Yvonne: In industries where we're seeing a good alignment of regulatory support, drone capability and a burning platform for change. For example, measuring stockpile in a mine, inspecting a roof top for the insurance industry etc. It's easy to see how a drone can replace much of the mundane and repeatable work that humans do with a much higher degree of efficiency and safety.
Industry disruption can also throw up new opportunities. Remember what Uber and Lyft did to the taxi transposition industry? This may be the case for drones as well - when a new player does something so different and innovative that both economics and engagement change; competitors either follow or go out of business.
Industries such as mining and construction tend to have a high level of comfort with drones because some of their workers were initially drone hobbyists. I remember one customer of Airware who, years back, duct taped an iPhone at the bottom of a drone to start playing around with measuring stockpiles. This type of experimentation helped these industries find use cases for drones that, combined with today's more permissive regulatory environment, is driving adoption. The commercial insurance and property management sectors also come to mind in regard to effective use of drones.
Drones are allowing these industries to do roof top and building inspections with both feet firmly on the ground, reducing the risk of casualties and fatalities. Additionally, these companies are starting to do predictive work using drone analytics and machine learning to better manage their capital expenditures.
The other sector, which stands to benefit tremendously from drone-use is agriculture.
It's easy to see how a drone can do much of the mundane and repeatable work that humans can do, but with much higher efficiency whilst ensuring a far higher degree of safety.
Yvonne: Not many people have been to a mine so tNot many people have been to a mine so they don't necessarily understand the challenging work environment. In a given year, a mine might dig up 136 million tons to produce 1.2 million ounces of gold. This requires blasting, digging, loading and crushing, with lots of large equipment driving around an everchanging site that runs 24/7. Safety in these environments is critical. Part of creating a safe environment is the management of high walls and safety blocks along the haul roads along with measuring the grade and widths of the haul roads themselves. In the past, this had to be done manually. Now, this can be done automatically, leveraging drone imagery and machine learning.
Because mining is linked so heavily with commodities, operations economics are critical. Drones not only improve safety, they also make tasks more efficient. Measuring stock piles takes minutes, not hours. Managing the grade and width of haul roads can improve fuel efficiency. Sometimes a mine might spend 20% of its operating cost on fuel alone, so small percentage improvements mean big bottom line benefits.
Yvonne: I hear a lot of debate around the cost of data storage on Cloud. The Cloud is perhaps the only practical way to manage data, enrich and provide access to drone analytics in the long term, unless you are an extremely large company.
Airware leverages the Cloud very effectively and the benefit of cloud reaches well beyond just the storage of data. In the past, we had a customer who had terabytes of drone flight data sitting on storage drives in the corner of the office and ultimately had to stop the drone program because the data was meaningless. By leveraging the Cloud, data collected via drones is always on and accessible. It is easy to compare it from one date of collection to another. The data is easy to visualize, annotate and collaborate across a site and around the globe. The Cloud also makes it easier to access burst compute power required to do value added machine learning work to further enrich the data insights.
Yvonne: The regulatory environment is crucial. The issue is that the advancement of drones has been challenging for regulators to understand and manage and that is holding back innovation. Thankfully, there is awareness that should the challenges surrounding regulation not be addressed, as a country, we will become less competitive in this shapeshifting industry.
Airware has a regulatory expert on staff and from the beginning, we have been actively involved in helping drive commercial drone regulations by testifying as an expert before Congress and serving on standards committees both in the United States and abroad. What we're pushing for is an approach that is more agile in nature and hopefully we'll get to what I call the "common core". Every country will have its unique set of regulations but if we can get to a place where there is an uniform minimum standard that companies can expect across geographies - that will be a tremendous win!
To achieve the value that drones can bring, businesses need to have the ability and regulatory permission to fly beyond the visual line of sight. Another pressing insistence is that one operator should be allowed to control multiple drones and fly over areas that might have people. I believe most of these issues will be addressed in the next 18 to 36 months.
There's a lot of work being done around the tagging of drones - how do you identify specific drones flying in a particular air space? There's also a lot of work being done around advanced airspace management, drone flight path, anti-collision ability etc. All these things combined, I believe, will increase the confidence of regulators that the flying robot can be effectively controlled in any scenario and quick corrective action can be taken should something start to go wrong. I think that's the mindset that people are trying to adopt around our community as we see a balance of innovation without compromising safety and integrity.
Yvonne: This might be a surprise to many but I personally know the CEOs of Airware's top competitors and speak to them on a regular basis. That's really a reflection of how early we are in the market. We all realize there is tremendous potential for growth ahead and we are just at the tip of the iceberg of what's possible. The biggest barrier for a commercial drone company's success today is the lack of large scale adoption. We do not necessarily want to fight over the same piece of pie but expand the pie itself. The successful expansion of drone usage into new companies is, in many ways, a win for us all.
I think a great example of our collaboration is the future of mobility group pulled together at the World Economic Forum (WEF) so that a variety of different players, both complimentary and competitive, can work specifically on regulatory recommendations. And by extension, towards growth of the marketplace.
Yvonne: Technological progress will fundamentally reshape our work, our companies and therefore our society. I'm a strong advocate that we need to rethink not just what we're doing with our workforce but also how we educate our youth and prepare them to be workers of tomorrow.
What we need to do is embrace the potential for change early on versus running away from it. In my experience, people avoid change. It makes them feel uncomfortable to think about things differently or reimagine life.
Yvonne: Financial pressure is there but I think much of this goes beyond that; it is about being scared that the new future is going to have horrible outcomes so it's better to ignore it. But the irony is that if people think creatively and start early, they can craft a much more positive outcome.
I would advise companies to plan early, think about re-investing some of the benefits and being thoughtful about engaging the workforce because workers are creative and they help identify new innovations if they are not burdened by physically challenging tasks that technology can take over easily.
Every country will have its own unique set of regulations around drones, but if we can get to a place where there is an uniform minimum standard that companies can expect across geographies that they operate in - that will be a tremendous win!
Yvonne: As easy as it is to conceptualize the amazing things drones can do, it is far tougher to execute. The sector attracted immense funding based on potential. What subsequently happened is that reality set in. The proliferation has been driven by sophistication in the drone technology but that has taken time. The regulatory environment was not permissive enough and businesses weren't convinced that the benefits were crystal clear for them to start writing big cheques. The market did not materialize as fast as people had expected.
But market momentum is accelerating now because we are at that sweet spot where regulations are beginning to change in favor of drone technology, business cases are stronger and machine sophistication is reassuring. You will see consolidation; the less productive firms will be weeded out.
Yvonne: We have now moved from the experimentation phase to the value realization phase. Already, repeatable solutions have been proven so customers are working towards capitalizing the benefits.
Innovation will dominate the next phase of growth. We will not only replace processes with ones that add better value, but also start integrating data streams and building predictive analytics.
I fundamentally believe the winners in this marketplace are going to be those who capitalize quickly on the value realization component to drive revenue up that $100 million mark while demonstrating their ability to lead the next phase of innovative change.