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Current State of the Drone Industry - Skylogic Research

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Current State of the Drone Industry - Skylogic Research DroneDeploy Day Presentation - October 27, 2017

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Current State of the Drone Industry - Skylogic Research

  1. 1. 1Copyright 2017 Skylogic Research, LLC | THE CURRENT STATE OF THE DRONE INDUSTRY DroneDeploy Day October 27, 2017 Colin Snow, MBA CEO and Founder
  2. 2. 2Copyright 2017 Skylogic Research, LLC | Topics What industries are paving the way for drone adoption? Who’s leading the drone market? What role does software have in this space?
  3. 3. 3Copyright 2017 Skylogic Research, LLC | What is the real number? $2B - $127B
  4. 4. 4Copyright 2017 Skylogic Research, LLC | The pundit industrial complex We are currently tracking 72 different forecasts! Most reports sell between $2,000 and $6,000 Source: Skylogic Research
  5. 5. 5Copyright 2017 Skylogic Research, LLC | The pundit industrial complex "[X Consulting Firm] believes that [Y emerging technology] will eventually reach a market size of [$Z billion]." Image: CB Insights How it’s done
  6. 6. 6Copyright 2017 Skylogic Research, LLC | Setting realistic industry expectations Our approach: 1. Start with actual market data (sales, user surveys, etc.) 2. Analyze it 3. Build a realistic model of industry growth THE FAA Image: The Marketoonist
  7. 7. 7Copyright 2017 Skylogic Research, LLC | Growth issues we consider 1. More consumer drones are being used for commercial work than ever before. 2. Drone sales is not equal to fleet numbers and there is a huge gap between actual commercial use and compliance with FAA regulations. 3. Part 107 has created low risk barrier to entry and this has created a current glut of certified sUAS remote pilots. 4. Film / photo / video is still the #1 largest commercial use. 5. Most drone-based service providers are very small and do not make enough money to sustain even a part-time venture. 6. Business / industry adoption growing, but it’s mixed because of factors such as: • Digitization varies by industry • Business risk aversion • Concerns over invasion of privacy • Reluctance to share too much information about successes
  8. 8. 8Copyright 2017 Skylogic Research, LLC | General industry adoption hurdles Source: Skylogic Research Basic public concerns: • Safety • Security • Privacy • Public Nuisance
  9. 9. 9Copyright 2017 Skylogic Research, LLC | Role of software Mission Planning •Site selection •Airspace •Flight path •Overlap •Capture parameters Data Acquisition •Aircraft / Platforms •Sensors •Computer vision •Embedded AI Data Processing •On-board •Cloud-based •Post- processing •Live streaming •Storage •Images/ video •Photo- grammetry •3D models •NDVI/ index maps •Machine learning/AI •Mobile •PC •Real-time data •APIs Data Visualization Data Presentation Operations •Flight logging •Fleet management •SOPs •Safety checks •Pre-flight / post- flight maintenance •Insurance ..in the drone industry will need to support a standardized workflow and the various operation types with built-in functionality or an ecosystem of partnerships. Operation Types: Standardized Workflow Day Night Over People BVLOS Source:: Frost and Sullivan and Skylogic Research
  10. 10. 10Copyright 2017 Skylogic Research, LLC | 1.7 6.5 4.1 2.9 1.1 12 7.0 3.8 1.7 0 1 2 3 4 5 0 1 2 3 4 5 Agriculture Construction Insurance Mining and Aggregates Oil & Gas Public Infrastructure Railroads Telecommunications Utilities Estimated Market Size in $B Market size and potential There is a general lack of consensus on how to calculate the total market demand - aka Total Available Market (TAM) - for drone based product and services. Source:: Skylogic Research Use Case Maturity RelativeGrowthRate Relative to the others – not actual growth rate Not shown: Film / Photo / Video
  11. 11. 11Copyright 2017 Skylogic Research, LLC | Latest research Data collected for our latest study comes from a survey we conducted over the web in July and August 2017 and interviews performed with business users in Q1 and Q2 of 2017. We evaluate four distinct sectors of the market: 1. Drone Purchases 2. Service Providers 3. Business Users 4. Software Services Our online survey garnered 2,666 respondents representing over 60 industries worldwide. Large sample size means the statistics are reliable • Confidence level 99% • Margin of error ±2.5%
  12. 12. 12Copyright 2017 Skylogic Research, LLC | Purchases Source: Skylogic Research 72% 25% 68% buy for professional / commercial use 59% is for film, photo, or video use purchase direct from the manufacturer Amazon was #2 at 17%. purchased DJI drones vs. all other brands Individuals or organizations that purchased a drone in the past 12 months We asked detailed questions about: • Type of aircraft • Brand purchased • Price • Place of purchase • Intended use • More..
  13. 13. 13Copyright 2017 Skylogic Research, LLC | Current market leader DJI is the clear market share leader in drone aircraft sales, industrial use, and almost every software category. More DJI aircraft are used by service providers and business users than any other brand. They also have more partnerships supporting the standardized ecosystem workflow than any other. Our data shows DJI is the dominant brand for drone aircraft purchases, with a 72% global market share across all price points. It’s even higher share (87%) of the core $1,000–$2,000 price segment. In North America (U.S. and Canada), DJI’s overall market share is 62%. Drone Brand Market Share Source: Skylogic Research
  14. 14. 14Copyright 2017 Skylogic Research, LLC | Top use cases Commercial Drone Use by Vertical 1. Film / Photo /Video (combo) 42% 2. Surveying and terrain mapping 11% 3. Asset and infrastructure inspection and monitoring 7% 4. Public safety / first responders 5% 5. Agriculture / farming 5% Top 5 Business Case Uses
  15. 15. 15Copyright 2017 Skylogic Research, LLC | Service providers Our survey finds only about 8% of service providers make more than $100,000. 1 Surveying / Mapping / GIS 2 Aerial Photography and/or Video 3 Utilities Infrastructure Inspection or Monitoring 4 Construction 5 Agriculture / Farming Services 6 Consulting 7 Cinematography / Movie / TV 8 Oil & Gas Facilities Inspection 9 Mining or Aggregate Operations 10 Real Estate (commercial and/or residential) Source: Skylogic Research Top 10 Drone Services Making Over $100K/Year Source: Skylogic Research
  16. 16. 16Copyright 2017 Skylogic Research, LLC | Business users (industry) We define business users as those individuals or companies that use or purchase drone-based imaging or sensing services. Our confidence level for this portion of the survey is 95% ±4%. Who performs your drone-based services? We asked detailed questions about: • Annual revenue • Services used or purchased • Controlling department • Number of aviation authority, licensed small UAS / UAV remote pilots employed • Number of projects performed per month • Method of drone purchase
  17. 17. 17Copyright 2017 Skylogic Research, LLC | Software services We define software services as the software apps or online services to log flights, manage drone operations, plan missions, or process data from drones. Our confidence level for this portion of the survey is 99% ±3%. We asked detailed questions about the software apps or online services used to perform: 1. Flight logging and operation management 2. Automated mission planning 3. Data, image, video processing
  18. 18. 18Copyright 2017 Skylogic Research, LLC | Software services Drone Data / Image / Video Processing Software Market Share For data / image / video processing the top 3 vendors (53%) do film / photo / video. All others (the next 47%) do mapping and photogrammetry
  19. 19. 19Copyright 2017 Skylogic Research, LLC | Future of drone software What’s on the horizon? Imaging • RGB, thermal imaging, orthomosaic, radiometric data combo Cloud-based artificial intelligence (AI) • Machine learning (deep learning, predictive analytics) Edge-based AI • Vision (image recognition, machine vision) Asset management systems • Documentation, tracking, and GIS data integration Unmanned Traffic Management (UTM) • Drone ID • Performance based navigation (standards based) Image: Drone Infrared Imaging
  20. 20. 20Copyright 2017 Skylogic Research, LLC | Research report AVAILABLE NOW Price: $1,450 Single User License $2,250 Enterprise License PURCHASE HERE: http://droneanalyst.com/research/research-studies/2017- drone-market-sector-report/ 10keyinsights 88pages 40figures 9datatables
  21. 21. 21Copyright 2017 Skylogic Research, LLC | Questions? Additionalslides: About Disclaimer
  22. 22. 22Copyright 2017 Skylogic Research, LLC | About Skylogic Research, LLC is a research, content, and advisory services firm supporting all participants in the commercial unmanned aircraft systems (UAS) industry. We help companies make critical investment decisions with confidence by providing research-based insights on the commercial drone markets. Our focus is on the needs of three constituents: • Manufacturers, suppliers, and business service providers – who need research and insight into buyer needs • Buyers of UAS technology and services – to help inform their acquisition decisions • Investors – who need to distinguish technical and market viability This focus, plus research as a foundation and reach into a community of more than 90,000 business executives and innovators through social media and media partnerships, allows us to deliver a high-value, low-risk method for achieving optimal understanding. Drone Analyst® is the registered trademark and brand name and trademark of Skylogic Research, LLC Learn more: Web http://droneanalyst.com Twitter @droneanalyst Email colin@droneanalyst.com
  23. 23. 23Copyright 2017 Skylogic Research, LLC | ©2017SkylogicResearch,LLC. Allrightsreserved. This publication is not approved for public distribution under the terms of agreement with DroneDeploy. Drone Analyst® products and services mentioned herein as well as their respective logos are trademarks of Skylogic Research, LLC. These materials are provided by Skylogic Research are for informational purposes only, without representation or warranty of any kind, and Skylogic Research shall not be liable for errors or omissions with respect to the materials. In particular, Skylogic Research has no obligation to pursue any course of business outlined in this document or any related presentation, or to develop or release any functionality mentioned therein. This document, or any related presentation, and Skylogic Research strategy and possible future developments, products, and/or research directions are all subject to change and may be changed by Skylogic Research at any time for any reason without notice. The information in this document is not a commitment, promise, or legal obligation to deliver any material, research notes, or web content.

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