Speaking at a January 2020 earnings call Barclays’ oil country analyst John David Anderson asked Schlumberger CEO Olivier Le Peuch about the new strategy for an ‘asset-light, more technology-driven businesses in North America’ and the ‘primary growth driver’ of digital technology. Anderson asked for more details on Delfi sales and the likely progression of revenues from the reservoir characterization business. [Le Peuch had intimated that these might double with the move to a subscription-based model]. Anderson asked for a roadmap.
Le Peuch demurred on the roadmap but did restate the ‘clear ambition’ to double Schlumberger’s digital revenue in the next few years. Furthermore, the transition to a software as a service model should not negatively impact revenue. Le Peuch did acknowledge a ‘pause’ in digital revenue growth over the last couple of years, down to market condition and the fact ‘Delfi was not having the readiness and the breadth to expand into the marketplace’. These issues have now been addressed with four new Delfi products and the ‘new momentum’ that Schlumberger’s ‘open’ strategy is bringing. Le Peuch cited flagship client ExxonMobil’s acquisition of its ‘drilling digital products’ in North America. Le Peuch did not explain how a doubling of digital revenues could square with the recent announcements around the ‘open source’ inspired OSDU. But there again, Anderson did not ask that question.
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In a separate announcement, Schlumberger has teamed with Dataiku* to ‘enable the E&P industry to build and deploy their own artificial intelligence solutions within the Delfi environment’. Dataiku AI’s availability in Delfi will let petrotechnical experts ‘build and extend workflows that leverage machine learning and data science’.
Dataiku is a New York headquartered software house whose flagship product, the Data Science Studio is said to ‘democratize’ access to data, enabling enterprises to build their own path to AI. DSS provides a simple interface for data wrangling, mining, visualization, machine learning and deployment. In December 2019 Dataiku received an equity injection from Google/Alphabet’s CapitalG late-stage growth venture capital fund, bringing Dataiku’s value to $1.4 billion and a ‘unicorn status’.
The deal confirms our long-held position that Delfi’s ‘cognitive’ tag has always been a marketing gimmick. Google’s investment in AI boutique is also interesting in the light of regulators waking-up to the GAFA’s predatory acquisition of smaller potential competitors.
* Dataiku is a mash-up of ‘data’ and ‘haiku’.
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