Mister Beacon Episode #48
IoT on the High SeasAugust 23, 2017
How are big data and the IoT reshaping the shipping industry? We sat down with the Chief Business Officer of Alpha Ori, Sam Jha, to learn how they're helping steer their customers toward smart shipping. Don't miss this fascinating episode, our first to deal with pirates and autonomous ships!
Receive new Mr. Beacon episodes right in your inbox
Steve Statler 00:14
Welcome to Mr. Beacon, the podcast for location aware IoT solution designers. My name is Steve Statler of Wiliot. And this week, we're looking at IoT on the high seas. I interview Sam Jha, the Chief Business Officer at Alpha Ori, we have to inspire what you're doing on dry land by hearing how Alpha Ori bringing shipping into the 21st century with drones, IoT sensors and big data, check out our first episode deal with pilots and autonomous tankers. Sam Joe, Chief Business Officer of Alpha Ori, welcome to the show.
Sam Jha 00:53
Pleasure to be here.
Steve Statler 00:54
So we're going to talk about IoT at sea is my kind of rather trite title for this, but I'm really interested to hear about what's happening with the Internet of Things in your space, because shipping is really key. But let me be devil's advocate. I think shipping has been going on for quite a long time. 45,000 years, according to Wikipedia. So you know, what's new and shipping? And why is it even relevant to a technology discussion?
Sam Jha 01:22
I think that's a great question. People say is the second oldest industry in the world after retail, I believe. So we don't see ourselves as a company operating in shipping domain. We see ourselves as a technology company, which is trying to solve an age old problem. It's like what Amazon to retail industry? It's a technology company in retail industry. Similarly, we are a technology company. And why in shipping? The second question is, you know, imagined, the days before 1990s, when we were sending paper memos to everybody in office, and from where how far, we've come in 2017, and how the productivity gain has happened in the, in the every industry, you name it, for some reason, the shipping stayed away from this productivity game. And things are still done, the way it was done back in 80s, and 90s. And our goal is to transform the shipping industry achieve that the productivity that has been achieved by every other industry, but shipping has stayed away from it. Where you don't depend on a phone call from master or a chief engineer to know exactly what is going on the ship. The idea is to get a digital twin, where you know exactly what's happening on the ship, not only just where it is, but what each perform machinery how they're performing. You know it while sitting in an office in San Diego or Singapore, and there is a huge opportunity here in multiple ways. One is, of course, the industry is so far behind that every effort that you make, every chain that you bring in, is a sea change, no pun intended. But at the same time, shipping is vital to our existence in a way 90% of commerce that currently happens, it goes on a ship somewhere in some part of the world.
Steve Statler 03:33
So it's really the backbone of globalization. And we may be in a super high tech business, we're building new beacons. But probably those beacons will arrive from China on a boat. And you know, what I'm taking away is this 45,000 year old industry, and it's maybe not moving at the pace of other industries, but it's still critical. What are the technologies that you guys are looking to inject into this industry?
Sam Jha 04:01
Primarily, let me just focus on three different technologies that we are trying, the one is the IoT, industrial IoT. And that's extremely important to get the data out. But once you get the data out, once you deploy the industrial IoT onboard the ship to every data point, you get 5000 data points per second, or 7000 data points per second. What do you do with it? As people say, a data without context is just number and context without data, it just feelings. So what we're trying to bring here is the data with a context. That's where the other technologies like big data science, like ERP, those are critical to actually provide something which is really transformational. So where the real value gain happens, so when you talk about industrial IoT, yes, we get the data then It's a large amount of data coming in at high velocity. And that's where we need big data to actually look at the disparate sets of data. And correlate is and come up with a creative insights, insights that are economic and value, which is can either save money and increase your productivity, etc. Okay, that's where it is.
Steve Statler 05:23
So you've mentioned a few topical things. There's, I mean, the baseline is ERP systems for ships, but IoT to instrument and then big data to analyze and get inside Santa. And I know you're looking at other things, drones and AR and, and stuff like that. What are the kinds of insights that you you're instrumenting these chips, and it's, I mean, I think of these like the moon shots, you've got Apollo 13. And they have kind of this replica of the spacecraft that's going off to the moon, and in this case, it says slowish boats to China. But you still need to have this kind of virtual representation, what, what's the value of that instrumentation? And what are some of the insights? How can you make a difference?
Sam Jha 06:10
You know, you hear about a term called autonomous shipping quite a lot. Now, the autonomous shipping will not happen, just like the autonomous car. Because when you talk about autonomous car, it's all about navigation.
Steve Statler 06:23
So, just because I actually don't hear the term autonomous shipping very much because I'm running the business. But we're talking basically like a drone. Only it's a huge tanker or a container ship.
Sam Jha 06:34
You mean drone. Would the US government fly those kinds of drones?
Steve Statler 06:37
No, I'm like, are you talking about ships without people on board that are being piloted remotely?
Sam Jha 06:43
Absolutely. So that's what people talk about who are in this industry. In fact, in Norway, they are one launching next year, for us very small vessel. And, and a very fixed route from north of Norway to south of Norway. And they are starting one that pilot next year. Yes, that's what I mean by autonomous shipping.
Steve Statler 07:04
So when the pirates kind of jump on board, and they try and find someone to hold hostage, there actually won't be anybody on board, they'll just be a bunch of robots that will turn them off the boat.
Sam Jha 07:13
That's a good visualization that I hadn't thought of. But yes, when they try to get on board ship at the pirates, there won't be anybody. Okay, and they won't be able to drive the ship because it'll be driven from shore somewhere. That's what autonomous shipping will bring someday.
Steve Statler 07:29
Just mind blowing. Okay, so we're gonna get into sensors and how you wire these things up. But what kind of insights do you use to inspire the people that you're selling to presumably kind of a little bit old school? What, what's the business value you can deliver based on big data and IoT?
Sam Jha 07:48
Like in any business? The new and cool things are good for R&D. But when it comes to selling or convincing somebody to adopt, it's all about dollars and cents. So the idea is, how can we save money in the long run? How can we improve productivity? How can we improve longevity of the ship itself, because shipping is a very capital intensive business. So you buy a Panamax vessel, it costs $50 million. So if you don't maintain it well, and you lose that ship in 20 years, versus if you can do it, well then extend that for 10 more years. Huge, huge benefit. But the way we are trying to sell people is basically based on dollars and cents. So when we talk about big data, when we talk about data analytics, you know, each day charge and shipping is quite a bit. If you have to stop a ship for a day, you might lose $25,000, just like that, because something went wrong, something wasn't overhauled correctly, certain machinery. So with big data science, our goal is to provide remaining useful life on each machinery, okay, so we can predict when this machinery is gonna go bad, and when it should be overhauled or corrective action should be taken.
Steve Statler 09:03
The thing I love about these conversations is I think of them as mental cross training from one industry to another. So I'm hearing exactly the same thing. And actually in airports, they want to start monitoring the people movers because when they break down then then that's expensive. And so this kind of preventative maintenance thing is one of the drivers and basically maintaining uptime of the vehicle and extending the life of the boat.
Sam Jha 09:29
Just a quick one. I wanted to just add that preventative maintenance is a very old phrase people use it which is basically you prevent it before the breakdown happens by following a certain parameters or falling a manual, what we are doing is predictive maintenance. And then it becomes prescriptive at some point. So it goes from detective that what went wrong to predictive That means I'll tell you when things would go wrong, too prescriptive, which means here's what we should do to have void that what could go wrong? So that is the path we are headed forward with big data analytics.
Steve Statler 10:07
Okay. So yeah, basically, it's like that Tom Cruise picture where they're kind of arresting people before they commit crimes, you're kind of getting in there and doing the maintenance before before things break, you're extending the life, any other kind of big areas where you can either make more money or save money with IoT?
Sam Jha 10:25
Absolutely. So if, for example, if you look at what are the incidents that happen on the ship, they all cost money. Big example would be collision avoidance, right? There are collisions happening all around the world that we don't hear, we only hear when there is a loss of life, but a small fishing trawler near Port hits a ship, ship is out of commission for a certain number of days. And some repair has to be done, you never hear the news, but it costs the insurance company millions of dollars. We can save that those kinds of things by having a collision avoidance system in place. There are other incidents where you can save money is if you order a spare part in advance, when you know when you things are gonna go wrong, you can get up to 60% discount on spare parts, the BMW and man can give you 60% discount if you ordered three to six months in advance rather than, you know, seven days notice. That's one. The other part comes as you build more autonomous shipping, you're able to, you can think about reducing headcount, it'll it's we're not focusing on that, but that's the eventual outcome, then you talk about how much fuel you burn in a day, how can you make it more efficient, it will be surprised to a lot of people to know, the biggest amount of expense for running a ship is the fuel. So on a Panamax level vessel, it's $10,000 a day of fuel that you run. So if you can save one to 3% of that, by having a good fuel oil consumption system on board, you're talking about good number of dollars per day. And if you multiply that over a month period, you're talking about 1000s of dollars per month. So there are various ways where we can increase productivity costs cost, and at the same time provide long term economic insight to another example would be very quickly to chime in there is insurance industry. That is they can benefit greatly. Right now. It's a it's a guesswork that when I'm trying to insure your ship, they just do by who you are, how you are, how big the vessel is, etc. There is no input there, how well are you maintaining it? So now, if you know when a smart ship, if our smart ship is on a vessel, you know exactly what is happening on the ship, you can create a risk profile of every ship. And based on the risk profile, your premiums can change, it provides incentive for people to maintain the ship better. And people who do that they get rewarded by having less premiums.
Steve Statler 13:05
Is that what your announcement with Lloyds?
Sam Jha 13:07
The announcement with Lloyds was about creating, going in the direction of autonomous? Okay, so we had al three notation that we got, we had the first smart ship in the world to get al three notation. And what is says that a particular component on the ship is completely automated, no human intervention required. So that's what the announcement was about Smart Ships.
Steve Statler 13:34
I love it money to be saved. Let's talk about some of the nuts and bolts of getting this done. What are you doing with drones?
Sam Jha 13:43
Excellent. I know drone is a very popular topic everybody talks about right. So drone can play a big role in a lot of, for example inspection. So onboard the ship, you have to sell send a human inside the tank to see the condition of a tank, there's just one example I'm giving. Now you have to make sure that the oxygen content is correct in that otherwise, accident can happen. Now, on vessels where you're carrying crude oil, you always top it up with inert gas so that there's no fire, you know, to avoid fire. Now, even though the gas is pumped out, you don't know how much inert gas is in there. So you have to run a five or six our mineral drill to make sure the oxygen content goes up before you can send a human. Now if I have an intrinsic intrinsically safe drone, I can just send the drone with a fork a camera and it get tells me it shows me exactly what the condition is there. If there is a crack there is no crack that I just saved bunch of time or six hours of activity happening big activity on the ship to increase the auto content and then put a risk to human life who's entering a deep tank and there are people who have slipped on those ladders and died. So we can save all that human loss of life, save money, all at the same time.
Steve Statler 15:05
I was actually trying to pilot a drone on one of the aircraft carriers down in the harbor in San Diego. And I think I almost took out several people that were standing on, on deck. So presumably, I mean, are these autonomous drones or is that is one of the fun jobs gonna be some kid that gets recruited from playing on their XBOX, that's piloting the drone around the ship.
Sam Jha 15:25
It can be done multiple ways. There are some people who are doing it right now. If it's in the port, you can draw a geofence. To maintain where the drone is going. That's one. The other way is to put markers. It follows the markers. The drone follows the markers, where it is going.
Steve Statler 15:47
Makes sense. So, you know, this is the Mr. Beacon podcast. So we got to talk about sensors and beacons and that sort of thing is there. You know, what's the role for beacons and sensors on board? I am thinking these chips are made of metal, right? So that's got to present a few problems?
Sam Jha 16:03
Absolutely. And that is one of the reason why we've gone wired in the beginning. There's chips are built of metal number one, number two, the lot of machinery which are running, so electromagnetic interference is high. There are a lot of Faraday cages in a way on the ship. So that poses a challenge. That's why as we were going into it, we simply went wired, the old fashioned way, we are looking at alternatives of Wi Fi and ZigBee and others to see which portion because any portion where we can remove wiring, it saves us not in material, it saves in the labor cost of drawing bore wire. We are also looking at other alternative technologies like PLCC, powerline, communication over Powerline. Our goal is to reduce as much wiring as possible to reduce labor during installation. And, again, Bluetooth or beacon. We'll have to look at where it fits into this. But I totally agree with you big challenges because of electromagnetic interference.
Steve Statler 17:12
Sam, you said Panamax a couple of times. What does that mean?
Sam Jha 17:16
Panamax is referred to a vessel the maximum size of a vessel that can cross Panama Canal.
Steve Statler 17:22
And how big is big in how big can you get in that space?
Sam Jha 17:26
So if I talk in terms of tonnage, it said, you know, let's say it's a crude oil vessel, so 65,000 ton vessel.
Steve Statler 17:34
All right, well, that was a fascinating insight, Sam. So Sam John, Chief Business Officer of alpha Ori, thank you so much for visiting us.
Sam Jha 17:43
Glad to be here. It's like all times two friends talking together. Thank you so much.
Steve Statler 17:54
Normally, when we do these interviews, I asked the interviewee what three songs they would take on a on a mission to Mars, but I feel like I should ask you what three songs you'd take on a slow boat to Singapore, isn't it? How long does it take to sail from San Diego to Singapore?
Sam Jha 18:10
I did avoid back in November 1995. from Seattle, on Anacortes, which is close to Seattle. to Singapore, it took 25 days.
Steve Statler 18:21
So what three songs would you take? So there's some terrible communications problem. And you've got a an iPod from pre, pre 90s What three songs would you take on that voyage?
Sam Jha 18:35
First of all, no matter how bad or old iPod is, it should have more than three songs.
Steve Statler 18:42
We don't have one long enough to talk for.
Sam Jha 18:46
The three songs that I will take as the first one is imagine by John Lennon. And the reason is that that song has never lost its relevance. And I think that it will remain relevant 100 years from now. Because people as long as people are on this planet, there's always a fight. And we thought that we were done with religion fights back in the Crusaders days. But now it's back the forefront. People are talking about religion again. And the fight is there. So it's a very relevant song. It gives me hope, and hope is what we live for. So I will take that. The second one I'll take is the wall of Pink Floyd. And primarily because it's one of the most imaginative, intriguing album in rock music. In my opinion. It's It's amazing album. We grew up listening to that. It's a transformation even even that stage performance is so astounding. I have the video also the movie that came out afterwards and boyhood of post World War Two to know that As the as the protagonist grows to a rock star, which is the Isolate is an isolation, self imposed isolation, that the entire song is explosive. It's very astounding. And it's one of my favorites. So I'll take it. The third one will be Stairway to Heaven. And simply because I love the guitar, that Jimmy Page is fantastic. And I just love the guitar so I'll just take it.
Steve Statler 20:26
Great choices. Thank you.