By Richard Stubbe, BloombergNEF editor. This article first appeared on the Bloomberg Terminal.
It’s a familiar cycle — a new technology gets better and cheaper, people find new uses for it and increase demand, inspiring competition that makes them better and cheaper. It’s happened with solar power, wind energy, storage, and electric vehicles.
Now it’s happening with drones and drone software like that made by DroneDeploy, a San Francisco-based company that takes the images captured by drones and turns them into highly precise three-dimensional maps that can change over time. The company said its customers — among them are Jacobs Engineering Group Inc. and Skanska AB — have conducted more than 1 million flights.
The commercial range of applications for drones is wide: surveying construction projects as they’re being built, monitoring crop growth, determining solar panel placement, inspecting wind turbines for wear and damage, finding underground pipelines.
And the growth is impressive as well: The U.S. Federal Aviation Administration reported over 277,000 unmanned aerial vehicles were registered by the end of the year. It projects that there will be 835,000 by the end of 2023 and says that will almost certainly be too low.
“A drone is a self-driving electric vehicle that happens to fly,” DroneDeploy CEO Mike Winn said. “The hardware is getting better and the software is getting better and will be able to help our customers in new ways. The products are becoming smarter, they can fly farther, they can capture better data.”
Winn talked with BloombergNEF in a phone interview in late May.
Q: What do you do?
A: DroneDeploy makes software that lets customers get a bird’s-eye view of the areas that they care about. They can capture digital twins of their assets. They can measure those twins, see their changes through time, and run analytics and artificial intelligence on them.
Our largest industry is construction. Agriculture and energy are next. We have about 5,000 customers flying drones every day.
Q: How’s the business in general? What’s changing?
A: We have customers across every industry, from Fortune 500 brands down to individual farmers. We have the world’s largest repository of drone data. We’re the leader in AI in our space — Google has used our AI tools with their drone data. We’re growing really fast, and the industry is growing really fast.
A big change for us this year is going from smaller deployments — a dozen or fewer drones — to hundreds of drones.
Q: So you don’t own the drones.
A: We are just drone software. You can use any drone with our software. We write the software so customers can go on site with their drones, use our product and the drones will automatically fly around with the data. That data is sent to DroneDeploy to be processed into models and maps for artificial intelligence to run against it.
You can get a terrain model. You can monitor the progress of a construction project and use that information to pay your subcontractors. We also collect information about solar in the operations and maintenance space. Thermal cameras can help solar operators understand where maintenance needs to be done.
Q: What’s a typical case for a construction customer?
A: Construction customers will fly drones on a weekly basis at a project. A big part of what they’re trying to do is understand what progress they’re making. That’s the first layer. They’ll fly the drones and capture different types of data. The most obvious things are photos and video; they can create 360-degree panoramas and 3D models.
They’ll use that data to communicate across their teams. Up until now, for anyone to contribute to decisions on a construction site, you had to be there in person. Now you can get a weekly update with a 3D model. So the CEO of a construction company can keep an eye on all of his company’s projects. The safety teams can make sure all the projects are OSHA-compliant without leaving their desks.
The companies also use drones to survey land. A human would have to survey using GPS points. A drone can fly over the top and do that work 10 times faster at higher accuracy, down to about 1 centimeter.
Q: What does your software create?
A: For the first time, a construction company can have a sort of Google Earth 3D representation of their job site on a map that is measurable and repeatable over time. You can explore in 3D like you can in Google Earth except it shows what happened today and it’s at a much much higher resolution.
Q: And I can get one whenever I want?
A: The only limitation is how often you want to go outside and press the button.
Q: You mentioned construction and agriculture. Bloomberg News reported that vineyards in France are using drones. Who’s your typical agriculture customer?
A: We focus on row crops like corn and soybeans. A cornfield might have 160 acres and corn can be 6 feet tall, so the best way to get information is to fly a drone over the top.
That’s a really big market for us. It’s where we have our biggest customer, a company called Corteva. They have 400 drones in the hands of their agronomists. Those agronomists go to their customers’ fields and they help them make decisions about chemicals and seeds. Historically they walked around that field to get information. Now they go to that same field and fly a drone and they can see the whole field in real time with a map.
Q: What about costs? Are they going up or down?
A: They’re going down. The products are becoming smarter, they can fly farther, they can capture better data. The drones that farmers are using cost roughly $1,500. Our software costs $1,000 to $3,000 a year. With drones, you can do 10 times more work for the same price.
Q: As the products offer a better value, are customers finding new uses for them?
A: All the time. DroneDeploy.org is our NGO arm. I was recently in Australia and they’re using drones there to map out the coral reefs. It’s kind of a surprising use case because the reef is under the water, but you can see the change over time from the air.
I’m from South Africa, where there is a problem with poaching. Rhinos are being killed, about three a day. The areas that need to be secured are huge. The Kruger National Park is the size of Israel, and the security team is about 500 people. So drones are being used in anti-poaching efforts to keep an eye on huge areas using thermal cameras so you can see when poachers enter the park at night.
So there are tons of use cases, although our focus is on the commercial side.
Q: What’s happening there?
A: We’re seeing a ton of growth right now in oil and gas. There’s a lot of activity in the Permian Basin. A lot of oil companies have pipelines throughout the area, but sometimes they don’t know exactly where those pipelines are. They know roughly where they are, and they want to make sure that nobody is constructing anything over the top of them. The drones can detect those pipelines underground by using a vegetative camera or a thermal camera.
Q: What can drones do other than photo and video and thermal imaging?
A: A properly outfitted drone can detect a gas leak. Oil companies can use the drones on their well pads to make sure there are no gas leaks.
Also, our customers are capturing this digital twin of their job sites. They want this high-resolution imagery of exactly what that job site looks like. So you can do a ton with that data. Essentially any human inspection can be done by a drone.
Q: What regulatory issues are you facing?
A: We operate within the regulatory environment of the FAA. In general, the FAA has found ways to integrate drones into commercial airspace that aren’t overly burdensome to the industry.
Q: People could use drones for less positive purposes — spying, for instance. Do you have to police how drones are used?
A: That’s come up. There are ways to abuse any technology. But in general, the users have been very positive. There are rules designed to protect people’s privacy that aren’t specific to drones that still apply — for instance, governing the use of a telephoto lens or a camera on a long pole or a camera in a helicopter. It hasn’t become a broad problem.
Q: How does the solar industry use your product?
A: Drones can create value across the whole life cycle of a power plant. They can help with site selection, with plant design and construction, and to improve efficiency of operation and management. SunPower, one of our customers, has told us they use our product to evaluate terrain and decide how to place modules. Some of the sites developers look at are 3,000 acres.
Drones also help with designing solar power plants. The sites have creeks and hills and vegetation that drones capture accurately.
SunPower said they use terrain models created by drones and our software, that enables them to choose the ideal design for placement and orientation of solar panels.
Then they can use drones to monitor the site and keep their up time near 97% or 98%.
Q: What are some other cases?
A: We’re not currently in the wind business, but drones are being used to examine the conditions of blades. Typically a wind turbine is inspected annually by a human. Now that can be done more frequently by a drone.
Drones are also being used to inspect flare stacks and oil and gas plants, and that’s a really high-value use case. A stack has to be turned off for 24 hours to cool down before a human inspection. With a drone, you can fly it around after a much shorter cooling period.
Drones are being used in application of pesticide and fertilizer — like a pilotless cropduster with a lot more precision, putting the right amounts in the right places.
Q: What about indoors?
A: Drones are starting to have the ability to fly indoors, and new use cases are opening because of that. In the oil and gas space, they have to inspect tanks every five years. They have to drain and clean the tanks, build scaffolding, and take a tank out of operation for days. With a drone, you can just get the oil out and fly the drone around inside the tank.
Indoor flying is difficult, just as it’s easy for a self-driving car to navigate in the desert and difficult in the city. That technology is starting to arrive now for drones.