Global information and communication technology (ICT) giant Ericsson plans to transform shipping efficiency through its Maritime ICT Cloud that the Swedish company defines as a solution to enable “ cargo and logistics data to be shared automatically at each leg of the cargo’s journey, helping to streamline the entire supply chain.” We sat down with Douglas Watson, Ericsson’s Maritime Business Unit director.
NE e-mag: You launched Maritime ICT Cloud at the beginning of 2015. What significant updates have you made?
Douglas Watson: To reflect industry needs, we’ve developed and matured our offerings. They not only cover shipping but also the needs of ports and terminal operators.
In addition to our existing relationships with Globecomm and Inmarsat, we recently partnered with SpeedCast, which has a strong track record of successfully delivering shipping connectivity. The partnership enables us to benefit from significant economies of scale and an enhanced global infrastructure, allowing us to deliver a comprehensive services portfolio. We also partnered with Pole Star Space Applications Limited to develop a new level of fleet management, ship security and asset monitoring systems.
NE e-mag: Have there been any concerns over system security?
Douglas Watson: All systems are vulnerable to data compromise. The traditional way of addressing security has been to do whatever possible to prevent it by access control, firewalls, encryption, secure communication, etc. We refer to this as perimeter control.
We say 100% prevention is impossible, but 100% detection is possible.
There are some drawbacks, however, including the handling of secret keys and high costs for building perimeter defense. Once an intrusion has occurred, it can take a very long time to detect it, to prove who did it and when.
Ericsson offers Data-Centric Security as a complementary solution that, instead of protecting from intrusion, signs the data and enables near-real-time detection during intrusion, and verification of the signature and data integrity, whether the data has been tampered with or not. We say 100% prevention is impossible, but 100% detection is possible.
NE e-mag: Your first major client was Maersk. Have you now rolled out ICT Cloud to its entire fleet?
Douglas Watson: The initial roll out brought two thirds of Maersk’s vessels online in partnership with Ericsson.
NE e-mag: And with U-Ming, your second major client?
Douglas Watson: The partnership between Ericsson and U-Ming started in 2015 for end-to-end connected vessel and voyage optimization solutions, which significantly saved on fuel consumption and reduced CO2 footprint. We have expanded this offering, which now includes:
- Collision and Pirate Identification based on IoT infrastructure to avoid colliding with small fishing boats and to predict pirate attacks
- Vessel Data Management to increase vessel data visibility for big data analysis in the future
- A remote maintenance system to decrease maintenance and repair costs and time.
NE e-mag: How large must a shipping line be for ICT Cloud to make financial and/or operational sense?
Douglas Watson: Much of the shipping sector has yet to adopt ICT Cloud. To assure industry-wide acceptance of our solutions, the cost has to be compellingly justifiable and [the system] quick to implement. We’re offering a platform solution that is already developed and in use. There will always be a requirement for some customization, but this approach is significantly more economical than implementing a brand new set of custom applications.
NE e-mag: Have you signed additional contracts?
Douglas Watson: Yes, And we are engaging with a number of port authorities in Europe.
NE e-mag: Is it possible to quantify the amount of money Maersk and U-Ming are saving annually?
Douglas Watson: We never comment on individual customer contracts or unpublished agreements.
NE e-mag: What major efficiency benefits have Maersk and U-Ming seen in their operations?
Douglas Watson: There are many examples. An improvement of reefer maintenance for Maersk is one area. Each reefer has to have a manual pre-trip inspection to ensure its condition before it is delivered to the exporter. This can take up to six hours. The reefer online monitoring solution has enabled Maersk to take that process down to 12 minutes.
Improved reefer control while at sea is already beginning to filter into voyage operations. Cargo care can be improved aboard ships—reefer technicians aboard now receive data from each container every hour. If there is a problem, they now have the visibility to fix it.
NE e-mag: Looking to the future, what do you see as the major challenges facing ICT Cloud?
Douglas Watson: We see potential in employing a model that enables our customers to pay as they grow and implement an IoT strategy at a pace and level of expenditure that suits them.
“We see potential in employing a model that enables our customers to pay as they grow.”
As we have gained knowledge and developed our concept, this has informed our view of how we bring value in terms of return on investment and total cost of ownership, and how to generate the best impact from that investment.
What will make the difference in the long term is when more big players take the first steps to promote the benefits of this transformation. Our work with AP Moller-Maersk and U-Ming shows that change is desirable and possible.
Business transformation in shipping is a process that is informed by technology, but not defined by it. Instead, it means talking and listening, understanding the landscape and, from time to time, getting your feet wet.