Bluefield Research was on the ground in London last week participating in Bentley Systems 2018 Year-In-Infrastructure (YII) conference. The annual event brings together a diverse crowd of infrastructure professionals – from planning engineers to construction executives, technology start-ups to Bentley’s strategic partners like Microsoft and Siemens – to showcase how the development, delivery, management and operations of infrastructure is going digital.
Here are some takeaways as viewed from Bluefield’s perspective (e.g. related to water, wastewater, stormwater), with a view to broader market impacts.
Bentley Corporate Evolution Continues
Based in Exton, Pennsylvania, Bentley Systems has emerged into a global player in the delivery of critical infrastructure. In 2017, the company recorded over 50% of its revenues from outside of the Americas (33% EMEA, 19% Asia), and it forecasts its annual revenue run-rate to surpass US$700 million in 2018. It made several strategic acquisitions in 2018, adding modelling capabilities in construction (Synchro), smart cities (Agency9), pedestrian movement (Legion), and geotechnical engineering (Praxis, SoilVision). A strategic partnership launched with Siemens in November 2016 has seen US$100 million funneled into a joint-R&D fund. While early returns of this initiative have been focused on the energy sector, there should be opportunities to apply these technologies to industrial and municipal water market applications.
Siemens has reinforced this strategic alignment through continued purchasing of secondary and non-voting shares of Bentley colleagues and retirees on the Nasdaq Private Market, resulting in a 9% ownership to date. Siemens views its strategic partnership, and increasing minority position, in Bentley as a key level to seize opportunities in ‘Digitalization’, a segment it sees growing at 8% CAGR by 2022.
Bentley Stakes its Claim for the Digital Twin
In one of two big product announcements at the conference, Bentley launched its iTwin Services platform, effectively throwing its weight behind an industry term – digital twin – that has been championed by industrial technology companies (e.g. GE, Siemens) over the last few years. Bentley feels that its version of the infrastructure digital twin is the first commercial offering that combines all technology stacks needed to facilitate a true digital twin, at an engineering level.
Bentley has developed iTwin Services for application across the infrastructure lifecycle, augmenting existing products within design, delivery, and operations workflows. Combining Bentley ProjectWise with its iModelHub distributed database, and connecting to discipline specific modelling products (e.g. OpenFlows for water), the platform enables a digital twin of the entire design and construction process. Extending into the operations and asset performance phases, iTwin Services can connect with products such as AssetWise, which Bentley has advanced in collaborations with Siemens IIoT platform MindSphere, to create the initial PlantSight offering for energy markets.
A key differentiator of Bentley’s iTwin Services is in its ability to augment the traditional intersection of operational technology and informational technology, with engineering knowledge – such as design and safety standards, material specifications, and maintenance requirements.
Company Views an Open Eco-System as Key to Future Success
Bentley announced a significant shift in its approach to how it will participate in the infrastructure software ecosystem in the future. In launching iModeljs.org – the platform that will form the core of a new open source-code strategy – Bentley aims to improve the accessibility, for both visualization and analysis, of data stored within an infrastructure digital twin. It is banking on an open source eco-system to help drive adoption of its iTwin Services across its market segments, while enabling an environment where third-party start-ups can tap into Bentley’s code to advance their own applications. The open architecture and iTwin Services platform should also position Bentley for increased opportunity to drive recurring revenues and create alternative channels of R&D, product innovation.
Water Utilities’ Evolution Toward Advanced Asset Management
A common thread across the Utilities and Water Forum, the trend of digitalization within the municipal water sector was tackled from a variety of angles. Paul Boulos, founder and former long-time CEO of Innovyze, gave an interesting talk on the application of digital twins at Las Vegas Valley Water District in the U.S. Bentley’s Bob Mankowski showcased a pilot in which it had applied machine learning algorithms to a utility’s flow and pressure data within the AssetWise platform. Once trained, the algorithm could predict where, and when, an event would occur. While this concept is not new in the digital water landscape, it is significant in that Bentley’s product offering across water design, modelling, and simulation, paired with its AssetWise asset performance management solution, provides a unique opportunity to develop artificial intelligence capabilities within a proven utility platform.
Narrowing in on utility strategies in the digital water journey, Bluefield’s Keith Hays provided a keynote presentation focused on advanced asset management, which tackled some of the key questions around the drivers and adoptions of new technologies. Keith concluded three key points; 1) effective data management is a key first step toward more advanced analytics; 2) asset management practices are advancing globally, with key early-adopters leading regions, and; 3) the vendor landscape in digital water is converging on asset management.
Finalists for Water-related YII Awards Proof of Bentley’s Global Reach
Bentley’s annual awards program provides the company with a unique marketing vehicle. On the one hand, exemplary applications of its software are identified and celebrated, which helps builds relationships with key users and clients. The submissions also generate great marketing content for customer stories and case studies. The entire process draws Bentley closer to practitioners, bringing to light unique applications of its products from around the world, all the while feeding product and R&D teams with data and insight to guide product roadmaps and identify strategic acquisitions.
The 2018 competition involved the selection of 57 finalists from 420 nominations, which were submitted by more than 320 organizations globally. The two water, wastewater, and stormwater categories, covering networks and plants, saw finalists from two of Bentley’s fastest growing markets, China and India. With burgeoning demand for water and wastewater infrastructure being driven by tightening environment regulations in both countries, local practitioners are leveraging digital tools to improve efficiencies in how they design, construct, and operate facilities.
Going digital is a trend we at Bluefield Research are keeping an eye on, specifically within global municipal and industrial water markets. Check out our recently launched Digital Water Insight Service or contact waterexperts@bluefieldresearch.com for more details.
