Industry representatives came together at the GeoIgnite virtual conference for a very frank conversation on the business of optical-based Earth Observation (EO) and radar-based Synthetic Aperture Radar (SAR) on April 22nd at the “Spatial Finance, New Markets for Earth Observation” panel.
The panelists were: June McAlarey, President/CEO of PCI Geomatics; Bill Greer, Product Manager at Maxar; Joe Morrison, Head of Product Success at Umbra; Florian Thaler, CEO and Co-Founder of OilX; along with moderator Will Cadell, CEO of Sparkgeo.
Joe Morrison brought particularly pointed critiques to the panel. Explaining how he had tried (and failed) to incorporate EO into his business before joining Umbra, he stated outright that “this industry is broken.” While EO has had tremendous success providing information to military and intelligence customers, he said that the industry was having difficulty attracting and serving other clients.
He pointed to several problems, chief among them pricing issues. Morrison said that EO information was often too pricey for private-sector clients, and the panel generally agreed. The bigger problem, though, is that the prices were unpredictable — as you can’t draw up a business plan based on unpredictable vendor prices. Because of that, businesses are mostly relying on free solutions like the ESA’s Copernicus Sentinel-2.
Maxar’s Bill Greer agreed that pricing was an issue, that licensing can make things “confusing and hard to sell,” and that the derivatives market is still only “starting to figure those things out.” He cited a low price of $3 to $5 per square kilometre as something that would help the “long tail,” but is “hard to get to” from where we are.
Thaler expanded on Morrison’s points, saying that they reflected a general divide between EO companies and potential clients. Thaler said that EO companies tend to focus on technological capabilities, and that that is a mistake, as potential clients are ultimately “agnostic to the type of technology” being used. No matter how impressive the tech is, their focus is on solving problems.
Thaler gave examples in the energy sector where firms may want to monitor wide areas for change, but closely observe certain critical locations to get a competitive edge. EO companies may be able to help, but clients may not realize it, and Thaler said that it’s up to EO companies to recognize clients needs and show how they can help. Thaler pointed to the European Space Agency’s new focus on “earth intelligence” as an example of how the industry can refocus its own efforts.
The whole panel agreed that a lot of opportunities were being left on the table. Cadell and Morrison noted that there were a lot of unfulfilled “long tail” applications for EO data. An audience question about the cost of back catalogue information prompted Greer give one example, saying that machine learning (ML) provides “really interesting use-cases” for comparatively-inexpensive archive imagery. Codell agreed, calling ML data “the new gold.”
Morrison added another limiting factor, which is that there isn’t as much SAR capacity as people believe. He said “there are a lot of headlines about SAR” but not enough satellites in orbit, especially considering the technical issues involved in SAR imaging. He believes that optical EO is greatly enhanced by using SAR, pointing to Maxar’s analysis as proof, and Greer agreed that “SAR and EO compliment each other,” and that he’s already “seeing a lot of use cases where we need SAR, and SAR needs us.” That however requires much greater SAR capabilities than currently exist.
These open opportunities led to general optimism about EO’s future. Morrison said that Umbra and others are working to both provide more SAR capacity and resolve technical issues, and that this growing SAR capacity could synergize with optical data from companies like Maxar to create game-changing opportunities for the entire industry. Greer agreed that “there’s no one solution,” and Morrison said that “none of us are competing with each other, we’re competing with the status quo.”
McAlarey said that her team was focused on “putting the science in non-traditional users’ hands,” pointing to the market impact of (for example) verifying carbon emission claims on behalf of ESG funds. McAlaray said it’s just one example of how there are “so many opportunities that are untouched” that depend on the EO industry deciding to “follow the dollars” and to start “talking to business people on business terms.”
Morrison agreed, and closed the panel by saying that “right now’s a great time to get involved.” Individuals and companies can achieve real success by not “taking the data and looking for problems,” but by understanding existing problems and using EO to discover real solutions.