General Electric is pouring $105 million into Pivotal, an offshoot of EMC’s VMware subsidiary that focuses on data analytics and cloud applications. In exchange for that hefty amount of cash, GE will receive a 10 percent equity stake in the venture.
“We are experiencing a major change in the wide-scale move to cloud computing, which includes both infrastructure and the transformation of how applications will be built and used based on cloud and mobility,” Paul Maritz, CEO of Pivotal, wrote in a statement. “This transformation is also happening in enterprises where their environments must adapt to a world that is data-centric, requires agility and real-time response.”
But what does the deal actually mean, beyond a cascade of buzzwords? GE’s new “Software Center of Excellence,” which was set up in part to research data analytics, will have access to Pivotal’s analytics and cloud-architecture software. GE will use those resources to develop more sophisticated analytics services at a faster pace.
Pivotal combines resources and employees from EMC’s Greenplum and Pivotal Labs organizations; VMware also contributed its vFabric, Cloud Foundry and Cetas units. Pivotal products include Pivotal One, a “next generation” Platform-as-a-Service (PaaS) due to arrive in the fourth quarter of this year.
GE has been investing more and more in analytics, which it publicly believes is the future of industry. “The next holy grail is about decision support and analytics,” GE CEO Jeffrey Immelt told the audience at his company’s Minds + Machines 2012 conference, as quoted by The Wall Street Journal.
To that end, GE has released software designed to surface and analyze data from industrial processes. In February it revealed Proficy Vision, which unites Web-based data from GE’s Proficy analytics platform with third-party displays, for a single viewpoint into operations.
But even GE faces challenges. The data flowing out of many industrial concerns is largely heterogeneous, presenting issues for any organization that wants a holistic view of operations. That’s sparked the rise of several analytics products that flow disparate data streams through a single dashboard. But such technology isn’t mature—it needs to evolve still further, in order to analyze multiple types of data at acceptable speed. In light of that, GE’s newest investment could potentially pay major dividends over time.
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