STATE OF THE DRONE INDUSTRY 2018 REPORT

Colin Guinn & Oren Schauble

EXECUTIVE SUMMARY Colin Guinn Five years ago, I traveled up and down the west coast visiting every camera shop I could find to show them a cool new product category they should consider bringing into their stores. I was showing them the first DJI Phantom, a drone we had created to make the world of aerial imagery more accessible to newcomers. Many of those early dog and pony shows didn’t go exactly as planned, and there were plenty of times I probably said things like “the wind must have caught it” as I packed up my now-crashed $700 gadget. The original Phantom had no camera, no gimbal, no autonomous flight capability, no optical flow, no obstacle avoidance, no computer vision, no smart battery, no video link, no mobile app. And you didn’t dare fly it in cold weather. If you required a drone with all of those capabilities, you needed a DefenseDepartment sized budget…literally. Now, for around the same price as the original Phantom, you can get the Mavic Air with all of those things and much more— and it fits in your pocket. How does this relate to the commercial drone market that everyone is so excited about? Only a few years ago, using a drone to create a 3D model of a construction site, an orthomosaic of a farm, or an elevation map of a flood plain meant spending an incredible amount of time and money on piecemealed drone and camera hardware, dealing with extremely cumbersome workflows and buggy software, dealing with crashed drones on a regular basis, and oh yeah, disobeying FAA regulations. To say that things have come a long way in five years is quite the understatement. I’m not even sure how to quantify the pace of innovation between the Phantom 1 and the Mavic Air, but it certainly exceeds Moore’s Law. Drones’ ability to provide real ROI across industry is arguably less than two years old, and we’re already seeing commercial drone use graduate from the fringe cases and internal exploratory studies to organization-wide programs being planned and implemented across thousands of large companies the world over. As the commercial drone space goes from zero to 100 over the next few years, the one thing this industry is short on is expertise. Over the last decade, myself and the team at Guinn Partners have flown dozens of aerial platforms and stood on hundreds of real-world job sites in various industries: construction, telecom, oil and gas, production, real estate development, public safety and more. The conversations we’ve had and the connections we’ve made have given us knowledge and experience applicable to companies adopting these new technologies, as well as to companies developing new drone technologies. As we continue to have conversations with organizations new to the space, we are reminded again and again just how novel this technology is. We see how little information spreads about trends, standard operating procedures, and best practices- especially in commercial applications. We’ve come to recognize that one of the most valuable things we have to offer the industry is our experience and expertise. So we sat down together to figure out what we agree on and where we think this industry is headed.

Now, the hard part of creating this report: the members of our core working team have personal and professional relationships in almost every industry setting. We want to assure you in advance that nothing inside this document should be considered as investment advice. We offer strong, informed opinions and a collection of ideas and concepts that excite us and come up in regular conversation with partners, friends, and clients. Our hope is that this report will serve as a catalyst for conversation and collaboration among technology providers, real world users, enthusiasts, investors, and commercial operators. The better the spread of information and the greater the collaboration, the faster this industry will realize expansion. We are incredibly grateful to the many industry members who contributed their interviews, and for the countless projects that have allowed us to learn how drones provide value in the real world. We’re happy to share something interesting back by means of this 2018 industry overview.

Sincerely,

Colin Guinn

TABLE OF CONTENTS COMMERCIAL HIGHLIGHTS INTRODUCTION: A Platform for Capturing Reality Commercial Trends Highlights Commercial Companies We’re Excited About FAA Highlights Chart Commercial Drones Breakdown Interview: Yuneec Interview: Orbital Insights Interview: Interdrone

INDUSTRY BREAKDOWNS Insurance Construction Power Interview: Skycatch Interview: Dronebase Interview: Scholar Farms

GOING CORPORATE: Internal Drone Programs

A Key Concept: Cloud Robotics Program Options Tips for Building a Commercial Drone Program Interview: Uplift Interview: Firmatek Interview: Hangar Interview: Department 13

CONSUMER HIGHLIGHTS Consumer Trends Highlight CES Recap

LOOKING FORWARD BLOS (Beyond Line of Sight) Interview: Grayline Group Interview: Auterion Will Anyone De-Throne DJI?

CLOSING Trends We’re Tracking About Guinn Partners The Authors Final Words

A PL ATFORM FOR

CAPTURING REALITY

Drone innovation has been rapidly adapting to new markets over the past few years, first as consumer toys and now as revolutionary new tools for businesses. By the end of 2018, we will see hundreds of thousands of drones being used in the workforce, and it won’t be just for package delivery. Drone technology creates new potential for businesses, not because it gives companies access to tiny helicopters, but because it gives them all the capabilities of a flying smartphone. Drones should be thought of as a communications platform, and as with any such platform, the primary focus for users will be the vast array of apps created for it. The advantages of using drones are already clear across industries as diverse as construction, mining, communications and media. Drones are a characteristically disruptive technology, drastically changing how companies work with their operational and labor costs. By 2017, enterprise-grade drones with high-powered sensors and complex autonomous capabilities were available for between one and three thousand dollars. But although drones have become cheaper and more fully automated, they have yet to become fully autonomous. Many of the most profound innovations have yet to take place. That’s why this is an excellent time for companies to delve into the drone ecosystem and develop strategies for adoption.

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Drone technology creates new potential for businesses, not because it gives companies access to tiny helicopters, but because it gives them all the capabilities of a flying smartphone.

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The average off-the-shelf consumer drone, as sold by DJI, Yuneec, Autel and others, is a modern marvel of technology. For a product that costs between $500 and $1500, the technology included is staggering: multiple Linux computers, premium chipsets, autopilots, 4k cameras, GPS, accelerometers and more, all of it on the shelf at your local Best Buy. This technology even includes crash prevention “sense-and-avoid” features that prevent the drone from running into trees or walls. There are millions of these products in consumers’ hands worldwide today, and tens of thousands in the hands of legal commercial service providers and companies. The availability—at this price—will set propellers of change in motion across industries. Perhaps the single most useful development has been fully-automated flights and data collection: a successful mission no longer requires manual skill. What’s more, the onboard technology is now easily connected to automated cloud processing, so that you can link a wide array of capabilities that can facilitate the processing, analysis, integration, and distribution of whatever data you collect. All of this is available in affordable hardware packages, as well as from services firms like Dronebase, Uplift, Measure or Hangar, with data results increasingly ready-made for commercial industrial applications. One of the most striking capabilities we see becoming available in drone apps now is “reality capture” — the ability to produce a digital scan of the world and the objects in it with a variety of different sensors (an imaging camera, for example). Applications enable various kinds of processing, from map-making to photogrammetry to inventory tracking. These apps can transform many aspects of business. Take Google Maps as a well-known example of reality capture: satellites, airplanes, and cars all capture photographic and geospatial data which is presented to users as 2-D or 3-D images and maps. High-res reality-capture can also be used to develop detailed routes for selfdriving cars navigating through cities.

Drones illustrate an even broader use-case for this kind of data capture. The method of reality-capture is similar to that of motioncapture for films. However, instead of needing to build a complex artificial scene for a motioncapture that takes place in a studio, realitycapture affords the ability to create multipleangle video or 3-D structural models directly from the natural scenes themselves. Smart software allows the drones to precisely track and revolve around objects while collecting sensor-based data about those objects. Ten years ago, this kind of drone technology was still in laboratory development. In 2013, it was still prohibitively expensive for most commercial applications (and both risky and heavily regulated for those who chose to try). In 2018, every major city in the US has firms using drone technology to monitor construction sites and film entertainment. Today it’s cheap and easy to launch a cameraequipped drone that, when combined with software, will do enterprise-level work for your business. The vast capabilities of drones are now becoming widely accessible for commercial and business applications. Almost every industry that operates in the physical world is using drone data to capture reality. Construction uses drones for development site inspections, popularized by firms like Skycatch. DroneDeploy has led the way in agricultural uses for drones conducting crop mapping. Insurance teams use off-theshelf drones for roof scanning, driving large volumes of business to on-demand companies such as Dronebase. The old saying is that “you can only manage what you can measure.” Drones make measurement, and therefore management, easier than ever before.

Satellites and planes have been a source of aerial data and measurements to many industries for years. You’ll see images from companies like Eagleview present on any major commercial real estate project. Drones, however, offer many competitive advantages over both of these other aerial sensing-technologies. With “anytime, anywhere” access and laser-like precision, drones offer a much higher resolution and much more frequent data sampling than any satellite possibly could. They are also far cheaper, safer, and easier to deploy than traditional manned aircraft. The impressive data capabilities of drones have been seized upon by industry, yet are still most often ignored in media portrayals of drones. Drones are often thought of as consumer toys or flight extensions for action cameras. And it’s true that those functions still command a significant portion of drone sales. In other media representations, drones are praised (or made fun of) for their imagined use as delivery vehicles for Amazon Prime. Consumer delivery in crowded urban environments, however, is one of the furthest-off uses yet imagined for drones. Rather, we expect that the majority of business applications of drones will involve flights over private land, not over dense cityscapes. Drones now equipped with the latest sensors and software will be realized as full-scale datacollection platforms. And, as happened with smartphones, it is likely that as third-party software developers get involved, the range and abilities of the data collection apps will continue to become more sophisticated. As the predictable applications like aerial photography and other sorts of imaging continue to improve, businesses will also see new and unexpected apps adding ingenuity and previously-unimaginable solutions for capturing reality. Full automation will bring further reasons to enter into the drone economy. The FAA’s current regulations require that every drone must have a human operator who is both within sight of the drone and responsible for it. On-board sensors and computer vision will soon become much more capable of managing flights than even the best pilots, and it is therefore likely that the restrictions on unmanned flights will be relaxed. With this change in regulations, the cost of operating drones will further plummet. Once we reach that stage when aerial and remote data collection can be completely automated, anyone anywhere will have unlimited access to the sky and the data that can be captured there, at rates that will make the technology as ubiquitous as Google Maps. Businesses need to prepare for that day and start devising their drone strategies now.

COMMERCIAL

DRONE HIGHLIGHTS Commercial Drone Trends

CONSTRUCTION COMPETITION WILL FUEL RAPID DRONE PROGRAM ADOPTION. Through the course of various programs in 2017, we’ve spoken to managers on over 100 construction sites and have overseen efforts by multiple brands in the UAV industry to enter the construction space. With what seems like every analyst putting out an article or report on the impact drones will have in construction, the question now is: Is the hype finally becoming real? More than 90% of the construction managers and technical teams across the US that we spoke with had experience with drones. Some had drones on site, some went through vendors, some had a company team that handled drone operations. We spoke at length with top Engineering News & Record (ENR) companies, and a number of both the largest and most tech-forward in the group were engaged in the same process: defining requirements, establishing standard operating procedures, and selecting vendors or hardware for drones. Project management software suites like ProCore and Plangrid continue to gain popularity. The transition from paper documentation to cloud-based documentation provides a great opportunity to compare drone-adoption strategies across different construction businesses. We believe that the early adopters of drones who have put thorough processes in place are going to enjoy a healthy competitive advantage. Their successes will likely spark firms of all sizes to incorporate drones into their programs. As a result, adoption of drone technologies—locally, nationally, and internationally—is going to grow even faster and more broadly across the construction industry in 2018.

STOCKPILE HAS PROVEN ROI—WHO WILL SURVIVE IN A NOW-CROWDED SPACE? If you browse the websites of specialist drone hardware and software providers such as Kespry, 3DR, or Skycatch, you’ll see that the trend in featured industries is unanimously toward stockpiles and surveys. Mining and stockpile applications have proven return on investment for drone programs compared to traditional survey methods. Traditional survey firms such as Firmatek have embraced aerial data as well; their surveyors make frequent use of drones alongside traditional survey techniques and hardware. In addition to the fantastic software from Propeller, and Airware’s recent acquisition of Redbird, there are many options for surveyors, engineering firms, mines, quarries, and others in the survey and stockpile industries who want to take advantage of these new technologies. The question is: Is there room for growth in the stockpile industry? Our analysis, based on conversations with C-Level and project-level contacts in the field, as well as with the companies providing hardware, services and software in the space, is that 2018 will establish some clear winners among technology vendors, but that we are nearing market saturation. By the end of the decade, competition will grow more expensive and less attractive. Companies who are unable to offer compelling differentiators in stockpile analysis will be at a competitive disadvantage, and should begin exploring other emerging profitable uses for aerial data.

THE ACCESSORY MARKET IS FULL OF OPEN OPPORTUNITIES. The drone hardware onslaught has not stopped in the consumer markets, and it is merely beginning in the commercial space. Competing with established hardware providers for aircraft is a tough value proposition, but there is another entrepreneurial opportunity. Aftermarket accessories in the drone space are currently limited to cases and aesthetic options. In years to come there will be a hot market for hardware accessories that help solve real-world problems in aerial data-acquisition workflow. As an example, consider Propeller. They provide compelling data analysis software, but their Aeropoint solution for integrating ground control points for more accurate mapping and modeling with drones has become ubiquitous. In 2018 and beyond, there will be a huge demand for useful accessories that help solve problems in the field.

LONG FLIGHT-TIME IS COMING— FUEL CELLS, TETHERS & MORE Battery life has always been a top issue for drone users, but battery limitations have not as yet affected the industry’s dramatic hardware sales. As regulations allowing beyond-lineof-site operation come to fruition, and as companies demand more and more data from their drone programs, finding ways to extend flight time will become a challenge worth investing in. Already, we’re beginning to see robust tethered drone options from companies like Hoverfly. Alternative energy sources such as hydrogen fuel cells are also being tried for complex projects in industries like oil and gas. As the creators of cutting-edge drone programs look to push the limits to achieve greater ROI, the attempt to power Matrice M200, M210, M600, Freefly and Yuneec aircraft for 1-2 hours or more is likely to attract and reward the attention of investors.

COMMERCIAL DRONES

WHAT WE’RE EXCITED ABOUT. DroneSense—Software for Public Service DroneSense is a software solution designed to help public safety agencies organize, manage, and scale their drone operations. As we’ve seen with the success of specialized drones and software with services like Redbird (in surveying) or 3DR’s Sitescan (in engineering), when software is specifically adapted to solve industryspecific needs, there is both a distinct corporate advantage and an escalated adoption curve. We believe that software which is specific to public safety workflow needs will be of much greater value to its users than off-the-shelf commercial software. DroneSense could rapidly escalate the adoption of drones for public safety initiatives.

Autopilot The most powerful ground station gets even more powerful. Hangar’s Autopilot, offering autonomous and semi-autonomous software for controlling DJI drones, quietly made several critical improvements this year. Autopilot added shareable templated flights, preset options for inspection, and extremely robust mapping capabilities to their professional-grade software, making it excellent for commercial use. To achieve wider adoption, this software needs far more documentation and tutorials, but no ground control station for DJI offers as much versatility and as many useful features for professionals in the field.

Yuneec H520 Affordable thermal camera deployment? Yes, please. Competing with the excellent new DJI hardware offerings like the Matrice 210 isn’t easy, but Yuneec has found a way to separate itself from other hardware with a distinct commercial strategy. Their H520 drone is low-cost compared to its competitors and is integrated directly with Pix4d. Best of all, the H520 features swappable cameras, including a thermal option that is offered at a fraction of the price of its nearest competitor. Thermal is one of the most interesting features for inspection, construction, public safety, and insurance, so the affordable and versatile H520 platform will likely find widespread commercial adoption in an increasingly crowded market.

(UAS)

UNMANNED AIRCRAFT SYSTEMS UAS METRICS TOTAL REGISTRATIONS

947,970

Hobbyists

845,170

Non-Hobbyists

102,800

REMOTE PILOT CERTIFICATES PART 107 WAIVERS ISSUED

70,043 1,208

Top Five Waiver Requests (Percent) Night operations

70%

Operations Over People

29%

BVLOS

17%

Altitude

9%

Ops from Moving Vehicle

7%

AIRSPACE AUTHORIZATIONS ISSUED BVLOS: Beyond Visual Line of Sight) Source: Office of Unmanned Aircraft Systems, As of: Nov. 29, 2017

10,965

COMMERCIAL HARDWARE PLATFORMS THE BREAKDOWN

These are the 25 most common registered commercial drone models, which when added together account for over 80% of all non-hobbyist drones registered with the FAA. Twelve of these systems are made by DJI, giving them 70% of all registered commercial drones. It is worthwhile to note that Intel’s Shooting Star drones are used in swarms for Intel’s performance program, and not sold separately to companies or providers for use. Since they are two of the top 10 pieces of hardware, it follows that DJIs dominance for use in data collection is far higher. Of these platforms, 24 are multirotor and 1 is fixed-wing. **FAA DATA AS OF 2017

DJI PHANTOM 4 26000+

DJI PHANTOM 3 17000+

DJI MAVIC 14000+

DJI INSPIRE 1 7,500+

INTEL SHOOTING STAR 2 4,500+

3DR SOLO 3,000+

DJI INSPIRE 2 2,500+

DJI PHANTOM 2 2,000+

INTEL SHOOTING STAR 1,500+

YUNEEC TYPHOON H 1,500+

YUNEEC TYPHOON Q500 1,500+

AUTEL ROBOTICS X-STAR 1,000+

KESPRY DRONE 2.0 1,000+

GOPRO KARMA 1000+

DJI MATRICE 600 800+

DJI MATRICE 100 800+

DJI SPARK 700+

SENSEFLY EBEE 600+

DJI PHANTOM 1 600+

PARROT AR DRONE 2.0 500+

PARROT BEBOP 2 400+

3DR IRIS 400+

UNKNOWN 400+

PARROT BEBOP 400+

DJI S1000 350+

INTERVIEW:

DOUGLAS SPOTTED EAGLE Douglas Spotted Eagle has worked extensively with Yuneec Commercial in Product Development and as Director of Business, and conducted extensive piloting and training in the UAV Space with Sundance Media Group.

There is a lot of buzz about drones being used for law enforcement. What do you think are the real, value-driven use cases that will stand the test of time for drones in public safety? There are three primary areas where drones benefit LEO/PSO (at this time): accident scene recreation, pristine CSI capture, and overwatch/monitoring (particularly useful for no-knock warrant service and observation). Accident scene capture time is reduced by as much as 80%, while quality of data is immeasurably increased at a fraction of Real Time Kinetic/laser systems.

You’ve worked hands-on with commercial companies to integrate drones. What are some of the biggest success stories of companies you’ve worked with have seen new business value as a result of their drone programs? The greatest success stories have come out of teams focused on solving a specific problem. Whether it’s been the large-scale news organizations I’ve worked with, or medium-to small-scale construction companies, the groups that have gone into the decision with a determined outcome have all been successful. Successful organizations are able to understand that the drone itself is virtually meaningless, that it is just a support component of a much larger ecosystem that may not yet exist. The drone carries the important component (the sensor), but how does that component capture, transmit, process, report, and store the data? Is CJIS required? Building Index Modelling input? Photographic reporting with specific UTM, distance, radiometric data? What requirements are there, and what is the data path to deliver that information accurately, completely, and rapidly to the decision makers that are asking for the data? How does that data path compete with current information flow? What is the comparable ROI when acquisition, training, execution time, and costs are laid over the existing flow?

An example of a previous successful project is a mid-sized construction company building a retail space. We went in early, consulted the right equipment for the need, and trained the site super and one of his team members to fly with automation and tri-weekly overlays. We started the project flying at the elevation level, and by the fifth week after the flatwork went in, we discovered two construction errors, both of which would have been extremely expensive to repair had the work progressed much further. The cost of the drones and training was zeroed out in that one dataset/flight.

You’ve got an extensive background in drones for cinematography. Where would you recommend new users dive in to learn about using drones for real-world films? I’d recommend learning about the technical side of image capture, while at the same time learning how to fly intuitively. Very little of the “real” drone work in cinema is automated, but rather well-rehearsed. There are many incredible cameramen who cannot fly a drone, and many drone pilots who cannot fly the camera. Focus on flight techniques, “feeling” the shot from the director’s description, and understanding how the aircraft can add to the tension, freedom, and expansion of a shot. There isn’t yet a “where,” although there are training companies that specialize in teaching cinematic/kinetic flight.

If you were a company just building out your drone division, where would you point them to learn about the industry? Identify a consulting, training, and operational partner that has the ability to demonstrate case studies, actual end-user experience, and hours of real flight time. There aren’t many. Choose a guide that is specifically focused on one area identical or reasonably similar to the vertical applications your company is targeting. There are many, many people who have been flying for a short period of time who are branding themselves “consultants,” “SME’s”, etc. Look at their portfolios, talk to their clients. Visit the trade shows and pay attention to the seminars. Spend a lot of time looking at what others in related verticals are doing, how they do it, and, most importantly, why they do it.

INTERVIEW:

DANIEL MCKINNON ORBITAL INSIGHT Daniel McKinnon, PHD was the product development force behind 3DR’s Site Scan and is now the Director of Product Development at geospatial analytics company Orbital Insight.

You’ve always had a great drive to talk to real users in the field and figure out just what they’re looking for and why. What do you think are some underserved niches that could benefit from specialized drone technology? 1) Agricultural spraying. I knew these numbers like the back of my hand during my Agribotix days. It is very expensive and dangerous to apply chemicals by airplane when the conditions prevent terrestrial spraying. Heavy-lift drones can apply concentrated chemicals far more cheaply, more precisely, and more immediately than airplanes, with greater safety and lower environmental impact. I’m looking forward to watching DJI evolve their Agras platform. 2) Dangerous delivery. I believe that drone delivery as a whole is largely overhyped for the immediate future, but there are certain scenarios where society spends an enormous amount of money and risks an enormous number of human lives to move a parcel from one point to another. These scenarios include mountain rescue, resupply behind enemy lines, delivery of life-saving medicines to areas stricken by disaster, and many more. We should identify situations where a human pilot is flying a multi-ton flying machine to deliver a few hundred pounds, and replace that human and multi-ton flying machine with a drone.

You’ve worked on two very different sides of the aerial data industry, both in drones at Agribotix and 3DR, and in satellite imagery with Orbital Insights. What are the key differentiators between the two? Why would users prefer one to the other? From an analytics perspective, the businesses and technologies are largely identical: imagery comes in, and analytics come out. Satellites obviously offer a larger catalog that is captured effortlessly, but at the expense of resolution and timeliness. That said, this trade-off implies enormous differences in the business model. Despite enormous advances in drone hardware and software that have enabled nearly autonomous operation, flying a drone still represents a significant hurdle for most companies. A company interested in integrating drone imagery into its decision-making process will either have to make a significant investment in operations, or pay a premium to a drone operator. Satellite imagery arrives in a processing queue without effort and at minimal cost.

Large, macro-scale problems that can be solved with satellite imagery should be. If the resolution or the timeliness limitations imposed by orbiting spacecraft make the use of drones preferable, then companies should be prepared to foot the bill associated with their operation.

Do you think there will always be a place for both drone and satellite data, or does the drone industry need to think ahead to when satellite imagery or other technology sources will be able to provide competitive data? There will always be a place for both drone and satellite data. Commercial satellites are limited by international treaty to 30 cm GSD, which obviously precludes their imagery from solving quite a few business problems. In addition, a typical high-resolution satellite costs hundreds of millions of dollars to design and launch, so we will not see a flock of Worldviews orbiting the earth anytime soon. On the flip side, even fully autonomous large fixedwing drones will never cover the earth the way satellites do. At Orbital Insight, we image more than a quarter million parking lots in the United States for our retail product. Unless the skies become blackened with drones, I see the job of the satellite as quite secure for these applications. However, I do believe that the idea of a drone analytics company as opposed to a satellite analytics company will become obsolete. The pipeline to extract rooflines from satellite images to service the insurance market is nearly identical to that from drones. The analytics derived from the former would likely be purchased by an underwriter and those from the latter by a claims agent, but there is no reason a company couldn’t or shouldn’t offer both. Rather than differentiating by data source, the analytics companies will begin to differentiate by customer vertical served.

You spearheaded development of one of the best niche solutions available for aerial technology with Site Scan. Do you have any recommendations for new companies developing solutions for a specific vertical? Talk to your customers. Seriously. Just talk to your customers, listen to what they have to say, and understand their problems. Go so far as to even literally step inside their shoes. Partway through Site Scan development, I became a surveyor-in-training, so I could get comfortable stepping on to any job site and empathize with the problems our customers were facing.

While Site Scan began as a broad drone mapping platform, it evolved into a specific tool for helping engineering service providers survey their earthworks projects through relentless customer development. Nearly every business activity at 3DR from engineering backlog to customer success process was driven by 3DR users. This focus allowed 3DR to outmaneuver entrenched competitors.

You’ve hacked together some projects yourself which you’ve featured on your blog and forums like DIY drones. What’s one of your favorite DIY/hacked projects? I love building fun software projects. I’ve done some neat things with drones including hacking together the first Solo/QX-1 prototype that later became Site Scan R10C, and building a tool to check on the games at the local basketball courts. More recently, I scanned satellite imagery of the entire planet to find secret signs of civilization in remote places. That said, my current favorite is unpublished. I’ve been writing algorithms to profit from inefficiencies on and between various cryptocurrency exchanges. I’ll post this one after all of our alpha disappears :-)

What technology would you be excited about hearing is integrated into drones in the future? The end of the era of innovation in sensor-carrying drones is in sight. Changes have been largely incremental over the past couple years. Currently, commercial drones carrying almost every type of sensing payload are already on the market hunting for vertical-specific solutions. I am excited for the next generation. I believe that the next movement will be around communications. From the tactical repeater that could be deployed to connect firefighters combating blazes in adjacent valleys by radio, to the large-scale atmospheric satellites that the large tech companies believe will connect the distant corners of the earth to the internet, I am excited to see our flying robots evolve into a tool to further connect humanity.

Anything you’d like to promote or showcase to the readers? Orbital is hiring like crazy. The business is growing, the team is talented, and the problems are global. If you are a software engineer, data scientist, or anyone who fits any of the profiles listed on our careers page, drop me an email at [email protected]. We would love to have you aboard.

INTERVIEW:

TED BAHR

INTERDRONE Ted Bahr is the President and CEO of BZ Media, producer of multiple technology trade shows (several of which were acquired in 2017 by various entities). Most notably he is the brains and execution force behind Interdrone, considered the most prominent modern drone trade show in the world.

We’ve seen as many drone trade shows as drone hardware companies pop up over the last few years. What separates Interdrone, and what are you excited about for the future? I think the trade show market has settled out pretty quickly. In North America the three shows that matter are (in chronological order): AUVSI Xponential: Attendance 7,000 but maybe 50-70% defense-related. Sheer mass makes it viable for the commercial market, and it’s the big show in the Spring. InterDrone: Attendance 3,500. No defense folks, but it covers the entire commercial drone market from soup (components) to nuts. Pretty much everyone who is anyone is there. As DJI told us, “You guys won.” Comm UAV Expo: Only half the size of InterDrone, but very targeted on enterprise. Because both shows are in Vegas and near each other on the calendar, the attendee base is pretty unique at each show. The acquisition of the San Jose walk-in show Drone World Expo is kind of a non-factor. Those guys were losing money and someone had to take them out.

You’ve also worked on a drones-in-retail summit. What were some of the key things users took away from getting together to discuss drone sales? Yes, it’s too bad Drone Dealer Expo didn’t take off. It’s just not a big enough niche to pull in the buyers from the big-box resellers, and a lot of the smaller players (small drone dealers) frankly go to InterDrone or other shows… I think a smaller summit could work, but it’s tough to get all the players in one room - especially if they are competitors. The takeaway is that DJI’s “scorched Earth” policy has essentially obliterated the retail market; basically, they own it. And they continue to eat their own young, ensuring that none of the other Chinese manufacturers can get a foothold.

When you’re curating speakers and agendas for your shows, what do you and your team look for in proposals and submissions? Either wide, broad appeal, or very deep on a technical topic. We are happy to work with you in this way: submit a bunch of ideas—just a title and sentence or two—and we will tell you if we are interested or not. This way you don’t waste a lot of time, and we get what we want. We prefer speakers to be experts in the field, often users. Often we will blend in vendors—who often are experts and do a reasonable job of staying non-partial—on the panels.

What were some of the best keynotes given at Interdrone over the last few years? Well, the head of the FAA is always a draw just for sheer “importunateness.” Having the CEO of Intel last year wasn’t too bad either. Keynotes should be visual and big picture. Chris Anderson’s keynotes (first 2 InterDrones) were always good. Greg Agvent from CNN was pretty good. Romeo is always good. The Intel keynote was good.

What topics are you excited to hear discussion about this year? LAANC, use of drones in verticals, especially new ones like insurance, counter UAS, whatever the latest FAA-related discussion on regulations is. We have a fair number of proven speakers on the bread-and-butter topics, so don’t be afraid to bounce ideas off us.

How has the makeup of exhibitors changed over the last few years? Do you see any trends? New types of companies or technology becoming more popular? Oh my, that’s been a HUGE change, especially at InterDrone. Way more grown up, so to speak. The first year we had companies like Hobbico. Now we’re getting dominated by Intel, AeroVironment, PrecisonHawk, Drone Deploy etc… Essentially, since InterDrone is The Big Show, we reflect the marketplace at that point in time. We’ve become quite “enterprise-y”

Tell us about what we can expect at Interdrone 2018. Too early to tell, but lot’s more of the same good stuff. Elwell has been invited to keynote, and the enterprise tracks are expanded. More surveying and mapping. A new re-conference program on putting together a public safety drone program (fire, police etc.) Frankly, the most exciting stuff comes in 4 months before the show—this world moves so fast.

2017 INTERDRONE ATTENDEES:

INDUSTRY DRONE USE BREAKDOWN Surveying & Terrain Mapping

57.1%

Construction & Building Inspection

51.8%

Agriculture

44.2%

Pipeline, RR, Bridge, and Infrastructure Inspection

32.5%

Law Enforcement, Emergency Response, Search and Rescue

32.1%

Insurance/disaster mapping

28.0%

Process, Power & Utilities

24.2%

Mining and Aggregates Analysis

21.4%

DRONES DRIVING VALUE IN INDUSTRY BREAKDOWNS BY VERTICAL

DRONES IN INSURANCE USABILITY ENABLES VALUE

Drones in insurance have been thrust to the forefront of the technology news cycle after the recent tragic hurricanes that have impacted the coastal United States. Numerous professional drone teams, including Hangar, were able to work quickly and efficiently with regulatory agencies, companies, and affected individuals to gather data to help make realtime decisions and document the disaster impact for later processing. What was once a novelty is fast becoming commonplace as rapid post-disaster technology deployment becomes a reality. In this writeup, we look at the history and the impact of drones and insurance. An aerial glimpse of the coast of Texas post Hurricane-Harvey:

The future is here, even if you don’t know it. In 2012, Matt Waite- a Pulitzer Prize-winning journalist- drove into a small town in the Florida panhandle to report on local damage from Hurricane Isaac. He selected a residential street at random, parked and stepped out of his car, and saw in every direction homes that had been flattened. But he had no idea how extensive the destruction was, couldn’t get an idea of the line the hurricane had traveled (and therefore the line he should also travel to investigate), and was frankly overwhelmed at the scope of the project ahead of him. He yearned for a helicopter. A year later, he saw his first drone and remembered that scene. “Things had changed,” he said of this first inflection point. “It’s just that no one knew it yet.” Here we are a few years later, and while more people know about the power of the aerial perspective, usage has still not hit critical mass. This is because the technology until now has been either prohibitively expensive, unreliable, or difficult to use without extensive training. But now we’ve hit a second inflection point: Usability. “Usable” really just means “easy.” And easy is brought to you by autonomy. Everything can be done at the push of a button.

The Business Perspective It might not seem like the technology has fully arrived just yet, but we know it’s inevitable, because firms are now acting on this technological advantage. Just as Matt Waite realized in 2012, drones — now commercially legal for mainstream business use in the United States under the FAA’s Part 107 — w ill soon be as essential to an adjuster’s toolkit as cameras and mobile technology. Drone systems can help improve insurance operations in three main areas: risk monitoring, risk assessment, and claims management (including fraud prevention). Given this scope, Price Waterhouse Coopers estimates that drone solutions represent a $6.8 billion opportunity in the insurance industry. There’s also the risk you save your workers who must often conduct inspections at height: falls and slips are the second and third most common sources of all workplace injuries. Drones can help you in all of these areas right now.

Technology Makes It Easy Imagine this: A tree falls on a rooftop during a storm. When the claim comes in, a licensed pilot is dispatched, and they capture high-resolution data of the roof, all presented to the adjuster in an interactive interface that can be used to zoom into questionable areas, and analyze details to understand the cause and scope of loss. All done on-site with the push of a button, without disturbing the scene or sending someone up on top of a compromised structure at a dangerous height. The drone system will collect and deliver everything you need — including image processing — so you can get straight to performing your analysis. Drone inspections in insurance will

• Save you time and money • Keep your employees safe • Deliver live video and HD images • Process those images stitched into 2D maps, DEMs, and 3D models, and integrate them directly into your business systems.

The Top Value Propositions Here are a few specific areas insurance firms report as having the most value for drone solutions. Visualization

• Model risk and identify vulnerabilities and improvements • Accurately determine property conditions and maximize your underwriting capability • Analyze high-resolution terrain data for more accurate



flood modeling • Analyze property over time with uniform and repeatable inspections

Safety

• Eliminate the need to climb up to elevated platforms or structures — especially important for damaged high-risk areas

Claims assessment

• Make accurate measurements within centimeters • Make comprehensive and detailed damage assessments • Conduct automated inspections, even in wet or damp conditions • Facilitate post-catastrophe analysis

THE POWER OF AERIAL IMAGERY FROM

DRONES IN CONSTRUCTION

While almost all the conversation online around drones in construction seems to revolve around VDC (virtual design and construction) or BIM (building information modeling), our conversations with real users in the field indicate that they often look at those concepts as impressive, but not representing the real value of drones as they are used on a regular basis in the construction industry. They are more interested in the power of basic imagery to make a difference in driving safety and ROI on construction projects. Many have heard about drone or aerial data impacting complex operations around surveying and calculations, but the real value is even simpler. Photos from above are helping contractors digitize construction sites and make decisions across departments that impact the business every day.

SPECIFIC VALUE OF PHOTOS IN CONSTRUCTION

Photographs provide one of the best records of job progress. Acquired consistently, photos allow managers to track jobs and judge if work is progressing on schedule. They can also prove when (and how well) work was completed. Additionally, a review of the photographic record can demonstrate when progress was best, which helps stakeholders identify hang-ups and informs solutions for improving efficiency and design. This hasn’t always been practical. In the past, most aerials were taken from helicopter or satellite, which were incomplete solutions. Each has its own drawbacks, such as accuracy, expense, time, and safety. Drones, however, are powerful, reliable, and affordable imaging platforms that address all those concerns, and they’ve taken their place on-site next to tried-and-true machines. In addition to being much less expensive than a helicopter, drones are more versatile. For instance, an industry survey ranked “tracking job progress” as the number one use of drones in construction. Drones can easily capture crisp images in places that might otherwise be difficult or impossible to reach, such as close to the exteriors of high-rises or underneath spans and structures. We often forget that drones can also take pictures close to the ground, and can get closer to subjects than can legally and physically be done using a helicopter. For example, you can’t fly a helicopter underneath the Space Needle in Seattle, WA, but if you have the proper licensing, you can get there with a drone.

We understand the value that precision photo and data analytics have for virtual design and construction (VDC) teams, but these applications focus mainly on the interior of a project, for as-builts and comparing/preparing models for completed work. The technology can’t account for much of the action that happens outside, which architects, developers, builders, and contractors must also track. Such data is necessary to accurately document site progress, but it isn’t worth much unless it’s reliable and up-to-date. This is where aerial systems will excel. Drones capture critical images and data on-site. An operator on your team or a third-party provider can run these missions easily, cheaply, and frequently, with tremendous payoff. When you combine the panoramic aerial perspective with state-of-the-art cameras and sensors, you get visuals that are both comprehensive and precise for sites of any size, and dated pictures offer a visual timeline of a project’s progress. Drone systems can improve and accelerate several existing processes:

• Report and forecast project status



• Document progress over time



• Plan and adjust transportation routes



• Track efficiency of site layout



• Monitor resource use and adjust allotment



• Track and record contractor work

AERIAL PHOTOGRAPHY IN CLAIMS

Claims companies often use photographs as an evidentiary resource. Accurate and reliable photos can verify conditions on-site and demonstrate any changes, illustrate characteristics and variations under different conditions, and provide a record of methods and equipment used on a job. Pictures tell stories, too. They can show causal relationships resulting from managerial decisions or site conditions over time, and can help managers and adjudicators evaluate the costs and benefits of key decisions. For example, a series of pictures can demonstrate how adding a structure to a contract unexpectedly forced those contractors to reroute access roads, which in turned disrupted other work-zones under different contracts. And of course, there’s litigation. Accurate and verifiable visual documentation can be invaluable evidence for firms, contractors, and owners facing or pursuing damage claims. Drones collect visible proof of site conditions before, during, and after your contract.

THE FUTURE OF

JOBSITE PHOTOGRAPHY SAFETY

Remember that drones aren’t just hardware. The flying robot is just the most visible part of what’s in reality a sophisticated end-to-end data collection and processing system. The software systems that drones interact with are becoming more and more important for managing and processing visual data. For instance, the same neural network software (sometimes used interchangeably with “artificial intelligence” or “machine learning”) that identifies faces in your social media pictures can also be used to identify safety violations. Not only that, but software can do it faster and more accurately than humans. Why does this apply to safety? Drones provide a tremendous amount of visual data to help “teach” this software, including live aerial video feeds that can cover an entire site. It’s reasonable to expect it won’t be long before artificial intelligence can process that video in real time to alert supervisors to safety violations for immediate correction.

PUBLIC RELATIONS AND MARKETING Written communication and conversation will always be valuable assets, but clients and stakeholders also want to see things for themselves. Drones can document projects from scouting a site to cutting the ribbon. Conversely, if a project is experiencing delays or other issues, photography can help to chronicle this as well. It also goes without saying that images can do wonders for presentations and marketing materials. Drones capture truly stunning aerial panoramas that showcase in-progress and completed work. These are great for internal presentations (both aesthetically and for visual proof) and can add an extra dimension to your marketing materials, your website, brochures, and even social media.

WRAPPING UP In the coming years — months, really — drones and other autonomous robotics platforms will be one-touch, and even no-touch machines, deploying automatically when you want them to. Though right now we might look up at drones because they represent a new dimension of machine, they’ll soon be out of sight, out of mind, and you’ll only be concerned with looking down at the data in your hands.

THE POWER INDUSTRY’S

DRONES FLY THE NEST WHAT CAN DRONES DO FOR ENERGY? For years, drones have assisted inspectors with difficult sites and have helped managers take stock of asset inventory. The latest advancements in UAS technology are presenting further opportunities for the power industry to make use of drones and their unique multitasking capabilities. There are a number of these areas where drones are already making a demonstrable impact:

ASSET INVENTORY. Drones and the data acquired from their sensors are used by energy infrastructure operators to manage inventory, assess conditions, and efficiently plan maintenance work. By using unmanned systems, infrastructure operators make their work more efficient and avoid unnecessary human trips.

CONSTRUCTION & REPAIRS. Work that is done at great heights, such as constructing a building, repairing infrastructure, or trimming vegetation, is made significantly safer using drones. In major construction projects, drones can easily produce aerial images for planning and for monitoring the site as the project progresses. As drones’ load-bearing capabilities further increase, engineers and builders will be able to use drones to assemble or weld heavy materials.

MAINTENANCE MANAGEMENT & HIGH-RESOLUTION IMAGERY. Drone fleets are used in a variety of highly-specific aerial inspections by professionals such as facility owners, asset managers, technicians, and contractors in order to cut operation costs. For example, drone sensor technology has been developed for advanced thermal imaging and orthomosaics in order to automate solar panel inspections. For wind energy, Aerial Technology International recently developed a system for inspecting turbines and identifying cracks and fissures on blades. Nuclear power plant drones have also been recently developed by scientists at Purdue University to automatically detect and monitor structural changes to buildings’ steel components and immediately alert technicians to the issue and potential danger. In each of these applications, high-resolution cameras and industrial-grade drones have saved businesses money, diminished human risk, and decreased shareholder liability, all while creating a process which increased inspection efficiency.

EMISSIONS MONITORING. In addition to visually surveying infrastructure, sensor technology continues to advance drones’ ability to monitor non-visible light and airborne toxins. Data from airborne infrared cameras is already being used in the field to detect chemical leaks, and new chemical sensor programs currently being developed at universities and in the military will enable further capability in the coming years.

DISASTER RECOVERY. Drones have been shown to help significantly with rescue missions and damage assessments after natural and environmental disasters. By integrating drones and 3-D modeling software, power companies and researchers have been able to effectively assess and respond to damage from coal ash spills. As part of the nationwide recovery effort after Hurricane Harvey last August, utility companies such as Southern Co. sent drone specialists to Houston to assist with repair work. From Southern Co. subsidiaries alone, seven drone teams consisting of UAV operators and spotters were brought in to collaborate with local utility workers in their efforts to rebuild their infrastructure. Though drones have demonstrated success in disaster recoveries, not all drone activity is helpful in the aftermath of a disaster. The increased use of civilian drones can pose a significant risk to rescue missions. Again, in the aftermath of Hurricane Harvey, the Federal Aviation Administration (FAA) had to issue a temporary flight restriction for all non-commercial drones in order to avoid risk to rescue crews scouting damaged areas.

INTERVIEW:

CHRISTIAN SANZ CEO, SKYCATCH

How has your original vision for Skycatch changed and iterated over the last few years, and what were the key catalysts for these changes to where you are as a company today? The vision always remained the same: data & software. However, the original route we took and the detours presented to us propelled us to adapt and change our strategies in order to achieve that vision. For example, by partnering with DJI, world experts in drone manufacturing, we have been able to reach a level of market differentiation and production at a speed that no one else in our space has been able to achieve. Rate of adoption was also a factor we had to consider. Slower U.S. adoption rates led us to focus more on markets in Asia rather than in the U.S.

You’ve worked with top-tier enterprise customers not just in the US, but also globally. What are some of the nonNorth American markets that are really starting to take advantage of aerial data and why? Japan has been the most innovative drone data player for us. Japan and, in particular, the Japanese construction industry has been experiencing a major labor shortage. As a response to the need for automating that process, Komatsu created a division called Smart Construction, which uses Skycatch drones and data for machine-to-machine automation and enables heavy machinery to operate without humans.

You’ve been through the tough cycles of an entrepreneur in the drone space over several tumultuous years. What were some of the hardest experiences to overcome since starting Skycatch? Creating (and now paving) an industry where one didn’t exist before is a big challenge because you have to continually educate customers on something they have no frame of reference of. Since our technology is so unique and has never existed before, we at Skycatch always try to promote greater opportunities for conversation around our service offerings. Before the FAA’s Part 107, when regulations were more cumbersome, operating in this industry was not easy. Although we were lucky to get 333 exemptions with our partners like Bechtel, AECOM, etc., there were many other companies that were ready and willing to work with us but were put under moratorium [to fly drones] by their legal departments.

If you had advice for any new companies just looking to start integrating drones and aerial data into their workflows, what would they be? I would recommend those companies to first try these technologies alongside their employees. One workday with a highly intelligent, data collecting instrument such as a drone can bring a massive amount of insights that would otherwise take twice or three times as long with manual labor.

Looking ahead over the next 18 months, what are some new hardware and software technologies on the horizon that excite you? First technology that comes to mind: LIDAR (light detection and ranging). This tech is revolutionizing the way people can map in less than simple conditions. Through various terrains (dense forestry) and any time of day, LIDAR can collect data accurately and efficiently. AI (Artificial Intelligence) in the form of machine learning through smart modeling will introduce an entirely new workforce that we’ve never known before. For the construction industry, this will mean safer jobs, greater human control, and most importantly better understanding of the environment around us. The value of AI will be instrumental to society as a whole.

What are obstacles still standing in the way of true mass adoption of drones for enterprise commercial use? The biggest hurdle in the commercial drone space is the rate of adoption. The technology has arrived; now, the only thing holding us back is human resistance to change. This is especially true in the U.S.

Two years ago, what would you have predicted as the industry that would be best served by commercial drones and their data and why? What industry is actually best served in your opinion today? We have always been bullish on construction since the company was started in 2013. I saw the immediate need myself when I was on these construction sites, where the environment is constantly changing every day and there’s so many factors in play that should not be just seen but analyzed, tracked, and reported as well. I would say construction is still the best served industry because we’ve seen such strong demand and adoption from the field. Construction personnel really understand the value drone data brings to their workflows and their bottom line.

You both make your own drones and integrate with DJI’s solutions. What made you take this approach? Can we expect to see future generations of Skycatch hardware? DJI is a world-class manufacturer and partnering with them to create solutions has been instrumental to the mission we serve. We have had to build our own drones because the hardware we needed wasn’t available on the market. As the saying goes, “If you want to go fast, go alone. If you want to go far, go together.”

If a new technology team was to develop one piece of hardware or software innovation that would integrate with what you have at Skycatch and radically improve the value of your drones and their data in the field, what would that technology be? As mentioned previously, LIDAR technology would revolutionize not only the drone and aerial mapping sectors but also completely change the game for all mapping systems (e.g., forest inventory). If LIDAR were incorporated into Skycatch products, we would be able to collect data very quickly and with high accuracy. We could fly drones through the night using active illumination sensors, scan dense forests, and integrate other data sources and LIDAR hyperspectral sensors in a portable and more efficient manner. It would help advance the industry if traditional tools used for managing construction are also adapted to ingest and act on this data, such as scheduling, task and visual BIM management tools.

Dive Deeper With Skycatch Below:

THE CONSTRUCTION INDUSTRY IS IN LOVE WITH DRONES

5 WAYS AI AND DRONES ARE OPENING UP A BILLION DOLLAR MARKET

TOMORROW’S BUILDINGS:

CONSTRUCTION INDUSTRY GOES ROBOTIC

INTERVIEW:

NICK OSGOOD DRONEBASE Nick Osgood is the Director of Operations (and one of the first employees) for Dronebase, the most prolific drone operator network.

What is the industry you see having the most traction from aerial data as a service in the next few years? DroneBase flight services are seeing significant traction with enterprise customers that have nationwide distributed assets, as opposed to the localized/regional companies that can be serviced by in-house drone technology (a local construction company or realtor, for example). From the software analytics perspective, most of the venture capital funding that will impact the aerial data we collect ($250m+) has gone into Architecture, Engineering & Construction related data analytics over the past 3-5 years. Unless all of that investment is wrong, I expect AEC to be one of the largest verticals to get the most traction in a few years. Depending on regulation for beyond visual line of site applications of drones, agriculture can be a HUGE market, but we’ve found the customer base continues to be slow moving in adopting aerial data.

Are your pilots typically running small businesses as well as being Dronebase pilots, or do they focus purely on Dronebase work? We have a variety of pilot personas with different backgrounds including

1) Full-time drone pilots who supplement their own drone business with additional DroneBase missions



2) Part-time drone pilots who have primary 9-5 jobs outside of drones but enjoy putting their Part 107 commercial drone license to work on weekends



3) Pilots who fully rely on DroneBase for supplemental income but don’t want to deal with the stress of running a business. It is very rare that we see independent drone pilots busy 100% of the time if their sole income is based on drone work.



We have a segment of our blog where we spotlight our pilots on a monthly basis, which those looking for insights on pilots might enjoy reading:

Meet Dronebase Pro Pilot Joe Kotrady

GO>>

Meet Enterprise Pilot Andrew Dean

GO>>

Pilot Spotlight Brian D.

GO>>

What software for flight/processing with drones sees the most use in the field by your pilots? We have an iOS and Android app that allows our pilots to accept missions and fly manually; however, we do not have set requirements on the customer-side for the flight tools that our pilots are using (especially if automation is needed). Some of our enterprise customers require us to use say, DroneDeploy, Hangar, or Ground Station Pro, while others may require us to use an in-house tool built into the DJI SDK. From a processing standpoint, there are many positives to all of the software solutions out there. I believe that either there will be a convergence over time among the drone analytics companies, or an existing industry titan may just integrate drone imagery into a current analytics solution.

Do you encourage your pilots to use any applications or tools for their workflows (such as Skyward, Kittyhawk, Airdata etc)? We have in-house dashboards for pilots to manage their flights and we currently do not endorse any fleet management software; however, we are built into the AirMap API for airspace and LAANC integration. Unless the pilot or company has a significant fleet, I’m not 100% sure if there is enough value in paying for some of these SaaS drone tools yet.

What was the impetus behind developing AR attachments for your pilots? DroneBase wants to engage with as many pilots as possible by providing endless commercial and creative activities. We have created an augmented reality platform called AirCraft for hobbyist to build “Minecraft” like structures in the air. This deep tech was created to provide more engagement for all skill levels of pilots, from professionals to hobbyists. We’ve seen pilots across the globe build signs, racecourses, cell towers for training, and a variety of other structures. We are continuing to develop this technology and will be releasing professional-use cases of Augmented Reality soon. This is what excites me the most because there is a world of opportunity to support professional use cases with AR.

Anything you’d like to promote or showcase to our readers? We are always looking for more Part 107 pilots to sign up on our network!

INTERVIEW:

GREG CRUTSINGER Gregory Crutsinger PHD has a background in academic research, but in recent years has served in various capacities at 3DR, Sensefly, and Pix4d in the development and sales of drones and in the deployment of drone-related technology in education, agriculture, and mapping. He is currently the owner of Scholar Farms, a training and consulting business with popular programs around mapping protocols, workflows, and plant mapping using drones.

What are some of the interesting educational programs that are developing curriculum around drones? I’ve worked with a wide range of academic partners. These are early days for a lot of university drone programs, but there are already some clear leaders. Duke Marine Lab is pioneering drone use for the environmental sciences and coastal monitoring. They work everywhere from the east coast of the U.S. down to Antarctica, and probably have completed more eBee flights than anyone else on the planet. Sinclair Community College in Dayton, Ohio is leading the way for two-year colleges. They have being developing their UAS much longer than the vast majority of 4-year schools. They are also developing great partnerships with local businesses and public agencies in the state. That’s really impressive for a small college. Those are just two examples, but more are popping up all the time.

How should new companies be thinking about working with educators as they bring new technology in the drone industry to market? The future of education and training is really in partnerships between education and industry. The technology and analytics are moving so fast that it’s difficult for universities to keep pace. Most don’t have the budget or the incentives to stay on the bleeding edge. There are too many committee meetings to attend, long grant funding cycles, and lots of distractions from basic research. I know because I left a tenure-track job at a top research university to join a drone startup. At the same time, the industry needs the workforce that colleges and universities produce, and they need them to be trained in the right ways. The key to this is a constant dialogue between the schools and the companies involved, which is what I have tried to facilitate over the past few years in the drone industry. I get frustrated by the slow pace of academia; but at the same time, I still strive to help out those who want the assistance. I guess I’m still an academic at heart.

What would be the most valuable hardware or software technology a technology company could develop to assist with research using drones? Both the hardware and the processing software have improved dramatically over the past few years. We are starting to see some maturation in the industry and a focus on particular verticals. It may seem mundane, but better batteries are going to be essential to the long-term success of the commercial and research industry. The limitations on flight time are a big issue, and I bet that someday we will look back and laugh at how many batteries we used to lug around. In terms of software for research, improvements could be directed towards improving the ability to merge data layers. Not just drone data, either. We need to be able to merge satellite imagery, weather data, ground sensors, and more. How do you compile all of this information, summarize it, and make decisions based upon it? It’s a challenge for sure…but it’s a fun one to have.

What are the industry segments in agriculture that are benefiting most from using drones? It’s interesting, Ag Tech is having its own sort of revolution that has many parallels to the drone industry, including a lot of vaporware and hype. While there has been much excitement surrounding drones for agriculture, the reality is that the return on investment is yet to be determined for many Ag applications. In the U.S., the restriction of maintaining line of sight creates a limitation on the size of farms that can be flown in one go. Image processing and data management also take time. Right now, drone technology has the highest benefit and return for smallerscale operations , which would include academic research, commercial test plots, and higher value crops. In California where I live, this would include vineyards, berries, almonds, and, most recently, cannabis.

What do you think is the ideal hardware and software setup for gathering data for precision Ag? If you can get away with a multirotor, it makes takeoff and landings a lot easier. Then it’s about the sensors. There isn’t a great RGB and multispectral combination sensor out yet. What would be ideal would be a DJI Matrice 210 with dual cameras, a high resolution color camera, and a multispectral camera like the new Micasense Red-edge M flown in tandem. You could also get by with this dual setup on a Matrice 100, but currently it’s less of a finished product and more a developer tool. For fixed-wing though, I like the eBee Plus. They are not cheap, but they work and have been well-tested in a whole range of applications. I would swap the 20 MP SODA RGB and use either a Rededge M or a Parrot Sequoia, depending on the resolution of multispectral data I needed. That’s the ideal hardware to me, but obviously you could get by with lowercost options if needed. For software, since many agricultural folks are in rural areas without high speed internet for cloud processing, I would use Pix4D desktop software. Then I might supplement by pushing some of the finished maps to the cloud. Micasense Atlas has some nice visualization tools and a range of vegetation indices. Using the cloud also makes it so much easier to share data with partners, clients, or collaborators.

What are the barriers from more mass adoption of drones within agriculture? First, cost. Multispectral cameras aren’t cheap (though it’s amazing what you can do with just color imagery from the camera on a Phantom 4 Pro for about $1500). Then, data interpretation. A lot of ground-truthing is still needed to understand the relationships between the imagery, the plants, all the other field information being collected, and the decisions to be made. We know quite a bit about a few crops, but there is much more work to be done. It’s a fantastic time to be looking for a senior project or a master’s thesis.

When do you think we’ll see a “tipping point” in adoption of drones for agriculture?

People want simple answers and, unfortunately, it’s still not simple. We have different drones flown at different heights, speeds, and times of year, and different cameras over different varieties of different crops in different locations processed with different software visualized differently. ‘It depends’ is not a very satisfying answer, but it’s where we are at in the near term. It’s going to be a while before we have set standards most people can follow, and that’s what mass adoption is going to take.

Talk to us a bit about your new project in the drone space. Scholar Farms is hyper focused on becoming the go-to place for professional training for vegetation mapping using drones. We’ll be launching a masterclass in spring of 2018 to help scale education around plant mapping for agricultural and other related verticals like ecology, forestry, and environmental consultancies. We teach you how to map plants with drones. That’s all we do.

SPOTLIGHT:

INTERNAL DRONE PROGRAMS

THE KEY CONCEPT BEHIND DRONE PROGRAMS - CLOUD ROBOTICS Too many companies devising drone programs tend to focus on the drones themselves, rather than on the drone apps which have the most potential for business solutions. When it comes to data collection, drones are of course invaluable. They offer opportunities to take photographs, perform scans, communicate messages, or fix damages at unprecedented low costs. However, drone programs do not end once the data is collected. The most successful drone programs will make use of what is being called “cloud robotics” to improve drone performance and analytics.

Drone software has evolved out of smartphone and mobile-app technology. Like smartphones, drones are built already connected. Unlike smart-phones, drones are also full-fledged robots, because they don’t just sense the world, they have actuators that allow them to also interact with the world. The robots of the past required custommade communication technologies which would laboriously collect data, download it onto another system, and then either analyze it or leave it to the user to analyze. Drone robotics, however, allow the cloud to do all this for us, with communication, data, analysis, and implementation occurring automatically. Drones and cloud technology are making it more attractive than ever before for companies to automate their operations. There are four major implications of this shift to cloud-based robotics:

1. Apps over-ride obsolescence. Technology users are all too familiar with the immediate obsolescence that begins as soon as they start up their devices for the first time. Connected devices like drones, however, are powered primarily by software which receives automatic updates, or by the brand-new apps which extend their capabilities. Though hardware continues to evolve, and old models will eventually become obsolete, connected technologies like smart-phones, Teslas, or quadcopter drones gain value and improve performance after the point of

purchase. A drone purchased today will have new autonomous abilities tomorrow.

2. Operations get real-time intelligence. One of the major differences between traditional and cloud robotics is that cloud-powered robots are not forced to run a preset program that is limited by their on-board data storage capacities. Cloud-based algorithms can use data uploaded by a drone to do real-time calculations to optimize the flight path, speed, angle or other elements of the drone’s daily operations– calculations which would be difficult to design for a small robot with bespoke software solutions. Cloud robotics allows a data-first approach to automated operations to make them more efficient, robust, and context-aware.

3. Drone data enlightens the cloud. The successes of AI have always been dependent on the quality of the data input to the system. The improvements we have been seeing throughout 2017 have less to do with improved computational capacity or innovative algorithms than with the greater quantities of data that are now accessible to these systems. However, AI has not yet been fully utilized to power data collection itself. Though we know drones will download maps and recent environmental data from the cloud for their operations, they can also upload the data they collect to improve those cloud-based maps. With the drone-powered revolution in data collection on the horizon, cloud-based AI analytics will continue to see massive improvements in the near future. For the first time, AI will be powering and scaling the data collection that drives AI.

4. Off-board analytics simplify automation solutions. No company considers a drone program as an enterprise solution simply because it is trending. Whole industries are paying attention to drones because they far exceed the data-collection capabilities and efficiency of any alternative forms of technology. Companies want solutions without gimmicks, without frills, and without unnecessary barriers to adoption. Cloud-based automation, as it improves, will remove many of these barriers by creating a seamless process with near-real-time analytics. Cloud robotics removes many of the logistical difficulties of automation from the picture. Imagine cloud robotics as a black box with a red button. Companies that make the transition to cloud robotics will see dramatic improvements not only in cost and efficiency, but also in the simplicity of their operations.

Developing a Drone Program Considerations To Note Macro-Level Program Considerations Any company wishing to begin investing in a drone program needs to develop a sound business case before they begin. The process of assessing a drone program involves a number of considerations: the expected need and frequency of drone use in daily operations, a cost analysis for both drone fleet and team relative to prior methods of operation, a listing of the metrics that are expected to be improved by the program, and a timeline for program adoption. If the drone program looks to be a sound investment, then the next step is to determine the technology that best fits the business needs and specific drone applications desired. For example, companies will need to choose between offthe shelf and specialist hardware, and identify which software will be used. An in-house drone program will also require user documentation such as flight operations protocols, accident procedures, training manuals, and company standards for the program. An in-house drone program is not, however, a company’s only option. With the advancements of drone technology over the past several years, a global submarket for “drone service” firms has opened up, which presents companies with the opportunity to partner with specialists. This drone services sector has grown dramatically, and the market is now flooded with remote pilots and service providers who use commercial drones to capture data for client companies.

Meeting FAA Regulations Regulations which govern drone operation differ by country, yet companies throughout the world have embraced drone technology and have been exploring its possibilities and limitations. In the US and worldwide, companies have tended to be relatively wary about the evolving federal and state regulations concerning drones. In June 2016, the FAA established Part 107 (of the Federal Aviation Regulations) which created new rules that limit the physical dimensions of commercial drones as well as the height, speed, and time at which they can legally fly. These new rules also require that drones remain within unaided sight of their operators in order to ensure that they avoid collisions with

manned aircraft. Though Part 107 was more lenient than anticipated in the UAV industry, more elaborate rules are still warranted for greater flexibility in commercial drone operations. The further development of Part 107 has been impeded, however, by the Trump administration’s de facto ban on new regulation. In our opinion, logistics and scalability, rather than commercial regulation, will be the primary practical concerns for drone adoption by enterprise businesses. Even relatively restrictive FAA jurisdiction on airspace would be a minor setback to the implementation of a drone program. Rather, the most significant barriers to adoption for companies to overcome will be those that stem from the steep learning curve for drone implementation.

Operational Challenges Rather than focusing on regulations, companies getting started with a drone program should concern themselves with acquiring the right talent. By hiring drone operations staff with the necessary skills and piloting experience, businesses can dramatically boost efficiency and reduce both human and technical errors, like the chance of crashing into a power line and causing serious infrastructural damage. It is important to have staff who have experience with flight planning and regimented processes. To simplify these hiring challenges, a company can consider entering into a partnership with a specialized company which can provide training, certification preparation, documentation, and equipment. Hybrid partnerships can also help reduce the risk of committing to a particular drone technology too soon. UAV manufacturers are constantly inventing new hardware features, improving performance, and adding new sensor capabilities. That leaves companies at risk of investing in quickly-outdated models. For example, the technologies to extend drone battery life and to improve camera resolution are constantly under development. These innovations, if purchased at the right time, would allow for longer flights and more rapid and detailed sensor processing. Businesses that partner with drone specialist companies, rather than maintaining their own fleets independently, can greatly reduce the risk of investing in obsolete technology.

Practical Tips for Building A Corporate Drone Program Current commercial trends that have placed drones on thousands of construction sites and service trucks worldwide are going to continue and even escalate in scale. More and more companies are going to formalize their use of drones, and begin to put together comprehensive programs and processes around their use both in the field and in their internal data systems. At Guinn Partners, we help put together full solutions, from picking hardware and software to building long-term program goals, to scale enterprise use of drones to get real business results.

The best practices we’ve learned from dozens of early-adopter business clients worldwide are communicated to companies either just starting out or growing already existing programs. Here’s a listing of some practical recommendations we have for building your corporate drone program:

Get results today and plan for the future by building a roadmap from day one. It’s best to consider not just what drones can do for you today, but also in the coming months and years. Ask yourselves:

• What are we trying to learn on each flight today? • What are the best media for us to use? Video, photos, maps, models? • What can we achieve with pre-planned flights that don’t require a human flying? • What other media (such as thermal imagery, LIDAR or sensor data) would impact our business in the future? • What use cases would come from being able to fly the drone beyond line of site or without a human monitoring the flight? • If our drones could fly for hours, how would that change our corporate usage?

Know your regulations - and ensure you have licensed operators. All operators using drones in your business need to be commercially certified to operate those drones, which means passing the exam required to achieve a Part 107 license in the US. No other team members are allowed to legally fly your drone if they do not have this certification. We highly recommend that you get commercial drone operation certifications not just for your pilots, but for any support staff or related team members in the office or the field. By learning the legalese and processes, everyone will be able to have intelligent input on correct operation during day-to-day drone usage within your company.

Establish a pre-operation checklist, and a pre-flight checklist. Every time your team flies, we recommend two checklists: one that happens before the team even deploys to the field, and one that happens right before a flight. The pre-deployment checklist should include items regarding verifying airspace, establishing objectives, charging equipment, equipment inventory such as batteries and SD cards, checking for software upgrades, reviewing mission plans, and notifying points of contact on location. Every drone operation needs to be in clear airspace that is permissible under regulations, and compliance is becoming a huge driver of specific hardware

and software adoption. The on-location checklist should including reviewing safety protocols, checking airspace again, walking around the location for visual review, evaluating weather, and establishing a plan for operating within visual line of site. The ultimate objective is for your team to clarify what they need to do with the data you acquire to ensure successful operations that drive business results back in the office. So it’s important to establish processes to organize and utilize your aerial data accordingly.

Organize and store your data. One of the most common mistakes of new drone programs is capturing a large amount of content, then attaching a few files to an email or report and having the content live on different hard drives, cloud services, or SD cards with no plan. Create a file structure on a set of local drives or in the cloud where every job is labeled, and the content is backed up so you have historical information and access to your drone data archives.

INTERVIEW:

SUZANNE EL-MOURSI

CEO, UPLIFT DATA PARTNERS

Tell us a bit about your company’s background, and what you’re trying to solve in the industry. Uplift Data Partners is the leading data capture platform for businesses to adopt drone aerial data into their business operations. Our turnkey platform strategically matches commercial drone pilots with enterprise clients, enabling them to scale their drone data capture needs. The platform seamlessly solves for compliance, airspace, and dispatch of commercially trained pilots at the touch of a button. Uplift’s pilot network is the leading commercially trained and insured pilot network, guaranteeing that every drone pilot meets our enterprise client requirements. Our network has 100% nationwide coverage of the United States, allowing us to deliver any mission anywhere. Our clients are leading brands in the construction, insurance and real estate industries with national and global recognition. Our mission is to make it a “no-brainer” for commercial businesses to outsource their drone data capture needs allowing for more streamlined, faster adoption of drones into their business operations.

What is the industry you see having the most traction from aerial data as a service in the next few years? We believe roof inspections will be the industry that allowed the aerial data as a service market take off. The cost savings and safety increases are real and tangible today, and it’s only a matter of time before more and more roof inspections are performed with drones.

What countries besides the US do you feel are really taking advantage of drones and aerial data? Australia United Kingdom Netherlands

What software for flight and data processing sees the most use in the field by your pilots? DroneDeploy has written and tested the most robust flight control software in the industry. It’s platform agnostic, and DD does the best job in keeping up with DJI firmware upgrades.

Where would you like to see drone hardware improve in the future? It’s hard to imagine drastic improvements from the DJI Phantom 4 Pro. This particular drone is stable, small, consistent, and an incredible workhorse. Obviously we’d like it to have a longer battery life, more and less-expensive payloads, but for $1500 the P4 pro is an incredible piece of machinery.

What regulatory hurdles do you feel need to change before great adoption of drone services commercially? The “no flights over moving vehicles” part of current regulation is impossible to detect and prevents many safe and simple commercial applications.

What are the top things a company should consider before retaining a drone services company? There are six areas: · What exact outputs are they looking for? i.e. who will process the drone data? · Which company gives me the easiest solution for integration into my business operations? · Which company can own all aspects of the “first mile” in drone data capture, with the best turnaround? · Who is best at managing the risk associated with the first mile; i.e. the pilot training, caliber, experience, professionalism? · Who can scale and service my entire portfolio of needs across the country and the world?

What technologies are you most excited about being integrated into drones in the coming years? I believe that drone data is a currency and can have enormous fluidity in the current data and data analytics trends we see. This means it can both stand alone but is most powerful when it is added to other multi-dimensional data sets. We are excited to see drone data integrate with industry specific technologies, allowing for greater data set enrichment and improved insights.

INTERVIEW:

ANDREW MAXIMOW

CHIEF DRONE OFFICER, FIRMATEK

You were one of the first Chief Drone Officers in the world. How did Firmatek come to the conclusion they needed a C-Level position around drone technology? As a leader in the 3D Mapping space, Firmatek recognized that the disruption being caused by the rapid development of drone technology would require C-level leadership that would enable our clients to successfully migrate, adopt, and implement this technology at scale. Secondly, Firmatek is evolving its business towards data analytics services which are being accelerated by remote sensing technology such as drones. As such, they were looking for someone with a strong enterprise client background and experience in growing subscription-based professional services in high-tech domains.

What does your job consist of day-to-day? Funny, my family and kids ask me the same thing and think its pretty cool that I get to “play with drones for work.” Yep, I truly love what I do! However, while I do “play” with a lot of cool stuff, it’s not about the drone. My responsibility is largely about de-emphasizing the drone, reducing it to a mundane data collection device, so that we can spend more time with our customers on data analytics. I spend a lot of time thinking about bringing value to our clients and solving their business problems with the best tools and knowledgeable people available in a consistent, repeatable manner. My goal is to offer our clients a value-based choice of practical options that meet their long-term needs and requirements. Of course it is very satisfying to hear how we’ve delighted a client or solved a problem, and to listen to their feedback about how new value can be derived from aerial data in unexpected ways.

What are some of the challenges of your position? One of the unexpected challenges is the amount of education and effort it takes to correct some of the misinformation about drone technology that persists in the industry. All too often Firmatek finds itself “cleaning up” bad data, and fixing problems created by a third party. It takes time to do things the right way and ultimately restore trust and confidence.

What technology or partners do you rely on in gathering aerial data for clients? Firmatek is different than others; we are currently not building out a network of drone pilots. We strongly believe in enabling our clients to collect their own data whenever and wherever possible by giving them a drone. Our clients prefer to capture their own mapping data, but have Firmatek process all the data so they don’t have to. They appreciate the freedom of capturing photos and videos as they please. Currently, the DJI Phantom 4 Pro (P4P) is our “go-to” drone. It’s easy to use, inexpensive, and has a very good camera. After some initial set-up and a little bit of practice, it’s close to “one button” operation. Our aim is to make the data collection process as simple, repeatable, and boring as possible. Of course, if a client prefers and complete end-to-end solution, all of our regional Geospatial Field Technicians are equipped with a drone that can get the job done. We do fly and collect data for more complex mission-types, using a variety of drones, payloads, and software for data analysis. The eBee Plus/RTK fixed-wing drone is very effective for large area sites.

What are some concepts or trends you see coming as the future of drones and robotics in surveying? Clearly the surveying industry has been disrupted. In a broader context, that disruption extends beyond surveying to the digitization of the physical world around us (above and below ground and underwater) utilizing a variety of autonomous and robotic data collection tools. Drones offer a unique aerial perspective that lends itself to effective and safe data capture for roads, bridges, utilities and other infrastructure.

You’ve been in this industry for a long time. What most surprises you about where drones are today that you never would have expected back in the initial garage at 3D Robotics? I am still surprised by the overwhelming market dominance of a single drone company so early in the overall lifecycle of the technology. While this has driven prices down, a few other strong players would be good for healthy competition and innovation in this space. On the flip side I am equally surprised by introduction of new drones in the market by start-ups and established companies alike.

What tips do you recommend for team members of companies just entering the drone and aerial data industry and building their first programs? My recommendation is to focus on customer needs/requirements, client relationships, and actionable data that drives value. It’s not about the drone! If you get that right you’re off to a good start. Secondly, growing organically starting from zero, can be a long and difficult process of evangelizing to a risk-averse market. Consider building accretive value- where 1+1=3- by partnering with companies who have an established client base yet are open to implementing innovative technologies. I’m a big fan of offering a value choice: two or three options that meet the needs of early adopters, mainstream, and laggards alike. For example, Firmatek offers a “hybrid solution” of LIDAR combined with drones. That provides clients a “bridging” strategy allowing them to gradually migrate from old to new.

What is Firmatek offering to the market, and what are the differentiators from other offerings in the survey space? Firmatek has a reputation for delivering supreme confidence in the data. As such Firmatek has become a trusted advisor to many clients in the markets that we support. We speak their language, solve their problems, will not let them fail. As industry leaders we offer a “hybrid” solution, including familiar LiDAR scanning and new drones, allowing customers to gradually understand and trust a new technology in their environment. Firmatek will tailor a solution that meets a client’s needs and requirements. We place the drones in the hands of our clients, allowing them the flexibility and freedom to collect data on-demand. Firmatek then processes and analyzes all of the data so that our clients don’t have to.

www.firmatek.com

INTERVIEW:

CHRIS HAINES HANGAR

Chris Haines is the Director of Business Operations at Hangar, and has a background in professional services at 3DR and with various contractors for unmanned systems.

You’ve been in the drone industry for quite some time. What are some technologies or processes that exist today that you never would have thought would exist when you first got started? I entered the industry in the late 2000’s. At that time sUAS were used for two purposes, 1) to look at something, or 2) to deliver something. At that time, unmanned systems ran $100k on the cheap side, and mainly only old retirees bothered with RC aircraft. Since then, I have watched decades-old national defense contractors, who had a stranglehold on the industry, get swept aside by a Chinese drone startup. DJI disrupted the industry by developing a solution that was as good or better than existing systems, but at a tenth of the price. The radical commoditization of this technology has been paradigm-shattering. To this day, I marvel at the novel drone use cases that I am now presented with on a weekly basis. This technology has so much more potential than I could have possibly fathomed when joining the industry, and it appears that we are still just scratching the surface.

You’ve built custom drone hardware from scratch for commercial clients. What were some of the most interesting projects you’ve done in that arena? I am blessed to have worked on a number of exciting projects each with great teammates. Below are a few standouts that combined massive engineering efforts and nearly impossible timelines.

Google Fiber Copter for GoogleX 3D Robotics had a professional services division before the consolidation of the team and its eventual focus on the Solo platform. My team and I worked on a number of great projects for companies like BNSF Rail, Liberty Mutual Insurance, and Keiwit. The most exciting project by far was one brought to us by GoogleX. The request was for a multi-rotor that could autonomously secure a clamp to telephone poles to efficiently run Google Fiber throughout cities. It was one of the most challenging engineering problems I had seen to date, be we had an exceptional team and successfully demoed phase one of the contract prior to the migration of the team to the consumer side of the business.

Tube-Launched Vehicles Through the SBIR (Small Business Innovation Research) Program, the government releases what are essentially product requirement documents for their immediate needs. Prior to working for 3DR, I spent a number of years at a Department of Defense contractor where we rapidly fielded unmanned systems in response to SBIRs. Our niche was tube-launched vehicles, and we designed and built vehicles that launched from land, sea, and air. The most interesting was a jet-turbine-powered system. Once it was launched, its spring-loaded wings would scissor out, and it would take off traveling up to 200 kts.

Autonomous Retrofitting of Manned Aircraft Drug smugglers along the US/Mexico border are surprisingly innovative, and I was surprised to learn that they had begun using ultralight-class manned aircraft to fly across the border and deliver their payloads to a pre-coordinated GPS coordinate and then fly back. These aircraft can carry hundreds of pounds and fly many miles into the US. They are quiet and not often spotted. Even when they were found, the government’s answer was to scramble a military helicopter to do its best to identify a drop zone, then follow the pilot right back to the border where they were forced to halt pursuit. The government wanted a solution that could bring down an ultralight without harming the operator, which is no small feat. Two engineering teams were contracted to develop non-lethal solutions to the problem, but the government needed to test the solutions to ensure their effectiveness and safety. My team was contracted to take a number of ultralight aircraft and convert them into unmanned vehicles so that the various solutions could be shot, dropped, and fired at the aircraft in a real life scenario. We crammed actuators, drivers, and an autopilot into each aircraft and successfully flew the vehicles across the dry lake beds of Edwards AFB in Southern California.

What software or tool doesn’t exist today in the drone world but would be invaluable or very exciting to you? I believe that this is best answered in the context of what would our customers find invaluable. The most talked about, but least delivered upon request from customers, are actionable insights from the aerial data that they receive today. Many companies preach this, but I have seen very little progress. Most just throw around buzz words like AI, machine learning, and deep neural nets. But you can not effectively leverage these technologies without massive amounts of data. That is what we are focused on at Hangar today, ensuring that data is captured with increasing velocity to ultimately be leveraged to generate real insight for our customers.

I would also like to see indoor reality capture solved in context of AEC. There are several innovative companies out there trying to solve it, and I am looking forward to presenting a solution to our customers.

What are some of your favorite pieces of drone industry hardware and software? I am a huge fan of the DJI Mavic and I am excited to see the next generation in a few months. It is so well engineered and is light-years ahead of solutions produced even two years ago. Frank Wang and DJI continue to innovate at neck-breaking speed. I am also looking forward to Adam Bry and Skydio’s release of their new drone. Their team is stacked with brilliant people, and they are well backed with venture money. It will be interesting to see if they can find a good fit in the consumer market. As far as software, I am impressed with what Cape has done to date; we successfully had an operator in Singapore operate a drone from our headquarters in Austin TX. Very impressive.

What companies are you most excited about in the industry going into the next two years? Dronebase I really like what Dronebase is doing on the drone services side. They have done an excellent job owning the operational layer from the bottom up. I am impressed with their leadership team as well.

SolidEnergy We flew a Solo prototype with a SolidEnergy Lithium-Metal Battery and saw double and triple flight times. I’m excited to see them bring their technology to market.

Droneinsurance.com I am really impressed with the solution that is being put together by the group at Acend.io. They offer data-driven flexible premiums with a strong underwriter. They will be able to remove a large barrier to entry for many operators who choose to fly uninsured today.

Measure Measure is known as the most professional drone service company out there. They do an excellent job of providing a full solution of hardware, training, and drone program management for companies who want to build out their own drone program. They will be a key factor in getting the AEC industry across the chasm.

SpektreWorks A startup out of Phenix AZ, SpektreWorks has a phenomenal team and is developing promising technology to enable the Ardupilot ecosystem with cutting-edge hardware. In addition to their work in the open source community, they build end-to-end VTOL long-endurance systems and are master payload integrators.

Swift Nav Precision Navigation will be paramount for all autonomous vehicles. Swift provides solutions today and is a promising player as the industry takes off.

Airmap In order for drones to own the skies, someone has to build the highways. Airmap appears to be way ahead in the roll out of UTM.

What industries do you think have the most potential in the long term to utilize drone data? What about in the short term? I think the analysis clearly shows the construction sector, specifically our national infrastructure projects, as having the largest opportunity for improvement. This will be an ongoing long-term process, as construction is one of the least digitized Industries when compared to agriculture, mining, and insurance. In the short term insurance takes the cake. It is impressive how quickly the insurance industry has taken to leveraging drones to keep adjusters off roofs and allowing them to assess many times more claims per day than using standard inspection means.

What regulatory hurdles do you feel stand in the way of the future of widespread commercial drone use? Forcing a 1:1 relationship of drone to human severely handicaps the capabilities of a fully autonomous solution. Specifically requiring a PIC and maintaining VLOS needs to be addressed. There should be drones perched throughout our cities waiting to be called upon. The technology is nearly there, we just need to work towards more inclusive regulations.

Hangar is an exciting new company in the aerial data space, what sets it apart? Hangar is by far the most scalable data capture platform out there. Data can be ordered with the click of a button, and can be captured either by our customer’s internal drone program or by our professional operator network partners. Our focus on autonomous capture not only guarantees the same precision-captured assets over time, regardless of operator ability, but has unlocked new complex data products that deliver insights that didn’t exist before to industries like telecom and construction. You want your skyscraper scanned, processed, and delivered? We can do that. We have also invested heavily in developing the system architecture and partner ecosystem to truly connect best-in-class partner solutions to provide incredible value for our clients.

Anything you’d like to spotlight or promote? You can learn about what we’re working on at Hangar here:

INTERVIEW:

KEVIN FINISTERRE DEPARTMENT 13 Kevin is a Senior Software Engineer at Department 13, but is perhaps best known for his prolific internet presence, working by himself and with a community of passionate programmers worldwide to expose vulnerabilities in the drone hardware ecosystem.

You made quite the splash in the tech world this year by showcasing some of DJI’s security vulnerabilities. What did you find, and where can readers dive into your work more deeply? There were multiple facets to the DJI security reveals from this year. The first was in the form of discussion on how to first gain, and subsequently retain control over your own property. Despite the fact that DJI has used Open Source as their foundation, they have had a notoriously closed system for a number of years. Right-to-repair conversations become a very big problem in the drone community when you have vendors like DJI placing encryption and obfuscation in the way of end users being able to maintain and adjust their own gear. For quite some time, rumors circulated about being able to “root” or “jailbreak” DJI drone platforms; however, no tangible evidence was available. I put quite a bit of effort into doing the required research and shared my subsequent results. This ultimately helped form the current DJI reverse-engineering and jailbreaking community. This community has a staunch determination to retain control of their aircraft, and be able to tweak them as they wish. DJI, on the other hand, uses the guise of “safety” to help maintain a strong grip on the innards of their platforms. So it has turned into a security arms race at this point. Every new DJI version contains a new countermeasure, and every new countermeasure has an army of reverse-engineers and hackers waiting to circumvent it. The landscape has evolved quite pleasingly in the last year. On the flip side of the drone security coin, opposite the actual drone platform security, is the security of the information systems that help keep these platforms usable for end users, and serviceable by vendors. Additionally new regulatory mechanisms are forcing new means of accountability and enforcement for end users, and where they may or may not fly. One of the current DJI incantations is to collect Personally Identifiable Information about end users asking for No Fly Zone unlocks or High level SDK access. There was unfortunately an amassing of this PII in the form of stored digital assets on DJI’s servers, and said data was made available, due to a comedy of errors in DJI employee handing of company secrets. Several DJI employees were found to have left access keys for various services on GitHub, as well as Public buckets on Amazon AWS. In the end, DJI attempted unsuccessfully to hide some of these errors via DMCA threats sent through GitHub, and a Computer Fraud and Abuse Act threat sent via their lawyers. I have documented this story as much as I was able to in the following PDF:

Paul Dot Com Security Weekly also interviewed me on the subject, capturing much of the story directly from my mouth:

WATCH INTERVIEW>>

Both the DMCA notice, and my counter notice can be located here:

What are the top things drone hardware manufacturers need to consider to create properly secure hardware? Security is not something that you can just bolt on after the fact. You need to have a subject matter expert involved during your development and planning phases. Additionally, you need to make sure that any IT assets your platform requires will also have the appropriate IT staff, with a mindset geared towards security. To me the choice to invest in security is binary: either you are doing it, or you aren’t.

How could DJI have better handled the publicized dispute over their bug bounty program? DJI could have come to the table prepared, but they did not, seemingly because the PR opportunity was much greater than the actual desire to seek out security solutions from the community. They should have engaged folks in the community that have done this before such as HackerOne, or Bugcrowd, or LutaSecurity. I think the response from the community was very clear, the “comments section” on various articles spoke very loudly about how NOT to

treat folks that come to you on good terms with security research. DJI seems at many steps to have chosen to be poster child for how not to do Bounties.

There is a lot of taking advantage of open source and GPL in the drone industry. Why does this seem to happen so often? Generally speaking there is no one there to enforce it unless it is egregious. Most end users don’t “care,” or even know why to care, about GPL violations. People don’t understand, for example, that if there was no GPL code on Mavic, it would cost you a lot more because DJI would have had to invest in writing more code, instead of just borrowing it. Folks like VMWare getting sued for abuse of GPL hasn’t occurred often enough for large companies to fear potential ramifications. The use of GPL by many commercial companies calls to mind the old adage “No cop, No stop” when coming to a stop sign that appears to have no traffic.

You’re a long-time drone enthusiast and creator. What are some hardware or software components or products that you would love to see developed someday? If I were being selfish, I’d wish that the old OpenPilot project could have a proper rebirth. I used to love the attention to detail both on the hardware, and software QA for flight control. Much of the industry has been built on the back of unpaid volunteers in a small handful of Open Source projects. Commercialization has caused rifts in those communities, creating haves and have nots with regard to resources and funding. Many projects and individual volunteers have fizzled out completely as a result. I would love to see a mechanism by which the open source community could be rewarded more for the foundation that they laid down. The process of productization of the old foundation often forgets all of the folks that served as stepping stones in community. More importantly the productization has also priced some of the original players out of playing in the sandbox that they helped create, which is kind of sad. I wish some of the old “for fun” communities were still able to thrive without the looming threat of cost (due to rapid prototyping of hardware) and

competition, not to mention IP theft from larger entities. There are many ideas and potential logic blocks that could become product if it weren’t for resource hurdles and the inability to compete with certain players in the industry. The risk to the individual is too great. As the investors have moved in and set up shop, we’ve lost some of the “fun” in the hobby.

You currently work in the counter-drone technology industry, which has grown increasingly competitive. What differentiates Department 13 from the other options out there? Protocol mitigations. We don’t fall under the standard category of “jammer.” Our flagship product MESMER doesn’t need to spam a communication link in order to have an effective mitigation. Several of our mitigations are what we call “finesse,” in which the underlying protocol has been studied, understood, and replicated. With a deep understanding of how devices communicate with each other, it becomes much easier to insert oneself into the conversation, and pretend to be either party on the communication link. Under the right conditions, and with the right technical resources, it is possible to spoof, or manipulate, UAS communications in a predictable fashion in order to provide “positive control.” Think of it as the ability for me to stand in between you and another person talking, and convince you both that you were talking to each other, when actually I was the one relaying the bits of conversation on, as I saw fit, potentially omitting, or manipulating it as I went along. Traditional systems in the same scenario would instead just stand in the middle and yell as loudly as they could and hope that it prevented the two parties from talking.

Anything you want to showcase or promote to our readers? In the past few years I have given several talks that highlight some of my work in the CUAS & drone security space, they can be found linked below.

A LOOK AT THE

CONSUMER DRONE SPACE CONSUMER DRONE TRENDS

CONSUMER DRONE TRENDS //

INSPIRE 2 & THE X7 The holy grail of professional aerial video We have reached peak aerial video. The Inspire 2 and the X7 go beyond what any film crew could possibly look for in terms of quality, safety, and professional capture. What do we ask for next? For the software team to really look into cinematic flight programming, and to tie the X7 into their Osmo or Ronin handheld stabilizers.

COMPLETELY MAINSTREAM The Breeze at $199 Though the Spark gets a lot of attention, the quiet winner on store shelves was the Yuneec Breeze. $199 at Walmart gets completely usable aerial photo and basic video in a minute package.

WHAT WE’RE EXCITED ABOUT //

TEALDRONE Modular, easy-to-use racing drones set Teal apart at launch. If they deliver on their Teal 2 platform, complete with NVIDIA GPU, we might see a new kind of drone experience evolving in the consumer industry.

PIXHAWK 2 A tiny, modular autopilot that is completely community-driven. Its design allows for complete calibration and motion testing of each unit. For the many interested in Ardupilot over PX4, this an extremely powerful and affordable unit.

MAVIC PRO PORTRAIT MODE Flipping a single switch in the photo or video settings of the Mavic Pro rotates the camera to vertical for both photos and stills. As content from drones goes quickly to social media endpoints such as Instagram stories and native Facebook videos, this is an awesome option for social content teams and consumer creators. This is a nice little UI trick we wish we’d known about earlier.

GOPRO KARMA — MULTIPOINT CABLE CAM

You might not see it in the marketing collateral, which focuses on the simple user experience, but GoPro’s Karma team now has a version of multi-point cablecam, the most popular feature of 3DR’s Solo. Set multiple points and watch beautiful footage from the ultra-smooth Karma gimbal ensue. Combine the multi-point capabilities with the unbelievable video quality and image stabilization of the Hero6 and you’ve got quite a strong video offering. As the GoPro drone program is now discontinued, it might be worth adding a Karma system to your toolkit for its film capability.

**TWO-POINT CABLE CAM

CES 2018

TRENDS FROM THE SHOW FLOOR

THE HANDHELD STABILIZER BATTLE Dozens of companies are trying to replicate the popularity of the GoPro Karma and DJI Osmo handheld gimbals. DJI, with their Osmo Mobile 2, comes in at a brutal (for competition) $129. It’s jampacked with features and has an incredible battery life. Companies competing with DJI fail to learn from history. DJI can do incredible volume, and they are not afraid to drop their margins to unholy low levels to jettison competition.

UNDERWATER DRONES The use cases are definitely interesting, whether for b-roll filming, inspecting cruise ships, or exploring the seas. However, with a dozen companies making these drones at large size, it is a radically overestimated market. The miniaturized versions which include technology to help with maintenance and inspection will have a future in the commercial space as the years go on, but one consumer underwater drone at most will survive the next 24 months.

REBRANDING “SELFIE DRONES” AS “RACING DRONES” All the knockoff companies who came to CES with selfie drones last year swapped some paint, changed some props and called their robots “racing drones.” Meanwhile, dedicated FPV and racing companies have cool-looking feature-loaded options that continue to interest consumers.

HERE COME THE MAVIC CLONES The Mavic clones ranged from audacious (the same design and software, with a slightly different color) to reckless (the same exact color and design, with no software). Is anyone buying these? Is there really enough of a business model in consumer confusion to warrant the continued high presence of cloned DJI drones in consumer electronics?

OF NOTE

Yuneec had a $699 fixed wing FPV drone that looked like a more market-ready version of Parrot’s Disco.

CES 2018

WHAT SHOULD HAVE BEEN THERE THAT WE DIDN’T SEE. SOLUTION BUNDLES Not one of these companies, from the big guys to the new competitors, is doing anything with software: no bundles or integrations with interesting vendors, no workflow solutions for creatives. There were certainly no workflow solutions for commercial users (granted, this isn’t the show for that). Hardware is commoditized—give us software: fleet management, capture apps, advanced cinema shots, editing packages, advanced mobile workflow, more powerful auto-editing, social compatibility, partnerships with photo networks, anything…

STABILIZED 360º VIDEO SOLUTIONS Cameras along the lines of a GoPro fusion—stabilized and built for drone deployment.

BIG-NAME CAMERA SENSOR PACKS ON HIGH-END CONSUMER PACKAGES Sony and many others have made extra-small versions of their sensors for use on drones. Yet none of these modules are on the market with a hardware provider, even for older systems like the original A7S or A7R. There will always be a market to put real cameras in the sky for photography and videography at a lower price point than DJI’s Inspire.

REAL ACCESSORIES Data uploaders, advanced battery chargers, tethers, safety cages, RTK… Give those millions of drone-owners a reason to pull their hardware out of the closet or a reason to spend money improving their workflow.

LOOKING TOWARD T

H

E

FUTURE

BEYOND LINE OF SITE THE FUTURE OF DRONE ECONOMY

Dawn of a new technological era You set an alarm on your phone, and every weekday morning it wakes you up. You set another alarm on your phone, and every weekday it wakes up your company’s drones. They spin up their own propellers, take off, perform their daily pre-programmed inspection missions, land, and upload all the data to the cloud. The data is automatically processed and delivered straight to your business and analytics systems. No human required. It’s not hard to imagine such a world anymore. In fact, it’s almost here.

THE TECHNOLOGY In the last five years, drones have crossed over from the realm of engineers and DIY enthusiasts to the shelves of consumer electronics stores, and now they’re making headway into the commercial and industrial market. Along the way, they’ve gone from Frankenstein monsters made of RC parts to ready-to-fly consumer goods outfitted with senseand-avoid safety technology and premium cameras. This steady movement away from custom hardware continues in step with broader trends in robotics. Today, you can buy purpose-built, fully-integrated systems that are essentially ready-to-fly as soon as you get them out of the box. In the future, drones will incorporate advanced technology from a wide range of fields: robotics, sensors, data processing, and beyond. Specifically, innovations in autonomous flight, computer vision, and machine learning will lead to near-total independence from human operators, which to the end user means “easy.” The goal is for drones to become as seamlessly integrated into business systems as a space bar.

DRONE IN A BOX Today anti-virus software will scan hard drives and servers at a click. Tomorrow it will be the same for drones in the physical world, scanning and inspecting construction sites, structures, farms, forests, mines, quarries, survey sites — any site, of any size, that needs to be looked at early, often, or up-close. Maybe think of it as a “drone-in-a-box.” Set a timer or launch the drone (or a fleet of them) remotely, and the drone will launch itself, carry out its cached preplanned mission, and land itself back at its “box” to recharge. The drone will send the captured data to the cloud, and the processed data will get piped into your system. The whole operation — camera to cloud — w ill take minutes, and almost no effort or special training. You’ll be able to focus on analysis, planning, and response. Today’s generation of drone pilot specialists will transition to become drone data analysis and action specialists, and the on-demand aerial data economy will be in full swing.

Jobs that can be done autonomously by a drone in a box: Safely and accurately inspect cell towers, buildings, and other structures at height

Monitor crops to assess blight, water distribution, fertilizer distribution, and crop yield

Monitor construction site status and resources

Collect data for volumetrics

Build DEMs, orthomosaics, and 3D models

STATE OF “BLOS” REGULATION We can see the technology isn’t much of a hurdle for an on-demand, fully automated “drone in a box” commercial solution. But technological advancements can’t overcome the bigger hurdle standing in the way: a very specific government regulation. The “drone in a box” concept has an implicit prerequisite: the drone has to fly beyond the line of sight (BLOS) of a human operator. BLOS operation is relatively easy in terms of technology (using first-person view monitors or goggles, for instance), and many countries — including Australia, Canada, and China — already have BLOS-friendly regulations on the books. The FAA, however, still hasn’t sanctioned BLOS flights in the United States. Here are the FAA’s current rules about the range of drone flight:

“ You must keep your drone within sight. Alternatively, if you use First Person View or similar technology, you must have a visual observer always keep your aircraft within unaided sight (for example, no binoculars). However, even if you use a visual observer, you must still keep your unmanned aircraft close enough to be able to see it if something unexpected happens.” (FAA.gov)

The FAA’s position will change. The economics of drone delivery alone, which Amazon has foregrounded with a massive lobbying effort, will compel the government to find a way to integrate BLOS rules as quickly and safely as it can. It might seem like the FAA is too cautious to adopt drone regulations, but keep in mind the U.S. has by far the world’s busiest and most complex airspace. The recent “Part 107” approval of commercial drone operation has opened that airspace to over 40,000 licensed drone pilots in less than a year. There should be no doubt that the FAA is committed to enabling American businesses to take advantage of drone technology. We’ve seen good signs. A couple years ago the FAA partnered with CNN and BNSF Railways to launch its “Pathfinder” program dedicated to researching BLOS flight. Then in December 2016 the FAA granted its first BLOS flight permit outside the Pathfinder program to the Northern Plains UAS Test Site in North Dakota, where more companies will be free to develop and test a range of new BLOS applications. When the FAA sanctions BLOS flights, we’ll see a surge in commercial drone adoption, and the range of potential applications will broaden even further. We already know push-button or preset missions will change the way we examine bridges, roofs, cell towers, buildings, and real estate. Drones will make inspections, monitoring, and modeling easier, safer, and cheaper. You’ll get better data, too, and more of it.

Industries potentially impacted by BLOS applications • Construction • Infrastructure inspections, e.g., pipelines, powerlines, roadways, and rail • Windfarm inspections • Agriculture • Mapping/GIS • Search & rescue • Firefighting • Forestry, conservation, and wildlife management

INTERVIEW

GRAYLINE GROUP Joseph Kopser and Bret Boyd are the founders of Grayline Group, a collection of experts working to provide intelligence analysis and insights about new technology to enterprise businesses, and work with companies to prepare for and adapt to technology-driven change.

At Grayline Group, your team spends time with organizations working to understand technological change and how it will impact their businesses. Do you feel there is a widespread understanding of the potential of the impact of drones and aerial data in the future that exists inside of major corporations today? Not really, no. Our experience is that companies that are directly in the UAV business (i.e. aerospace companies) and those with obvious applications (i.e. energy infrastructure) are very knowledgeable and focused on the impact of drones and aerial data, but companies outside of those circles are not as focused on identifying the less-obvious opportunities and risks that will undoubtedly emerge.

What roles do you foresee drones playing in the new transportation and urban mobility economy? The obvious role for drones will be in delivery. What is not so obvious will be how they will be used to assess the status of traffic, accidents and traffic rerouting, and crime-in-progress, as well as aiding police, fire, and EMS in their command and control operations.

Companies such as Amazon, Uber and Intel have all made major plays to push their concepts of the future of drones in front of mainstream consumers. Do you think they are truly invested in the technology, or are these promotions more about building their brands? Both. It’s a tool to capture the imagination of their users to remind them that they are innovative companies. By staying cutting edge they can also experiment with new concepts while learning from mistakes. In the long term, drones will be a mainstay.

What are some new technologies and concepts around smart cities and urban mobility that drone hardware and software manufacturers should consider when planning their future project roadmaps? I am more concerned about the reaction of policy makers than I am about the technology itself. It will require a new look at training and certification of what it means to be a pilot. It will also call into question our definition of right to privacy. It will have a huge impact on crime and crime prevention. Will crimes caught on video not inside the surveillance warrant request be permissible? The 4th Amendment never anticipated drones or constant aerial surveillance.

What cities and regions in the US (and globally) do you consider hotbeds for technological innovation for the future of transportation, and why? Texas will certainly play a role. It has four cities in the Top 15 in the US, it has the technology, and it has thousands of miles of pipelines, an international border, wind farms, and military installations that would be instant consumers and willing participants in testing and prototypes.

The concept of autonomy has increasingly gained central stage as part of the media and thought space leadership space around modern technology. What do you think the most realistic applications of autonomous technology we will see in the next few years look like? The hype around drones is real. Semi-autonomous and autonomous robotics systems (including drones) are going to become significantly more capable in the next few years as a result of three key trends: machine learning, energy storage, and war. Machine learning and AI algorithms being developed for other applications will enable increasingly capable semi-autonomous behavior. Battery technology being developed for electric cars will enable better size, weight, and power ratios for all robotic systems. The technologies and operating practices developed via government R&D and refined over 15 years of hard use in Iraq, Afghanistan, and other combat theaters are now flowing down into civilian systems. The drone industry is also doing great work and making its own advances, but it benefits significantly from the work of others.

The drone hardware industry to date has been dominated by China when it comes to production of affordable, massproduced drones for consumers and commercial applications. How do you see the manufacturing world shifting in the next few years, and how might that affect this dynamic? In general, we see China starting to price out of some low-cost manufacturing categories as its economy grows. We also expect additive and autonomous manufacturing technologies to ultimately pull more manufacturing back to the US and other developed nations, but it’s not clear how this timeline will play out and when these forces will affect drone manufacturing. The rise of 3D printing will allows enthusiasts and inventors of all backgrounds to participate in developing new concepts.

The drone market to date has seen rapid, tumultuous growth. What planning or methodology advice do you have for new companies who have been in an emerging industry for only a few years as they prepare to be a part of this technology’s mass adoption? Broad adoption is enabled by companies that can solve people’s problems. Second and third wave adopters don’t want to buy a generally useful product and take the time to figure out how to apply it to their problems; they want a solution from someone who has already thought about and solved their problem. To participate in this growth, try to think about your capabilities in terms of vertical or horizontal specialization. Vertically-oriented companies solve many problems for one industry or customer type, while horizontallyoriented companies solve one problem for many industries or customer types. There are opportunities for both, but we suspect that the one-size-fitsall companies will be surpasses by more specific, solution-based companies as the market grows.

INTERVIEW:

AUTERION Kevin Sartori (left) and Lorenz Meier, PHD (right) CoFounders of Auterion

What prompted you and Lorenz to start Auterion? We have been on the same mission for a decade. What started as the Pixhawk student project at ETH Zurich in 2008 and enabled a new industry by connecting the community of developers, contributors, and companies and creating better technology the open source way. While Lorenz Meier pursued his PhD. at ETH Zurich, I moved to the Bay Area for my MBA in Berkeley and joined 3DR from 2015 to 2017 where I lived the transformation of the industry first hand. 2016 and 2017 were challenging years for the drone industry. Drone companies had to change business model (3DR, Airware, Skycatch), many changed their leadership teams (Yuneec, Airware, Kespry, PrecisionHawk) to help steer the company in new directions, and some are not active in the drone industry anymore (GoPro). The industry is shifting from vertically integrated to horizontally integrated; it’s a trend that we have seen in many maturing industries. It’s becoming clear that we need to work together and align with global standards and use a common infrastructure. More and more drone companies are seeing PX4 and Dronecode as a way to consolidate their efforts on a common platform. It allows them to stay on the technology curve and gain market access for their product and services to remain competitive. However, companies have needs that the open source project on its own cannot satisfy. For this reason, we founded Auterion, a company that can address these needs and sustainably grow the ecosystem. Auterion operates on an open-source business model based on open code, contributions to the development community, professional quality assurance, and subscriptionbased enterprise support. We release an open source managed distribution of the Dronecode flight stack so that drone companies can leverage the community’s work and make further adaptations and improvements. 2018 will be an exciting year for open source on drones and Auterion will bring the level of professionalization to drones that Red Hat brought to Linux.

Why has open-source been so important for the drone system to date? Open source is an R&D model and has been a critical enabler in many industries: from enterprise computing to website design, from genomics to the cloud. The same applies to the drone industry. In the beginning, there were two main reasons. First, drones are complex mechatronic systems that require in-depth knowledge in many engineering fields such as computer science, electronics, and mechanics. It is difficult for one company to hire all this expertise. An open source approach allows multiple companies to work together with researchers in academia and with the passionate developer community, making sure to cover all the knowledge gaps. Second, the open source model prevented developers from repeating the same mistakes of others and allowed the industry to innovate at a much faster speed. Cheap and reliable sensors and increased compute capacity accelerated this process, so it’s a coincidence that all this happened at the same time as the introduction of the first iPhone. Today, in a maturing industry, there are new fundamental benefits of open source. First, open source platforms like PX4 and Dronecode align companies on a universal standard; this creates networks effects because it’s more convenient for companies to work with an ecosystem to scale the integration of their technology (Intel, ARM, NXP) and services (Airmap). Second, open source platforms provide the core infrastructure that is used to build products and services. These are things like communication protocols or the computer vision pipeline. This infrastructure is non-differentiating and it would be prohibitive for each single company to develop its own. Third, open source allows companies to stay on the technology curve and still have the freedom to customize on top. Their product or service improves as the platform progresses. All these factors make the decision to align with an open source platform a business decision more than a pure technology one.

Can you explain PX4 and Pixhawk and why they are important to readers who might be new to the space? Both projects originated at ETH Zurich under the guidance of Lorenz Meier as efforts to enable autonomous flying. PX4 is an open source autopilot that powers any drone: multicopter, fixed wing, and VTOL. Over the years there have been adopters that used PX4 to control mobile rovers, boats, and even submarines. In Linux terms, it would be the equivalent of the Kernel. The PX4 Autopilot is open source and free to modify under a permissive license (BSD). This fact (licensing) differentiates the project from other open source projects and is the reason for its broad commercial adoption. Today it powers products from mass scale consumer drone companies like Yuneec and Airdog and commercial and industrial products like Wingtra, Sentera, and Alti. Pixhawk is an open hardware reference design. It explains how to create the electronics for an autopilot so that they are compatible for PX4. The design is open and was created by the development community under a creative commons license. It was successful because for the first time an integrated system included all the needed components of an autopilot (IMUs, compute, GPS) for a low cost and in a very small form factor. Both PX4 Autopilot software and Pixhawk hardware were key drivers in the development of UAV technology for the global academic and developer community and companies worldwide.

Where would you like to see drone hardware improve in the future? It’s simple: hardware needs to become cheaper and better. Drone hardware has not yet reached the maturity that smartphone hardware has. Today, drones still resemble cell phones in their infancy, and hardware constraints limit the user experience. To reach the next level of adoption, drone hardware needs more visual computing power and better sensors at lower cost. A drone built to deliver highest-end user experience will still cost a few thousand dollars -- cost needs to drop by order of magnitude to provide a truly consumer-ready user experience. Luckily, the automotive industry is solving the same autonomy problems and will be the primary driver in reducing cost because it offers

much larger scale and returns on investment than the drone industry. We are working with leading technology providers in the automotive industry to crossutilize technologies on drones.

Anything you’d like to promote to our readers? If your business, technology, or services would benefit from having access to an ecosystem, I encourage you to join Dronecode.

Members directly contribute to the Dronecode platform development, influence priorities, while enabling their products and services to work with the platform. We have been contributing to the ecosystem for the last decade, and we are excited to tackle technical and business challenges that will influence the industry in the next decade with Auterion. Headquartered in Zurich, we operate with a worldwide network of the best robotics engineers. Whether you want to join the core team in Zurich or work with us as an external community developer, we want to hear from you!

CAN ANYONE DE-THRONE DJI? LOOK TO BLOS AND EMERGING TECH. In conversations with countless investors, developers and manufacturers one question persists… Can anyone take over DJI? Or even become a close competitor- either in consumer or commercial?

DJI is that far ahead. We estimate their commercial share in both consumer and commercial at over 80%. Their hardware is unbelievable, their price points are reasonable, and their innovation cycle has been non-stop. There are plenty of weak points in the Goliath, including growing security issues, tough software UI, a convoluted SDK, tone-deaf marketing in consumer, and no real marketing in commercial, but none of those individually or even combined is doing anything to stop their continuing success. Of the existing players in the hardware space, there is plenty of room to carve out niche opportunities and build great businesses, but mass-adoption is owned by the Chinese giant.

When we look to opportunities for a sea change in drone hardware, two events on the horizon could lead to a displacement of the current order.

The first is emerging technology. Hardware integrated with cutting edge energy technology could upend the possibilities we currently consider for unmanned systems.

The second is true application of beyond-line-of-site. If drones inside of boxes on city corners, on construction sites, or perched on roofs and cell towers come to fruition—drones that can operate fully autonomously—then the vendor that creates that hardware will need to navigate an extremely complex web: regulation, procurement, integration, hardware technology, and the development of software that can tie into systems of all kinds. If you’re looking for true blue-sky opportunities in the drone space, and the change to do something great,

set your sights there.

FINAL THOUGHTS:

TRENDS WE’RE TRACKING We’ve gotten granular throughout this report, so to end it, we will explore some macro-level trends that we’ve identified and are strategizing around for the coming years.

PREPARE FOR & EMBRACE CHINA An article that was circulated heavily recently about the work ethic of Chinese startups was heavily disparaged in tech circles, and we think not taking the rapidly evolving Chinese startup scene extremely seriously is a clear mistake. As a group that has both partnered and competed with teams in China for years, we can say, without a shadow of a doubt, the time has come where Chinese tech teams are solving important problems intelligently, and they are prepared to work much harder to achieve their goals than their stateside competitors. Gone are the days where the US may have had an “innovation edge.” Welcome to an era of global competition where new companies in Asia are at a distinct cultural advantage. The complicated regulatory environments in North America and Europe are crippling technology innovation in drones and beyond. All of these factors add up to a rapidly changing landscape for development of modern technology.

WORK ETHIC OF CHINESE STARTUPS

CRIPPLING TECHNOLOGY INNOVATION

GLOBAL COMPANIES ARE THE FUTURE.

We firmly believe that as technological challenges become more complex, we will enter into a new era of globalization where collaboration across countries and borders by teams of multi-cultural experts will lead to significant business advantage. Startups that are truly global will have their hands on the pulse of manufacturing efficiencies, technology developments, and marketing trends. Being on the cutting edge of so many important factors in launching technology can give these global companies a formidable barrier to competition. Picture companies forming and merging to take advantage of design strengths in Western Europe, hardware manufacturing and development in Asia, marketing and business development strengths in North America, and software design expertise in Eastern Europe. Expect this to happen at earlier and earlier stages, as efficiencies from advanced internet collaboration and community are realized by global startups.

THE TECHNOLOGY IN DRONES GOES BEYOND DRONES

As we hear the word “autonomous” more and more frequently in so many different channels—from cars to planes to vacuum cleaners to laundry robots—the innovations being made in drones will begin impacting myriad industries outside the aerial data space. The only industry in the world that can deploy tens of thousands of robots to solve real world problems today, unmanned, taking advantage of autonomous technology, is the drone industry. Not only will commercial drone applications be a testing-bed and collaborative hotspot for individual pieces of technology supporting innovations like autonomous vehicles, but the miniaturized technology being developed for drones at scale will be applicable to autonomous hardware projects across many realms.

ABOUT

Lots of people have great ideas but few see them all the way through to a successful product in a competitive marketplace. We saw an opportunity to apply what we know about technology products, especially drones and sensors, and help clients take their ideas to market in the optimal way for them; leveraging our expertise, experience and execution assistance. This approach ultimately saves our clients money, reduces the stress and uncertainty associated with building a team for launch and learning market nuances the hard way, and allows us to share in the upside that a successful product launch represents for all involved. We’ve flown drones on set with Michael Bay, filmed rocket launches for SpaceX, Blue Origin and Virgin Galactic, stood on offshore pipelines sending up giant custom rigs in international waters, flown without GPS inside of flare stacks for inspection pilot programs, and had to learn the hard way the ins and outs of the technology, manufacturing processes and regulation that make this industry tick. As you begin or continue your company’s journey in the drone space, whether developing an exciting idea with aerial technology, or building out a drone division inside of an established business, we want you to be able to learn from our experiences, good and bad, so you can quickly validate assumptions, hone in on your target markets, and form the connections and partnerships that will enable long-term success.

WHERE WE FOCUS FINDING MARKETS Who will be the users for your new tech? What is the competition like? What are their budgets and how do they buy? We speak directly to subject matter experts in the field both new and through long-term relationships, to get you direct info on going to market you can’t get anywhere else.

PRODUCT DEVELOPMENT We’ve worked on dozens of projects, large and small, working in manufacturing, supply chain, mass-production, custom modification, app development and more, and can lend a hand with partners to produce product, and validate technological assumptions around everything from gimbals, airframes, batteries and motors to cloud data transforms.

SELLING-IN Identifying and creating lead lists and outbound engagement strategies for your target customers, and connecting the dots with our large networks of drone-specific retail and distribution partners, covering niches like construction, inspection, public safety and more.

COLLABORATION Validating and connecting our clients with the right partners in the space to make their technology part of a complete solution for end users.

EXPANSION Bringing products to new markets, whether that be verticals or geographies, with focused, goal-oriented engagements over medium-term time frames.

LEARN MORE

Schedule a briefing call - GuinnPartners.com/contact/

GP STRATEGIC THE MOST COMPREHENSIVE LEARNING AND ANALYSIS PORTAL FOR MICRO AND MACRO-LEVEL DRONE INDUSTRY INFORMATION.

Our GP Strategic portal contains: • Hours of expert video covering everything from macro-level industry segment overviews to go-tomarket strategy reviews to deep-dive technology explanations of technical components in UAV systems such as autopilots, gimbals, VTOLs and long-range video links. • A collection of sample private company and public institution RFPs for UAV services or UAV purchases for understanding or helping craft requirements • Database of preferred drone service providers and service provider networks with contact information • Interviews with over a dozen industry leaders and drone field users discussing use cases and technology developments they are looking for in the future • Comprehensive database of drone-related media and outlets with contact information

• Review of use-cases by segment, with written documentation and video overview compilations including construction, power, agriculture and more • Complete database of top 90+ major investors in drone technology • Government section detailing commercial sales requirements, and procurement process overviews • Database of analyst and industry report PDFs covering surveying, insurance, regulation, mapping, investment, inspection, construction, agriculture, industry analysis and more • Consistent video and written analysis of industry trends • Monthly private industry newsletter • Access to our regular private webinars w/ Colin Guinn and team (with question submission) • Ask an analyst form to request additional data into release queue

Yearly open-access subscriptions, and quarterly guided executive subscriptions are available. Learn more by clicking the link below.

THE AUTHORS COLIN GUINN Colin Guinn is a product development expert and serial entrepreneur. He most recently founded Austin startup Hangar, after serving as Chief Revenue Officer at 3D Robotics and co-founding and serving as CEO of DJI North America. He is one of the most interviewed experts on robotics technology in the world, and has been featured at premier industry conferences and in countless top-rated publications and newscasts, including 60 Minutes, Techcrunch, and Fast Company. Colin’s uniqueness to the business world is that he understands the technology in two dialects: the granular argot necessary to communicate with an engineer, and the simple, digestible language that’s interesting to the average consumer.

OREN SCHAUBLE Oren Schauble is an experienced sales and marketing executive specializing in high-tech and disruptive products. He served as the VP of Sales and Marketing at Hangar Technology, after serving as Vice President of Marketing at 3D Robotics and Director of Marketing at TrackingPoint. Before this he worked agency-side as a creative director for lifestyle brands. Oren’s specialty is in building comprehensive sales and marketing programs, managing complex social media content programs, and establishing systems for companies undergoing rapid expansion.

ADDITIONAL WRITING PROVIDED BY: Roger Sollenberger and Hudson Bailey

THANKS TO Jered Garrison at Hit Machine Creative, all our contributors and subject matter experts, Bruce and Jason for their copyediting assistance, the wonderful industry team who submitted their interviews in our aggressive timelines, all the imagery providers, and the amazing team at Guinn Partners.

Thanks for reading, and we hope we’ve provided some insight worth considering and integrating into your business plans for this year.