If GoPro gets into consumer drones, the industry could finally have the innovation champion it needs
In order for any consumer technology to go mainstream, it needs one tech giant to emerge as its innovation champion. In search, it’s Google. In social networking, it’s Facebook. In digital music, it’s Apple. In e-commerce, it’s Amazon. And now the consumer drone market might one day have GoPro, the wildly popular action camera maker that just went public in June.
According to a credible report from the Wall Street Journal, GoPro is considering the launch of its own line of multirotor consumer drones priced between $500 and $1,000 by late 2015. While GoPro hasn’t officially confirmed or denied the report, they have joined a Washington-based drone-lobbying group, the Small UAV Coalition. And moving into consumer drones would be a likely next step for them, given the popularity of aerial photography for GoPro users.
Almost overnight, GoPro would become the odds-on favorite to become the leader and champion of the fast-growing consumer drone market. According to Teal Group, an aerospace research firm, the worldwide UAV (unmanned aerial vehicles) market – including both military and civilian drones – is expected to nearly double in size over the next ten years, from $6.4 billion to $11.5 billion.
Right now, military drones account for 89 percent of that total, so the total worldwide civil UAV market is relatively tiny, approximately $700 million. The consumer drone market (i.e. the market for personal, hobbyist drones and not the market for mapping or search-and-rescue drones) is even tinier, estimated by the Consumer Electronics Association to be $130 million in 2015. To put that number into context, GoPro’s sales through the first nine months of 2014 — $763 million — is almost six times the size of the personal drone category and bigger than the size of the entire worldwide civil UAV market.
So whom would GoPro have to knock off in order to become the undisputed champion of the consumer drone market?
There are three consumer drone manufacturers that are considered the industry leaders – China’s DJI Innovations, France’s Parrot and California’s 3D Robotics (founded by former Wired editor-in-chief Chris Anderson). According to industry estimates, DJI posted $131 million in annual sales in 2013. The next closest competitor is France’s Parrot, with $53.35 million in sales in fiscal 2013.
There’s not a single U.S. tech giant in the consumer drone market. in other words, there’s no Apple waiting in the wings with an Apple Drone to take on GoPro. While both Facebook and Google acquired drone companies in 2014, and Amazon seems to be embracing drones for commercial deliveries via Amazon Prime Air, none of them has created a drone that consumers can walk in and buy at a retail store. And even market leader DJI could be ripe for the picking, given that the company only launched its Phantom quadcopters in 2013 – hardly enough time to gain true brand equity in the marketplace.
At the end of the day, if American consumers had the chance to choose between “designed in the USA” (GoPro) and “designed in China” (DJI), which one do you think they’re going to pick?
Right now, we don’t know exactly what GoPro is going to create with its consumer drones. Company spokesmen are keeping things close to the vest, only noting that the company’s users are creating “jaw-dropping GoPro footage recorded from quadcopters.” So there’s reason to expect more from GoPro in this direction — it’s a natural brand extension, given that the company already provides cameras for drones.
There are two basic options for GoPro – either the company creates a new standalone consumer drone with an internal GoPro camera, or it essentially adapts a drone model already in the marketplace, equips it with a sophisticated mount, and lets users hook on an existing GoPro camera. You can see immediately see which of these two options is more valuable for GoPro – they’ve got to build the drone with the internal camera because there are already a handful of companies that already offer the “drone plus mount” option for aerial photography. Why would you bother buying a new GoPro drone if you can just buy another drone and mount a GoPro on it?
Another big question is how the FAA is going to rule on drones. That matters a lot, since the civil UAV market is expected to explode in popularity if the FAA gives the green light for commercial drones. Right now, civil drones are essentially limited to hobbyists, they cannot be flown above 400 feet in the air and they cannot be flown close to airports.
Yet, even with those restrictions in place, there are signs of drone mania taking off. It’s not just aerial photography, which is far and away the biggest drone hobbyist use so far. Filmmaking could be next, now that Hollywood has received the green light to use them for filmmaking. We may even see more creative uses unveiled at January’s CES tech trade show in Las Vegas, which for the first time ever, is going to have an Unmanned Systems Marketplace.
For now, though, all eyes are Washington and not on Vegas. It seems like we’ve been expecting an FAA ruling forever. And now even the White House has been pushing for more guidance. There’s a lot of regulatory risk here, especially given all the concern about airplane-drone accidents. In fact, perhaps based on all those concerns, the latest reports are that the FAA will go ultra-strict on its commercial drone ruling, perhaps even limiting consumer drone use to daylight hours and requiring all commercial drone operators to get a pilot’s license.
Regulatory risk obviously plays a big role here. But GoPro already has jumped through U.S. regulatory hoops for its IPO filing and understands what it means to be a highly-visible public company subject to regulatory control – something smaller, VC-backed drone companies in Silicon Valley may not yet fully grasp. And, most importantly, GoPro has also joined the Washington-based Small UAV Coalition, giving it a voice together with other consumer drone champions.
There are a lot of factors that go into a company being able to become a market leader: Network effects. First-mover advantage. Barriers to entry. If GoPro hopes to become the consumer drone market champion the way it did with the action camera category, it will need to do more than just “get big fast” by converting a large share of its GoPro action camera users into GoPro drone users. It will have to make sure these users are part of a networked ecosystem that makes it almost impossible for other competitors to catch up. If any company can make consumer drones mainstream, it’s GoPro.
Authored by Dominic Basulto via washingtonpost.com.
Nowhere other than inside the Pentagon will you find more truth in Machiavelli’s warning about the hazards of change: “There is nothing more difficult to plan, more doubtful of success, nor more dangerous to manage… For the initiator has the enmity of all who would profit by the preservation of the old institution and merely lukewarm defenders in those who gain by the new.”
Which was why my response to Deputy Defense Secretary Bob Work’s arrival involved a reference to Raymond Chandler’s Big Willie Magoon, a vice cop who “thinks he’s tough.” The arrival of someone with genuine strategic and technical chops at the upper level of the Defense Department was such a good idea that a lot of people were guaranteed to respond with equal parts rage and terror.
Work’s co-thinkers have now run the pirate flag up the mast with the publication of a concise and hard-hitting report by the Center for Strategic and Budgetary Assessments that details what Work has called a Third Offset strategy for towing the Pentagon out of the strategic quicksand into which it is steadily sinking today.
My compressed version of the CSBA report is here, along with an explanation of the innocuously wonkish “Third Offset” name by which the new strategy is known. But to be even briefer, this is the gist of the strategy.
Widely available weapons—this is not all about China—are threatening the U.S. ability to project power and influence events worldwide. Those weapons include guided missiles, satellites, and drones that can track ships in mid-ocean, and long-range surface-to-air missiles.
Rather than wading into a symmetrical fight against those weapons, the Third Offset strategy exploits U.S. and allied core competencies—not just the things we do well, but areas where we can maintain our lead for a long time, and without adding to the defense bill. Think advanced unmanned vehicles, all-aspect, broadband stealth, and undersea warfare.
Third Offset calls for some new weapons, none of them miraculous, some of them a little more specialized than those that have been planned in the last decade or two.
As a strategy, it has the enormous merits of focus and consistency, which is why there are people and groups who are going to hate it and try to stop it from happening.
The strategy exploits not just the things America does well, but areas where we can maintain our lead for a long time. Think advanced unmanned vehicles, all-aspect, broadband stealth, and undersea warfare.
First among these will be the boot-centric warfare (BCW) crowd, whose admiration for the military theorist Carl von Clausewitz has blinded them to the fact that our world is not Clausewitz’s, where armies ruled and the war was won when the enemy’s capital was occupied. They will not be mollified by another new CSBA report that proposes an expanded Army role in providing offensive and defensive regional missile support. They will portray Third Offset as the intellectual stepchild of one of those nutty airpower cheerleaders, and not the kind of warfare performed by Real Warriors.
This is not completely inaccurate. Third Offset reflects the views of people inside and outside the Pentagon who see large-scale BCW, particularly in a counter-insurgent role against cultures that revere martyrdom, as akin to wrestling a pig: You both get covered in slime but the pig enjoys it.
Next will be the peace-hawks. No, Third Offset does not advocate war with China. It seeks to prevent war with China, or any other nation that wants to exploit anti-access and area denial to further its own interests at the expense of the global community. In the classic phrase of deterrence, we want all such actors to wake up each morning and think: Not today.
The fighter generals and the advocates for the biggest program in Pentagon history, the F-35 Joint Strike Fighter, will not be much happier. Lord knows I am not a Joint Strike Fighter fan, but I have yet to call it “semi-stealthy” as the CSBA report does. The report also suggests that the Navy’s F-35C might be usefully canceled. But the critique is deeper: In some scenarios, it matters little if the adversary’s fighters can’t defeat F-35s directly. Shoot down or drive off the tankers and the fighters never make it back.
Some naval aviators will be at best skeptical of the report’s embrace of carrier-based unmanned combat air systems. They should not be surprised: Work himself co-authored an early and influential study of Navy advanced drones at CSBA, identifying range as a critical factor in an anti-access/area-denial environment.
The Navy’s surface-combatant community and the U.S. shipbuilding enterprise will be clearing the decks for action. Third Offset strongly favors the submarine and implies that, as missile threats become more intense, the weapon tubes on surface warships will fill up with defensive interceptor missiles, leaving only a handful of weapons to fire at the enemy.
The CSBA report says little about the Marine Corps and never mentions the F-35B—the Corps’ version of the Joint Strike Fighter. However, it does mention all the short-range anti-access weapons, like guided rockets and mortars, weapons that Work (a retired Marine himself) talked about in his CSBA and Navy years as representing a very difficult challenge for amphibious warfare in general and the F-35B in particular.
Third Offset is not policy. Yet. But it’s an important and coherent starting point for a discussion that is long overdue.
Authored by Bill Sweetman via thedailybeast.com.