Hitachi Undergoes Major Reorganization to Compete With GE

By Barb Darrow

Hitachi the global Tokyo-based conglomerate, is combining three of its U.S.-based tech units–Hitachi Data Systems, Hitachi Insight Group, and Pentaho–into a single company to be called Hitachi Vantara.

The new company will compete in the Internet of things sector against such players as General Electric


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, as well as Microsoft


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, Amazon


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, and Google


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–all of which field their own IoT platforms, says Stacy Crook, research director at IDC.

However, Hitachi Vantara execs say it will not complete directly with Microsoft Azure, Amazon Web Services, or Google Cloud Platform to sell basic computing, storage, and networking to customers.

“This is all about standing up end-to-end solutions that can run on-premises or on Azure or Amazon,” says Bobbi Soni, Vantara’s chief solutions and services officer and another HDS veteran. “Our strategy is to bring industrial IoT expertise, our software and ability to manage and run technology. We don’t think many companies are in a position to pull all those things together.”

Related: Amazon Sets Sights on Huge Internet of Things Opportunity

With the reorganization, one entity will sell HDS’s data center infrastructure, Insight’s big data software, and Pentaho analytics. Together, those companies claim annual revenue of $4 billion. HDS purchased Pentaho in 2015 for a reported $500 million to $600 million.

Hitachi Vantara will be a wholly owned subsidiary of Hitachi Ltd., but will be independently managed, Soni tells Fortune in advance of the announcement at Hitachi’s Next Conference in Las Vegas on Tuesday. Vantara management also looks a lot like HDS management: HDS chief executive Ryuichi Otsuki and president/chief operating officer Brian Householder are assuming the same positions at the new company. The company will also be bsed in HDS’s Santa Clara, Calif. headquarters.

Together, the three component companies claim customers including Disney


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, BMW


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, Verizon


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, InfoSys, and Marks & Spencer.

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One priority will be to push Insight’s Lumada Internet of things technology as a platform for connected devices in industrial settings. In the industrial Internet of things, sensors on factory floors, in mines, in airplane engines, or some other remote or hostile location are designed to send data to an aggregation point, where it can be aggregated and analyzed in order to help manufacturers fix problems before they become dangerous.

Related: GE Kills Plans to Built Its Amazon-like Cloud

To date, Lumada itself has been more of a roadmap than a sellable product. But that will change now, says IDC’s Crook. “The big reveal is now that Lumada will be a standalone commercial offering and sit at the middle of Hitachi’s IoT strategy,” she says.

Hitachi, Crook explains, is bringing together all these related assets it already had and telling a better story about how they work together.

Read more here:: fortune.com/tech/feed/

Posted on: September 19, 2017

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