GE says data business on track for over $1 bln in sales

By Lewis Krauskopf

NEW YORK (Reuters) - General Electric Co said on Thursday it was on track to generate more than $1 billion in revenue this year from its industrial data-analysis business, and plans to make its software platform broadly available next year.

GE is making a big bet on what it calls the “Industrial Internet,” in which the company harnesses data from large industrial machines, such as power-generating turbines and jet engines, to yield productivity, efficiency and other improvements for customers.

GE, which posted $146 billion in total revenue last year, said it is on track for more than $1 billion in revenue from its "Industrial Internet" offerings this year, up from $800 million last year. The company targeted $4 billion to $5 billion in revenue from such products in 2017.

“This is happening today. This is no longer a vision about the future,” GE Chief Executive Jeff Immelt told an audience of customers, analysts and others at the company’s “Minds and Machines” meeting. “Every industrial company is going to be transformed in some way around data and analytics.”

The data-driven products add new revenue on top of what GE derives already through servicing its industrial products, a lucrative business.

Immelt said he hoped the new data analytics would help drive services revenue faster than its 5 percent historic growth rate.

The U.S. conglomerate several years ago said it would invest $1 billion to build a software center in San Ramon, California, that now employs 1,000 engineers and other workers.

“We’re going to invest to be a leader as this industry continues to evolve,” Immelt said.

GE's "Industrial Internet" business is powered by software called Predix, which analyzes data that helps a client's equipment run better, consume less fuel, receive service more efficiently and minimizes unplanned downtime.

The Predix software would be available to any company in 2015, GE said in a statement.

GE touts about 40 such data-related offerings. One aviation product, Flight Efficiency Services, helps airlines improve traffic flow and flight paths to help save on fuel costs. Another, Wind Power Up, allows wind farm operators to raise output by up to 5 percent by optimizing performance based on environmental conditions.

“We’re really doing this in every GE industrial business,” Immelt said.

GE shares were down 1.9 percent at $24.77 in late New York trading, in line with a broader U.S. market selloff.

(Additional reporting by Ankit Ajmera in Bangalore; Editing by Savio D'Souza and Nick Zieminski)