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Bold Move, Brilliant Alliance
- Posted on September 2, 2010
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In a flash of true synchronicity, my trip to visit Itron's Liberty Lake, WA, headquarters fell on the same day as the company announced what I feel is going to be one of the biggest strategic industry alliances of this year.
Yesterday afternoon I sat down with Philip Mezey, Itron's senior vice president and chief operating officer for North America, to discuss the company's announcement earlier that day that Itron would join forces with Cisco in a strategic alliance to deliver collaborative solutions to transition smart metering technology into an open and interoperable, enterprise-class network for utilities.
Specifically, the two companies will jointly develop a standards-based, highly secure technology for full IPv6 implementation of field area communications to support smart metering, intelligent distribution automation and interfaces to the customer premise. As well, Itron will license and embed Cisco IP technology with its OpenWay meters, and distribute Cisco networking equipment and software as part of its smart meter deployments.
Itron president and chief executive officer Malcolm Unsworth commented at the end of last month (as he announced record financial results through the second quarter of this year, strong bookings and record backlog) that there were some disappointments with recent contract awards in North America. He added, "As we look forward, we are actively pursuing a variety of activities to enhance our competitive position in these areas."
Well, they sure didn't rest on their record-breaking laurels. This initiative is definitely a bold step in a direction the electricity industry needs to move, and quickly. So, my first question for Mezey was, "What does this mean for utilities?"
For utilities, the devil is in the details of installing smart grid technology, he told me. Utilities can have many different data collection and communication systems (for SCADA, substation automation, smart meters, etc.), and many are proprietary and not interoperable. And yet, it's the ability to be able to gather data from all systems and analyze the whole, as well as all of its parts, that makes all the gathered data even more valuable and important. Large investor-owned utilities (IOUs) have many large networks, and many are struggling with how to integrate and manage them all.
"The industry is caught in the forest-through-the-trees stage," Mezey said, "struggling with the basic mechanics of how to connect it all."
To broaden the market, you have to lower the adoption levels, he told me. "When you level the playing field and open it up, you accelerate and broaden the market."
And that's just what this strategic alliance is setting out to do. "We want to enable easy, non-proprietary on-ramps," Mezey said. "Yes, it's scary that we're going to open it up, but we should be opening up and enabling and not making it difficult."
Industry alliances and partnerships create these opportunities, he added. By partnering broadly, and enabling third-party development on the platform, all the `opps and apps' have the ability to flourish. And if it's modular enough, utilities can pick and choose according to their own specific needs.
"If this technology is going to spread beyond the IOUs, we have to move toward more open standards. If it works right, it'll make sense for munis and co-ops," Mezey said.
In coming weeks, Intelligent Utility Daily will be exploring this broadly based, alliance-centered approach to interoperability, and where it could take the electric utility industry, in much more detail.
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