Honeywell Acquires Tridium
The major news this month in the Pervasive Internet/M2M arena was the completion of Honeywell’s acquisition of Tridium, a leading software development company based in Richmond, Va., with subsidiaries in London and Singapore.
We have been asking for a few years now, “Where are the large, diversified automation and control players in the Pervasive Internet story?” They are, by default of their legacy in monitoring, control and sensing systems, the true inheritors of the Pervasive Internet opportunity. It’s as though Pervasive is the “trust fund” of the automation and control community and yet they have acted as though the opportunity is nothing more than their “step child.”
Maybe with Honeywell ‘s acquisition of Tridium we are seeing the first real indicator that this community of leading companies really sees the opportunity with clarity. Let’s hope so. In order for the market to really move forward in its development, it needs some very large players to take charge and let customers know there is clout and experience behind this emergent space.
Why? Because the automation and control community has close, ongoing contact with major device and OEM players. The automation and control crowd is much more grounded in the real world than the navel-gazing technology community, and much more application and vertical-market fluent. These suppliers are positioned to be involved on both the physical and virtual sides of the Pervasive opportunity. If one adds up the revenues related to their core automation, control, sensing and power businesses, as well as new revenue derived from pervasive technologies, the total easily surpasses $400 billion. That, like almost all the numbers related to Pervasive, is a very large sum indeed.
Companies like Siemens, Honeywell, ABB, Emerson, Eaton, Schneider, Rockwell, Invensys, Mitsubishi, and Omron have much to gain, and just as much (or more) to lose if they don’t position themselves properly. These established players all have equipment and systems in our buildings, vehicles, factories, offices, and homes. They have also created software and services that run and automate complex environments. Ultimately, they could be the community best-positioned to break ahead of the pack—if they don’t become their own worst enemies. [Bolding inserted as Blogger’s Comment] Internet connectivity is a major disruptor in all economic spaces. Digital power and control will be embedded in virtually all real-world devices that will eventually hang on networks and be assigned IP addresses. These new power and control technologies are replacing vast quantities of electro-mechanical systems, and will be essential to everything Pervasive—from silicon drivers and networks for everything from vehicles to semiconductor lighting and power chips in everything from appliances to MRI machines and pacemakers, and even the power grid itself.
With Honeywell’s latest maneuver, we hope its peers begin to become more visible in their understanding and validation of the Pervasive movement.
Honeywell and Tridium have been sharing technology solutions for their building automation customers for over five years. While Tridium has marketed Honeywell’s controllers and components to its systems integrators, Honeywell has established Tridium’s Niagara Framework™ as an Open System Infrastructure for building automation and controls. Companies using Niagara, for example, can manage separate building systems such as lighting, security and heating/air conditioning from a central point. This points to a brave new world of larger, established players leveraging the technologies “hatched” in emergent players.
Honeywell has indicated that Tridium will continue to operate as a separate business entity within Honeywell’s Environmental and Combustion Controls (ECC) business. All we can say is that hopefully Honeywell won’t behave as most large lumbering multi-billion players do and smother the creativity and drive of a true up-start. Tridium has many advantages for Honeywell, including its third-party network and channel, as well as a rich base of technology and partners that reach beyond just building controls.
The move could be particularly significant in the Pervasive Internet/M2M market. Tridium is currently a small company, with 85 staff and $13.4m in annual revenue. Against that, Honeywell International is a $26 billion diversified technology and manufacturing leader, serving customers worldwide with aerospace products and services; control technologies for buildings, homes and industry; automotive products and a variety of specialty materials. The Tridium acquisition could allow Honeywell, already an automation giant, to broaden its reach into the age of devices riding on IP networks.
Tridium looks to be a well chosen addition for Honeywell to integrate the many and fragmented device-level networks and protocols of the big legacy control companies in the drive to provide real-time enterprise level information. This acquisition will undoubtedly raise awareness of the overall Pervasive Internet/M2M value proposition globally and we look forward to tracking its impact on the development of this fascinating market.