What's going on?

Over the past two days, industrial conglomerate General Electric (GE) has announced that it�s buying three startups � it�s a sign of the substantial transformation GE�s business is undergoing.

What does this mean?

About two years ago, GE set a plan in motion to transform itself from a disparate group of manufacturing and financial businesses to a more streamlined company focused primarily on providing its industrial customers with digital solutions (think: using artificial intelligence and 3D printing to optimize their clients� manufacturing processes). GE’s three new acquisitions are a machine learning (a.k.a. AI) firm, a �big data� cruncher and a maker of apps for services like inventory management. All are aimed at boosting its burgeoning software business (a.k.a. GE Digital).

Why should I care?

For stocks: GE and Siemens are both heading in the same direction.
On Monday, Germany-based Siemens (one of GE�s biggest competitors) announced it was buying software maker Mentor Graphics for $4.5 billion. Meanwhile, GE counter punched with its three new acquisitions. Both companies are in the midst of shifting from selling industrial products to providing industrial software � and, as we saw last week with Siemen�s plans to sell its healthcare business, ridding themselves of other businesses as they pursue this major bet.


The bigger picture: All companies are tech companies now.(tweet this)

If a company isn�t using technology as a fundamental driver of its business, then it�s probably going to be left behind by competitors that are. McDonald�s and Starbucks, in an attempt to streamline their customer experience, are busy developing app-based ordering. Airlines increasingly use artificial intelligence to price tickets, and live sports are being streamed by new media players (like Twitter); the list goes on and on. In many respects nothing has changed: companies have always had to adopt new technology or risk irrelevancy. But the speed of the changes has increased rapidly in recent years.