A Converged IT Platform is Taking Over the World and Revolutionizing Industries

While the PC platform started with the desktop and expanded over the past 40 years into computing machines and the datacenter, the mobile platform was born at the edge and more recently started expanding. Initially confined to the smartphone, the mobile platform is now percolating in the edge and increasingly towards the center. Together, these two platforms create a converged information technology (IT) platform that is broadly applicable and is revolutionizing industries.

The birth of the PC platform

When a team of IBM engineers in Boca Raton, Florida, developed a personal computer (PC), it looked more like a side project than a serious endeavor. Nobody foresaw that not only would it disrupt the computer industry, but it would give birth to a movement that would revolutionize countless other industries – from the financial industry to the film industry.

For the past 100 years, the 340,000-person company had supplied increasingly large, sophisticated, and expensive computer systems to enterprises. IBM’s flagship product at the time, the IBM System/370 mainframe, was a closed & proprietary system composed of bespoke hardware and software sub-components developed in-house. In contrast, IBM’s Boca Raton team, several of which were computer hobbyists, designed the “IBM PC” using an open architecture with off-the-shelf components sourced from various third-party vendors, including Intel and Microsoft.

A viral growth boosted by an open and extensible architecture

Soon after its launch, the IBM PC’s popularity soared due to its open architecture and extensible design. Anyone could develop and sell hardware components or software for it.  Some upstarts even started manufacturing IBM PC clones, such as Compaq and Dell, eventually surpassing IBM PCs in performance and price. New software vendors created a deluge of offerings from games to business management software, such as Electronic Arts, Microsoft, Intuit, Adobe, and Lotus. Hardware innovators created new components that augmented the PC’s capabilities, such as Western Digital with the modern hard drive interface, 3Com with the Ethernet network interface card (NIC), Logitech with the mouse, Toshiba with the laptop, and Nvidia with the GPU.

The desktop extends to computing devices and industry-specific applications

In the 30 years since its inception, the PC became a de-facto platform for all kinds of computing devices and percolated into countless industries. Cash registers, ATMs, ticket machines, and other devices started leveraging PC hardware and software across various sectors. At the same time, new software extended the applicability of PC-based computers to different industries, such as newspaper writing, graphic design, dental office management, small business accounting, and countless more.

The PC-based information technology (IT) platform

The growth of the World Wide Web in the late ‘90s fueled the demand for data centers.  Creative startups like Google popularized the buildout of server farms using inexpensive PC-based servers equipped with sophisticated software that could compensate for lower reliability. The era of the PC becoming a modern enterprise-grade system had begun.

The ‘00s brought to this PC-based platform software virtualization, server-grade Windows and Linux, advanced security, and many advances in hardware. The ‘10s brought software-defined networking, micro-services (e.g., Kubernetes and Docker), and a large influx of venture capital funding in software startups that dramatically grew the quantity and quality of enterprise-grade software for PC-based datacenters.

Today, the intense competition to supply cloud computing has resulted in tremendous amounts of computer power made available to anyone on a pay-per-usage basis – once again, based on the PC architecture. These systems achieve mission-critical reliability, military-grade security, and performance levels previously only dreamed of. And with an estimated $250B invested in R&D every year [data: PwC 2018 Global Innovation Study], this IT platform keeps getting better, with seemingly no end in sight.

A new mobile-specific architecture fills the gap at the edge

While the PC-based IT platform experienced tremendous success and seemingly unstoppable momentum, there is one area where both its hardware and software struggled year after year: low-power compact devices with realtime performance requirements. Throughout the ‘00s, PC powerhouses such as Microsoft, Intel, Dell, Compaq, and HP repeatedly tried to sell handheld devices based on the PC architecture, “personal digital assistants” (iPod-like devices), smartphones, and tablets with a variety of PC-based software. But despite all its success, the PC-based platform could not scale to these “edge” use-cases, which have requirements far different from the datacenters and hardwired computing boxes where the PC architecture flourished.

A new mobile platform emerged from the smartphone. Although it leveraged a lot from the pre-existing PC architecture, the hardware and software were predominantly designed from scratch to meet mobile requirements.

Today, the mobile platform is merging with the PC-based platform into a converged IT platform, creating a universal infrastructure platform that adeptly covers the gamut of computing needs, from powerful cloud infrastructure to far-edge lightweight and power-efficient devices.

Sleek tablet-like payment terminals are replacing the clunky electronic cash registers in department stores and appearing in small businesses such as your local coffee shop. FedEx, Amazon, and supply-chain logistics scan and route goods with handheld computers built on a smartphone chassis. Car infotainment systems are increasingly leveraging hardware and software that is an offshoot from mobile. Compact security cameras are using mobile-based technology to run artificial intelligence (AI) algorithms in realtime.

The converged IT platform is changing industries

Music studios, previously composed of bespoke equipment supplied by a small handful of vendors, are now built around mobile apps and servers with specialized software and industry-specific hardware interfaces. Television studios are moving away from roomfuls of complex broadcasting boxes to just a few servers, tablets, and streamlined control interfaces, offering them increased automation and flexibility. Even Hollywood, once a champion of traditional film production equipment, is now increasingly relying on an IT-based infrastructure that manages all aspects of movie-making — from crafting the initial script, designing the sets, to producing the final cut. And the distribution of these movies is increasingly going through Netflix, Hulu, HBO+, and other digital networks – all running on an IT-based infrastructure that combines PC and mobile.

Investment trend: industries across the gamut will increasingly move to the converged IT platform

Like the music and movie industries, other industries will increasingly move to an IT-based infrastructure, leveraging datacenters, cloud computing, microservices, and mission-critical software. These shifts will create opportunities for innovators and create new winners.

For example, the cellular segment so far has relied on an industry-specific platform for its infrastructure. Vendors such as Huawei, Ericsson, and Nokia developed their offerings around a purpose-built architecture, home-designed chips, and bespoke software & protocols – costing them around $25B per year in R&D. [Source: company annual reports.]

In recent years, innovators have developed entire 4G and 5G networks leveraging IT-based infrastructure as the foundation, augmented with technology from the mobile platform, such as signal processing accelerators, radio amplifiers, and wireless processing software. Linux, Docker, Kubernetes, server virtualization, software-defined networking, edge computing, artificial intelligence (AI) security, large-scale automation, and smart NICs are combined with mobile technology to create 4G and 5G networks that compete with incumbent solutions and will likely soon surpass them.

Many industry experts perceived such a vision as fiction just a few years ago.  Today it is set to disrupt the wireless industry and usher in a new era of innovation and growth.

Opportunities for startups

The converged IT platform is a powerful foundation that virtually every industry will eventually rely on. Some have already started making the shift, while others have yet to. In every industry where this shift happens, innovators have three waves of opportunity:

1) Develop technology that carries over the industry’s existing way of operating onto the converged IT platform

Example: RED Digital Camera catalyzed Hollywood’s shift to digital. Jim Jannard, the company’s founder, came to understand what would sway movie directors to embrace digital cameras.  At the time, heavy hitters such as Sony and Panasonic offered professional digital camcorders for several years with limited traction.

2) Develop technology that leverages the converged IT platform to simplify, automate, and improve operations

Example: Capsule Technologies improves patient outcomes and staff satisfaction in hospitals that use a hospital management system (HMS), an IT-based system that helps manage operations. The founders saw the potential to improve day-to-day operations for nurses, doctors, and administrators by networking medical devices with the HMS systems that hospitals are adopting.

3) Develop technology that builds upon the converged IT platform and creates new capabilities

Example: SoundCloud enabled artists to distribute their music at scale without having to sign up with a record company. The founders, both music artists, leveraged the IT platform used by the industry and created a mobile publishing tool for music distribution. This new capability allows anyone the opportunity to become a broadly distributed artist.

Revolutionizing industries

As the converged IT platform continues to grow, the potential for innovators to leverage the technology and impact other industries will expand. Industries that already were impacted will see new waves of opportunity as the platform gains new levels of performance and capabilities, in particular from the newly integrated mobile platform.

This is a mega-trend that is happening now, will morph, and will continue to disrupt industries over the next decade. It creates significant opportunities and will result in many big winners.

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Note: My posts are opinion-based and these opinions do not reflect the ideas, ideologies, or points of view of any organization I may be affiliated with. The information I post is prone to errors and the absence of some key information. I may explore and develop perspectives that I do not espouse, or espoused at the time and no longer do. My posts are for entertainment and informative purposes and should not be perceived as professional advice.