over for industrial IoT platforms; generative AI and industrial metaverse on the rise – insights from Hannover Messe 2023

Hannover Messe 2023 marked the end of the IoT platform era. SAP, Google, and IBM announced the end of their IoT platform services in 2022. Microsoft has laid off a significant part of its Azure IoT team over the past few months, and Microsoft’s industry cloud for manufacturing was not even visible at the fair. We expect to hear more details from Microsoft about its future direction in this space in May. At Hannover Messe 2023, Siemens silently said goodbye to its MindSphere IIoT platform. It hasn’t officially been confirmed yet, but according to rumors in the market, the ADAMOS IIoT platform is also nearing the end of its life.

Does this mean that IoT/IIoT is dead? Certainly not, but it is transforming. Google and SAP are moving to a partnership model in this context. Google entered into a strategic partnership with Litmus Automation, and SAP is working more closely with partners like FORCAM. Siemens and IBM, on the other hand, have integrated their existing IoT capabilities into other offerings. IBM has integrated the IoT functionalities from the Watson IoT platform into the IBM Maximo Asset Application Suite. Similarly, the current Siemens MindSphere capabilities and solutions will move to the recently announced Siemens Industrial Operations X portfolio. Industrial Operations X is part of Siemens Xcelerator; it’s an open and interoperable application portfolio for automating and operating industrial production (MES, SCADA, and more). We can derive several insights from these trends. First, the value of IoT as a standalone capability is limited, which is why we see closer integration of IoT services with industrial and asset-related applications. Second, the hyperscalers have not been all too successful with their IoT services; otherwise, they would not have stopped their investments in this area. Third, the IoT market has been a battlefield between IT and OT giants for years, and the OT vendors have been able to defend this space against attacks by IT giants. Fourth, the new market environment will open the door for even more collaboration between IT and OT vendors.

We expect the intensifying collaboration between IT and OT vendors to move beyond cloud infrastructure towards AI/generative AI (ChatGPT) and the industrial metaverse. One good example of the new level of close collaboration we expect to see between IT and OT players came from Siemens and Microsoft at Hannover Messe. The companies presented a concept on how OpenAI’s ChatGPT and Siemens’ industrial automation engineering solutions can help software developers and automation engineers accelerate code generation for PLCs (Programmable Logic Controllers) by generating PLC code through natural language inputs. If we take this one step further and combine it with detailed, real-time visualization capabilities from the industrial metaverse, we will end up in a new era of digital factory automation. In this scenario, developers/engineers quickly generate code for industrial computers via voice commands and can instantly check the correctness of the code through a visual simulation model that proves how the machine acts with the generated code. This is not a reality as yet, but I believe it may be in the not-too-distant future. I’m looking forward to seeing what Hannover Messe 2024 will present in this area.