Ocado has been voted the best online supermarket in the UK by Which? readers every year since 2010. From the customer’s perspective, online grocery shopping is all about convenience -- you click it, they bring it. But behind the scenes, Ocado handles a logistical operation that rivals that of small military campaigns.
Its warehouses spit out more than 3 megabytes of data every second. Typically, in one of its warehouses, there might be 8,000 items on the move at any one time, and every two seconds automated systems decide the most efficient route along the 25 kilometres of conveyor belts. Nearly 2 million items are picked every day.
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On top of this, there are 900 vans going out twice a day, which are constantly streaming back data like GPS, road speed, temperature, cornering speed, and fuel consumption.
Paul Clarke is Ocado’s Chief Technology Officer and is responsible for making sure this colossal IT operation runs smoothly. Who better to speak to about the Internet of Things?
InformationWeek: Whenever we start talking about the Internet of Things, we invariably start discussing the “smart fridge,” and now here we are talking to the man that can help make this happen. Could the smart fridge become a reality, or is it simply an overused illustration?
Paul Clarke: Yes, the smart home is clearly of relevance to us, but I always shy away from the smart fridge. It has massively over-promised and under-delivered. Quite frankly, there are some significant challenges to overcome in doing it. It will be done, but it is not necessarily the most interesting place to start.
There are a lot of other areas -- where knowing more about your customers in terms of what they are prepared to share with you – that allow you to serve them better. As in, when are they typically home? When might they be able to receive a delivery from us? Things like that.
IW: Where do you see the Internet of Things going, both in a broad sense and Ocado specifically?
PC: My personal view is that the Internet of Things is going to be a truly massive transformation. Many people and many companies underestimate the impact that it is going to have on them, their customers, and their employees.
The other thing that is interesting is how it is going to build out. Whereas the mobile phone revolution was very much dominated by the big boys, in terms of who owned the technology, the Internet of Things is going to get built out much more by SMEs and start-ups.
Some of that is just to do with the way the necessary components and platforms are built into embedded systems. A lot of the Lego pieces are now widely available and very easy to build with and glue together to form complex, smart sensing systems.
Previously, you would have had to design those from scratch, and that would have provided a barrier. You just have to look at the number of projects that are on Kickstarter to see who is going to be the catalyst in this new IoT world.
In terms of Ocado, the IoT touches us in a number of ways. First of all, our warehouses are highly automated and are like little IoT worlds of their own. In a sense, they have always been like that, but IoT is only going to increase the degree of automation, both in the warehouses with employees using the likes of wearables, and from a customer perspective.
IW: Speaking of customer perspective, what are some other use cases arising out of IoT?
PC: There is definitely smart packaging, smart utensils, and smart cooking appliances; that whole area has a big relevance for us. We have talked with various universities that are doing work on smart packaging. For example, you might want a packet of sausages that changes colour two days before its sell by date. Or three items that remind you that they might fit together nicely in a recipe. Also simply monitoring the cold chain, making sure that your item has stayed at the required temperature throughout its life, from production to arriving in your fridge, or indeed since it arrived in your fridge.
If somebody leaves the door of the freezer open, which we have all done, wouldn’t it be great if each of the items told you whether or not they should be thrown away?
IW: Machine-to-machine (M2M) has been going on for well over a decade -- probably more than that -- especially in industries like yours such as logistics and fleet management. What exactly is the difference between M2M technology and the Internet of Things?
PC: There are several things. One is low power, hence longer battery life; devices that you can deploy and that then stay alive for long periods of time or potentially replenish themselves with solar.
Secondly, the whole identity-management piece is important; and this is to a certain extent one of the unsolved challenges of the Internet of Things. You need to be able to supply devices that have a degree of identity management built in. It is a bit like dropping a sonar buoy into the sea -- it needs to be able to identify itself as a freestanding object thereafter, and it is important that devices can do that so they can talk to lots of people.
There are things like wearables, which are connected to phones, which are just talking to individuals. But the much more interesting opportunities are where you have machines that actually talk to lots of people, and in doing that they have got to be able to have a sense of whom they are allowed to talk to.
In the M2M world, it was much more your machine talking to your machine, as opposed to somebody’s machine talking to you; that, I would say, is the difference.
You are right, in a sense, that this is not fundamentally new; it’s just the fact that lots more people are doing it. The barrier to entry into these devices is so much lower, and this has made all sorts of possibilities real.
IW: Do you envision a single global framework for IoT, or do you think that there is going to be a few different players in the game?
PC: There are going to be a few different ones. There are quite a few different players, and who knows how that shakeout will occur. I have not seen much from the big mobile companies yet in terms of trying to get in on the back of this, but no doubt they will.
My sense would be that there is going to be a number of different protocols. That, of course, raises the whole issue of standards. In terms of some of the challenges, there’s security, identity management, and power management. There is progress being made in these areas, but there is definitely more work required in order to build all this out.
IW: With so many dumb sensors at the edge of the network, there is an obvious security challenge, just in terms of data encryption and data protection. How do you envision the security challenges being handled?
PC: The key is going to lie in the gathering of anonymous data. So collecting the number of people walking past a point anonymously is one thing. But if you are going to allow a device to know who walked past there, then there is more of a security concern.
Another is the use of smart agents. Smart agents are effectively handling that negotiation with the devices, and you effectively give your smart agent rules to play by in terms of whom you are prepared to share the data with, for what purposes, and so forth; also, deciding whom you are prepared to make your information available to -- not only from a privacy point of view, but also from a cost point of view. People are going to wake up to the fact that their data is valuable and they don’t necessarily just want to give it away for free.
IW: Data is the lifeblood of IoT. Give us some working examples of how you are using data at Ocado.
PC: Data is a huge part of what we do at Ocado on multiple fronts. Our warehouses churn out an enormous amount of data every second. Data is absorbed just because of all of the items passing through our warehouses.
Then you have the whole eCommerce piece of the puzzle. What is interesting about grocery is it’s a very different journey from non-food. Normally when you buy something, like a toner cartridge, one person places the order for you, they check it out, and that is the end of the order.
For us, it is 50 items, it is multiple people involved as you and your partner may add items to your trolley; multiple checkouts because you may check out once and then go, “Oh, actually we have people coming to dinner so I will add these items.” There are multiple devices involved -- mobiles, tablets, laptops, and PCs.
It is a very different analytics journey, stitching all that together, than it is for a single item or a few items, one check out, one person doing it. That is why we have had to build our analytics platforms ourselves. You can’t buy off-the-shelf solutions that are doing that kind of journey. If you can do grocery, you can do non-food, but the reverse is not true because of temperature readings and crushability [items that can’t be put in the same bag together], and all those kinds of things. This is why we have had to build all the technology that powers Ocado ourselves. We buy almost none of it, and that is because it is so unique.
IW: Interesting point. One of the things that cloud proclaims to offer is the ability to bring advanced solutions to those that might not otherwise be able to afford them. Is there not a gap in the market for grocery analytics-as-a-service?
PC: It is interesting you ask that because that is exactly what we are creating. We are building what we call the “Ocado Smart Platform.” We have been working on it for about 17 months now.
We are re-platforming our complete end-to-end solution around the cloud, and it is a modular scalable way of building automated warehouses. This will literally put some of the largest grocery retailers around the world online. We are talking to many of them and have been for months now.
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