Drones Connected Conference September 22, 2016
Why a Drones Connected Conference? Most civilian drones will rely on near ubiquitous connectivity to fully leverage their capabilities. Cellular connectivity enables drones to tackle these new opportunities and to become an integral part of the bigger Internet of Things that telcos like Orange are enabling.
Letter from the CEO Looking over the Horizon, together At Orange Silicon Valley, we explore how connectivity is shaping our lives. As the innovation center of Orange in the Bay Area, we focus on how innovations are driving the adoption of new habits by our customers, new uses cases for the solutions we provide, and new lines of business for our company. We engage with entrepreneurs to collaborate around cutting-edge tools and tailored connectivity solutions to make their projects a reality. Connected objects, from smart devices to fleets of cars, are set to transform the role of telcos from communications providers to ubiquitous connectivity providers and business opportunity enablers for the Internet of Things ecosystem. Drones are a natural part of this ecosystem and here at Orange Silicon Valley, we are thrilled to be part of the conversation that will shape the “Internet of Drones” of tomorrow. Advances in remote sensing are remarkable examples of how drones are already acting as flying platforms feeding many industries’ growing appetite for actionable data with unprecedented refresh rates and unmatched level of details. What they imply for the agricultural industry for example, is of particular interest to Orange and our customers. Acknowledging the business opportunity of drones is one thing, shaping the future of the Internet of drones is another. It is our responsibility as a connectivity provider to bring these innovation forward and enable the next ones. 4G is already a key enabler of the most promising drone applications of today, and 5G will naturally follow, bringing more opportunities along with exciting challenges. So from drone delivery to drone racing, here’s to envisioning game-changing applications for our society. In the end, creativity and innovation can’t happen without them.
Georges Nahon San Francisco, California September, 2016
Featured startups per vertical
Connectivity
Delivery
Unleashing the full potential of drones
Drones + Cellular = ecosystem for drone delivery
Thus far, commercial drones have primarily used unlicensed bands for telemetry (e.g. Wi-Fi). The cellular infrastructure provides unlimited range and thus enables beyond line of sight operations. Cellular networks could enable applications such as the transmission of video in real time for news gathering, events filming, or disaster relief without the need of any satellite terminals.
Drone-based delivery will have a transformational impact on how logistics and supply chains are managed today. In rural and remote areas, drone delivery will significantly reduce the delivery time and carbon footprint. Applications include but are not limited to: time critical payload, emergency medicine, disater relief, merchandise from e-commerce transactions, food delivery to remote areas of the developing world to combat malnutrition. For example, the startup Zipline is engaged in a partnership with Rwanda to deliver blood and medicine to remote areas of the country, and recently announced planned expansion for hard to reach areas of the United States. In 2015, another company called Flirtey completed a drug delivery to a hospital in rural Virginia, this was the first FAA approved delivery of its kind.
Drones are already using the existing cellular infrastructure and will increasingly rely on it for: • virtually unlimited connectivity range • remote control • real time data transmission • safe integration into the national air spaces
AI
Remote Sensing
What does it take to make a drone SMART?
Sensors that fly
We have seen the tremendous growth of connected things, and we are clearly in the age of data; applying artificial intelligence (AI) to advance analytics on the collected data to gain deeper insight is the key to unlock more value for businesses. Drones are definitely part of the internet of things, AI is the next era of computing for the drone to help real-time decision making at the edge. AI will be shaping the drone industry from different perspectives, with sense and avoid system acting as the brain of these devices.
Like any remote sensing platform, drones are gathering large volumes of data that need to be stored and processed. This new “big data” generates new requirements for hyperscalable, reliable, and smart storage solutions. For example, a drone equipped with hyperspectral sensors can generate ~80 Mb/second or near 70 Gb of data every 15 minutes.
“Businesses that truly enable delivery or sharpen data collection and sensing will win mindshare.” - Michael Berolzheimer & Garrett Goldberg (Sep 14, 2016)
AI Applications Massive image data is fueling the growth of applied machine learning. In order to perform geoanalytics at exascale, GPU-based artificial intelligence — or “onboard processing” — will complement data analysis on the ground. “Smart drones” relying on the cellular network will not only be able to survey wide areas, inspect facilities, follow individuals, they will also be able to send back the right data at the right time and take decisions on their own. Hardware Mobile chips are being used for data processing at the time data is captured, at the source and on the edge, enabling real-time decision making to leverage machine learning technologies. Intel, Qualcomm, and Nvidia are all heavily investing in this space. Software Companies are embedding AI platforms onto their chipsets and devices, like Qualcomm’s Zeroth platform that enables on-device intelligence with cognitive capabilities such as visual perception, audio and speech recognition, or like Intel’s RealSense technology that has been integrated onto the drone platform.
600,000 Number of commercial drones the FAA expects will be flying in 2017, the first year of the drone new ruling. This number is expected to grow to more than 2.7 million by 2020
Regulations
UAS Guidelines
In the U.S., new rules (“Part 107” a.k.a.”Small UAS* Rule”, in effect on Aug. 29 2016) clear the way for increased commercial UAS use. The rule allows UAS operators to proceed without having to obtain waivers or flight-by-flight permissions from the Federal Aviation Administration (FAA) — a process that had caused long delays and discouraged many startups.
• Don’t allow flying beyond the line of site of human drone operators, or above the heads of pedestrians • Drone operators to pass a drone certification exam. The first exam available saw 3,351 people signed up to take it. • Weight limitation < 55 pounds (including payload) • Speed and altitude limitations: not over 100 miles per hour and over 400 feet from the ground • Avoid using drones at night
*Unmanned Aerial Systems
“Before, you had to apply for an individual authorization from the FAA to fly, whereas now if you are going to fly for business, you can fly under the Part 107 rules and you don’t need to apply for any sort of authorization.”
“[Zipline’s drone] goes about 80 mph and within the year they envision 14 different centers where they will be able to drop blood and medicines to, reaching about 6 million people” - Chris Williams, UPS Director of Operations
- Les Door, FAA spokesperson
Government Support
What to expect next
The United Arab Emirates launched a “Drones for Good Challenge” in 2016 that will award $1M USD to an international winner and 1M United Arab Emirates dirham to a domestic winner. The overall theme is to support the development of drone technology that can help improve people’s lives, in terms of health, education, civil services, humanitarian aid, tourism, and other related categories.
• Risk to manned aviation from interference to drone navigation and 5G standards to be discussed by the FCC soon. • It is hard to see how Amazon’s Prime Air service would be able to operate within the FAA’s line-ofsight requirement. So new rules will be issued, probably authorizing BLOS in the next year or so. • In frontier markets we envision faster adoption of beyond line of sight commercial drone-based services in remote regions.
30M
Estimated Consumer Drone Shipments Global
29 22 17
15M
0M
3 2014E
6
7
2015E
2016E
10
2017E
13
2018E
2019E
2020E
2021E
VC Activity Past year, US only
$29.7M
Airware (San Francisco, 2011) $30M Series C, Mar-2016 Next World Capital, Andreessen Horowitz, KPCB
Average Series B amount of funding for drones startups in 2015
DroneShield (Herndon, 2014) $22M Series A, Apr-2016 Undisclosed Investors CyPhy Works (Danvers, 2008) $22M Series B, Oct-2015 Bessemer Venture Partners, Draper Nexus, General Catalyst Partners, Lux Capital, Motorola Solutions, United Parcel Service PrecisionHawk (Indianapolis, 2011) $18M Series C, Apr-2016 Verizon Ventures, USAA, Intel Capital, Millennium Technology Value Partners, Innovate Indiana Fund, NTT Docomo Ventures, YMVSV Kespry (Menlo Park, 2013) $16M Series B, Jun-2016 DCM Ventures AirMap (Santa Monica, 2014) $15M Series A, Apr-2016 General Catalyst Partners, Lux Capital, Social Capital, TenOneTen, Bullpen Capital, Pritzker Group
Most Active VCs Andreessen Horowitz SV Angel GV Qualcomm Ventures Y Combinator Felicis Ventures Intel Capital Lux Capital Parrot Techstars Founder Collective Space Angels Network Start-Up Chile Sequoia Capital 0
1
2
# of startups in portfolio
3
4
5
6
Recent IPOs/ Acquisitions
$1.01B
Department 13 (Virginia, 2010) IPO Jan-2016 Drone defense, cellular communications, & networking
Amount invested in drone startups in 2015
Valmie (Houston, 2014) IPO Jan-2015 Software, hardware, cloud solutions, drone equipment and services Aetos Group Inc (Houston, 2010) Acq. Oct-2015 by Mistras Group Undisclosed Robotic inspection solutions
Funding to date per sector $88M $151M
$14M
UAV Manufacturers $1.17Bn
Consumer Military Commercial
Sensors Navigation
$993M
$66M
Software $183M
$38M
Other Hardware $53M
$39M
$79M
Drone Detections Fleet Mangement OS
Delivery Aerial Photos Inspections Other
Services $166M
â&#x20AC;&#x153;Industry estimates that over the next 10 years, commercial unmanned aircraft systems could generate more than $82 billion for the U.S. economy and by 2025 could be supporting as many as 100,000 new jobs.â&#x20AC;? - Anthony Foxx, Secretary of Transportation, Aug. 29 2016
Brought to you by the team at Orange Silicon Valley:
Carolyn Ma Design Lead
Daniel De La Torre Designer
Darren Sabo Senior Business Analyst
Gabriel Sidhom VP of Technology Development
Hugo Wagner Technology Analyst
James Li Senior Software Engineer
Mark Plakias VP of Knowledge Transfer
Soumik Sinharoy Senior Product Manager
Sept 2016
@Orange_SV www.orangesv.com