GE Must Walk This Fine Line With Amazon, Microsoft, Tech Giants

GE Must Walk This Fine Line With Amazon, Microsoft, Tech Giants

As General Electric ( GE ) looks to technology partners to build out its industrial Internet of Things business in the coming years, it has a fine line to walk between cooperation and potential competition.

[ibd-display-video id=2461767 width=50 float=left autostart=true] For example, Microsoft ( MSFT ) will host GE’s enterprise software solutions in the cloud starting in November. But Microsoft is also eyeing the industrial IoT, and CEO Satya Nadella said last year he wants the software giant to take the lead in creating digital platforms for industry .

Meanwhile, GE has used Amazon ( AMZN ) Web Services as its preferred cloud provider, and began offering software development tools for industrial apps to be used on Apple ( AAPL ) iPads and iPhones.

So, depending on the day, GE could be either friend or foe to the very companies it’s tapping to grow its digital business on a global scale. And while that may be somewhat unusual for the industrial sector, it’s par for the course in the tech sector, Khozema Shipchandler, VP and CFO of GE Digital, told IBD on the sidelines of last week’s Minds + Machines event in San Francisco.

“For a technology provider, it’s a very familiar battlefield,” Shipchandler said. “On certain days you’re partners, on certain days you’re competitors, on certain days you’re customers, on certain days you’re vendors. They’re all mixed up, sometimes in the same deal.”

Shipchandler added that GE is cloud-agnostic – so it can serve customers on Amazon’s platform or Microsoft’s or GE’s – and similarly expects tech companies will partner with its industrial peers.

So far, that strategy is helping to rack up customers for its Predix platform, a set of core applications and cloud-based operating system designed to optimize the performance of the jet engines, wind turbines and other industrial equipment that the company makes and sells.

Year to date, GE Digital has piled up $1.1 billion in Predix purchase orders, double the volume seen for all of 2016 and hitting its end-of-2017 target ahead of schedule, Shipchandler said.

Shares of GE closed down 1.8% at 20.41 on the stock market today , marking a sixth consecutive loss amid continued fallout from the company’s Q3 earnings report from earlier this month. Amazon climbed 0.9%, and Microsoft added 0.1%.


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