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The Morning Download: As IoT Takes Off, Companies Look Beyond Cloud to Network Edge



By

Steve Rosenbush

At Schindler Group, sensors in elevators detect data ranging from temperature fluctuations to energy consumption and the open and close cycles of elevator doors. That data is streamed to an edge device near the elevator, where machine learning algorithms integrated into the hardware detect anomalies.Photo: Schindler Group

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Good morning. The internet, designed around people, is increasingly about things and that is changing the way companies design their networks and rely on cloud computing or their own data centers. To enable things–from vehicles and medical devices to consumer products and industrial machinery–to gather and analyze data on the spot, companies are putting more computing resources at the edge of the network. “There are certain applications and use cases where you need to have real-time machine intelligence. You cannot wait for the cloud,” Michael Nilles, CDO of Schindler Group and CEO of Schindler Digital Business tells CIO Journal’s Sara Castellanos.

Startups and incumbents such as Microsoft Corp. and General Electric Co. are rushing into the market with edge products and services, which is expected to grow to $6.7 billion by 2022, up from about $1.5 billion in 2017, according to research firm MarketsandMarkets.

The number of devices connected to the internet is surging, and will reach 20.4 billion by 2020, up from 8.4 billion in 2017, according to Gartner Research Inc. By 2021, 40% of enterprises will have an edge computing strategy in place, up from about 1% in 2017, Gartner says. Read the full story here and let us know how edge computing figures into your business.

A Ford Fusion development vehicle at a test facility in Ann Arbor, Mich., on Sept. 12.JEFF KOWALSKY/AGENCE FRANCE-PRESSE/GETTY IMAGES/dd>

MORNING DOWNLOAD EXTRA: Edge computing, IoT raise security concerns

Enterprises looking to get more intelligence from factory machines and other devices are turning to edge computing, in which data is processed and analyzed on or near the device where it’s generated instead of first being sent to a corporate cloud or data center.

Technology providers of edge computing devices and services say their products adhere to stringent security requirements. But experts say the architecture and the billions of “things” out in the field pose increased security risks to enterprises.

Data and insights from connected devices may add business value, but it’s crucial that companies think about the security implications, said Richard Soley, chairman and CEO of Object Management Group, which is focused on developing standards for securing connected devices.

Companies now have a greater responsibility to know at all times what types of data are flowing in and out of devices and how that data could be used against the company if the data is exploited. “You have to figure out what the attack surface and potential attack scenarios are. Think like an attacker,” he said. – Sara Castellanos

PODCAST: Computing power comes to elevators and the like. With millions of objects connecting to the internet for the first time, companies like Microsoft and GE are putting more computing resources at the edge of the network, in vehicles, elevators, factory machines and the like. The Wall Street Journal’s Sara Castellanos has more.

Cybersecurity controls must change with shift to cloud, study finds. Firms eager to shift more workloads to a public cloud in the year ahead are finding they need to rethink cybersecurity controls designed for in-house data centers and private clouds, McKinsey & Co. says. One key challenge: Clarifying new cybersecurity roles and responsibilities shared between enterprise IT staff, public cloud providers or third-party cybersecurity firms, McKinsey partner James Kaplan tells CIO Journal’s Angus Loten.

SECURITY AND PRIVACY

Telegram chief executive Pavel Durov, shown here in August after a meeting with an Indonesian minister.TATAN SYUFLANA/ASSOCIATED PRESS

Iranians turn to Telegram app amid protests. Move over Twitter. Iranian protesters are using smartphone messaging app Telegram to share information about demonstrations and videos of gatherings, the Journal’s Sam Schechner and Stu Woo report. Built by the creator of Russia’s equivalent of Facebook Inc., VKontakte, the free app lets users send encrypted messages, so even Telegram doesn’t have access to the data. It’s precisely this reason why the app has come under fire in the U.S. and Europe, where authorities have accused it of allowing encrypted communication between terrorists.

Hack, whine, repeat. Congress today appears to be no closer to passing comprehensive data breach legislation then they were back in October after Equifax Inc. executives testified in Washington, D.C. Among the concerns, according to Politico, is the degree to which a federal law supplants existing state laws.

MORE TECHNOLOGY NEWS

The Nasdaq has risen faster than other major U.S. indexes.MARK LENNIHAN/ASSOCIATED PRESS

Nasdaq crests 7000 as tech giants roar into 2018. The Nasdaq Composite Tuesday closed above 7000 for the first time after racing to a fresh 1,000-point milestone in just over eight months—a pace not seen since the heights of the technology boom, the Journal reports.

Big tech works to cut Oracle ties.  Both Salesforce.com Inc. and Amazon.com Inc. are developing open-source alternatives to Oracle Corp. products, The Information reports. Salesforce is preparing to launch a database codenamed Sayonara, while Amazon.com has already switched to of its own internal databases from Oracle to NoSQL, The Information reports.

Nissan cars to read brain waves. At next week’s Consumer Electronics Show in Las Vegas, Nissan Motor Co. plans to show off its “B2V” system that transmits a driver’s brain wave activity via skullcap to the automobile’s various systems, including acceleration and breaking. Bloomberg reports that the system allows the vehicle to start responding 0.2 seconds to 0.5 seconds sooner than the driver initiates any action.

Collaboration ‘makes creeps worse.’ Readers tell the Financial Times that they are not crazy about the current push towards collaboration, saying company-wide efforts that require employees to participate through various social enterprise tools provide harassers, stalkers and assorted creeps easy access to their victims’ calendars and other data.

China plans AI park. The country’s goal to become the worldwide AI leader by 2025 shifts into a higher gear with the announcement of $2 billion research center, located in Beijing. The development center will focus on attracting up to 400 enterprises engaged in cloud, deep learning and biometrics, Reuters reports.

Thiel’s fund makes monster bet on bitcoin. Founders Fund, the venture-capital firm co-founded by Peter Thiel, has amassed hundreds of millions of dollars in bitcoin, the Journal’s Rob Copeland reports. Mr. Thiel made the decision to buy up bitcoin together with Founders’ other investment partners, a person familiar with the matter said.

The tech industry finally has its vertical edifice. Next week  Salesforce.com moves into its eponymous tower in San Francisco, a 1,070-feet structure that is the tallest office building west of the Mississippi, says the New York Times.

Is the ‘pour-over’ over? The purposefully slow, personal nature of the ritual is an icon of the artisanal movement. Now, uttering words like “efficiency” and “consistency,” some coffee shops are embracing the perks of machines. The Journal’s Julie Jargon has the story from the frontlines of caffeine automation.

Long Blockchain adds two new board members. The company, formerly known as Long Island Iced Tea Corp., announced late last year that it was pivoting from making ice tea and lemonade beverages to investing in opportunities that use blockchain, the WSJ’s Amrith Ramkumar reports. Long Blockchain’s new board members are Shamyl Malik, global head of trading at Voltaire Capital, and blockchain technology entrepreneur Sam Ghosh.

Guy behind Juicero into ‘raw water.’ Cutting the cord is so 2016. People in Silicon Valley, citing concerns over fluoridated water and  old pipes, are cutting their access to traditional plumbing and paying up for ‘raw water’. Some, like Doug Evans, who succeeded in getting Valley VCs to believe in a $700 juicer, are trespassing on private property to get their ‘raw water’ fix. “You never know who you’ll run into at the spring,” he tells the NYT.

EVERYTHING ELSE YOU NEED TO KNOW

Foreign makers of products including washing machines and solar panels are ramping up shipments to the U.S. ahead of government decisions on whether to erect new barriers. (WSJ)

Global sales of personal-use cars and trucks likely topped 90 million for the first time in 2017. (WSJ)

The Federal Reserve on Wednesday will offer more details on policy makers’ outlook for 2018 when it releases the minutes of its Dec. 12-13 meeting. (WSJ)

Senate Finance Committee Chairman Orrin Hatch said he would retire when his term ends early next year. (WSJ)

The Morning Download is edited by Tom Loftus and cues up the most important news in business technology every weekday morning. You can get The Morning Download emailed to you each weekday morning by clicking http://wsj.com/TheMorningDownload.

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