The core strength of Pitney Bowes products and solutions is creating a powerful analytics around the location concept while also trying to simultaneously incorporate other aspects of context. Why was this necessitated and how is this achieved?
James Buckley:In our portfolio there are two core offerings. First is MapInfo for professionals, which is fairly horizontal GIS desktop product. We have seen substantial increase in the adoption of this product, and we have received overwhelming feedback from the market. We feel that it’s going to help us capture more of the core GIS market. It also has lot of capabilities specifically targeting key markets such as telecommunications, natural resource exploration, insurance, etc. We also have a strong presence in the international market.
The second product, which is again relatively new, is Spectrum Spatial. It has all of the capabilities that you expect in a GIS product. Our strength and key differentiation lies in geo-coding products. We are one of the only two companies which provide reverse geo-coding on a global basis. We provide both reverse and forward geo-coding capability, which gives us particular appeal in the global markets. In US, the top 25 insurance carriers and all of the major insurance underwriters use this product. The reverse geo-coding product has helped us carve out a special space in social media as well. Spectrum Spatial is made especially focusing on enterprise customers.
How are solutions integrated with other enterprise processes such as ERP etc.
JB: Since it is a new product, the architecture is modern. The key strengths of the product are not only power and performance but also ease of integration. The way we view the world today — and where we think the markets is going to head — is that technology like Spectrum Spatial will be required to sync and integrate spatial information with existing enterprise systems. That was the key vision based on which we have added value to our products. For example, in business intelligence systems’ integration, we were supporting eight BI systems; plus, smart result was a key part of this strategy. Then, the other important thing is the relationship with SAP. We believe the partner should be inside of everything. Gone are the days where enterprise GIS deployments worked in silos. We believe the market needs to change and Spectrum Spatial is about how we hope the market to change. It’s putting location intelligence right inside business systems and workflows.
From architecture and technology standpoint, we have a very strong line of products. In terms of differentiation, we have the best in class geo-coding. If you think about CRM system, being able to provide the capability to locate customers and then apply a digital contextual data to that to answer a question for our client, this is what geo-coding fundamentally does. The same can be said about ERP or other systems. The fact that we have the best geo-coding in the world gives us the edge over the others. This is followed with the need to provide a powerful Web mapping interface across organisation.
Another important part of our business is data quality and helping enterprises manage customer information across organisations. We think the key differentiators in markets like insurance is communication with customer, and adding context and location information to that. For instance, if someone wants to know the risk of insuring a property, the geo-coded location would give the agent an idea about the challenges and risks; and that would influence the premium. Spectrum Spatial has delivered great results in such situations.
Mitch Rowe: Spectrum has allowed us to build businesses. It provides us a platform through which we can now extend data to our customers. There are various types of data that organisations demand such as reference data, business data, data that is relevant to the customers for operational challenges within their business. Spectrum allows us to extend that data to the customer in a consumable format.
What are the organisational challenges that it can handle?
JB: In insurance, it is critical to automate underwriting process. Spectrum Spatial helps in automating it to a large extent. In telecommunication industry too, it has been an effective tool. How can you chain-up the whole portfolio right from RF planning for cellular networks? That is done either using mapping solutions natively or through partners. Then the output is taken back into the system, reference data and geo-coded customer data, etc. are added, and business owners are then able to see the data from a much broader perspective with geospatial elements attached to the information.
Pitney Bowes is also into data; and software without data is not very good for your customers. So are you also collecting, generating and becoming a data provider? Or is it that you take data from your providers such as TomTom and add value to it?
JB: One of the key things that differentiate us is that over the years we have built a powerful network of data suppliers. So we don’t go out and do physical data capturing in the field but our relationship with key organisations around the world help us in that. We work with few partners like TomTom, which provide us with data, and work with several government organisations like the one in Australia, Ordnance Survey in UK etc.
In a way, we are aggregating the data and then adding value to it. So if we take the world census data, then take consumer data, bring that together at various levels, apply that geographically, then our demographers add population projections, look at composition of different communities, etc. All these are adding value and a spatial dimension to the data. We have done that in Canada, US, Australia etc. Geocoding is the other example, where we bring multiple different datasets from postal services, from mapping providers like TomTom, and then we geo-code that data.
MR: We strongly believe that data enrichment is one of our key core competences and differentiators. Another example is Point of Interest data.
Location intelligence is also catering to the industry you have talked about, are you adding more industry verticals to your portfolio?
JB: Those are just examples of the markets where we already enjoy considerable success but our product portfolio includes horizontal location intelligence. We enjoy strong market positions in multiple vertical markets and geographies in the world.
Domain expertise is where our wide network of partners pitch in. Many of those create new applications using our data and add value to it. Sometimes they develop their own data. These products are used in markets where we do not operate directly. The rationale behind the SAP alliance is that both companies can drive, add and create digital value for SAP customers.
Who are your important customers in geo-coding space?
JB: All the markets I have mentioned buy geo-coding from us. The biggest customer probably would be insurance. It’s a mature market which understands the use of this technology.
Several companies such as Google Maps have further brought this to the attention of other verticals. But the relation we share with Facebook, Twitter and other social media company got them to realise how powerfully this technology can be integrated with their systems. Mobile advertising business, too, has seen a surge.
Can you elaborate on the concept of master location database which will be released soon?
JB: Master location database can be explained as centrally taking the largest dataset of US and pre- geo-coding it. Therefore, instead of you geo-coding the data, we pre-geocode and maintain it for you. We see it as a foundation as once you have this master location database you can then add contextual data relevant to your needs on top of it and add value to it. The initial release of master location data would be focused on US but we would be extending it to other countries where it would be relevant.
Are you looking at geo-coding the indoors?
JB: Yes, but it is part of our long-term strategy. What we plan to offer can be loosely defined as ‘vertical geo-coding’. Which means that we can add the elevation aspects to the data. So if I am on the ground floor of the roof, the data would have a different geo-code for that. We are working actively with companies in that space including TomTom. We are examining how we can create products around such mapping. When it comes to indoor location, I am not sure if anyone has solved the issues yet. There are different ways these can be done. While, Apple uses IP, others might use something else. We are watching the space, and I am sure that someone is going to crack this and come out with a brilliant way of doing it properly, effectively. Once that happens, the market will explode.
Pitney Bowes has a range of partners enhancing its products and offerings. Are you exploring more partners for providing more solutions?
JB: We have a pretty extensive partner network. In Asia, especially, we are mostly represented by our partners. In Australia, we have a substantial presence with over 300 people. It’s the third largest geography for us after the US and UK. We have a good presence in Japan too but the bigger share of business comes from the US and Western Europe.
SAP is one of them. Initially, it is around HANA business objects. But we are actively exploring new opportunities with SAP. We would be working with a number of different teams in SAP around specific solutions. We will also work as the geospatial partner to spatially enable SAP’s ecosystem. We are talking indirectly with several of their partners, but since we are in the middle of discussions, we cannot talk specifics. However, in coming months you will see what exactly we would be doing with SAP.
We did some projects around IBM’s BlueMix. IBM was a better programme so we put some capabilities that we already had in that marketplace on top of it. You will see us releasing some new products in the API market place later this year. It’s an experiment which has been very successful for us. But as we roll out those location based service APIs you will see us participating in multiple different API market place. This is one of the key routes to market. We have a number of products which I feel would be market-appealing; IBM BlueMix would be one of them.
MapInfo had started as a core GIS software but has found its niche in location intelligence. Similarly, Bentley was a core GIS provider, but now it has developed its niche in engineering and infrastructure. Do you see a complementing aspect with other software providers? Are you working with them?
JB: In the broader marketplace, we co-exist with multiple geospatial vendors and clients. We see complementing strengths in some of these players. We do and will continue to work with newer companies which provide differentiating capabilities and overlapping technologies.
MR: With these significant mature GIS companies, the opportunity to cooperate and partner is little prohibitive; competitive overlap and conflicting strategies being the reason. That being said, we have recently upgraded our membership with OGC with the vision to participate in the development of the industry for the benefit of the clients. JB: We recently joined founding members AT&T, Cisco, GE, IBM and Intel as a member of the recently formed Industrial Internet Consortium (IIC). The group catalyses, coordinates and manages the collaborative efforts of industry, academia and government to accelerate growth of the Industrial Internet. It also defines requirements for open interoperability standards and develops common architectures to connect smart devices, machines, people, processes and data. From the perspective of Pitney Bowes, location intelligence is critical to those because one of the biggest drivers of future growth of location intelligence market is going to be the power to remain connected with the Internet of Things. Pitney Bowes is a traditional enabler of commerce in the physical world through its postage business. We are moving towards helping organisations drive revenue, postal service and communications through our digital technologies and location solutions. In all these efforts and initiatives, geospatial will remain the primary driver of our business.
What is the share of your location intelligence revenue coming from US? And are you looking aggressively at developing and capturing the emerging markets such as China and India?
MR: A little over 50% of the business comes from US, 30% from AMEA, 20% from rest of APAC region. The point to be noted here is that ofz the 20% from APAC region, Australia has the biggest share. We have a good install base with the local state government in Australia.
We have a direct presence in India. We have a sales team of less than 10 people focusing on pre-sales, channel sales etc. For China, our model has primarily been channel partner dependent, and we support their activity from Singapore. We are working on some strategic initiatives to invest in some of these emerging markets such as China.
We are going to have more direct presence in these emerging markets. We have been going through due diligence process for last six months to put together what our next five years’ growth initiatives would look like. We are also assessing some of the emerging geographies where we can invest. We are ascertaining the regions which warrant investment on a priority basis.
Who do you consider as your biggest competitor in location intelligence space?
JB: We compete in horizontal GIS location intelligence marketplace, and the largest company in that space is Pitney Bowes. We are a Fortune 500 company. We compete with other horizontal players in the market. The other players, however, get a fragmented share of the market. So companies like Intergraph, Bentley etc, in their earlier incarnation would have competed with Mapinfo, but today, they coexist with us in this market. We have been integrating with others such as Microsoft Bing and HERE because we see opportunity in that. It is a complex landscape. It is one of the benefits of providing the opportunity to the industry to come together.