Lenovo's IoT strategy is not new, but this year it is being expanded in terms of product commtiment and new channel-focused initiatives.
ORLANDO – At their combined Accelerate partner event and Transform customer events here, Lenovo laid out their plans to succeed in what they acknowledged is the most complex solution area that they have ever entered, the Internet of Things [IoT]. They indicated that the year ahead will see a major building out of the portfolio, both through major new product launches and creating new bundles for partners to sell. Partners will be instrumental in this initiative, both on the vendor side, and through Lenovo’s own channel partners.
Wilfredo Sotolongo, who has been acting General Manager, Internet of Things Segment, at the Lenovo Data Center Group, noted that the IoT market is full of paradoxes which offer both opportunity and peril.
“From the end user perspective, with IoT, we are headed for the trough of disillusionment, because it has been overhyped,” he said. “But from a solution provider perspective, we are headed in to the real good times where it can be monetized. As a company, we are coming into this segment of the market at the right time.”
“Cloud is a great tool, but there are black holes emerging all over the place,” Sotolongo explained. You need to enable it in terms of end-to-end management and security. It’s still too easy to break into and too hard to manage thousands if not hundreds of thousands of devices. So we have also had the emergence of edge computing – which is not just another computer out at the edge.”
“Taking the assets of traditional IT, and applying them in every corner of the world – that’s what IoT is all about,” said Jon Pershke, VP Strategy & Emerging Business at Lenovo IDG. “Adding to great hardware with machine vision and analytics, to be able to create an end-to-end solution is necessary. Customers don’t want components they have to assemble themselves.”
Lenovo’s IoT strategy is not new, but this year, they are doubling down on it, said Kirk Skaugen, the Lenovo Data Center Group President.
“We are committed to the Smart IoT space,” Skaugen said, noting that this is a long journey, as it took Lenovo eight years after the acquisition of the IBM PC business to get to number one in PCs. “We are executing to our strategy. This year, we will continue to build out the portfolio.”
While Lenovo is a relative newcomer to the IoT space compared to some other IT companies with OT roots that go back many decades, Skaugen emphasized that Lenovo has certain advantages to win in the space.
“The scale of our PC business is a huge advantage as we go into IoT,” he said. “Most large IoT and embedded companies are $200 million-300 million per year in revenue. Those companies make 40 points of margin today just selling embedded PCs, because they are highly custom. There is nobody like Lenovo selling at a scale of tens of millions of units who has walked into this market and said ‘we will focus here.’ And we aren’t going into IoT just to sell embedded PCs.”
Skaugen said that the Lenovo IOT strategy consists of three parallel strategies. The first, Smart IoT, deals with typical IoT solutions like kiosks and machines like turbines.
“We are also doing things like looking at how we take biometric devices in the home – edge devices – where health care providers can monitor them, to cut costs of people going back to the hospital,” Pershke said. “That’s a creative use of IoT.”
The second area is Smart Infrastructure solutions, extending from the data centre to the edge to the cloud.
“On the IoT side, we are excited about our edge server and building out the edge architectures,” Skaugen said. In March, at the Mobile World Congress in Barcelona, Lenovo unveiled its new ThinkSystem SE350 server, a six antenna server which is purpose-built for edge environments. At Accelerate, Lenovo announced the ThinkCentre Nano IoT, an IoT complement to their new ThinkCentre Nano PC, a small form factor device which is smaller than Lenovo’s Tiny, introduced several years back. It is slated to launch in August.
“This year, we will launch the largest edge server and embedded portfolio in our history,” Skaugen pledged.
The third focus area is Smart Verticals, vertical solutions will be supported by Lenovo-designed bundles. Some of these were highlighted on the show floor at Accelerate, and Lenovo says that there are many more to come
“Our systems integrator partners can then scale them out and tweak them to the customer’s unique needs,” Skaugen said.
The Smart Verticals are a newer extension to Lenovo’s IoT strategy.
“Our message to the market is the same as it was two years ago,” Sotolongo said. “Here though we are taking a core compute version and packaging it into a specific use case. That part is new to us – getting a bundle that customer or partner can bring. It’s a higher value space.”
Sotolongo explained how the vertical bundles fit into the overall IoT strategy.
“We will leverage our core infrastructure to create unique devices that we can manufacture more cost competitively than anyone else,” he said. “But we spend most of our time on the next level – bringing it together with management and security software. You then have to integrate them into solution bundles. That’s what you see on the show floor here at Accelerate, a bunch of solution bundles.”
Sotolongo stressed that the bundles component of the IoT strategy will be a pure channel play.
“Our IoT channel is an integration channel, and we will go to market through integrator partners,” he said.
“We won’t compete with our integrator partners,” Skaugen emphasized.
Many of these IoT integrator partnerships are new for Lenovo, and others are still being developed. Lenovo’s strategic partners with deeper roots in the space are critical here in bringing their integrator partners into the mix. Sotolongo noted in particular Pivot3, a hyper-converged infrastructure [HCI] provider with a strong legacy business in the physical security space, whose partnership with Lenovo was expanded last year into a major Smart Cities initiative.
“Our relationship with Pivot3 will be helpful in developing these new partnerships,” he said. “They partner with a lot of video analytics companies, so they have all these relationships with SIs who have been working with cities. Pivot3 is also introducing us to new integrator parties – who are often smaller 20-30 person companies who have been managing city infrastructure for decades. So we are adding new small integrator partners as well as big ones.”
“For us, it’s a very exciting future,” Sotolongo summed up to the partner audience at Accelerate. “We are coming with a common vision that we deploy to the marketplace. Build some of the best components. Tie them together through a common architecture. Connect the with software to other platforms. Bundle them together into IoT solution bundles targeted at specific industry use cases. Then partner with all of you to deliver these solutions. This is by far the most complex solution area Lenovo has attempted to get into.”