[House Hearing, 115 Congress]
[From the U.S. Government Publishing Office]




 DISRUPTER SERIES: THE INTERNET OF THINGS, MANUFACTURING AND INNOVATION

=======================================================================

                                HEARING

                               BEFORE THE

        SUBCOMMITTEE ON DIGITAL COMMERCE AND CONSUMER PROTECTION

                                 OF THE

                    COMMITTEE ON ENERGY AND COMMERCE
                        HOUSE OF REPRESENTATIVES

                     ONE HUNDRED FIFTEENTH CONGRESS

                             SECOND SESSION

                               __________

                            JANUARY 18, 2018

                               __________

                           Serial No. 115-91




[GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]







      Printed for the use of the Committee on Energy and Commerce
                        energycommerce.house.gov
                                     ______

                         U.S. GOVERNMENT PUBLISHING OFFICE 

29-593                         WASHINGTON : 2018 
                      
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                        
                    COMMITTEE ON ENERGY AND COMMERCE

                          GREG WALDEN, Oregon
                                 Chairman
JOE BARTON, Texas                    FRANK PALLONE, Jr., New Jersey
  Vice Chairman                        Ranking Member
FRED UPTON, Michigan                 BOBBY L. RUSH, Illinois
JOHN SHIMKUS, Illinois               ANNA G. ESHOO, California
MICHAEL C. BURGESS, Texas            ELIoT L. ENGEL, New York
MARSHA BLACKBURN, Tennessee          GENE GREEN, Texas
STEVE SCALISE, Louisiana             DIANA DeGETTE, Colorado
ROBERT E. LATTA, Ohio                MICHAEL F. DOYLE, Pennsylvania
CATHY McMORRIS RODGERS, Washington   JANICE D. SCHAKOWSKY, Illinois
GREGG HARPER, Mississippi            G.K. BUTTERFIELD, North Carolina
LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
BRETT GUTHRIE, Kentucky              KATHY CASTOR, Florida
PETE OLSON, Texas                    JOHN P. SARBANES, Maryland
DAVID B. McKINLEY, West Virginia     JERRY McNERNEY, California
ADAM KINZINGER, Illinois             PETER WELCH, Vermont
H. MORGAN GRIFFITH, Virginia         BEN RAY LUJAN, New Mexico
GUS M. BILIRAKIS, Florida            PAUL TONKO, New York
BILL JOHNSON, Ohio                   YVETTE D. CLARKE, New York
BILLY LONG, Missouri                 DAVID LOEBSACK, Iowa
LARRY BUCSHON, Indiana               KURT SCHRADER, Oregon
BILL FLORES, Texas                   JOSEPH P. KENNEDY, III, 
SUSAN W. BROOKS, Indiana                 Massachusetts
MARKWAYNE MULLIN, Oklahoma           TONY CARDENAS, California
RICHARD HUDSON, North Carolina       RAUL RUIZ, California
CHRIS COLLINS, New York              SCOTT H. PETERS, California
KEVIN CRAMER, North Dakota           DEBBIE DINGELL, Michigan
TIM WALBERG, Michigan
MIMI WALTERS, California
RYAN A. COSTELLO, Pennsylvania
EARL L. ``BUDDY'' CARTER, Georgia
JEFF DUNCAN, South Carolina

        Subcommittee on Digital Commerce and Consumer Protection

                         ROBERT E. LATTA, Ohio
                                 Chairman
                                     JANICE D. SCHAKOWSKY, Illinois
                                       Ranking Member
GREGG HARPER, Mississippi            BEN RAY LUJAN, New Mexico
  Vice Chairman                      YVETTE D. CLARKE, New York
FRED UPTON, Michigan                 TONY CARDENAS, California
MICHAEL C. BURGESS, Texas            DEBBIE DINGELL, Michigan
LEONARD LANCE, New Jersey            DORIS O. MATSUI, California
BRETT GUTHRIE, Kentucky              PETER WELCH, Vermont
DAVID B. McKINLEY, West Virgina      JOSEPH P. KENNEDY, III, 
ADAM KINZINGER, Illinois                 Massachusetts
GUS M. BILIRAKIS, Florida            GENE GREEN, Texas
LARRY BUCSHON, Indiana               FRANK PALLONE, Jr., New Jersey (ex 
MARKWAYNE MULLIN, Oklahoma               officio)
MIMI WALTERS, California
RYAN A. COSTELLO, Pennsylvania
JEFF DUNCAN, South Carolina
GREG WALDEN, Oregon (ex officio)
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
  
                             C O N T E N T S

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                                                                   Page
Hon. Hon. Robert E. Latta, a Representative in Congress from the 
  State of Ohio, opening statement...............................     1
    Prepared statement...........................................     3
Hon. Janice D. Schakowsky, a Representative in Congress from the 
  State of Illinois opening statement............................     3
Hon. Frank Pallone, Jr., a Representative in Congress from the 
  State of New Jersey, prepared statement........................     5
Hon. Greg Walden, a Representative in Congress from the State of 
  Oregon, prepared statement.....................................    68

                               Witnesses

Rodney Masney, Vice President, Technology Service Delivery, 
  Information Technology, Owens-Illinois.........................     7
    Prepared statement...........................................
Thomas D. Bianculli, Chief Technology Officer, Zebra Technologies 
  Corporation....................................................    16
    Prepared statement...........................................    18
Thomas R. Kurfess, Professor and Chair in Fluid Power and Motion 
  Control, George W. Woodruff School of Mechanical Engineering, 
  Georgia Institute of Technology................................    27
    Prepared statement...........................................    30
Sanjay Poonen, Chief Operating Officer, VMWare...................    36
    Prepared statement...........................................    38

                           Submitted material

Statement of the Electronic Privacy Information Center...........    70

 
 DISRUPTER SERIES: THE INTERNET OF THINGS, MANUFACTURING AND INNOVATION

                              ----------                              


                       THURSDAY, JANUARY 18, 2018

                  House of Representatives,
     Subcommittee on Digital Commerce and Consumer 
                                        Protection,
                          Committee on Energy and Commerce,
                                                    Washington, DC.
    The subcommittee met, pursuant to call, at 10:04 a.m., in 
room 2123 Rayburn House Office Building, Hon. Robert Latta 
(chairman of the subcommittee) presiding.
    Members present: Representatives Latta, Kinzinger, Burgess, 
Upton, Lance, Guthrie, Bilirakis, Bucshon, Walters, Costello, 
Duncan, Schakowsky, Clarke, Cardenas, Dingell, Matsui, Welch, 
Kennedy, Green, and Pallone (ex officio).
    Staff present: Karen Christian, General Counsel; Margaret 
Tucker Fogarty, Staff Assistant; Adam Fromm, Director of 
Outreach and Coalitions; Ali Fulling, Legislative Clerk, 
Oversight & Investigations, Digital Commerce and Consumer 
Protection; Elena Hernandez, Press Secretary; Bijan Koohmaraie, 
Counsel, Digital Commerce and Consumer Protection; Katie 
McKeogh, Press Assistant; Alex Miller, Video Production Aide 
and Press Assistant; Madeline Vey, Policy Coordinator, Digital 
Commerce and Consumer Protection; Hamlin Wade, Special Advisor, 
External Affairs; Everett Winnick, Director of Information 
Technology; Greg Zerzan, Counsel, Digital Commerce and Consumer 
Protection; Michelle Ash, Minority Chief Counsel, Digital 
Commerce and Consumer Protection; Evan Gilbert, Minority Press 
Assistant; Lisa Goldman, Minority Counsel; Caroline Paris-Behr, 
Minority Policy Analyst; Michelle Rusk, Minority FTC Detailee; 
and C.J. Young, Minority Press Secretary.

OPENING STATEMENT OF HON. ROBERT E. LATTA, A REPRESENTATIVE IN 
                CONGRESS FROM THE STATE OF OHIO

    Mr. Latta. Well, good morning.
    I'd like to call the Subcommittee on Digital Commerce and 
Consumer Protection to order. The chair now recognizes himself 
for 5 minutes for an opening statement.
    And, again, good morning and welcome to the first Disrupter 
Series hearing in 2018. Today, we are continuing the 
subcommittee's efforts to examine new and innovative 
technologies while learning directly from companies about what 
opportunities they see 5 to 10 years in the future.
    I'd like to thank all of our witnesses for being with us 
today and highlight that Owens-Illinois is headquartered in my 
district in Perrysburg, Ohio and I've been--we have held two 
roundtables on IoT and cybersecurity issues with local 
businesses at your headquarters and I appreciate that.
    Last summer, this subcommittee hosted a showcase with IoT 
companies for many of our member districts. We also held a 
hearing about how the IoT and interconnected network of 
physical objects embedded with sensors and communication 
devices that exchange information can improve productivity, 
increase response times, drive down costs, and benefit 
consumers. Today, we will discuss how IoT is making American 
manufacturing more competitive and how innovation is improving 
the lives of Americans. We will also learn about barriers to 
the continued expansion of IoT and what policy makers should 
keep in mind as the use of IoT expands.
    The ability of devices to communicate with other devices is 
revolutionizing industrial practices both in the United States 
and abroad. Already there are examples of smart components 
sending data about their performance and condition to workers 
who can monitor the equipment and if necessary replace it 
before it breaks down. Municipal water systems embedded with 
sensors can relay information about blockages or leaks that 
would help ensure that the water keeps flowing. Another example 
is how electricity providers can monitor electrical grids 
embedded with sensors and relays that can identify outages or 
surges, locate alternative pathways, and ensure that electrons 
keep flowing.
    Looking forward, the potential to further improve 
manufacturing processes through the combination of new 
technologies stretches the imagination. Utilizing IoT and other 
emerging technologies like augmented reality, workers will be 
able to virtually make adjustments to industrial systems to 
understand how to improve efficiency and then implement 
necessary changes without interrupting the manufacturing 
processes. IoT-connected factories will be able to monitor 
their need for raw materials and then order those materials 
from IoT-connected warehouses. IoT-connected transportation 
service providers will then deliver necessary products without 
the intervention of the human. These and other opportunities 
allow IoT-connected manufacturing centers the ability to devise 
their own ways to run more smoothly.
    Expansion-smart industrial processes will continue to 
create historic changes in how American companies build and 
deliver products. More efficient factories means that consumers 
will have more choices for the goods they purchase while being 
able to retain them at a lower cost. At the same time, like all 
new technologies, IoT will create disruption in the 
manufacturing economy. This disruption will create the need for 
new ways of educating and preparing our workforce both now and 
in the future.
    In addition, cybersecurity issues remain an ever present 
concern for an internet-connected service and the IoT is no 
different. Constant vigilance and improved coordination will be 
required to ensure that bad actors don't take advantage of the 
weaknesses in IT security policies.
    Today, we look forward to our witnesses describing how IoT 
is being leveraged in their facilities to improve manufacturing 
processes, how to address concerns around cybersecurity, how 
this technology is likely to develop in the future, and what 
policymakers can do to help promote continued innovation in 
American manufacturing.
    And with that, I will yield back the balance of my time and 
now recognize the gentlelady from Illinois, the ranking member 
of the subcommittee, for 5 minutes for an opening statement.
    [The prepared statement of Mr. Latta follows:]

               Opening statement of Hon. Robert E. Latta

    Good Morning, and welcome to the first Disrupter Series 
hearing in 2018. Today, we are continuing this Subcommittee's 
efforts to examine new and innovative technologies, while 
learning directly from companies about what opportunities they 
see 5 to 10 years in the future.
    Last summer, this subcommittee hosted a showcase with IoT 
companies from many of our Members' districts. We also held a 
hearing about how the IoT, an interconnected network of 
physical objects embedded with sensors and communications 
devices that exchange information, can improve productivity, 
increase response times, drive down costs, and benefit 
consumers. Today, we will discuss how the IoT has made American 
manufacturing more competitive and how innovation is improving 
the lives of Americans. We will also hear about barriers to 
continued expansion of the IoT, and what policymakers should 
keep in mind as use of the IoT expands.
    The ability of devices to communicate with other devices is 
revolutionizing industrial practices both in the U.S. and 
abroad. Already there are examples of smart components sending 
data about their performance and condition to workers, who can 
monitor the equipment and if necessary, replace it before it 
breaks down. Oil and gas pipelines, embedded with sensors, can 
relay information about bottlenecks or low pressure that will 
help ensure energy keeps flowing. Inventory and product is 
monitored in real time, finding more efficient routes and 
ensuring goods are delivered when and where they are needed.
    Looking forward, the potential to further improve 
manufacturing processes through the combination of new 
technologies stretches the imagination. Utilizing the IoT and 
other emerging technologies like augmented reality, workers 
will be able to virtually make adjustments to industrial 
systems to understand how to improve efficiency, and then 
implement necessary changes, without interrupting the 
manufacturing process. IoT connected factories will be able to 
monitor their need for raw materials, and then order those 
materials from IoT connected warehouses, which will communicate 
with IoT connected transportation service providers to deliver 
necessary products without the intervention of a human. IoT 
connected manufacturing centers will be able to devise their 
own ways to run more smoothly.
    The expansion of smart industrial processes will continue 
to create historic changes in how American companies build and 
deliver products. More efficient factories mean that consumers 
will have more choices for the goods they purchase, while being 
able to obtain them at lower cost. At the same time, like all 
new technologies the IoT will create disruption in the 
manufacturing economy. This disruption will create the need for 
new ways of educating and preparing our workforce, both now and 
for the future.
    In addition, cybersecurity issues will remain an ever 
present concern for any internet connected service, and the IoT 
is no different. Constant vigilance and improved coordination 
will be required to ensure that bad actors don't take advantage 
of weaknesses in IT security policies.
    Today we look forward to our witnesses describing how the 
IoT is being leveraged at their companies to improve 
manufacturing processes, how to address concerns around 
cybersecurity, how this technology is likely to develop in the 
future, and what policymakers can do help promote continued 
innovation in American manufacturing.

       OPENING STATEMENT OF HON. JANICE D. SCHAKOWSKY, A 
     REPRESENTATIVE IN CONGRESS FROM THE STATE OF ILLINOIS

    Ms. Schakowsky. Thank you, Mr. Chairman.
    The Internet of Things, of course, has tremendous potential 
to change manufacturing in the United States. Smart 
manufacturing can help businesses save resources, improve 
performance, and expand consumer choice. For example, a senior 
can remove the need for a human worker to physically check a 
machine. I didn't mean a senior. I meant a sensor. A sensor can 
remove the need for a human worker to physical check a machine, 
assuming everything works correctly. That sensor makes the 
worker's job easier and reduces the opportunity for human 
error.
    As the Internet of Things evolves, even more and more 
processes can be automated and this raises some familiar issues 
for subcommittee--privacy, cybersecurity, safety, and labor 
market impacts. Advanced manufacturing requires a different set 
of skills than the production line of previous generations and 
workers must be trained for these jobs, and we need to be 
responsive to the needs of workers who may be displaced by 
changes in manufacturing.
    We must also be mindful of accessibility. I think back to 
the autonomous vehicle legislation that the House passed last 
year that this committee worked on. Self-driving cars promise 
to open up new opportunities to those with disabilities. That's 
great. But some of those vehicles need to be accessible for 
people in wheelchairs, for instance, so that we can fully 
realize the potential to improve mobility. The same goes for 
manufacturing workers. Depending on how the technology is 
designed and integrated, bringing the Internet of Things into 
manufacturing could either expand or limit job opportunities 
for those, for example, with visual impairments or physical 
disabilities. In addition, we must ensure that businesses can 
get the full benefit of smart manufacturing. Often, a 
prerequisite for businesses to integrate new technologies is 
the broadband to support it.
    Last year, Democrats on the Energy and Commerce Committee 
unveiled a comprehensive infrastructure package--the LIFT 
America Act, which included a $40 billion investment in secure 
and reliable broadband. A serious infrastructure bill takes 
real dollars and I hope that we can work together to advance 
that type of job-creating legislation.
    I would also note that some of the advances we see in the 
manufacturing stem for research supported by the federal 
government. For example, President Obama established a national 
network for manufacturing innovation which included the Digital 
Manufacturing and Design Innovation Institute in Chicago, which 
I have visited. The Trump budget eliminates funding for the 
Manufacturing Institutes. The U.S. can only lead in research if 
we invest in research.
    We need a bipartisan deal to raise the budget caps on both 
the defense and non-defense side so that important investments 
in infrastructure and innovation can continue.
    I thank you, and I yield back, unless there is anybody who 
wants my remaining time. OK. I yield back.
    Thank you.
    Mr. Latta. Thank you very much. The gentlelady yields back.
    The chairman of the full committee has not arrived yet. But 
is there anyone on the Republican side wishing to claim that 
time?
    Not hearing anyone, the chair now recognizes the ranking 
member of the full committee, the gentleman from New Jersey, 
for 5 minutes.

OPENING STATEMENT OF HON. FRANK PALLONE, JR., A REPRESENTATIVE 
            IN CONGRESS FROM THE STATE OF NEW JERSEY

    Mr. Pallone. Thank you, Mr. Chairman.
    Since 2015, this subcommittee has been examining the 
opportunities and challenges of the Internet of Things, from 
autonomous vehicles to wearable technology. But the Internet of 
Things extends beyond consumer products. It can be found across 
industries including in the energy, healthcare, and 
transportation sectors, and today we will discuss how it can 
help make manufacturing more efficient, more productive, and 
more safe.
    The Internet of Things is used in smart manufacturing to 
make real-time control of production possible. Companies report 
that using smart manufacturing technologies lowers their energy 
use, reduces waste, improves product quality, and saves money, 
and with more efficient manufacturing we see less pollution, 
fewer health issues for our work force, and more opportunities 
for good technology-based jobs.
    As with all connected technologies, strong cybersecurity is 
essential to successful smart manufacturing. While the Internet 
of Things helps ensure that a manufacturer is monitoring, 
measuring, and sensing control systems work together, one weak 
point can affect the whole network. Imagine the potential 
consequences if a malicious actor brought down automated 
manufacturing at a pharmaceutical plant that makes vaccines or 
if network disruptions affect the quality control monitoring 
for seatbelts at an auto plant.
    Experts have found that companies in the U.S. are not doing 
enough to address these risks and that a strong comprehensive 
framework for cybersecurity in manufacturing is urgently 
needed. And also, unlike our smart phones, which seem to be 
replaced every few years, large machinery is used for decades, 
adding to the difficulty of ensuring they are consistently and 
properly updated for security vulnerabilities. And I have said 
at previous hearings on automation that we should not be scared 
of these new technologies but we must realize their potential 
effect on jobs. To stay competitive, we must ensure that 
employers are prepared for the changing workplace and we need 
to invest more in research and development so that the U.S. 
continues to lead the world in innovation.
    For years, we have listened to experienced witnesses in 
industry, academia, and government tell us that federal 
investment is vital if you want to keep making things in 
America. Unfortunately, the Trump administration proposed a 
budget last year that eliminates dozens of essential successful 
programs that make manufacturing innovation possible and 
provides support for U.S. factory workers. Moreover, industry 
witnesses repeatedly tell us what they really need is 
stability. Yet, Republicans have repeatedly failed to pass 
final appropriation bills for the fiscal year that began on 
October 1st and we are once again at a deadline tomorrow. It 
appears that Republicans are going to try once again to kick 
the can down the road. And with this delay, Republicans are 
adding even more instability, ultimately hurting American 
manufacturers and workers. I think those delays must end, but 
we will see.
    And I would like to yield the remainder of my time to the 
gentlewoman from California.
    Ms. Matsui. Thank you, Ranking Member Pallone.
    The Internet of Things and the industrial Internet of 
Things represents a shift in how companies and manufacturers 
interact with data. Smart manufacturing enables real-time 
monitoring and tracking of a company's assets through the 
manufacturing process. New technologies and tools can be 
critical to the means of facilitating the efficiencies promised 
by Industry 4.0. Of course, connectivity is a cornerstone of 
the next industrial revolution and wireless connectivity 
depends on the availability of spectrum.
    I believe that technologies like block chain could play an 
interesting role in both spectrum sharing to potentially 
maximize efficient use of spectrum bands and as a means of 
tracking digital records in real time.
    Thank you, and I look forward to the witnesses, and I yield 
back.
    Mr. Pallone. And I yield back, Mr. Chairman.
    Mr. Latta. Thank you very much. The gentleman yields back 
the balance of this time. This concludes member opening 
statements.
    The chair reminds members that, pursuant to committee 
rules, all members' opening statements will be made part of the 
record.
    Again, I want to thank all of our witnesses for being with 
us today. We appreciate you taking time to testify before us 
and it's very important to hear from you and your testimony.
    Today's witnesses will have the opportunity to give 5-
minute opening statements followed by a round of questions from 
the members.
    Our witness panel for today's hearing will include Mr. 
Rodney Masney, the Vice President of Technology and Service 
Delivery Information of Technology at Owens-Illinois; Mr. 
Thomas Bianculli, Chief Technology Officer at Zebra 
Technologies Corporation; Dr. Thomas R. Kurfess, Professor and 
HUSCO/Ramirez Distinguished Chair in Fluid Power and Motion 
Control at the George W. Woodruff School of Mechanical 
Engineering at Georgia Institute of Technology; and Mr. Sanjay 
Poonen, the Chief Operating Officer at VMWare.
    So we really appreciate you all being with us today and, 
Mr. Masney, you are recognized for your opening statement for 5 
minutes.
    Thanks again for being with us.

STATEMENTS OF RODNEY MASNEY, VICE PRESIDENT, TECHNOLOGY SERVICE 
  DELIVERY, INFORMATION TECHNOLOGY, OWENS-ILLINOIS; THOMAS D. 
    BIANCULLI, CHIEF TECHNOLOGY OFFICER, ZEBRA TECHNOLOGIES 
  CORPORATION; DR. THOMAS R. KURFESS, PROFESSOR AND CHAIR IN 
 FLUID POWER AND MOTION CONTROL, GEORGE W. WOODRUFF SCHOOL OF 
MECHANICAL ENGINEERING, GEORGIA INSTITUTE OF TECHNOLOGY; SANJAY 
            POONEN, CHIEF OPERATING OFFICER, VMWARE

                    STATEMENT OF MR. MASNEY

    Mr. Masney. Good morning to the members of the committee 
and to my colleagues who have travelled to Washington today to 
discuss the importance of the Internet of Things.
    Before I begin, I would like to thank Congressman Latta for 
his continued leadership and engagement on the issue. I also 
want to thank the committee for the opportunity to discuss IoT, 
which is important to U.S. manufacturing and my company 
specifically.
    Owens-Illinois, headquartered in Perrysburg, Ohio, is the 
world's largest manufacturer of glass containers, serving 
globally recognized brands throughout the world. Our company 
operates 79 manufacturing plants throughout the world, 17 of 
which are located in the United States. Glass making has 
historically been a trade where craftspersons and apprentices 
would develop expertise in the art of glass making.
    At the turn of the century, Michael Owens invented 
automated glass manufacturing, which was a huge step change in 
productivity and worker safety. While the glass making process 
is highly automated today, the industry is poised for the next 
step change, which will come from the factory becoming 
increasingly connected with IoT technologies throughout the 
end-to-end process. The information collected through IoT 
technology will be used to transform the craft of glass making 
to that of data-driven science which will enhance the 
competitive position of glass in the global packaging industry.
    Glass containers are the most sustainable option in the 
competitive packaging landscape with a life cycle that goes 
from cradle to cradle, reusable in many markets and infinitely 
recyclable into either new glass containers or other products. 
Glass is truly the sustainable packaging option. Owens-Illinois 
is on an IoT journey, which will transform our manufacturing 
process and add value to the products and services that we sell 
our customers.
    There are several IoT areas of focus for OI. Improve 
manufacturing performance through higher yields, increase 
quality, and reduce costs. IoT will deliver deeper insights 
into our end-to-end manufacturing process. The data generated 
from sensors in the plant will provide insights into 
environmental conditions, process settings, and control 
variances, enhancing our ability to increase first-time yields 
and improve quality. This work will require skilled engineers, 
information technology professionals, and data scientists. The 
data required through IoT will be used to reduce reaction time 
in the plants and allow us to adjust the process if controls 
are slipping out of tolerance.
    Addressing the variations in manufacturing process will be 
realized in a more proactive manner. The IoT platform will 
transform the glass manufacturing process from one of 
reactivity to one that is proactive and highly automated. The 
information generated by new sensor technology, data science, 
and information automation will increase yields and improve 
quality while achieving reduced costs and enhancing OI's 
ability to compete in the U.S. and global markets.
    Energy management and predictive maintenance are the second 
area of IoT development OI is pursuing. It takes a great deal 
of energy to melt and form glass and to operate a glass 
container manufacturing facility. Developing sensor technology 
can help glass containers maintain the status of the most 
sustainable packaging solution and reduce energy used to 
operate our furnaces. Advanced sensor technologies can also be 
used to collect information while monitoring equipment 
throughout the manufacturing facility and could be critical to 
seeking new ways to maintain equipment.
    IoT technologies and the concepts around IoT is enabling OI 
to also create and develop new and differentiated products and 
services for our customers with the goal to ensure the 
integrity, safety, and authenticity of its contents.
    I would like to highlight the several concerns regarding 
successful deployment and sustainability of IoT. Because the 
achievable deployment of IoT throughout an enterprise can be 
quite daunting, a successful deployment of IoT requires 
sensors, PLCs, IT systems, networking, massive amounts of 
storage and software to achieve the desired business outcomes.
    Seeking ways to make these investments more affordable can 
be a way to help U.S. manufacturing accelerate its investments 
in IoT technologies. Protecting against cybersecurity risks 
will become more critical while manufacturers deploy IoT in 
facilities. Manufacturing equipment devices, sensors, and 
control systems that previously may have been standalone, maybe 
exposed, not just within a plant location but also potentially 
throughout an enterprise.
    Cybersecurity-related disruptions could cause unplanned 
down time or impair productivity. Cybersecurity attacks could 
also put health and safety of employees at risk.
    Data scientists are in short supply and high demand. 
Transformation of the workforce becomes more critical. 
Tomorrow's manufacturing workforce must be increasingly 
knowledgeable about the use of information technology. 
Engineering disciplines and information technology skills will 
be needed to deliver and sustain these solutions.
    The use of business intelligence analytics and the role of 
data scientists will be critical to success of IoT.
    In conclusion, as manufacturers continue on the IoT 
journey, Congress may want to look into the following ways to 
help foster growth of IoT technology and its use, assist 
manufacturers and making IoT technologies more affordable by 
encouraging research and investment in these capabilities or in 
programs which encourage manufacturing companies to deploy IoT 
or programs and resources that address cybersecurity in U.S. 
businesses and encourage more research in the IoT data science 
discipline and seek ways to encourage a supporting pipeline of 
skilled workers through universities and manufacturing and 
related technical schools.
    Thank you for your time and attention.
    [The prepared statement of Mr. Masney follows:]
    
    
    
    
    [GRAPHIC(S) NOT AVAILABLE IN TIFF FORMAT]
  
    Mr. Latta. Well, thank you very much.
    And Mr. Bianculli, you are recognized for 5 minutes. Thank 
you very much for being with us.

                   STATEMENT OF MR. BIANCULLI

    Mr. Bianculli. Thank you, Chairman Latta, Ranking Member 
Schakowsky, and members of the subcommittee for the opportunity 
to testify before you today.
    I am Thomas Bianculli, the Chief Technology Officer of 
Zebra Technologies Corporation, and we are a global leader in 
bringing Internet of Things solutions to business-to-business 
and business-to-government markets.
    With approximately $3.7 billion in revenue, nearly 7,000 
employees, and doing business in more than 40 countries, Zebra 
is a trusted partner to more than 95 percent of all Fortune 500 
companies.
    And while many Americans may not know us by name, I am sure 
they come into contact with our solutions every day. For 
example, the bar code labels that are printed and applied to 
airline baggage tags or express delivery packages and 
pharmaceutical prescription bottles are often generated by a 
Zebra bar code label printer and tracked and managed by Zebra 
bar code scanning technology and mobile computers.
    Similarly, manufacturing, warehouse, and delivery workers 
as well as countless healthcare workers across the globe employ 
our mobile computing devices in their daily work to increase 
efficiency, reduce errors, and drive a better customer 
experience.
    Overall, what we see in the marketplace every day tells us 
that manufacturers and their supply chain partners are 
increasingly recognizing the transformational role of 
industrial IoT. Solutions in driving growth and improving 
performance in several key areas of business activity including 
increased total production and through put, improved ability to 
adjust to fluctuating market demand, and increased ability to 
produce a greater number of product variance, and increased 
visibility into operations across a given business enterprise, 
and a decreasing cost of production. All of these advances 
reflect the fact that, at its heart, the IoT revolution is a 
dramatic change in advancement in the way companies capture and 
ultimately share data.
    The ability to have data about inventory that's immediately 
available to both plant floor managers and suppliers is 
providing new levels of visibility that heightens operational 
performance and from the greater visibility comes the great 
advances we are seeing in manufacturing across a wide array of 
industries.
    In the opening comments from Chairman Latta, I heard 
mention of augmented reality and wearable technology. I think 
we should really keep that in mind as we see industrial 
Internet of Things creating more and more data. There is the 
opportunity to collect that data, analyze that data, and then 
use that information to inform a worker. And as we are starting 
to see that occur, we are seeing that mobile and computing 
technologies migrate from an interface that is handheld to 
interfaces that become heads up and are able to augment our 
physical reality with digital information that helps U.S. 
citizens and U.S. workers just get the job done. And I think 
that's an incredible opportunity for competitive advantage for 
us to help drive efficiency and to lead the world by way of 
example in that regard.
    Whirlpool Corporation wanted to optimize mobile device 
management at its distribution centers as a way of enhancing 
productivity. They were experiencing problems with misplaced 
devices, battery life, the inability to update devices in a 
systemic way, and a lack of data metrics around device 
performance. It needed a centralized management system to track 
device health, productivity, location, and ensure proper 
deployment. To solve their problem, Zebra worked with Whirlpool 
to employ an IoT-based solution which uses our mobile computers 
connected to their vehicle-mount computers and our handheld 
devices.
    We connected all of their devices back to the cloud across 
all of their facilities. We are able to manage to predictably 
detect when batteries may need replacing, when the performance 
and health of applications on the device, the resiliency and 
security of the network, and by monitoring all that information 
in near real time we can detect and proactively intercede if we 
see that a device is going to have a problem, thereby driving 
up the overall worker efficiency and uptime of their 
operations.
    Congress can play an important role in helping to ensure 
that all companies across America can successfully employ 
industrial IoT-based solutions. Specifically, we urge you and 
your colleagues to support infrastructure legislation that 
promotes the deployment of mobile broadband networks as well as 
directs the NTIA and FCC to allocate more commercial licensed 
and unlicensed spectrum in a technology-neutral way. 
Additionally, we urge Congress to advance policies that will 
help assure coordination among government agencies so that 
regulation of IoT does not needlessly impede innovation.
    In sum, Mr. Chairman, we commend the subcommittee for 
holding this hearing, for your ongoing efforts to ensure that 
American industry has the ability to continue to roll out new 
technologies that will improve the lives of both our workers 
and our citizens.
    IoT presents a transformative opportunity, some calling it 
the fourth industrial revolution, the advent of cyber physical 
systems that will create opportunity for jobs of all types and 
sizes across the United States to work smarter, be more 
productive, and help improve the overall American economy.
    At Zebra, we are committed to bringing IoT solutions to 
companies to help them achieve their goals. We look forward to 
continuing to work with the subcommittee and I thank you for 
the opportunity to share a Zebra story, and I am happy to 
answer any questions you and your colleagues may have.
    Thank you.
    [The prepared statement of Mr. Bianculli follows:]
    
    
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    Mr. Latta. Thank you very much.
    And Dr. Kurfess, you are recognized for 5 minutes.
    Thank you.

                    STATEMENT OF MR. KURFESS

    Mr. Kurfess. Thank you, Chairman Latta, Vice Chairman 
Kinzinger, Ranking Member Schakowsky, and other members of the 
committee.
    I do appreciate the opportunity to testify here before the 
subcommittee. So I am Tom Kurfess. I am at Georgia Tech. The 
difference between my colleagues here and myself is our product 
or our students. For example, mechanical engineering produces 
about 3% to 4% of all the mechanical engineers in the Nation 
and these kids are extremely capable and really moving a lot of 
the IoT forward.
    I have spent a lot of time in manufacturing. I grew up 
actually in a plant in Congresswoman Schakowsky's district. I 
went to high school there and so forth--a small family plant. 
So I've been in production for over 40 years. And if you look 
at it, we talk about the fact that, yes, it's going to take a 
lot of money to sensor up, as we would say it. But there are 
already a lot of sensors out there and they're providing free 
information to us and so forth.
    So there are a lot of sensors. They're generating big data. 
The companies know this and we are starting to track this. My 
team works with two major U.S. OEMs in automative, a major OEM 
in aerospace and several large-scale suppliers to figure out 
what their digital manufacturing platforms need to look like. 
And, basically, all the data are there for the taking and how 
are we going to make use of them, right. And then the question 
is what can we do with it.
    Well, certainly, we can improve efficiency. I think we've 
heard about that. We could lower our energy consumption. We can 
lower our waste. This is very clear. It's been demonstrated 
time and time again. I've spent a lot of time actually over at 
the BMW plant in South Carolina--tremendous opportunities there 
in terms of moving it forward. A safer work place--certainly, 
the more sensors you have out there, you know what's going on. 
You can make sure that your employees are safe and you can make 
sure that those machines keep them safe and actually make their 
jobs easier and more reliable. But perhaps a very important 
point that we need to really understand is that this capability 
allows us to respond rapidly to the changing markets and the 
changing technologies that are out there, and those 
technologies and markets are changing rapidly.
    It took about 70 years for the telephone to become 
ubiquitous. It took about 10 years for the mobile phone to 
become ubiquitous. It took about a year for the smart phone to 
become ubiquitous. This is how fast things are changing. So we 
can have a safer place, a place that responds better, and what 
industry doesn't want to respond better and faster?
    What do we get out of the Internet of Things for 
manufacturing? First of all, there are better paying jobs. 
There's no doubt about it. But I will caution you, and I will 
say this again, it requires a much lower-skilled workforce and 
a better trained workforce. But it's not impossible to do. I 
think we just saw over here, and I will wave mine around too, 
people are used to the smart phone. This is not something that 
they're afraid of. We can get them to use it and actually we 
are using smart phones in production operations day in and day 
out at a number of different corporations.
    We get a stronger, more productive manufacturing base, 
which is always good for the Nation's economy and national 
security, and we basically excel in the strengths of the 
culture of the United States of America.
    We are innovative, right. We have some of the best ideas 
and what this technology allow us to do, IoT for MFG, as we 
call it, it allows us to get these ideas out there rapidly and 
not just out there but to scale them in terms of the market. 
And you know, if somebody else wants to copy us, come get us, 
because by the time you copy us, we'll have our next 
technologies out there and we can see how fast these things are 
moving along.
    So how do we get there? Basically, we have to look at 
workforce development. I heard cybersecurity a number of times. 
This is critical. People--and we've actually seen at companies 
where they say, no, we are going to not do this because of 
cybersecurity issues. They have now come to the realization 
that we have to do this if you're going to compete, and we are 
looking at cybersecurity. We have a lot of, for example, 
national apps.
    NIST is doing some great work in cybersecurity analysis and 
so forth in conjunction with our universities and a variety of 
companies. So it's there. We are thinking about it. We are 
working on it and we are beating the bad guys in most cases. We 
have to develop that infrastructure to make sure that that 
broadband connectivity--I heard that, right--that is so 
important.
    Again, the low-cost labor areas, yes, you see their shiny 
new factories but a lot of low-cost labor areas don't have that 
type of connectivity. We can leverage that. We could make use 
of that. That is where we can compete.
    We also need to take a look at our universities. Right. How 
do we leverage our universities? How do we leverage our 
national labs--places like NIST and bring them together? I 
heard the National Network for Manufacturing Innovation, 
Manufacturing USA. This is where companies are coming together 
to really move things forward for the United States of America 
and this is where we can really leverage these things. So, 
basically, this is going to allow us to rapidly address a 
changing market, not just what people want but what the 
technology is when it comes out there.
    The bottom line is IoT for manufacturing it's going to 
grow. It's going to grow high in jobs. But that basically means 
not just workforce development and workforce training, not 
training the next generation workforce but training the current 
generation workforce. It can be done. We can't compete on the 
low-end jobs. We just can't, right. But we can compete on the 
high-end jobs and people are not afraid of the technology. It 
is amazing. We are doing Pokemon out in the factories right now 
and they're tracking things, and they love it, OK, and their 
reward might be to get off a couple of hours early on a Friday 
afternoon. But it allows to grow the national economy, to grow 
key sectors of the national economy--high-tech sectors--to 
strengthen our national security, to make sure that we are able 
to move forward in a rapid a nimble way.
    Thank you very much.
    [The prepared statement of Mr. Kurfess follows:] 
    
    
    
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    Mr. Latta. Again, thank you for your testimony.
    And Mr. Poonen, you are recognized for 5 minutes for your 
opening statement. Am I pronouncing your name correctly, sir?
    Thank you.

                    STATEMENT OF MR. POONEN

    Mr. Poonen. Dear Chairman Latta, Ranking Member Schakowsky, 
members of the subcommittee, and my honored colleagues from 
academia and the industry, it's an honor to be here to testify 
in front of this committee.
    And by way of instruction, my name is Sanjay Poonen. I am 
Chief Operating Officer of VMWare. VMWare is one of the top 
five software companies in the world, about a $54 billion 
market cap company. We are headquartered in the Silicon Valley 
in Palo Alto. We are also part of the Dell Technologies family.
    It's very clear from a lot of what you have heard already 
that the Internet of Things and IoT has a profound impact on 
the consumer economy and also in the industrial age. I will 
just give you two examples of how our lives have changed. One 
is from my past job. I worked for a German software company, 
SAP, and many of the meetings that I had would actually be at 
1:00 p.m. in the afternoon, German time, which is 5:00 a.m. 
Pacific time. So mean scheduled, I go down to my home office 
and I find out that overnight some person had the great joy of 
canceling the meeting. Now, listen, wouldn't it have been nice 
if I could have known that before I went to bed and I could 
have probably woken up an extra hour later? Well, it would be 
nice if once the meeting is canceled it actually communicated 
with my alarm clock that actually set my clock up an hour 
later, which is very much possible today with IoT because often 
the alarm clock and your calendar is on the same device.
    Another example--when I leave to go to ski--not a lot of 
snow this year in Tahoe but the years that we do have snow, 
we'll have a debate with my wife as to whether we turn the 
heating off. And I like to keep the energy down and keep the 
house not necessarily heated all the time. She wants to keep 
the house warm for our kids when we come back home. Well, now 
with modern thermostats you can actually turn your thermostat 
on or off from your phone when you get about an hour closer to 
NIST and many others are doing this.
    So this is the practical way in which our consumer lives 
are being transformed for the better with IoT and this is now 
starting to invade the American worker. And manufacturing 
actually becomes enormously smart, as you heard, because of 
this and it has profound impact, we believe, in lots of new 
areas--artificial intelligence, big data machine learning that 
can be very positive as opposed to as much as what's also been 
talked about, the negative impacts. But it does have some 
profound security challenges and that's been a key part to 
VMWare's focus. VMWare's focus is to ensure that the cyber 
attacks that we've seen, whether it's WannaCry, Petya, many of 
these things that could get even more profoundly disruptive in 
the context of IoT is something that we can attack and we can 
protect ourselves from.
    So we've actually been focused on aspects of cybersecurity 
and cyber hygiene that allow companies to protect themselves in 
this era of IoT.
    We've got some very practical ways in which management 
security would be baked into the infrastructure of both 
technology and manufacturing.
    We think that everybody today, whether you're in technology 
or not in technology, need to be educated in some very 
fundamental principles of security, like, for example, lease 
privilege, micro segmentation, multi factor authentication and 
identity management, encryption, patching. These are all very 
fundamental concepts that board members today are being 
educated on and certainly government and other professionals 
need to.
    As we think about the notion of hardware, that's also 
getting more sophisticated. We heard about mobile devices and 
rugged devices--one of my colleagues. Edge gateways now are 
becoming ways by which this miniature data center could 
actually become micro into something like a little nano data 
center, protected and ready for the production line. These are 
the ways in which we believe that the Internet of Things and 
smart manufacturing can actually be secure.
    In closing, the Internet of Things will have a significant 
and positive impact, we believe, on both American innovation 
and jobs. Billions of IoT devices will be in the free market 
for consumers, will be available to manufacturing and can have 
a very positive impact. But to make sure that this is actually 
deployed in a safe fashion, security is key. If consumers are 
to trust these devices and manufacturers were to trust these 
devices, we've got to take security seriously and we believe 
that this is something that both the coming together of 
academia, of industry and the government makes this a priority.
    We look forward to working and doing our part at VMWare to 
make this happen. The other aspect of this that could be very 
positive is the way and which the data can actually help a 
whole new category of jobs, whether it's machine learning, big 
data, artificial intelligence.
    This is going to be the next color of jobs, and much the 
same within the agrarian culture. A hundred years ago we 
couldn't see the coming of computing and high tech the same way 
the next 50 to 100 years are going to be very exciting in terms 
of new jobs.
    Chairman Latta, Ranking Member Schakowsky, I applaud the 
leadership of this committee for holding this hearing today. 
Thank you for the opportunity to testify and I look forward to 
answering the committee's questions.
    [The prepared statement of Mr. Poonen follows:]
    
    
    
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    Mr. Latta. Well, again, thank you all for being with us 
today. We really appreciate your testimony before the 
subcommittee.
    And now we'll move into our question and answer portion of 
the hearing, and I will recognize myself for 5 minutes.
    Mr. Masney, what are the major advantages for OI that come 
from using IoT? And, again, I've been through the facility in 
Perrysburg where you do a lot of the testing and seen a lot of 
what you're implementing there. But if you could maybe just 
walk us through what you're doing.
    Mr. Masney. Certainly. Some of the advantages are increased 
productivity in our manufacturing facilities. As I said in my 
statement, glass is still somewhat art, and we need to 
transform to data-driven science manufacturing process where we 
can increase our yield.
    Glass manufacturing yield is somewhere in the 90 to 91 
percent yield rate. If we are able to do that, we are able to 
unlock potential and capacity out of our factories and better 
serve the markets and, ultimately, reduce our cost to our 
customers.
    Mr. Latta. What are some of the challenges that you're 
facing out there today in the home manufacturing process then?
    Mr. Masney. And having enough of knowledge base in a 
workforce that has a demographic that is changing. The 
degeneration of knowing what to do, when to do it, is changing 
in our organization, and being able to empower people with 
information so that they can react faster and more nimbly is 
incredibly important. And cyber security--that is a concern 
today because many of our machines and equipment stand alone. 
So they're not exposed to cyber attack. And as we network them 
and collect more and more information to better empower our 
workforce it's going to be incredibly important that we protect 
the floor, our people, and the company.
    Mr. Latta. Thank you very much.
    Mr. Bianculli, can you give us an example of how a sensor 
can be used to convert data from a format that allows companies 
to improve manufacturing efficiency?
    Mr. Bianculli. Sure. I think a couple of examples there--
one is just driving operational efficiency. I mentioned the 
Whirlpool example earlier, where we just have a stream of data 
coming from devices. Well, just like we've done that with 
Whirlpool on device health, we are looking at doing that with 
the entire manufacturing facility.
    So imagine, if you will, a smart manufacturing environment. 
We know where goods are. We know where the capital assets are 
in that environment. We can know where people are located and 
we can bring the intersection of all those things together in 
an optimized way.
    We think about our daily lives using a route navigation GPS 
system in our vehicles. The incredible amount of advantage--the 
ability to dynamically reroute based on whether in traffic in 
real time and think about going from outside the four walls to 
an inside the four walls factory environment and being able to 
bring that same level of route optimization, work flow 
efficiency, dynamic work flow optimization to the processes by 
instrumenting the environment.
    I think that as we look at data coming from these 
environments we are moving toward a world where we no longer 
operate on what we think is happening--where do I think my 
people are, where do I think my assets are, where do I think 
inventory is--we are operating in a world where we truly know 
that in real time.
    And so we are able to close this gap between what we think 
is happening and what we would ideally like to be happening and 
that is where the benefit is--the efficiency benefit. The 
return on investment is being able to close that gap. And so 
you can run your operations in a much more precision way and in 
a way that's optimized from the get-go.
    We are seeing the imperative to do that because of the on-
demand economy. The notion that products and services are being 
delivered ever closer to the point of demand is a reality. We 
order online and the expectation is that product or good or 
service is delivered sometimes in an hour to our doorstep if 
it's a package that we ordered online and we live in an urban 
city, or in some cases I am standing at a street corner and I 
request a ride and in moments I expect that to show up.
    So the production and provisioning of products and services 
ever closer to the point of demand dictates, mandates, it's an 
imperative that we have IoT solutions that are able to create 
real-time streams of data to enable that new reality to propel 
us forward.
    Thank you.
    Mr. Latta. Thank you.
    Mr. Poonen, I guess in my last 40 seconds--this is going to 
be quick--this deals with how to manufacturers manage the 
threat of cyber attack disrupting their operations?
    Mr. Poonen. OK. Good.
    Yes, I think one of the things that we have learned, 
Chairman, sir, is that in this world of mobile, this device is 
not sort of a remote control to your life.
    We've learned a lot about security in the last 10 years 
with the mobile device. These operating systems have adapted 
themselves from the PC era to have even greater level of 
security, whether it's Apple iPhones or Android devices. Some 
of the security things that you saw in the early days of 
Windows. And even the PC operating systems, latest version of 
Windows 10 are better at being able to----
    We respect that same innovation, and this country has got 
some of the best research, whether it's from academia or other 
places. We'll continually pour it into the operating systems 
that run on these IoT devices. That's one, and we expect that 
to just have a greater and greater level of enterprise 
hardening.
    Secondly, the devices and the systems that they talk to, 
whether it's the data center or the cloud, will have the types 
of things that I talked about--cyber security, security 
infrastructure baked into it that have the types of things like 
segmentation, multi factor authentication, encryption. And we 
are learning from all of the attacks that have happened to make 
those also systems hardened.
    And then the third and final thing is just basic hygiene, 
and sort of just like you have a good diet, you do your 
exercise, you still have to have certain hygiene principles--
brushing your teeth, taking a shower, things of those kinds.
    We've got to educate government, industry, academia, 
college students, so that as they approach the workforce there 
are simple things you probably want to do.
    You may not want to send your password, for example, in 
clear text on a text message. These are the types of things 
that--and you may want to change your password--these are the 
types of things that I think are very easy for us to continue 
to educate that make us all a much more secure society and a 
secure infrastructure for IoT.
    Mr. Latta. Thank you very much.
    And the chair recognizes the gentlelady from Illinois, the 
ranking member of the subcommittee, for 5 minutes.
    Ms. Schakowsky. Thank you.
    First, Owens-Illinois--are you still in Illinois at all?
    Mr. Masney. Yes, we are. We are in Streeter, Illinois.
    Ms. Schakowsky. OK. Glad to hear that, being from the 
Chicago area.
    I think I, years ago, saw the plant. Were you over in 
Granite City, down in southern Illinois?
    No. OK. Let me ask Dr. Kurfess some questions.
    How do workers in manufacturing stand to benefit from the 
adoption of these technologies? Can the IoT be used to, for 
example, positive things--prevent workplace injuries, limit 
workers' exposure to hazardous materials, et cetera? And what 
are some of the pluses of IoT for workers?
    Mr. Kurfess. Sure. It's a great question.
    There are a variety of things that could be going on, for 
example, worker going through the factory. If you have been, 
for example, to an automotive factory you see the robots going 
on. They're moving, they're working. These are carrying 
sometimes in the thousands of pounds. So they're very powerful 
robots. And you'd never let a human get close to them. But now 
you have the robot area. You have the human area, and the 
reality is now with IoT of things, and again, one has to be 
careful about this issue of privacy and so forth. But I am even 
walking down with my phone. I know where people are. So if 
somebody walks into an incorrect area, we can shut it down and 
make sure the roadblock doesn't hurt them. But even better, we 
can start to localize it better--a much tighter resolution such 
that the robots can be working with the people.
    Robots are great. But they're never going to replace people 
completely. They're great at lifting really heavy things but 
try and pick up an egg with one and so forth. We have great 
research on that. But again, working together is really where 
you leverage it and, by the way, it also allows us to get rid 
of a lot of the really nasty jobs. You're taking away the 
terrible jobs, checking cooling tanks and lubrication tanks and 
machines. That's all automated. In fact, this morning I was 
down in your cafeteria and I saw your coffee containers--the 
coffee urns. They have the same technology that we are using 
now in there. It's about 50 cents and so the only difference is 
ours are online and so they're reporting the information. But 
we are talking with companies like Chik-fil-A and McDonald's 
about how to do that for improving their efficiency.
    So these are the types of things we see out there.
    Ms. Schakowsky. Well, I am also very interested in keeping 
manufacturing jobs in the United States and bring them back, 
and you wrote in your testimony that America's infrastructure 
gives us an advantage there. I would like to hear more about 
that.
    Mr. Kurfess. Sure. Well, if you look at everything from our 
roads to broadband and so forth, and again, these are things 
that people really use all the time. Whether it's broadband or 
you're wired into your factory or broadband, over here, that 
capability and that growing of that capability allows us to 
take the big data generated by all of these different sensors, 
and in some instances, again, it's not just well, I've have a 
bunch of sensors, but in some instances I've got this phone 
with this really nice camera and we have our workforce taking a 
picture.
    So now we are combining the workforce who says oh, this is 
good, this is bad, taking the picture. That integrates the 
information together. But you have got to get that out 
streaming all of the data and it is a lot of data. And then, of 
course, the other infrastructure of these, the educational 
infrastructure. If you think about the technology from even 5 
or 10 years ago, it's old. So we've got to keep that work force 
spun up. Lifelong learning and that infrastructure needs to be 
put into place so that today's worker is still viable in 5 or 
10 years.
    Ms. Schakowsky. Well, I was going to ask about that 
because, the role of government and, certainly, public 
education is a part of that, but there's also federally funded 
research, et cetera.
    So government does have a role to play then, doesn't it?
    Mr. Kurfess. Oh, definitely. And all the way--again, you 
know, from the K through 12 that we hear about education and so 
forth to our Bachelors students or Masters and Ph.D.s, if you 
take a look at National Science Foundation, I was sponsored at 
MIT, right, as a National Science Foundation on a project 
there. A good chunk of our graduates, Masters and Ph.D.s in 
engineering, technology, and in science are supported by the 
National Science Foundation.
    Again, that's something that you don't really see but 
they're supported as research assistants and this is a very 
important thing to move forward, the entire infrastructure for 
the Nation.
    Ms. Schakowsky. I appreciate that.
    So I am concerned because spending plans that we've seen 
from Republicans make drastic cuts to many of these things and 
to programs that directly support manufacturing and innovation, 
including President Obama's Manufacturing USA initiative.
    So these cuts, I am assuming, then could be a barrier to 
progress?
    Mr. Kurfess. Yes. I think that what you have to look at is 
in the short term it's fairly easy to make a cut like this and 
so forth. But really, the Federal Government--we don't have 
AT&T Bell Labs anymore. We don't have really long-range 
thinking companies. They're focusing on the here now, and I 
don't blame them. The Federal Government has to step in there 
and really do some of the longer range thinking. I guarantee 
you, China's doing it. Germany's doing it. You name it, other 
countries are doing it. We need to do it.
    So in 5 years, in 10 years, we are positioned to continue 
to move forward. This is really, again, what we really need to 
be looking at a little bit longer term and that's what these 
R&D capabilities are all about that we are talking about.
    Ms. Schakowsky. I appreciate that, and I yield back, Mr. 
Chairman.
    Mr. Kurfess. Thank you.
    Mr. Latta. Thank you very much. The gentlelady yields back.
    The chair now recognizes the gentleman from Illinois, the 
vice chair of the subcommittee, for 5 minutes.
    Mr. Kinzinger. Thank you, Mr. Chairman.
    And just to go off with what you were saying, sir, I agree 
with you. I think there's a role for the government in terms of 
long-term strategic planning that sometimes gets lost in the 
kind of momentary debates which is, as we look at world that 
changes, whether it's with IoT, whether as we look at 
autonomous vehicles, which this committee deals with and all 
that kind of stuff, we have to have people that are thinking 
long range and beginning to prepare our workforce for what that 
future looks like. It doesn't mean the heavy hand of government 
but it also means let's consolidate some of these programs we 
have and try to incorporate a vision which some of our 
competitors, unfortunately, do all too well.
    I want to thank the chairman for yielding and I want to 
thank you all for being here. I am excited. I have two 
companies represented here that have a strong presence in 
Illinois--Zebra and Owens-Illinois.
    Zebra is based in Lincolnshire, Illinois, which, now that 
the economy is expanding maybe you can build one in my district 
too because there's no presence there yet. But we'll take it in 
Illinois.
    And Owens-Illinois, of course, does have a strong presence 
in Illinois. Somehow they're headquartered in Mr. Latta's state 
but we can talk about that, too.
    And as Mr. Masney said, there's an OI facility right in 
Streeter, Illinois, and in my district. So proud to have you 
there. You provide good-paying jobs. I was able to visit a few 
years ago and have been very impressed by what I've seen.
    I would like to ask the panel, talking about the 
development of IoT, does that mean that American workers will 
require new training and what are companies doing to obtain a 
skilled workforce?
    I would like one or two of your to answer that with your 
perspectives.
    Mr. Bianculli. Sure. So yes, absolutely, happy to have our 
presence in Lincolnshire and we should talk later.
    Mr. Kinzinger. Yes.
    Mr. Bianculli. So yes, with regard to that, worker 
training--I think the future we are talking about here isn't 
going to arrive evenly.
    We are going to see certain areas. We are already seeing 
IoT drive location technology being used to control drones in 
site facilities to be able to--in manufacturing plants, 
actually, to be able to detect inventory in a more automated 
fashion.
    The ability to have robots deployed in a distribution or 
fulfilment center--but what's happening in those environments 
today is--let me take the robot example where goods now are 
bringing--taken to the picker. If you have a human, at the end 
of the day, doing that picking for those online orders to 
fulfil those orders, and the goods are being brought to them 
instead of them walking to the goods.
    And what does that mean? There's no job taken away. There's 
just several less miles a day that that worker is going to 
walk. That means there are many more picks per hour that worker 
can do.
    And so we are in a world now and will be for some time 
where humans and machines and automation, whether it be 
physical automation or it be artificial intelligence augmenting 
the worker, basically, a digital assistant----
    Mr. Kinzinger. And I just want to add onto that.
    If you look at the example, for instance, around Europe, 
the Germans are very good at manufacturing. They have a very 
low unemployment rate. But they are also embracing this kind of 
future technology.
    So we don't have to be scared of the future because it's 
coming. We just have to figure out how to lead and innovate in 
that process.
    I will go on. Mr. Poonen, when you talk about the Internet 
of Things, does that create new concerns when it comes to 
intellectual property?
    For instance, does the data collected in IoT manufacturing 
reveal anything proprietary that companies might want to 
protect?
    Mr. Poonen. Yes, sir.
    I think that one of the things you have to first remember 
is that the first wave of IoTs being able to take away mundane 
tasks and make them something that could actually be done more 
autonomously, I will give a very simple example.
    You don't want to watch me parallel park a car. I am 
terrible at it. That's a perfect job for a machine to do better 
than a human because it's a combination of cameras and 
geometry, and it'll probably parallel park better than you.
    But my value add long term isn't parallel parking. So what 
we want to be able to do as the next wave of economy shows up 
is to ensure that you have got the appropriate privacy and 
security baked into many of the machines. And there's a whole 
dedicated work of security being focused on the devices and 
what's on there and we have to make sure that there's standards 
also because the same type of privacy that applies to peoples' 
homes, people are worried as to whether or Alexa or Siri is 
always listening to you. Those are the types of things that 
standards need to be applied both from the government and 
industry working together, and I believe that this is 
absolutely solvable in the same say that the industry and 
government work together on standards like common criteria.
    This will be applied to the new world of IoT in the coming 
years, we believe.
    Mr. Kinzinger. And Mr. Masney, what's the trend when it 
comes to the cost of deploying IoT? Can you envision a day when 
the entire manufacturing process, from the procurement of raw 
materials to the delivery of the finished project, is 100 
percent automated without human intervention?
    Mr. Masney. No, I can't envision a day like that. It still 
takes human beings on the manufacturing floor to make things 
happen and make sure things are moving forward.
    I will share with you, in Streeter, Illinois it is one of 
our facilities where we are delivering what we call the factory 
of the future for the organization and invite you to come see 
that at some time that make sense.
    But, certainly, we are still going to need the capability 
to have people on the floor that can run machines, be ever 
present, make sure things are running safely, that productivity 
continues to move forward.
    Our innovations are around more flexibility and making sure 
that we can be more responsive to our customer base. And IoT is 
another area where we think we can do that as well.
    Mr. Kinzinger. Thank you all for being here, and I yield 
back.
    Mr. Latta. The gentleman yields back, and the chair now 
recognizes the gentlelady from California for 5 minutes.
    Ms. Matsui. Thank you very much, Mr. Chairman. I want to 
thank the witness panel. This is absolutely fascinating to know 
what's going on now and what the possibilities are too in the 
future.
    Digitally connected supply chains have the potential to be 
an important component of the industrial Internet of Things. 
Just in time, manufacturing promises to drive down the need for 
storing excess inventory and allow suppliers to anticipate and 
deliver the materials manufacturers will need more quickly.
    Decentralized ledger technologies like block train can make 
supply chain transactions faster and cheaper by securely 
connecting manufacturers and suppliers in real time.
    I would like to hear from Mr. Poonen and Mr. Kurfess what 
are your thoughts on technology such as block chain and others 
and its ability to play a role in IoT manufacturing and 
security.
    Mr. Kurfess. Sure. So it's a great set of questions and the 
reality is the distributed capability, whether it's block 
chain, or any of these other distributed capabilities.
    These are going to be critical in terms of moving things 
forward. If I've got a supplier, only one supplier that 
supplies me with parts, and if I say tomorrow, oh, I was at 
Toyota--how is it going there, this was in Kentucky, and they 
said, well, great, we've got very, every 6 hours we can get 
parts from Denso and so forth--we are very lean. We have very 
small inventory. You go to Denso--how is that working for you? 
Well, we've got two or three months of supply back there 
because we don't know what they're going to ask us.
    Now, they're starting to figure out how they're going to 
ask together. But imagine if instead of one big company, Denso, 
we had a bunch of smaller companies that could supply this.
    So, yes, if I need 500 parts, as opposed to having one 
company say can you make 500 parts, I could go to a hundred 
companies, local companies, mom and pop shops, and say, I need 
five parts, or how many can you supply--five, ten.
    And all of a sudden you can bring that together. You not 
only can get those parts there--and by the way, you could use 
something like an Uber to make a delivery, right. Again, back 
to the infrastructure, it's there to pull it off.
    But now you also have a very resilient supply chain. If one 
goes down, you don't have to worry about it.
    Turning that around as well on the educational side, you 
can take at what are these guys doing and, you know, where do 
they need more training and let's get them that training.
    We could even percolate that down into our colleges and 
into our high school levels so we can deliver the education to 
the workforce and we can even start to send the right students 
in the right direction to really engage them.
    So lots of stuff. Distributed all the way from supply chain 
of parts but supply chain of our workforce as well. Thank you.
    Ms. Matsui. That's great. Thank you.
    Mr. Poonen.
    Mr. Poonen. Yes. I think, Congresswoman, this is a very 
important topic. There's a lot of speculation and euphoria 
right now about Bitcoin and block chain.
    I think the bigger story is the fact that this notion of a 
subledger, which is really what block chain about----
    Ms. Matsui. Yes.
    Mr. Poonen [continuing]. Really transforms the way in which 
you do commerce at a much more miniature level and if you think 
about IoT it's sort of a miniaturization of this type of 
device.
    Now, combine that with commerce now becoming even more 
miniature, it has profound implications that could be 
enormously positive, and that's really, we think, the big 
story.
    If there are ways by which manufacturing could get smarter 
and even potentially more secure, and the commerce that 
happens--electronic data interchange--all of this would become 
a lot more efficient and potentially also secure because it's 
now distributed as opposed to one choke point--distributed 
actions have lots of inherent ways in which you can actually 
make the system a lot more secure.
    At the same time, it does require us to take security and 
privacy even more importantly because of this distributed 
nature, and that's something we are beginning to do early 
research on, not just from industry perspective but also in 
academia.
    But I am confident that the positive aspects, if you take 
away the speculative aspects of block chain, the positive 
aspects will have a profound implication that's actually--and 
we need to, as a country, be at the forefront of the research. 
If we don't do it, some of the other countries in the world 
will.
    Ms. Matsui. Oh, good. Well, I thank you very much.
    That was very interesting. Let me go on to something 
quickly. The Clean Energy Smart Manufacturing Innovation 
Institute in California has been working to accelerate smart 
manufacturing throughout the country.
    Broad collaboration on integrated tools and systems that 
are driving smart manufacturing will help reduce the cost of 
deploying these technologies. These partnerships and 
collaborations can also facilitate the interoperability of 
devices and standards.
    Mr. Kurfess, how can government and industry partnerships 
help develop tools and practices that will drive smart 
manufacturing adoption?
    Mr. Kurfess. That's a great question.
    I think we've already heard about things like----
    Ms. Matsui. Yes. Go ahead.
    Mr. Kurfess. Oh, I am sorry. Have heard about things like 
standards and so forth. But, really, to help move this forward.
    The difficulty is, again, you get back to the distribution. 
Different people want different standards and different 
capabilities and so forth.
    When you start to bring these entities together so, the 
smart manufacturing team that's, I think, centered in the Los 
Angeles area, and it's not only the big companies but it's also 
the so-called small- and medium-sized enterprises--the SMEs--
that they're bringing together. So they're really bringing 
everybody together to say yes, how does this move forward--how 
do we do this.
    And what a lot of companies are getting is, yes, I need to 
release this, because to become more productive, more capable, 
right, I need to participate in this standard.
    It's like when I turn my laptop on, the wifi, I know I am 
going to be online. That's a standard and that's really where 
we need to be going with manufacturing.
    And by the way, we see our competition overseas doing it in 
a big way. So, we have to be cognizant of that.
    Thank you.
    Ms. Matsui. Well, thank you. This is all very interesting.
    I know I ran out of time but thank you.
    Yield back.
    Mr. Latta. Thank you very much. The gentlelady yields back.
    The chair now recognizes the gentleman from Kentucky for 5 
minutes.
    Mr. Guthrie. Thank you very much. I appreciate this. My 
background, before I got here, was in manufacturing, and it 
wasn't very long ago that somebody from Ford Motor Company 
would make an order from a supplier--my family was a supplier--
you would have a production meeting where they'd say, ``We need 
a thousand of these parts.''
    A guy would walk out to the plant to look around and with 
the clipboard--or lady--and say, ``OK, we got this much here, 
this much there. Let's go to the shipping dock. See how much we 
have there,'' because you couldn't always depend on the counts. 
So then they would call the buyer at our place and say, ``I 
need X amount.'' So they would walk out on the floor and say, 
``How many do I have?'' and with the clipboard and it would--
this whole string of things.
    And if you go to an assembly plant and invite anybody from 
Bowling Green, Kentucky to go the Corvette plant and see one of 
America's great cars made, well, what you look for is how 
phenomenal all of this stuff just comes together and how much 
effort and time and planning.
    So if you do it now, you get a production manager who says, 
``I need a thousand parts,'' somebody uploads it on the 
internet, the supplier comes in the morning, downloads it, 
everything is barcoded--I assume Zebra--but everything is 
barcoded so you can depend on the counts, and all of a sudden 
it makes a work order. When you ship it you barcode it. When it 
goes out it creates a purchase order so you get paid for it and 
that's distributed through the internet or through the 
transfers--not necessarily through checks like you used to have 
to open checks and move forward. And that's happened in the 
last--since I've been in manufacturing. It wasn't that long ago 
I started. And it's just a phenomenal look forward.
    But I was looking at Mr. Poonen's testimony and looking at 
Dr. Kurfess' here, my son went to Georgia Tech so we appreciate 
having you here today.
    But I was looking at this security and cybersecurity, 
because we think about data security and whether your credit 
card was secure. You had all these retailers come in and talk 
about--really, if you put everything online and everything is 
Internet of Things in your manufacturing facility, is there a 
cyber attack, could that shut down an assembly plant.
    So in your testimony you talked about the importance of 
systems like Internet of Things, gateways, and why--you talk 
about securing the production lines, and not necessarily, I 
don't think, it's just from attack you were talking about. But 
just if you could throw that in as well and the importance of 
cyber hygiene and can you describe how this would provide a 
reasonable level of security?
    Mr. Poonen. Happy to, and I think the focus on security is 
a very good one, and I think just the same way that if you 
thought about various different eras of computing, sir--
mainframe, the client server, to mobile cloud--this notion of 
security has become a more and more profound because if there's 
one thing that's true, even though security is getting a lot of 
spending in software the bad guys, there's more attacks than 
there's actually investment even in security companies.
    So we have got to take this seriously, and the good news is 
that countries like the United States and Israel have been on 
the forefront of security spending. We want to take that 
seriously.
    So the way in which we think about IoT is as these devices 
get miniature, first off, you want to make sure the operating 
system that's on those devices are as secure as possible and I 
think we've learned a lot as the new operating systems that are 
post-PC have gotten more mature and with every generation 
they're getting better and better. IOS is a good example of 
that and the iPhone being more secure than the first examples 
of the PC and those will play down to the miniature devices.
    Secondly, you want to have control points that dislocate 
just these devices into what's called a gateway. So gateway is 
just a consolidated form of many of these so that you have one 
place rather than multiple places where much of it gets 
consolidated. Dell manufactures some of those gateways. You got 
to make sure those are secure.
    And then as they talk to other systems, for example, a data 
center or a cloud, that connection needs to be secure, and 
there's techniques like micro segmentation, ways in which you 
authenticate into those systems using multi-factor 
authentication. These are all technical terms but for the folks 
who are savvy in security we are educating more and more of 
them.
    And then, finally, for the common person, as I described 
earlier, you want to be able to educate them on some very basic 
principles of cyber hygiene, especially as it relates to their 
access of systems.
    Having a two-factor authentication is something that 
everybody should know about. It's not just your user name but 
some other factor. Maybe it's your birth date. Maybe it's your 
mother's maiden name. And setting up your system so that you 
have that and are refreshing. That allows fewer possibilities 
that your consumer accounts will get hacked the same way that 
the enterprise is dealing with it.
    These are just a few of the many principles of cyber 
security written in the white paper about this and it's a topic 
that all of us in the industry--there shouldn't be competing 
agendas here. We need to work together to make sure the 
security of the IoT systems.
    Mr. Guthrie. A quick question. I appreciate Mr. Masney. He 
was talking about glass and going from 91 to 93 percent. I am 
aluminum foundry die casting and as you said it's sometimes 
more of an art than science, and I remember saying that in a 
meeting and a guy goes, ``Well, all scientists were art at one 
time and how do you perfect it?''
    So I only have a few seconds. When these first come out a 
whole industry is created and everybody is buying these. All of 
a sudden you get saturation and sustainable and improvement. 
But there's a whole world of people in Silicon Valley, all over 
America, to go in and redo these plants, redo these facilities.
    And I don't have much time left, but anybody want to talk 
about just what transformation and what economy that could 
create by people going through and refurbishing their plants?
    Mr. Kurfess. I will just really quickly fire it off because 
we see it across the board. We work with a lot of different 
companies.
    The opportunity is tremendous. Whether the small or the 
medium or the large companies because, again, the kids now they 
program these things, and so they're in there, hey, we can do 
this. This is the barcode readers now and so forth. And so 
they're really implementing it. And so it does allow you to do 
these types of implementations.
    But back to Mr. Poonen's point, we've got to make sure that 
we are very secure about this. So, and again, in our classes 
whether it's high school or junior college, whatever, we now 
see that a lot of this type of thing, we are just doing good 
hygiene. For example, do not plug this into, just any old 
computer. I go to a machine shop. Million-dollar machine tool 
recharging my phone, which could have a virus on it.
    And so these are the types of things that we really have to 
start teaching them and stuff. But the opportunity is 
tremendous.
    Mr. Guthrie. Thank you. Thank you for indulging us.
    Mr. Bianculli. Representative Guthrie, one other point, if 
I may.
    There's a whole suite of capabilities I was starting to 
bring to these enterprise devices. We actually called it 
mobility DNA. But the idea is taking a standard operating 
system that we might be using Android by way of example and 
layering a whole host of enterprise-centric security on top.
    So we are working closely actually with VMWare on this sort 
of thing. So as these devices--these internet end points are 
deployed in these manufacturing facilities, being able to make 
it secure all the way up the device level, so we have a network 
of secure devices instead of just trying to secure the network, 
and that's an investment we are making to basically serve 
enterprise in a more secure way than we might find in 
traditional consumer devices.
    That, and the last thing--another word silos. I think 
there's tremendous opportunity to bring silos down across what 
many of my colleagues here spoke about--from farm to fork, if 
you will.
    So for being able to share data from where that seed was 
planted in the farm field and be able to carry that data all 
the way through to optimize the harvest out to the 
transportation carriers for just-in-time delivery and then 
ultimately getting to a retail location where we can all enjoy 
that in a much more efficient way and in a way that allows us 
to, in a more cost effective way, reach more people.
    So I think the data silo opportunity is tremendous as we 
start to collect more and more data across all the different 
elements of the supply chain.
    Thank you.
    Mr. Guthrie. Thank you very much. I appreciate the 
indulgence.
    Mr. Latta. Thank you.
    The gentleman from Pennsylvania is recognized for 5 
minutes.
    Mr. Costello. Thank you, Mr. Chair.
    Dr. Kurfess, I wanted to focus on something that you had 
provided in your written testimony, not just ask you but ask 
the rest of the panel for their feedback as well.
    There's no doubt IoT in manufacturing will help to grow our 
manufacturing operations and will generate new and higher-
paying jobs. However, those jobs will be filled by individuals 
that are highly trained. Furthermore, those individuals will 
need to be continuously trained and that's what I want to focus 
on.
    In the latest and state-of-the-art technologies to keep 
U.S. manufacturing operations at the forefront of this rapidly 
advancing technology wave, thus, a culture of lifelong learning 
must be instilled and supported in our workforce. If you look 
at our high schools and STEM schools and trade schools for 18 
to 19 year olds, I am struck by the opportunities that might be 
available to incorporate more of this lifelong learning culture 
into curriculum at an earlier age so that it is not incumbent 
upon a company in order to do that. And when you look at 
company of 20, 30 people, even startups of two or three 
individuals, it's just simply not sustainable to offer that 
type of learning and sort of up-to-date type education that's 
required in order to keep a well-trained workforce.
    I've already spoken too long. Share with me what you think 
the right kind of learning platforms are in order for our 
country to be a leader for the next 20 and 30 years so that 
these are not jobs that are not remaining in the U.S.
    Mr. Kurfess. Sure. So really quickly, the first thing is, I 
can tell you, we have turbine blade production. We do a lot of 
work in turbine blade production. So we have turbine blade 
production machines. We are doing research and so forth. And 
typically you need about 15, 20 years of experience before we 
turn you loose on those in production operations.
    We have developed gaming interfaces--high-performance 
computing that can really--it just pounds that problem to dust 
and there are gaming interfaces and we have high school kids 
who are now programming these types of machines and so forth.
    So it's a whole different way of learning and as I 
mentioned before, we can even take a look at who is really 
excelling. People think, oh, engineering--I've got to be a 
super genius. Well, you have to be fairly good at math and so 
forth. But if we can start to really identify those students 
early on and start to work them forward--they don't necessarily 
have to go into engineering. Maybe they're going to go into the 
shops and so forth and get the right type of training.
    But it's a two-way street. So the infrastructure is coming 
into place. We have a number of these different--if again you 
look at Manufacturing USA, these centers that are working with 
the local and particularly the community colleges, the 
Associates degrees and so forth, they are saying, yes, what is 
the next generation that we need to be moving forward and let's 
work that into the curriculum. And that's not only for the 2-
year degrees but for the continuous learning. And then we also 
see a lot of the professional societies, that they have a lot 
of curriculum development that's deployable whether it's on the 
web or interactive and so forth.
    So a lot of the technology is moving out. But I agree, you 
have got to build it in. Universities, I think, have done a 
good job with life long learning. We now have to start to 
propagate that down into the K through 12. It's getting there, 
but once it's there, I think the access for those students and 
for that work force is available and it also does respond very 
quickly to the needs of the workforce and the needs of the 
market.
    Mr. Costello. Right. Mr. Poonen.
    Mr. Poonen. I would just briefly add, this topic is 
personally very much a topic of passion for me, sir.
    I came to this country as an immigrant. I am now a U.S. 
citizen, partly because the United States has the best 
universities. I studied my computer science at Dartmouth 
College. I did my MBA at Harvard University at Harvard Business 
School, and I hope that this continues to be the country with 
the best education in the world.
    The education has now changed. Today, my kids, who live in 
Los Altos, California, are learning through Khan Academy. 
YouTube has completely transformed education and it's not just 
for kids. You can get a how-to or learn-to anywhere anyplace in 
15-, 20-minute Ted Talk types of videos and we encourage our 
workers to constantly be in that learning mode and the good 
news is the internet makes that possible. And it's almost 
upending the classroom where learning is happening at home in 
the evenings and the classroom becomes a discussion form. 
That's the new fashion of what we're doing.
    I think the other part that is incumbent on all of us as 
leaders is to mentor others. As much has been given to us, 
we've got to give back to the next generation. I encourage all 
of us--I know many of our colleagues here do the same--it's our 
job to mentor the next generation. As we do that, both the 
combination of STEM and mentoring will make the next generation 
ready.
    Mr. Costello. That's interesting. So it might be technology 
that enables us to teach technology.
    Mr. Poonen. Exactly, sir. That's what we hope.
    Mr. Costello. Anyone else?
    Mr. Masney. From a manufacturing company perspective, we 
are investing in our local high schools and STEM programs to 
help the younger generation get interested in science and 
technology.
    We are also working with local universities to make sure 
there's an interest as well. So I personally believe helping 
workers, obviously, continuous learning--lifelong learning--
there's also an aspect of company helping our employees be 
lifetime employable through those kinds of ideas as well.
    Mr. Costello. I appreciate your feedback. I yield back.
    Mr. Latta. Gentleman yields back.
    The gentleman from South Carolina is recognized for 5 
minutes.
    Mr. Duncan. Thank you, Mr. Chairman.
    Siri, hey Siri. I use that as an example in that these 
devices are always listening, right. Whether you have an Echo 
in your home or some similar device, whether manufacturing has 
those devices that, as you say, are all interconnected, or 
whether you as an individual have a smart TV and internet 
rumors, true or not, that that TV is spying on you and sharing 
that information.
    As we move forward with technology and we have a 
refrigerator that notices that my milk is low and asks me if I 
want to order milk, and I do, sends a signal to the grocery 
store--milk, bread, other things I may need delivered to my 
home by an autonomous vehicle, right.
    So I consider myself a conservative. There's nobody in this 
room that would say I am not a conservative. But I would 
actually take it another step further. I am a conservatarian in 
that I have a libertarian streak in me that it's my information 
and I own it. But in this scenario that I laid out, who 
actually controls that data and who owns that data, and at some 
point, it's the government getting that data and what do they 
do with it.
    Now, data sharing and by buying habits and what Amazon is 
sending me through e-mails or pop-ups that, because they watch 
my buying habits and they're recommending certain things, that 
benefits me. I get all that.
    But I can tell you the constituents in the 3rd District of 
South Carolina are concerned about who has that information, 
what they're doing with it and ultimately does it get in the 
government's hands without any sort of 4th Amendment 
protection, so to speak.
    So I would just love to--I know, Mr. Poonen, you were 
talking about some of that earlier. I would just like to 
expound on that. Who owns that data and how can I assure my 
constituents that that data is not going to be used wrongly.
    And then I would also like to get back out on that tangent 
because you have got proprietary information and corporations, 
and we all know that China got the plans for the F-35. China 
has gotten plans for a lot of the military components with the 
best safeguards of cybersecurity in place by our government, 
right, who has access to all of you all to create those 
platforms for security.
    So I would like to talk about not only individual privacy 
and data ownership but also how do we keep China from--or a 
Chinese company, and I am not just singling China out but from 
going to BMW or Magna or some sort of manufacturer in the 3rd 
District and getting proprietary information as well and 
creating a competing product.
    Mr. Poonen. Yes. Very briefly, and then allow time for my 
other colleagues, too.
    This is a very hard topic. I would be smug if I said we 
have all the answers today. This is going to require continued 
innovation and collaboration with the government.
    I would say there's a family of problems that are related 
to predictive maintenance of machines that are positive. For 
example, if the refrigerator or the washing machine is decrepit 
and you need someone to come and help you in that, that's a 
family of problems--that people are probably less concerned. 
The data on that machine probably needs to be encrypted.
    But as soon as you have things that are voice recognition, 
camera related, privacy concerns, and we encourage consumers, 
certainly enterprises also, to be extremely cautious. You can 
turn the camera off on your TV. You can certainly unplug Alexa 
when you need to and get appropriate cautions on how you handle 
these consumer devices.
    Mr. Duncan. But that smart TV is monitoring all of your 
viewing habits.
    Mr. Poonen. Exactly. So this is going to be one of those 
places where a combination of encryption, a combination of 
technologies, and I am with you. Consumer privacy--the consumer 
owns that data. The way in which they interact with 
enterprises--most of our focus has been on the enterprise use 
of this. But the consumer part of it is a huge problem that 
needs to be solved together and there's no easy answer for much 
of this because we are just beginning to scratch the surface of 
many of the topics that are way out there.
    Mr. Duncan. In the essence of time, we know China took the 
plans for the F-35, so to speak, and government was involved. 
How do private industry--how can they have some assurance that 
their proprietary information is sheltered from their 
competitors?
    Mr. Poonen. We are seeing the shift from assuming that we 
can prevent an enemy, if you will, from getting in to being 
able to detect that as quickly as possible.
    So if you think about what is your mitigation plan if you 
assume a thesis of you'll prevent attack from occurring, you 
have a very different outcome in that strategy and that plan 
that if you assume that you will not be able to prevent an 
attack and so now your strategy is going to be to detect that 
as quickly as possible, to shut down that intrusion, and then 
to take the corrective actions from that point forward but 
detecting that as soon as possible.
    So going from protecting to detecting and then taking a 
counter measure as quickly as possible in every sense of that 
word I think is a shift we are seeing right now. It's no 
longer, as you pointed out, the best resources on the planet in 
some instances cannot protect that attack from occurring. So 
let's focus more on leveraging all the technologies spoken 
about here--machine learning, artificial intelligence, 
technologies like deep packet inspection, over packets on the 
network, to be able to detect that if that is occurring.
    With regard to in-home, I think similarly we are going to 
see--technology has been used for a while in the network space 
called deep packet inspection where why not have a single 
source of truth of the information that's leaving my home.
    So what products are sharing what information with whom, 
and imagine if I had a dashboard that I could go to a portal on 
a web page in my home and I could see, well, I shut that TV--I 
don't want that camera on that TV sharing information. Is in 
fact that data going out over my network or not, and those kind 
of dashboards so that we can have--enjoy, all of us, the 
convenience associated with sharing the information but have 
the integrity and single source of truth to understand what 
actually is being shared, and I agree with the number of 
devices and the prolific nature of this that thinking that we 
are going to be able to control that because we were told it 
works a certain way is not going to be sufficient.
    Mr. Duncan. I guess my constituents would say, is Big 
Brother going to call me or send me a notice and say that your 
thermostat was set on 72 when you left the house today and you 
have over-utilized your allotment of electricity for the day. 
Do you see what I am saying?
    Mr. Poonen. I do.
    [Simultaneous speaking.]
    Mr. Duncan [continuing]. Be going and that's a true 
concern.
    Mr. Poonen. I think the best answer to that is to use all 
the mechanisms I just mentioned and more to come to ensure that 
that's your option--that you're informed enough to--it's your 
choice to share that information for a benefit gained.
    Mr. Duncan. I am way over time, Mr. Chairman. Thanks for 
leniency.
    Mr. Latta. Thank you very much.
    The chair now recognizes the gentleman from Texas for 5 
minutes.
    Mr. Green. Thank you, Mr. Chairman. I thank our witnesses 
for being here.
    Sorry we have other committees--the Energy Committee 
upstairs and so I am jumping back and forth.
    When I first saw the hearing, and that's why I appreciate 
this subcommittee--the Internet of Things--I thought, what in 
the devil is the Internet of Things? I cleaned up my speech 
after the president didn't.
    But what is it? And thank goodness I have young staff to 
explain to me. I am glad you're having the hearing because it 
makes some of us who don't typically live with these things 
shed light on different aspects of the smart manufacturing and 
the Internet of Things.
    One of our witnesses mentioned manufacturing as one of the 
sectors that is investing the most in IoT. I have a district 
that's predominantly petrochemical refineries, chemical plants, 
extraction, and I know they're looking for every way they can 
using technology both to produce their product safely or 
cleaner and doing more smart manufacturing can make operations 
both environmental safer and more efficient. But Congress needs 
to do more to prepare our workforce for those changing needs 
and manufacturers.
    Mr. Kurfess, you mentioned in your testimony importance of 
instilling a culture of lifelong learning and of helping to 
train our manufacturing workforce in the data science and IT 
skills that workers need. Some people that need job training 
the most are the unemployed and one of the biggest obstacles 
they face getting into that technical training is the cost of 
it.
    Can you elaborate on possible ways Congress can help this 
technical training be made more affordable as well as help 
support a culture of lifelong learning broadly?
    Mr. Kurfess. Sure. I would be very happy to do that, 
Congressman.
    I know that there are a lot of initiatives that are really 
supporting the community colleges. These are the 2-year 
colleges and so forth. They're very cost effective for the 
training of the workforce and so forth and there's a lot of 
leveraging that goes on there.
    We heard about some of the online courses that are 
available today, even via YouTube and so forth. And actually, 
our--at least our younger generation they learn and they think 
in a different way, right. So, when I was a student I might 
have had one book to look at or maybe two books to look at. Now 
they go out there and they get 10, 20, 30 different examples 
and so forth.
    So, really, not only just saying yes, we could make sure 
that we can support the community colleges and some of the 
professional societies that have these types of courses 
offering technical training but also the ability to basically 
say yes, let's make sure that we are starting to leverage some 
of these new approaches to teaching and so forth and that we 
understand that they're out there so that it comes out there 
very quickly.
    And by the way, these are also very important not just 
because they're lower cost but they're very nimble. They can 
respond quickly to new technology as it comes along.
    So, if you have some YouTube videos out there--you can 
learn anything from fixing a faucet all the way to, hey, let's 
go do a calculus problem.
    But as new technology comes along, it's amazing. You can go 
to YouTube. You can go to some of these different courses, even 
MOOCs, these massively online courses and so forth that some 
institutions offer for free. And so how do we promote that, 
once you have that, I think the next key thing is 
certification. Yes, you are certified in that course. So that 
when they go to your company--and by the way, it's interesting, 
when people think manufacturing, make a car. Those 
petrochemical plants are enormous manufacturers within the 
United States.
    And so how do we know when that company says yes, I want to 
hire somebody that yes, this person has the right credentials. 
It's great that they have a degree from, let's say, a Georgia 
Tech, but what about just some of the smaller credentials that 
are going along. So a lot of that credentialing and getting 
back to some of the standards that we are looking at.
    Mr. Green. Well, I appreciate that.
    I actually have a community college in our area who 
partners with the petrochemical industry--San Jacinto College 
in east Harris County, Lee College in Baytown, because of the 
dominance of that industry, and I've been out there and they're 
doing--and a number of my other community colleges in our area 
developing the same thing because you just don't go get your 
Associate's or your Bachelor's or anything. You need to 
continue to look at what's new, and I was there on campus one 
time and a young man had about three different certifications, 
and he was getting offers of over $150,000 at a Shell refinery 
or a LyondellBasell refinery or chemical plants.
    So it's a way that someone--but you have to continue to 
keep up with your industry and that's what community colleges 
can do.
    Mr. Chairman, thank you for the time.
    Mr. Latta. Well, thank you very much. The gentleman yields 
back. The chair now recognizes the gentleman from Indiana for 5 
minutes.
    Mr. Bucshon. Thank you, Mr. Chairman.
    Mr. Poonen, I am going to primarily talk with you and some 
of the other about security. Mostly, it seems to me, when we're 
talking about security we are talking about software and 
other--and access and things like that--passwords and all of 
that.
    But you probably saw in the news recently that in some 
areas across the country there were some communities and police 
departments that took down their security cameras because of 
concerns of where that product was made, and it was made 
overseas and so there was some question not about that it was 
connected to the internet but the actual hardware itself and 
whether that was compromised.
    There's some things I know that we do at the Federal 
Government level to ensure, for example, that chips that are 
used in Defense Department products are not compromised, so to 
speak, but worldwide and even in the U.S. some people estimate 
as many as 10 to 15 percent of computer--the hardware, like the 
silicon chips, are actually counterfeit.
    That's an area I think we should also look at. What are we 
doing there?
    Mr. Poonen. I think it's absolutely wise, sir.
    I think that when you think about security it absolutely is 
in all of those layers. You need a multi-layered, whether it's 
the hardware or the software, whether it was the service, was 
the people.
    And listen, capitalism works only if the entire world is a 
level playing field and when some countries are not necessarily 
playing by that I think it's absolutely the wise policy, 
whether it's the FBI, whether it's the appropriate agencies, to 
ensure that our products, whether they're bought for a foreign 
party, don't have embedded components, hardware or others, that 
could potentially compromise the security. So----
    Mr. Bucshon. I can tell you probably know and I know this 
myself, sometimes it takes an electron microscope and people 
that understand it to detect these problems with chips and 
stuff.
    Mr. Poonen. Yes, absolutely.
    Mr. Bucshon. It's pretty sophisticated.
    Mr. Poonen. Yes, and there's absolutely evidence of that 
happening. I am not a protectionist in terms of the way in 
which we think about the economy. We do believe in free market. 
But it has to be one with a level playing field.
    So many of the governments that have been focused on this, 
certainly in the United States and Israel, that have had this 
have got a very good way of looking at the ways in which many 
foreign governments are building technologies, and without 
naming certain countries, we've got to continue that diligence, 
because whether it's the camera technology, whether it's voice 
recognition, the types of things that could leave us 
vulnerable, we've got to make sure we've got the most 
protection. We work very closely, both the industry and the 
government, the agencies, to ensure that happens. That's 
probably a topic we haven't talked about. I am very glad that 
this committee is focusing a lot on security. Security is 
probably one of the key topics in this entire topic of IoT that 
needs even more and more focus.
    Mr. Bucshon. Yes, because it is a global marketplace and I 
am in favor of that. I am a free market person also. I think we 
all are.
    But we also, from our jobs' perspective as members of 
congress we have considered national security-related risks and 
the biggest port of entry that we have is our people using 
connected devices, maybe even at their homes. For example, say 
they work at the NSA and they deal with classified material 
every day that we don't want people to know about. But when 
they go home they have all their devices at home are all 
connected and who knows who's listening.
    And even though they're not supposed to--what if they're 
just pontificating among even themselves about the day's 
activities? It's hard to know.
    So I have pretty significant concerns about on the hardware 
side, because once we are able to mitigate other things, people 
are smart. You're already too late when the hardware itself is 
compromised. Does that make any sense?
    Mr. Bianculli. Yes. I am just going to add it absolutely 
does make sense, Congressman. If I could suggest, we could 
break the problem down to two components. One is around the 
counterfeit side of things. So these are counterfeit chips or, 
that are made overseas, copying our technology, and as you 
pointed out, you need somebody with sophisticated technology to 
check that.
    But what I would say is that actually IoT is a mechanism 
for auditing that because if we're seeing this occur today, if 
I'm a semiconductor manufacturer of those chips, I can have 
each one of those chips report back when they connect as a--
just basically a heart--pulse to say that that device is 
present, and if I see that coming from more devices than I have 
shipped, I've got an indicator that there's an alternate end 
around from a supply chain perspective. Someone else is 
injecting, if you will, these chips into the supply chain that 
aren't coming from my factory.
    So it's sort of an IoT connected auditing mechanism. I 
think that represents one level of--certainly compromises 
economics but is a little bit lower on the threat level 
compared to, as you were suggesting, information that's being 
sent--that's actually being captured we don't know it--the 
example you gave around the device in the home connecting back 
to the network or a video camera in a municipality that's 
sending information back to individuals that we don't want it 
to go to.
    And there, I think, we and a number of companies working on 
networking technology that can detect if information is being 
sent that is different than what we intended to be sent.
    And I think if we can audit the network, if you will, the 
pipe of data that's being sent to see what's actually being 
sent versus what we've authorized, and at the same time we can 
continue to invest and drive in IoT. So all of our devices, for 
instance, that are connected out in the field can connect back, 
we can literally count the devices we've shipped. We can count 
the devices we see. And if there's more devices we see than 
we've shipped then something else is going on.
    So those, I think, are perhaps two ways to look at it. 
Certainly a complicated problem, as our colleagues have pointed 
out. But a food for thought, perhaps.
    Mr. Bucshon. OK. Thank you.
    I yield back, Mr. Chairman.
    Mr. Latta. The gentleman yields back.
    The gentleman from California is recognized for 5 minutes.
    Mr. Cardenas. Thank you, Chairman Latta and Ranking Member 
Schakowsky, for calling this hearing.
    As a former small business owner myself, I know that a 
business that is not growing and evolving is a business that is 
not succeeding.
     As an engineer, I've studied the rise and proliferation of 
connected devices and for the potential to help businesses and 
government evolve and better serve their consumers and 
constituents. For example, a company in my district that 
testified last June in this hearing on the Internet of Things, 
Louroe Electronics uses connected microphones and sensors to 
help protect property and also help law enforcement detect and 
rapidly respond to gunshots.
    On the public service side, the Internet of Things 
technology has helped local governments and firefighters 
monitor and prevent and fight back firefighters in southern 
California, for example.
    Recently, the House passed my amendment to study the use of 
drones to detect and fight wildfires. However, I also know that 
as with any rapid-growing technology we must encourage 
innovation smartly, responsibly, and with our eyes wide open.
    We are constantly learning that virtually any connection 
can be hacked. So cyber security is an area that businesses and 
government will have to pay extremely close attention to and 
invest a lot of resources.
    Another issue that we need to hold our businesses to a high 
standard on is workforce preparedness. As our companies evolve, 
our workforce must necessarily evolve as well.
    Ideally, this evolution will come in the form of education 
and retraining. This was an important issue that I brought up 
during our markup of the SELF DRIVE Act and it's an important 
issue in every environment. For example, southern California 
happens to be--I was told when I got elected to Congress I was 
reminded that southern California is the largest manufacturing 
area in the entire country. I was pleased and surprised to hear 
that. So this is an issue that not only is important to my 
district but important to one of the biggest economies in the 
world, which is California.
    My first question is to Dr. Kurfess. You have the advantage 
of a bird's eye view of the industrial Internet of Things 
through your work with a variety of companies.
    So can you describe briefly what practices you've seen that 
help workers adapt to and learn how to better use new 
technologies?
    Mr. Kurfess. Sure. It's relatively straightforward. Some of 
the practices that are out there actually get to some of the 
discussions we've had about just hygiene. Don't plug your phone 
into the million-dollar machine tool out there because it might 
have a virus on it and so forth. But some of the other 
practices really go along the lines of understanding what 
people are comfortable with in terms of using and so forth and 
letting them make use of that technology in place.
    As I said before, we actually have developed some software 
where you're doing a Ppkeman type of program--you're looking 
for the guy to try and capture. But that guy you're trying to 
capture is a flaw in your production cycle and so forth and you 
capture it.
    So you actually start to bring these together. The Internet 
of Things--people are very comfortable in general. It just 
doesn't matter who you are. People have the smart phones now 
and they're very comfortable using it.
    And so the idea really is yes, can you bring that comfort 
together so that they make use of it in a very easy and natural 
way.
    So that's one of the things. The other thing, again, and 
we've heard from several companies here, just continuous 
learning, to make it easy, you make it rewarding, to provide 
the time so that the people in the plant can do some learning.
    And we are not talking hours and hours of time. Typically, 
it's just yes, just take a look at this thing--we can track 
your progress and so forth and making sure that they're up to 
speed on what a company needs to have them up to speed on, 
whatever that might be.
    Today it's going to be, and again, coming out of California 
you realize this--whatever's going on today may not make a 
whole lot of difference tomorrow in terms of technology. That's 
how rapidly things are changing.
    Mr. Cardenas. It's interesting that you describe the 
example of the cell phone and how that could interfere with the 
opportunity to, unfortunately, have an infiltration in your 
system.
    I learned, again, through one of the subcommittees on 
health, is that some hospitals, and a lot of people now realize 
that infections--if you're going to get an infection, probably 
going to get it a hospital more than anywhere else--that it 
wasn't some incredibly expensive process to bring down the 
infection rate at hospitals other than having the discipline of 
everybody washing their hands at every opportunity. Something 
as simple as soap.
    But what I am getting at is I think it's important for us 
to teach the next generation of workforce that even though they 
find these things to be so darn convenient and think that it's 
the answer to everything. It actually, if not handled properly, 
with simple measures you could actually cause a disaster or 
catastrophe that is unintended.
    So I think it's important for us to realize that sometimes 
the answers are complicated. Sometimes the answers are really 
simple about basic discipline.
    Thank you very much, and I yield back my time.
     Mr. Latta. Thank you very much. The gentleman yields back. 
The chair now recognizes the gentleman from Florida for 5 
minutes.
    Mr. Bilirakis. Thank you, Mr. Chairman. I appreciate it, 
and thanks for the testimony.
    I was at the joint VA Committee hearing. So I apologize for 
being late.
    I have a couple questions. The first one for Mr. 
Bianculli--in your testimony you state that industrial IoT-
based solutions are allowing companies to create jobs. One of 
the big concerns we are facing is automation replacing jobs. So 
can you please explain to us how these solutions help create 
jobs?
    Mr. Bianculli. Sure. Yes, I think there's sort of a micro 
and a macro view on that. The micro one I mentioned a little 
bit earlier around machines working with workers to help them 
get their jobs done more effectively. And I think when we think 
about that, we have a tendency to think of the brawn side of 
that, meaning that the physical movement of goods and that's 
for sure a part of it. The other part of it is that the brain 
or the intelligence are an assistant that can work along with 
the worker. So we mentioned wearable technology, augmented 
reality, being able to put information right up in front of the 
user. And as this starts to assist you, that should create more 
job satisfaction, a better work environment. It also, in 
addition to increasing quality and having benefit to the bottom 
line, reduces the cost of getting that job done. And so if I 
shift from the micro perspective over to macro, as we reduce 
the cost of getting that job done, we become more competitive 
on a global basis, thereby bringing jobs back in.
    So if we look at any one instance we could point to well, 
if we are reducing the cost of labor that--some might say 
that's reducing the number of jobs. I would say it's increasing 
the efficiency of an individual and thereby increasing 
efficiency of that individual has the macro effect of making us 
more competitive on a global stage.
    And I think that we are starting--I mean, it's happening 
already. We are starting to see that bear itself out. The other 
thing we are starting to see with the on-demand economy that we 
mentioned earlier is the peaks are getting peakier, if you 
will. If you look at the number of shipments that are happening 
from manufacturing facilities or from fulfilment centers in the 
November to January timeframe--in some cases, you see this in 
the headlines--transportation carriers, retailers, are doubling 
or tripling their workforce to be able to handle that peak 
demand.
    And so when you bring that influx of workers in, if it 
takes 2 weeks to train somebody how to do that job, you're a 
third of the way through that peak cycle. So leveraging this 
technology so that someone can be functional and up and running 
in an hour and be as skilled or as capable as someone that's 
been doing it for several weeks also becomes very important.
    So I think if we view it that way and look at the bigger 
picture over the longer time horizon, there's early indicators 
that what I just described is starting to happen and I think we 
should lean in and accelerate to take advantage of that for the 
country. Thanks.
    Mr. Bilirakis. Thank you. Good answer.
    In your testimony, Mr. Masney, you note that, and I quote, 
``the cost to achieve a full deployment of IoT throughout an 
enterprise can be quite daunting,'' and suggest that lowering 
those costs would help ensure the deployment of the IoT.
    What are some of the ways policy changes could help?
    Mr. Masney. Certainly. Looking at ways to reduce the cost 
per unit of a sensor or technology can help spur investment 
into IoT, and it's not just one thing. It's sensors. It's PLCs. 
It's storage. It's systems. It's investment in programming and 
those kinds of things.
    So, certainly, looking at ways that we can spur innovation, 
get products produced at a lower price than manufacturing 
companies can consume and deploy at a lower cost point, 
especially in a business like ours which is very capital 
intensive, is going to be incredibly helpful to move IoT 
forward.
    Mr. Bilirakis. Very good. Thank you.
    Mr. Chairman, I appreciate you holding this hearing. Very 
informative and I will yield back the balance of my time.
    Mr. Latta. Thank you very much. The gentleman yields back 
the balance of his time.
    And seeing that there are no further members wishing to ask 
questions, I want to again thank all of our witnesses for your 
great testimony.
    Before we conclude, I would like to include the following 
document to be submitted for the record by unanimous consent--a 
letter from the Electronic Privacy Information Center.
    And hearing no objection, that letter is part of the 
record.
    [The information appears at the conclusion of the hearing.]
    Mr. Latta. Pursuant to committee rules, I remind members 
that they have 10 business days to submit additional questions 
for the record and I ask the witnesses submit their response 
within 10 business days upon receipt of the questions.
    And without any objection, the committee will stand 
adjourned.
    Thank you very much.
    [Whereupon, at 11:46 a.m., the committee was adjourned.]
    [Material submitted for inclusion in the record follows:]

                 Opening statement of Hon. Greg Walden

    Good morning, and thank you to our witnesses for appearing 
before the Subcommittee today. Chairman Latta, I'm pleased to 
see the Disrupter Series continue with this subcommittee's 
focus on innovation, and American jobs and competitiveness. The 
Internet of Things' impact on the manufacturing sector has been 
transformative. I'm looking forward to hearing from the 
witnesses today about how their companies think about the best 
ways to utilize IoT, particularly if there are applications 
that improve safety for their employees.
    Over the last year our economy has expanded because of the 
efforts of entrepreneurs and American workers, and also in no 
small part because of the lifting of regulatory barriers. New 
technologies have continued to play their traditional role in 
driving American innovation, creating new opportunities and 
lowering costs for consumers.
    The Internet of Things is one of these technologies. In a 
sense the IoT is not new-industrial processes have long sought 
to create efficiencies through the acquisition and use of data. 
But revolutions in sensor technology, communications devices 
and data analysis have allowed manufacturers to utilize 
information in ways never before possible. Now machines can 
play an active role in their own operation, ensuring they are 
functioning properly and receiving attention when needed.
    That said, there is also an important conversation to 
continue around training and filling the workforce gaps we see 
in our own districts. This issue is has many facets, certainly 
one is the opioid crisis, and it is important to hear directly 
from businesses about their experience training and maintaining 
their workforce.
    There is bipartisan agreement that we want, and need, to 
see American manufacturing succeed. On that front there is 
great news: earlier this month the Institute for Supply 
Management reported that in 2017 U.S. manufacturing activity 
was the highest it has been since 2004, and in December 
continued to expand at its fastest pace in three months.
    The renaissance in American manufacturing, empowered by new 
technology that drives efficiency and lowers costs, holds the 
promise of continued opportunities for future generations of 
Americans--and to keep good jobs here at home. As policymakers 
all of us share the goal of removing barriers to innovation and 
productivity.
    I look forward to hearing our witnesses describe the role 
of IoT in manufacturing, and how it can further drive America's 
recent successes in expanding job creation. I also hope that 
our witnesses will share with us any areas for improvement, 
where Congress can help remove obstacles and promote growth.
    Mr. Chairman thank you for holding this hearing, and I 
yield back the balance of my time.


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