Smart Grid and Telecom Carriers…Friends or Foes?

I’m attending the OpenSG conference in Ft Lauderdale this week hosted by Florida Power and Light. The event is chock full of smart people, smart discussion and debate (as industry consortia go, there appears to be sparce rhetoric among the participants…although this is my first OpenSG event). I’ve had several sidebar conversations with utilities, consultants, vendors, and standards bodies or industry forum coordinators thus far. The conversations have ranged from smart grid security to OpenADR conformity and verification to more general smart grid topics and trends. It’s relatively impressive the pace at which the various working groups and committees are developing their specifications and recommendations that may ultimately become standards through more formal standards development organizations (SDOs) like IETF, IEEE, and so forth.

One category of participants which I’m not surprised is not in attendance though have high hopes this will change soon are the telecom operators or network operators in general. At least I’ve not noticed them in attendance. So the likes of AT&T, Sprint (and I know they have a Smart Grid initiative) or Verizon are persona non grata. I’m not surprised because I believe the evolution of the smart grid is such that it’s pretty early in the business model critical mass curves of the telecom operators. Simply put, I don’t believe they know how to make money on the smart grid at this point. This is fine but will need to be reconciled soon. There are many many parallels between the smart grid and telecom as far as how each will or has evolved to the Internet model, as well as their opportunities to collaborate. I had this exact discussion with a colleague from EnerNex. And not surprisingly both he and I had significant telecom backgrounds both from service provider and vendor perspectives (he was at Verizon and I was at Cisco and Motorola). That also appears to be a big gap in terms of smart grid/utility industry engaging the telecom players…if you don’t know who and how, it’s a harrowing experience just showing up on the lobby and saying “who do I talk to about your smart grid business?” An example I derived from the Smart Grid Security bootcamp I attended on Monday proved this point or at least just provided a useful datapoint. When the speaker took an adhoc poll of the years in the power industry among all the audience participants, the average was roughly 10-15 years! This ranged from 2 years (myself and another participant) to as high as 25 years.

Some of the parallels among smart grid and telecom that the EnerNex gentleman and I briefly discussed were:

  • both had to overcome major legacy from business models to operations to adoption of new radically different technologies (e.g., IP)
  • both suffered from extremely vertically integrated businesses and operations infrastructures
  • both see themselves as service providers with unique offerings
  • both are beholden to the whims of regulators and regulatory pressures
  • both are actually VERY good at customer service from the perspective of customer care and billing relationships are core to their businesses
  • both look at industry and standards for making decisions on adoption of new technologies and practices
  • IMPORTANT: both certainly can benefit from the guidance of people who’ve “done it before” for softening their respective migration to the New World

This last point is a key one. For example (and a gratuitous infomercial of my company) at People Power we have a significant presence of engineering, sales and executives that came from the computing and mobile industries. In other words we have experience dealing in complex value chains and ecosystems, embedded technologies, lengthy certification cycles, painful standards processes, and migration from legacy to new connected technologies. Hmm, looks like the same script being played out with a new stage and cast! What do you think? Should smart grid and telecom become BFFs or hate each other?

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