Why Union Pacific Builds Its Own Tech
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Ohio Investigator
Ohio Investigator,
User Rank: Apprentice
8/9/2012 | 6:16:02 AM
re: Why Union Pacific Builds Its Own Tech
Kaiser---you have a very strong insight into an industry that constantly acts like it's still in either the 1800's or 1900's. They only do something having to do with safety when the FRA forces them to do it. Countries in Europe have had PTC for years. I read recently that even Russia has it on their trains. I always like to talk to people interested in railroads about why the RR's got rid of the caboose. It was a huge safety factor since the two crew members could see the entire train ahead of them. If they saw smoke or fire from a "hot box", they could dump the air and stop the train. If they saw a car vibrating from a broken wheel / derailment, they could stop the train. But, as usual, the RR's were totally focused on the Bottom Line and so, the train crew got sliced to 2 from 4 by eliminating the caboose. FRED was supposed to replace the caboose. Uh HUH!

We had a CSX incident some years ago here in Ohio where half the train was lost due to a decoupling and NOTHING detected it! The air brake system should have stopped the train, but there was a "kink" in the air hose and the system failed. So, the Engineer went his merry way, not knowing that about half of his train had separated and was derailed all over the track behind him. Some people living along the track saw the derailed cars and called 911. Isn't that just great? Of course, we had that "run-away" CSX train go 66 miles here in Ohio with no one in the locomotive! The Engineer didn't get fired (!) even though he rigged the throttle and jumped off to move a track switch (where was the Conductor, huh?) When he tried to get back on the loco, he slipped on the wet steps and had to let go as he was being dragged over the ties / ballast. That train got up to speeds of at least 60 mph. There has been a movie made about it: UNSTOPPABLE, 2010, starring Denzel Washington. It's an absolute miracle that no one was killed or injured by that real CSX "run-away" train and that it didn't derail. Where is Casey Jones when you need him?


Want to see something interesting about UP? Do a Google on the Alcorn case in Missouri in 1999. A very angry jury hit UP with something like $120 million in punitive damages! Yes, the judge knocked the amount down, but still..........
User Rank: Apprentice
8/8/2012 | 6:42:35 PM
re: Why Union Pacific Builds Its Own Tech
Isn't Union Pacific the company that made the big splash in the tech mags a few years ago by telling the world how it was dumping its mainframe and moving exclusively to x86 architecture? And didn't they say they weren't going to worry much about virtualizing those servers? And didn't they say the migration and the complete rewrite of their code environment would cost between $150 million to $200 million?

Further, how much did it cost to develop all of the new code? How much was the re-tooling and how much was the cost to develop new skill sets? How much, over time, is it going to take to maintain that code? As for the 1.5 hours of downtime that they now allow in their service level requirements, how much downtime did they see when they were running their highly-available mainframe environment? How much money is being saved by having to build out, rewire, configure, and support a complete distributed network environment ? How much energy is being saved (I bet energy costs increased significantly...)?

Seems that I have to agree with the previous commenter: rail likes the position that they're in -- dominating small companies (whom I guess are the ones buying their software). But as for being risk adverse, I think Union Pacific took a huge risk dumping the mainframe for x86 architecture. Think of the security risks; the huge cost if the project failed; and the public embarrassment if we all find out that the mainframe is still there. To me, this shows Union Pacific is willing to take risks...

By the way, has Union Pacific finally moved off its mainframe or is it still there?
User Rank: Apprentice
8/8/2012 | 1:36:37 PM
re: Why Union Pacific Builds Its Own Tech
It certainly appears that Union Pacific is the hot topic for the day! I am surprised to learn that UP is going with a web based system versus and enterprise system to manage their NetControl. I would think with all the in house IT that it already going on, I would think UP would want total control over managing NetControl. I also enjoyed reading that UP us earning millions based on some of the innovative technology they have already come up with. I would not worry if I were Tennyson it appears that his decisions are very good for business and that he is not making bad decisions at all.

Paul Sprague
InformationWeek Contributor
Kaiser Sose
Kaiser Sose,
User Rank: Apprentice
8/8/2012 | 1:25:17 PM
re: Why Union Pacific Builds Its Own Tech
Off the shelf software doesn't fit rail because the gang of 4 US-based railroads (UP, CSX, BNSF & NS) close themselves off to the world. Look at PTC. They had an opportunity to work with the industry and create something truly advanced. Instead, they teamed up, selected a handful of vendors, dictated the terms to the vendors and only pushed the technology as far as they were willing to invest. So, something that could have taken railroads into the digital age turned out to be a modern layer over 19th century technology.

I used to work for a tier 1 integrator that had ex railroad executives and was very interested in working with the rails. Yet, they pushed each and every offer aside in favor of going it alone out of fear that we'd also work with their competitors. For all of the talk that rail is a small market and it doesn't attract the large players is nonsense. The truth is the rails like the position they are in - dominating small companies and making small, risk averse advances in technology.

This market is ripe for new thinking.

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