Launching Siemens Xcelerator - Full Event

Hello everyone and welcome to Accelerate. Today, we want to talk about speed, how we can accelerate digital transformation and how we can do this with you and for you, our customers and partners. During the pandemic, many organizations turned to technology to keep their operations up and running. When the supply chains broke, assembly lines came to a standstill. Digital technologies gave us transparency and we knew where we had available components and capacities. For example, when we didn't have the parts in Amberg to make a specific version of our SIMATIC controllers, we shifted production to Chengdu instead. Digital technologies enabled us to deliver when others couldn't. Technology also saved lives. Some companies were able to adapt production lines to make medical ventilators and they did it within weeks, or they ramped up the production of Covid vaccines in just a few months. When we combine the real and the digital worlds, we can achieve new levels of flexibility, and we can bring products to market faster. Teams can collaborate from anywhere, saving time and travel cost. The very same digital technologies that saved lives during the pandemic can give firms a competitive advantage today. But, for all its promises, digital transformation is hard. It can be difficult to move beyond proof of concept. It can be difficult to deploy an integrated solution. It can be difficult to integrate legacy systems and to fuse data silos. And it can be difficult to scale up. But when it works, it unlocks huge potential. Here is an example. For a decade now, the Mars Curiosity rover has been collecting samples and recording images of the red planet. NASA uses only the most advanced technologies for their missions since failure is not an option. That's one of the reasons why their engineers used a digital twin from Siemens. This allowed them to simulate the extreme environment on Mars, lots of rocks, storms, freezing temperatures. And the most critical part was the landing, but they were able to test the rover virtually until they got it right. When your mission is to explore Mars, to increase the flexibility of your factory or electricity grid, if you want to reduce time to market or achieve net zero, it is our mission to make your digital transformation as easy as possible. We want to put the technology in your hands. We know there has to be a better way than how we have been doing things up until now. It's why we decided to make a fundamental change. We asked ourselves, what if our hardware was already IoT-enabled and all you had to do was plug and play? What if applications were open and interoperable, so you weren't locked into the solutions of one company? What if there was a platform that enabled all of this? The change starts today. We are launching Siemens Xcelerator, our open digital business platform. It will accelerate the digital transformation for you, our customers, our partners, and everyone in our growing ecosystem. It marks a step change in how we can use our technologies and in the way we work together. Our business platform has three pillars. First, it's a portfolio of IoT-enabled hardware, software and services. Second, it’s a growing ecosystem. And third, it’s a marketplace that will evolve over time. The Siemens Xcelerator is a commitment, a commitment to openness and simplicity. We are committing to making all our digital portfolio modular, cloud-connected and interoperable. It will work with standard APIs, so it will fit with any other applications you have. We will make it easier for you to try things out. You can pay as you go and use our software-as-a-service. But Siemens Xcelerator is not only about software. The curated portfolio also includes hardware and services. They all complement one another and work well together. Also, Siemens Xcelerator is more than just a commitment. Today, you will learn what is already available and the portfolio will grow step by step and include more and more offerings over time. Some of them will actually be from our partners because no company can do it alone. More than 50 companies have already been certified. This means their offerings can be found in the Siemens Xcelerator marketplace next to us. There are the big players that you might expect like Accenture, Amazon Web Services, Microsoft and SAP. And there are smaller ones with smart ideas and solutions. Siemens Xcelerator is also a commitment to collaboration and will allow you to accelerate your digital transformation. But no matter how fast we run, and how much we accelerate, digital transformation simply doesn't stop. We see the next wave of disruption coming already, and it is called the metaverse. Some describe it as the next iteration of the Internet, a virtual world, which is always on, a world where people can meet, work, play and shop. And when it comes to the industrial metaverse, we can see some of the concrete benefits that it could bring. Already today, we use many of the technologies that will define the metaverse: among them 5G, AI, edge technologies, and digital twins. I will give you a few concrete examples and they have one thing in common. They combine the real and the digital worlds. Because when we combine the real and the digital worlds, the real world works much better. When we combine the real and the digital worlds, we can reach new levels of productivity and sustainability. When we combine the real and the digital worlds, we can change the way we live. In Berlin, they are using digital twin technology to create a city district, which will be both 100% CO2 neutral and 100% barrier-free. We call it Siemensstadt Square. Together with our partner, Bentley Systems, we started out by creating a holistic digital twin. This twin not only uses data that shapes the buildings and the street layout, but also this twin will use data on power usage and transport in real time. And as people start to use it and call it their home, the district can optimize itself and become more efficient and more liveable every day. In London, Siemens is guaranteeing technical availability of up to 100% for the Thameslink rail line. This is possible because with predictive maintenance, we collect 9 million performance data points per week from the fleet and by using AI we can predict when parts are likely to fail. Of course, we service and maintain them long before. The outcome: fewer delays and improved customer satisfaction. In Nanjing, we have built a digital native plant. Even before we poured the first concrete, we simulated the plant's performance with a digital twin. In a virtual inspection, we spotted a painting machine without proper ventilation. In the real world, this would have caused a lot of hassle. Yet all it took was a few drag and drops during the design phase to put it in a more suitable spot. And the true benefits of the digital plans: manufacturing capacity increased by 200% and productivity by 20%. For over a decade now, our digital twin technology has helped customers across all industries to boost their productivity. Today, we offer the industry's most comprehensive physics-based digital twin. It not only looks like the real thing, it also behaves like the real thing. It represents the exact functions and behaviors of the system in the real world. How does a product behave if you shake it or heat it up? Or if you run our software on it? The twin will tell you. We will now bring digitalization to the next level. Let me give you an idea of what could be possible in the industrial metaverse. Imagine. Your factory in China is slowing down. It produces fewer parts every day. Nothing bad, but it adds up. Your team at the factory has no idea why this is happening. To fix this, you bring together a global team, the production engineers in China and the engineers at their sister plant in Mexico, the product designers from South Africa and the company in Germany that makes the robots. So they meet and collaborate in the metaverse. They immerse themselves in the digital twin of the plant, which is the perfect mirror image of the plant. And of course, it is not still photography. It also mirrors exactly what's happening in the real plant and in real time, down to the physical behavior of the robots. Now, the team looks for the problem in the virtual world first. In the digital twin. They zoom in and out, they move things around, and to all of them it feels as if they were at the real factory in China together. In part, that's because of the photorealistic visualization. The team decides to travel back in time in the metaverse to a point when the output had been strong. What has changed since then? So finally, they realized that one robot on the feeder line had missed its latest software update and is out of sync - a rare miss. Time to fix it. The team updates the software in the digital twin first. The virtual problem robot immediately speeds up and works in sync. Now, the team is confident enough to update the software on the real robot at the real plant. Problem solved. This is the moment the real world starts to mirror the digital twin, a closed loop between the real and the digital worlds. So, of course the industrial metaverse will not just help us fix things when they break, it will be a place where engineers, workers, anybody can experiment and test improvements, try out big new ideas. Also, AI bots will tour our digital twin 24/7 on their own and come up with innovative ideas to make things better. The industrial metaverse will be a place where we innovate at the speed of software. It will offer enormous potential to transform our economies and industries. Now you ask yourself, who will build the metaverse? That's like asking: who built the Internet? It's all of us. That's why, today we are announcing a partnership with Nvidia, a company well known for its high-power computing, visualization, and AI capabilities. Jointly, we are going to work towards the industrial metaverse. And I've invited Jensen Huang, CEO and founder of Nvidia, to join us today. Welcome Jensen.

Roland, hi, it's good to be here. Good to see you.

Please take a seat. So, thank you for being here today, and I have to disclose to our audience that actually you are interrupting your vacation. And those who know him know that that cannot be, because he doesn't normally take vacations.

It is very true. It's a pretend vacation. I'm delighted to be here. This is a very important day for our two companies. This is a very important day for all of the companies in the world of industries that are on a journey of digital transformation. And I'm delighted to be here.

So, I was talking about the metaverse. When we talk about the industrial metaverse, people don't really understand it. What's your view on it?

Well, if you look at the last decade of digital transformation of industries, Siemens played a giant role in laying the foundation of the journey of digitalization and started all the companies towards putting all of their design and operations information, all of their planning and manufacturing information, all into a digital format. Siemens Xcelerator, from CAD to PLM to ERP all the way to OT, has enabled companies to enter the world of digital. The next decade is going to be fairly exciting. It will be completely transformative and it's going to do for the world's industries what it has done for the world's consumer Internet companies. And the two enabling technologies that had to be invented, of course one of them is AI. We've been working on that for the last decade and we've made enormous progress. We now have the ability to write software that no humans can, and perform perception, sensing, reasoning and activation software that is really quite magical. However, something else that needs to be invented in order for us to deliver, to develop the AI and also to deploy the AI, and let me explain why. In the world of developing AI for Internet services, everything is software anyways, you're recommending a movie or recommending a search or recommending news, or recommending music, and the recommendation using AI has made it possible for us to all enjoy the Internet in a personal way. However, that technology, as miraculous as it is, and it is miraculous indeed, makes a recommendation that in the final analysis, if not exactly what you prefer, does no harm. In the case of the world's industries, two things are unique. One, the recommendations that our systems are making engage the physical world, which means it has to make a recommendation that understands the laws of physics. And the second thing is, the recommendations it makes have significant life, security and other implications. And so we have to do an incredibly good job. And so the second piece of enabling technology is this concept of a live virtual world, otherwise known as metaverse. This live virtual world has the ability to mimic the physical world in full fidelity. And it has to mimic the physical world in real time. This is the only piece of software that industries will engage from the moment they start designing their product, plant or process, all the way through operations, and it will live on for as long as of course, that product, or that process is in operation. This is where the partnership between our two companies is so important. No company in the world has done more to integrate and to develop a comprehensive suite of tools and applications for the creation of what is called a digital twin. However, between our two companies and now with our two companies, we can connect what Siemens makes and what Nvidia makes, AI and Omniverse, and turn that digital twin into a live digital twin. We can now fuse information, fuse data from the point of design, through product life management, all the way through the automation of plants to the optimization of the plant after deployment, that entire life cycle can now be in one world. Just as we're all in the same world of the Internet, we can now be in the same world of the metaverse and because it will be based on the laws of physics and is real time, we can invite literally everybody who is part of the design process, from designers, the planners to operators into this world of the industrial metaverse. And so our partnership of connecting what Siemens makes and what Nvidia makes to enable this industrial metaverse is a first of its kind, it's a gigantic technology breakthrough, frankly, and I think that 10 years from now, when we look back, we would realize today is a very important day, that we have taken digital transformation and given it a giant leap forward.

This, what you just said, is like a replay of what we discussed 6 months ago in November when we met, and we figured out that when we bring our competencies, our technology, our platforms together, we can do something great. We can basically go for the fully-fledged industrial metaverse, giving customers the possibility to have faster decisions, real-time decisions with higher confidence. And then we figured out: why don't we send a bunch of people from your side and our side on a mission and say, what can you do in six months from now in order to show what our technologies can do together. As a first step?

That's terrific. Let's see.

Siemens and Nvidia are partnering to advance industrial digital twins in the metaverse, opening a new era of automation for manufacturing. In this demonstration, we see how the expanded partnership will help manufacturers respond to customer demands, reduce downtime, and adapt to supply chain uncertainty while achieving sustainability and production targets. By connecting Nvidia Omniverse and the Siemens Xcelerator ecosystem end to end, we will expand the use of digital twin technology to bring a new level of speed and efficiency to solve design, production and operational challenges. Siemens Xcelerator offers the industry's most comprehensive digital twin and includes best-in-class software for digital manufacturing, collaboration, design and industrial operations. Omniverse, based on the open standard of USD, Universal Scene Description, connects a wide range of software tools and users with AI, physically accurate visualization, realistic physics and ray-traced RTX rendering. Nvidia Omniverse is a large-scale, full-fidelity, virtual world engine, and ideal for industrial metaverse. The connected platforms running on GPU-accelerated systems from edge to cloud unlock amazing superpowers, from factory planning to autonomous robots and beyond. Uniting the worlds of information technology and operational technology, the Siemens Xcelerator platform uses edge-enabled devices to collect real-time IoT data connected to the digital twin. When problems occur, engineering, manufacturing and logistics teams can immerse into the live digital twin to root cause the problem and develop a solution. New solutions can be tested and validated using the digital twin across thousands of scenarios and edge cases, eliminating the need for physical prototypes, reducing critical downtime, and increasing manufacturing agility. Siemens Xcelerator and Omniverse train robot perception AI models on physically accurate synthetic data generated from the digital twin, accelerating both initial training and retraining in the event of production changes. In live digital twins, customers can train robots to perform tasks before deploying the AI models into the physical robot. Omniverse can even be used to train fleets of robots working in harmony. Industrial automation is being supercharged with AI. Inside a digital twin, customers can design environments that allow humans and robots to collaborate safely and efficiently. Together, Nvidia Omniverse and Siemens Xcelerator are bringing open collaboration to industrial automation, enabling full-fidelity, live, digital twins to drive a new level of speed and agility in the era of software and AI-driven digital transformation.

Wow, that's almost like it's a real thing.

It is, and this is the start.

What did it take from your perspective? What did your engineers do?

There are several things you saw. First of all, the amount of data that we have to load into Omniverse is extraordinarily large-scale. Remember a plant, a manufacturing plant, could be millions of square feet. There could be millions of moving parts, hundreds of millions of parts in total, and all of this data, all of this geometry data, mechanical data, has to be able to work in this virtual world. Second, we have to fuse electronics and software information. What you saw earlier is not animation but a simulation. The mechanical information, the electronics information and the software information from largely different organizations have been brought together in this virtual world, in this industrial metaverse. Once you can bring all of this data together, fuse it together, then you can activate it. Turn it on just like we turn on a factory. We virtually integrate, we virtually assemble the factory and now we can virtually operate the factory. The amount of data that we saw just now is extraordinary. It took our engineers from the moment you and I met, when we were describing this future, most of the people in the meeting, you could just imagine what they were thinking: this is something that's going to take a decade to go do. However, because of Xcelerator, because of all the design suites that already capture, comprehensively, a digital twin, and do it so well, and because Omniverse has the ability to ingest in its full fidelity all this information and turn it on activated in a virtual integration, virtual simulation, the engineers took several months. And what we saw there is really quite a miracle.

And if you listen closely, the audience, Jensen said it’s not an animation, it's a simulation. A small detail, but this makes the big, big difference because we have to bring the real and the digital worlds as close as possible together. The closer they get, the greater the value is. The software of the robot is operating, the software of the plant is operating to the company, to the industrial company, that virtual factory is exactly the same as the physical factory. And that's exactly the point.

Exactly. Let me give at this point, a great high five to our teams who did it.

So everybody who was working on it, well done, and we need more. The next point is about how to bring it to the customers, how to scale it and how can we get traction on the market?

Well, one of the things about the industrial applications is although manufacturing is, you could imagine manufacturing theoretically being very similar, manufacturing of cars, of ships, of plants, of processes, have some similarities but they're very, very different in many ways. That's one of the reasons why the domain expertise of Siemens is so valuable in this partnership. We bring the technology of artificial intelligence and a virtual world, Omniverse, however Siemens' domain-specific expertise in these different forms of manufacturing is invaluable to us. This partnership activates that. And nothing is more wonderful when you can find a customer who is pioneering in this way, who wants to build the future, who has the technical expertise to engage us to build this future so that we could start this journey together. And I think both of us have a mutual friend who...

Exactly, and this is a perfect segue to our next guest here, Milan Nedeljkovic, the CEO of BMW and he is with us today. Milan!

Nice to see you.

So, a friendly customer, a customer, an innovative customer, one of the most innovative customers in the automotive space, but let me start with the challenges which you have. What kind of things are ahead of us, of you?

First of all, thank you very much for the invitation today. It's great to be here with you and Jensen, since we see as a customer, but of course we are more, we are partners on that one, we are working together and I think, especially working on the digital world and the future is something exciting and can set the pace, working in a collaboration and doing it together. And since you are mentioning the challenges and changes, somehow everything is changing and all at the same time. We have faced as the automotive industry a very challenging two years looking back. We had Covid lockdowns, we had semiconductor shortages, we had to react very flexibly and spontaneously to changes and always provide the right product to the customer during that time. I think as BMW, we had a highly flexible production system but looking into the future, it will become more and more important to link the supply chains, the suppliers, to get transparency in the whole process chain and that's a digital challenge we are facing there. At the same time, we have a transformation of the industry in different dimensions. One is for sure electromobility - it's ramping up, customers are buying the cars, we are providing the right cars for the customers. By the end of next year, BMW will offer 13 fully electrified cars. They need to be produced so we are changing our equipment, we are changing our production environment, processes and equipment and all that needs good planning. Again, digitalization is part of it. Sustainability is for us a significant transformation field. Premium means sustainable and that's why we are today already a benchmark in the automotive industry but we have set ourselves a target in this decade, by 2030, to reduce 80% of CO2 emissions by cars on top of that. And all that shows there is much to do and an enabler for all that is, again, a digital world.

Milan, I've had the benefit, if I could just say something about BMW's miracle, I've had the benefit of visiting your factory in a digital metaverse, in Omniverse, and this is quite an extraordinary thing. You build 2.5 million cars a year and 99% of it is customized, you have 2,100 options, the combinatorial explosion is incredible, you're manufacturing this in 31 different factories and somehow you roll out a car - I think it's once every minute or is it every hour?

Every minute.

You roll out a fully customized car every single minute, and now you have to replan your factories to be able to support ICE as well as electric. Really quite a miracle.

Yeah. Thank you very much for this compliment. Looking at the complexity, that's the core element we have somehow to manage and find a way to plan it in the right way and especially how to steer it in the right way. Since we are working on this digital twin approach together, we see the chance to get a grip on it and that's a great perspective. I think it's worth looking in detail into it and setting ourselves significant targets.

And these challenges you have to manage all at the same time, this is what I understood, so it's a real transformation, what we see in the automotive industry, and BMW’s answer to that is the iFACTORY, is that right?

Yes, the BMW iFACTORY. What is the BMW iFACTORY? The BMW iFACTORY is our master plan for all these transformations. So it's our vision of the production of the future. And we say the iFACTORY is lean, green and digital and I think it explains it by itself. So with lean, we want to have efficient processes, lean processes, but also flexible processes. This is the core of our production system. We want to be green. We are developing individual footprints for every single production site worldwide and we have to adopt new ways of energy management at our sites. And, of course, digital. That's the core enabler. We must transform from our legacy systems into a future where data is seamlessly transmitted, where transparency is given, where we are talking of flow systems, which link into our machinery with edge computing and which go into applications, and all that must be one unit as a twin of the production and the steering of the production.

The thing that's really profound about iFACTORY, the first time I heard that from Milan, I realized that they realize that the factory is as much of a product as the product that the factory is trying to make. And yet all engineers would design digitally with CAD, we would simulate, we would stress test, we would optimize, we would be connected to our product, we would continue to refine it with OTA over time. But yet very few companies would treat their plants that way, to design it digitally, to simulate it, to fuse all the data to simulate it cohesively, to stress test it, and iterate and optimize it over time. So the fact that you named the factory a product says a lot about your attitude about the factory. And that's completely transformative.

And that's a product which has to live because your manufacturing sites, I guess the idea is, once you have the digital twin, that you go for optimization in a continuous way. You will build a brilliant one, but it will be always improving potential. You have changes in your cars, in your products and then you improve it. That's part of why you digitalize too, right?

Yes. For us it's important to get transparency and also to use the capabilities for digitalization, and we have different pillars we are looking at. One is connectivity. We must get seamless connectivity, easy connectivity, flexible to adopt 5G networks in our systems, to easily have small applications being used and then, again, changed over time. We need artificial intelligence being used in our equipment. For me, artificial intelligence is the next big thing for automation in a production field, to use it for camera systems in quality areas, to use it for the logistics transport, to use it in maintenance and machine steering. So, artificial intelligence is boosting right now and gives us huge opportunities. And, last but not least, virtualization and the digital twin. To bring everything as a digital twin into a virtual world opens up a completely new dimension. We are getting the opportunity to set up our systems, plan the systems, link them into the real planning fields, connect people, and ultimately even steer the whole plant with it. So it's a huge, huge field.

And then when I quote a bit of our discussion which we had, when I said let's start with a line, and you said no, no, no, this digital twin has to be comprehensive. It has to be a full digital twin, from the shop floor to the roof, from your robots, to the cars, to the products, it has to be complete, right?

It has to be complete. It's very important. Jensen, we did some work this last year to bring our facilities into a digital twin to generate more as the basis for a digital twin. But the important thing is to link it into existing systems to really have the reality and the twin always fit to each other, and then have the capability with AI inside the digital twin, even to steer the factory. That's a huge, huge approach.

And we talk always about having real-time decisions with confidence. That means, if you simulate something on a digital twin, and you figure out if you want to change something in the real world, then you should. That means you change the real world and you had better get it right first time. This is the big difference between what you described before the Internet or the metaverse, and the industrial metaverse. We are talking about impact in the real world.

That's right. If you look at almost every engineering project of any significant complexity, we simulate the product before we go to production, and because almost all products are software-defined, a great deal of software sits on top of it. We essentially, all companies that build products, have a digital twin. BMW has a digital twin of the car and they would simulate new software releases on the car before you release it OTA into the fleet. NASA does that for the rovers. We do that. Customers do that. Companies do that for phones. We do that for our chips and computers. And yet for most plants and most factories, it's nearly impossible to do that today. The reason for that is because a plant, building a bunch of products, is way more complicated. There are millions of parts, many of them are moving, the amount of software inside a plant is incredible. We need to create a very large-scale simulation platform which is what Omniverse is about. It has to be physically based, just like Omniverse, and it has to fuse data of all modalities. Whether it's mechanical, electronic or software, we need to be able to put that into Omniverse and simulate this plant. And so in the future, Milan, you will develop new software, you will change the layout of your plants, maybe you change the procedure of the workers in the plant, and you would simulate that in your virtual digital twin. And you will prove that it is optimal and safe before you OTA into your plant.

So those partners who are listening to us, they would say that sounds great, but that seems to be really expensive. Why would I invest in this? Did you think about the investment you have to make in order to make this really the true twin?

The core element is to get started. I mean, we got started and we are going from one step to the next. It's an adventure. Since we are approaching new fields, the digital twin itself, - I mean many fields, as you say, they have digital twins already - the digital twin itself is not the challenge. The challenge is to link into this digital twin the existing systems, one by one. And to have any change in the digital twin being reverted in the original planning tools, to get the digital twin as a full digital twin, means to use it with sensors in the manufacturing and use it as a steering brain for the reality. And this is something from today's point of view, it's a vision, it’s not here yet but work on it, step by step, that's the challenge. And at the end of the day, the benefits are huge, so I think it's worth doing it.

There are two things that you said that I would love for everybody to hear one of them. You told me a long time ago that you would like to improve the operational efficiency of manufacturing by 30%. Now for a company the enormous scale of BMW, 30% of manufacturing could drive enormous efficiencies and cost savings. That's one of the reasons why it makes so much sense and is so compelling for you to make the investment. The world's industries represent hundreds of trillions of dollars over time and to be able to find several percent of efficiencies represents trillions of dollars a year. That's one of the reasons why people want to invest and now we have the technology capable for them to do so. The second thing is the source of truth. The source of the data has to have high integrity and has to be full-fidelity, which is exactly the reason why we're connecting today. This partnership today is about exactly the problem statement you just described, which is to connect directly from the tool that the engineers are using, directly from the data that they're using, connecting it directly into Omniverse and creating the digital twin, the live digital twin. And so that's the purpose of our partnership and we're going to make it happen.

Jensen, you're completely right - 30%, it's absolutely realistic. If you think of the steering, of safeguarding the processes, of being able to visualize them and change them before you have them in hardware and before you have any mistakes. So the potential is huge and for me the vision would be with our new plant in Debrecen, which we are setting up as a fully electrified plant, is 100% CO2-free. It's the vision of the iFACTORY. So to get the full digital twin in place with Debrecen, that would be the right approach.

That's the right approach.

And I do believe that the leverage is productivity increase, is shortening cycle time, is so big that it justifies investment and it justifies taking the effort, which brings me to your Hungarian plant, and here comes the fun part. You talk about a vision, very often people think visions are maybe 10 or 15 years away, so I think the challenge is to make that happen by 2025?

2025, yes.

Remember, we are 2022 right now. So that's, I mean, you said before, maybe 3 years in my business, that's quite a long time.

That's forever, 2025. It's 2025 for the virtual version or the physical version?

The physical version.

Really? Okay, so you and I have to have the virtual version in about six months so that Milan could integrate it, operate it, optimize it before he breaks ground.

We should give it a try; the digital version is faster than the real one. Of course the digital version will be faster.

Let's make it happen.

Let’s do it. Great.

Thank you. Thanks for joining us.

Thank you.

Well, this is one of the examples that shows the spirit of Siemens Xcelerator. But there's a lot more. Plenty of industries have already been disrupted and those that haven't, will be. Across all industries, markets are changing faster. Complexity is increasing and traditional business models are no longer competitive. My next guest has experienced this first hand in the media industry. Today, he works at AT&T as their Chief Technology Officer. Here is Jeremy Legg. Hello.

Hi Jeremy. How are you doing? I'm very good. Thanks for having me.

Thank you for joining us today. So, Jeremy, digital transformation is hard, we know that. But it's hardest when digital transformation is disrupting you and your business. Jeremy, this happened to you sometime back before you joined AT&T in 2020. You had worked at media companies, so what happened?

We've seen this happening all over the world in the media industries, not just here in the United States. I watched our business model deteriorate before my eyes and the new ones spring up. And so the television industry domestically certainly, and much of Western Europe, has been the paid television model, the traditional cable closed system delivery model, where consumers paid a subscription for channels and many of them they didn't want to watch. And then when the streaming wars happened, and Netflix certainly was the first one out of the gates, I was one of the people that built HBO Max, and one of the competitive products, that business model grew up. I think the subtext of all this is what happened in media is happening in a lot of industries and that's software eats hardware for breakfast. And that's what happened in media. Everything moved and the digital transformation moved to video delivery over the Internet at scale, which wasn't something the Internet was really originally set up to do, but it is capable of doing it now. And so it was just an enormous change in business model and technology and in consumers in that you move from a wholesale business, where you weren't really responsible for the consumer experience, to one where you were directly responsible for it, not just in terms of the billing and all that side, but the experiences that consumers were having with your products. So a tremendous change in the media industry and one that I've carried with me here, over to AT&T over the course of the last couple of years.

I like that: software eats hardware for breakfast. Our way of saying it is out of a hardware problem, we make a software problem and increase the speed with which we can solve it. So today as Chief Technology Officer, you need to help with the digital transformation of AT&T. So what do you need to deliver?

So, it's a host of things, you start at a platform level and we were pretty traditional on-premise computing, both network as well as software application technology stack. And we had to modernize that stack, which is quite large. And so we ended up moving thousands of applications up into the public cloud. We shut down thousands of applications that we no longer needed. We had to retrain our workforce to really become a cloud first software developer workforce versus one that was used to doing a lot of these things on-prem. We developed and embraced SaaS applications, both ourselves as well as with partners. But then we also, at our core, we’re a networking company and so we built out technologies around the edge of our network, as well as the interior of our network to bring new products and services to our partners, as well as consumers. And so we've been working very closely with the automotive industry, with healthcare and a number of other industries, certainly cybersecurity in addition, to build out new products for them. So an example of that is as you look at autonomous driving and what's happening in autonomous driving, the connectivity and the network in and of itself is incredibly important. Not a lot of people want to be inside of an autonomous car that has high latency. So we've built edge compute and we're working with and delivering low latency services, hyperlocation APIs, to the auto industry as part of the future road maps of how their digital transformation is occurring, particularly around electric vehicles. But we're also doing a lot of other things in cybersecurity as it relates to how do we block the bad guys before they ever get down to the device or to the firewall on a LAN or a WAN as an example. So, it's like blocking the bad guys before they get on the beach versus waiting until they get inside of the country. So, there's a lot of different technologies that flow off of the digital platform changes we've made, and a lot of new exciting products. Digital twins is another example. I was just watching some of your prior conversation and as we think about how we deploy Spectrum, how we deploy our network, and how we optimize that network, we've started building digital twins in order to optimize how we do that in certain markets. And that's another example of what we're doing.

That sounds like heavy lifting first and foremost, and secondly also like a typical digital transformation. You're cleaning up legacy systems, bringing new products, innovating faster, changing your business models. So here comes my last question to you. What do you want from a partner like Siemens? How can we help you on your digital journey?

Well, I mean, in a lot of different ways, but I'd say, first and foremost, is making it easier to integrate technology. And large companies have a lot of different inputs in these digital transformations and have lots of partners and so you’re aggregating technologies together that haven't always worked together. So how we actually integrate these technologies and making it simpler and moving at the pace of digital transformation is enormously important. The one thing that I've really noticed in my digital transformations in the media industry as well as at AT&T, is that you're stepping onto a faster moving conveyor belt. The expectations for how quickly you integrate products go up, the expectations for how you iterate your products for consumers or for businesses increase, the pace just gets faster. It's more exciting, and it's really fun, but at the same time you have to be more responsive. So a number of the things we're already discussing with Siemens, whether it's the electrification of our fleet or things that we're doing in smart buildings and smart cities, it's making those technology integrations as simple as possible. And so that gets into how you architect API layers, how you architect abstraction layers, how you build development tools and integrate them in, where you make these things available, whether it be in the public cloud or through yourselves. But looking at open standards, looking at open stacks and making it as simple as possible for us to leverage and integrate those technologies.

Thanks Jeremy, for sharing your insights, your experiences and your challenges and I'm very much looking forward to meeting the real version of Jeremy sometime soon. Take care.

Take care. Thank you for having me.

Thank you. To make digital transformation easier for Jeremy and for you and for everyone else, we are building the Siemens Xcelerator business platform. You remember, a comprehensive curated portfolio, a powerful ecosystem, an evolving marketplace. A defined technical and commercial governance will make it easier for partners to come on board. The whole Siemens Xcelerator portfolio is designed to connect and to fit into your world. If a Siemens product has the X on it, it means that it follows all these four criteria and principles: interoperable, flexible, open and as-a-service. So let's take them one by one. Interoperable. If you combine several applications from Siemens Xcelerator, it will feel like plug and play because the solutions and technologies can talk and understand one another. Flexible. Every business environment is unique and has its specific needs. Normally 95% of your landscape might be rather standard, but the remaining 5% can cause a headache. When you connect the Siemens Xcelerator portfolio with legacy systems or with applications from other companies, we promise that those 5% will be manageable. We can even give you tools to make things fit 100%, like Mendix, our low-code platform. Open. You will always be free to use applications or products from other companies or from the open source community, and you can connect them with our Siemens Xcelerator offerings. Finally, our offerings come as-a-service. Take the example of predictive maintenance. You might want to know when is the exact moment to service a pump? So you could buy components and a software license and build the solution yourself. Or you use one of our Siemens Xcelerator offerings. You pay only for what you need and when you need it, without a big upfront investment. We are creating a business platform that has the power to accelerate your digital transformation, to make it easier, faster and more scalable. Its purpose is to create value for you, for companies of all sizes in industry, buildings, grids and transport. We are building Siemens Xcelerator with you and for you. Because we want to do more with less. Because we want to disrupt rather than be disrupted. Because we want to innovate faster and because we want you to accelerate. Thank you.

Thank you, Roland, happy to be here to represent Fast Company as the media partner for today's event and take everyone through the rest of the program. You've now seen today's big news with the launch of this open digital business platform and seeing the first example of what partnerships will mean. Now we'll take a look at the heart of Siemens Xcelerator and share more about the first launch. Let me bring to the stage Siemens CEO, Smart Infrastructure, Matthias Rebellius.

Thank you Matthias. I look forward to having a better environment in my office very soon so looking forward to seeing what Building X brings when it's rolled out. Now, to dive into the world of industrial operations, I want to introduce the Chief Technology Officer of Siemens Digital Industries, Dirk Didascalou.

Thank you everybody. What I would like to do is talk about what we are going to do in industrial for the Xcelerator. Siemens Xcelerator is a strategic vision. Matthias told you about Building X. I'll talk about industrial side: combining real and digital worlds so customers become data-driven and move at the speed of software. Every industrial manufacturer needs to become a digital enterprise. We are number one in automation and industrial software. Digital transformation means becoming data-driven, optimizing end-to-end system value. Two sides: efficiency and possibility. Siemens Xcelerator provides tools for digitalization, democratization. It's based on our industrial products across the life cycle and up and down the stack. It allows data to flow securely. With Industrial Operations X, we bring IoT, edge, and low-code into one offering. Examples: our Amberg factory with 140% output at double complexity without additional resources; digital twins for vaccine production with Atos; Heller hardware-as-a-service; Northvolt battery sustainability; vertical farming. Partners like Susterra build on our low-code. Now let's look at Space Perspective.

You will rise floating to the edge of space until all you feel is wonder. A thrilling six-hour journey, carried by decades of aerospace expertise, a view few have experienced, a journey that will change you. Welcome aboard. Space Perspective.

Let's welcome Jane Poynter, CEO of Space Perspective, a start-up company that's using Siemens Xcelerator today. Welcome Jane.

It's so good to have you with us.

It's really exciting to be here.

Jane, tell us about Space Perspective and what you are up to.

We have reimagined space flight. We use enormous balloons to take people to space at 12 miles an hour, making it gentle and accessible. The six-hour experience: two hours up, two hours at altitude, two hours down. It's a quintessential astronaut experience.

That's awesome. Tell us about the difficulties and how we could help.

You are helping us. Safety is key. We splash down in the ocean, and we use your software for rapid simulations of the splash cone. We've gone through hundreds of designs to ensure a gentle splash. Also, thermal optimization of the capsule for comfort.

That sounds fantastic. Sustainability is important. You created Biosphere 2. Tell us about how technology helps sustainability.

We co-created the control system for Biosphere 2 with Siemens. Now you help us with Spaceship Neptune, a zero-emission vehicle using buoyancy. We optimize mass with your software. We also operate carbon neutral.

You are a proof point for our digital platform. How do you use digital twins?

Digital twins help us design for operability and maintenance, and during operations they help us understand the vehicle's behavior. It's transformational.

I know someone interested in space travel. Cedrik, come up. We have three questions. When and where can we sign up?

We start taking people around end of 2024. You can buy tickets at spaceperspective.com.

Third question: Do Xcelerator participants get a discount?

For you guys, you are awesome partners.

Perfect. So whoever signs up for Xcelerator can fly to space.

Something just shot to the top of my wish list for gifts. Thanks for sharing that with us, Dirk and Jane.

In our last session today, I'm excited to be joined on stage by the CEO of Siemens Digital Industries, Cedrik Neike. As he and I will hear from three customers in three very different industries, we're already making these ideas a reality. And to tee up our conversation, here's what that looks like.

And they are in. Please welcome Laura Matz, Chief Science and Technology Officer at Merck, Patrick Verwer, CEO of Govia Thameslink, and Trond Skellerud, CEO of Elvia. Thanks and welcome. It's absolutely wonderful to have you. We want to make things real. Merck, 350 years old and innovative; Thameslink pushing the envelope; Trond with the grid integrating renewables. I'm excited to learn from you. And thank you for being here.

Thank you.

Laura, we heard a lot about digital transformation and data. Data has never been as important. So how is Merck managing the data needs of your business?

Data was important before, but with Covid the mindset changed. Regulatory bodies ask for more real-time data. We need traceability from raw materials to finished goods. In 2021 we partnered with Siemens for digital tracking. Personalization in medicine requires bringing complex data sets together, and interoperability is a key challenge.

What do you see from your perch? If I have a digital twin, I want trust. We work with Merck from sensor to cloud to ensure data is true and secure. Once we solve it, it can be replicated across industries.

Patrick, your company transports over a quarter billion passengers every year. How do you manage digital transformation with 100-year-old infrastructure?

It's a challenge. We had to add capacity while operating. We designed a fully integrated system with intelligent stations, infrastructure, and Siemens trains with Railigent. Predictive maintenance using 4 billion data points per year. Automated train operations boost availability to almost 100%. The future is linking infrastructure to trains with standard APIs for a proper system.

You mentioned transforming. What does the future look like?

We need to look at all systems and link them. Use standard APIs to bring data together for passenger benefit.

How does that play out with passenger experience? We collect 4 billion data points and use AI to predict failures like train doors. We encapsulated this technology to make it replicable.

Trond, Norway is a leader in EVs. What role does digital transformation play?

Thank you. Norway had green hydropower and incentives. Now demand is growing rapidly with new generators like wind and solar. This changes grid behavior. We are transforming our infrastructure in three years to cope. It's a huge technical and organizational project.

Speed is required. Trond combined two grid operators and chose a new digital infrastructure. We built microservices on communicators. This is important for carbon neutrality goals. We are making these capabilities available with Xcelerator.

At the core is collaboration. Laura, share about collaboration at Merck.

Digital transformation involves technology and people. We use a plug and play approach to add sensors and IoT. But we must upskill our people. Demystifying buzzwords and showing how things make jobs easier creates momentum. It's a mindset shift.

Laura, can I ask you something? Are people welcoming that upskilling or is there a barrier?

Some are reluctant, but once we demystify, we get momentum. It's a journey. For example, when I say Java, they think of coffee. We need to bring that together. Change is scary, but we must drive it.

Change is scary, but if explained, people understand. Often tools are brought in without considering end user experience.

Patrick, what's your experience with change management?

Ups and downs. Once people see benefits, they embrace it. Train drivers were reluctant about automation, but we assured them they are still needed. They became proud. Accept reluctance and find common aspects.

Trond, your journey with buy-in?

Buy-in is essential. Involve people during the project. They are not losing jobs but will work differently. Done right, it's motivating.

Let's talk about ecosystems. Laura, what does an ecosystem mean at Merck?

Ecosystems are important for early drug discovery and sharing patient data. But patient data is sensitive, so security is key. Our crypto anchor partnership with Siemens ensures trust.

Security is key. Patrick, what does open ecosystem mean for you?

We need to link all systems with standard APIs to create a predictive system for passenger benefit.

Cedrik, final question. Siemens presents a future of modular, flexible, open, faster digital transformation. Is that your vision? What does the future look like?

Looking at 175 years of partnership, we understand each industry. With Xcelerator, we want to be open, easy, integrated. The idea is to run grids, rail, and manufacturing as software. What if every grid is green energy? No rush hour? Next cure for cancer? That's our vision. Each of you is on a mission to change the world, and we want to help by making capabilities available to all.

Plug and run. Laura, Patrick, Trond, thank you for sharing your insights. Now, we'd like to welcome back to the stage CEO Roland Busch.

Today, we introduced you to Siemens Xcelerator, our new open digital business platform offering IoT-enabled hardware, software, services, an ecosystem, and a marketplace. Its purpose is to make your digital transformation easier, faster, more scalable for companies of all sizes. It's a fundamental change in how we work with you. We combine the real and digital worlds to enable you to do more with less. We want to bring the industrial metaverse to life for solving real-world problems collaboratively. But we cannot do this alone; we will partner with our ecosystem. This is only the beginning. Thank you all so much.