Drones in the enterprise: The future of data collection

Why your company might (or might not) want to deploy a drone -- and what to keep in mind if you do.

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To hear some tell it, the world will soon be abuzz with small drones that inspect bridges, monitor pipelines, survey crops and help assess damage for insurance claims.

Before companies head off into the wild blue yonder, however, several things have to happen. The federal government needs to figure out how to regulate the commercial use of drones. Drone vendors need to figure out their business models. And corporate users need to figure out how drones will fit into their IT operations.

Today, the market for unmanned aerial vehicles (UAVs), a.k.a. drones, is dominated by defense applications like the multi-million-dollar Predator. However, ABI Research predicts the commercial market for small UAVs will grow from an estimated $652 million in 2014 to more than $5.1 billion by 2019, becoming twice as large as the military/civil defense market, says Dan Kara, practice director of robotics at the market research company.

If thing unfold as ABI forecasts, IT departments need to prepare now for the potential drone invasion and the data they collect. Exactly how they should prepare depends on the final form of drone regulation as well as how drone vendors decide to sell to the enterprise market. Nevertheless, IT needs to be ready to deal with a new type of big data, the type that comes from drones.

Vendors from all markets are moving to sell small commercial UAVs. Low-end vendors that have so far sold just to consumers for a few hundred dollars are moving upstream, Kara says. For example, UAV manufacturer DJI has started selling more powerful models designed for professional filmmakers, while Horizon Hobby, known for selling toy drones, recently created Horizon Precision Systems to target commercial users.

Meanwhile, defense contractors are moving down market. For example, Lockheed Martin has acquired Procerus Technologies, which develops less-expensive UAVs for civil public safety and first responders. In addition, there are entirely new entrants, including Google, which bought drone-maker Titan and plans to start testing drones later this year, and Amazon Prime Air, which plans to use its drones for package delivery.

Following the rules

That's a lot of activity for a device that's banned for commercial purposes. Although the U.S. Federal Aviation Administration (FAA) has long allowed recreational UAV use if operators follow certain safety precautions, industry players waited years for the FAA to come out with regulations for commercial use. It finally unveiled a proposal in February, to mixed reactions.

Some commercial proponents think the rules are too restrictive. For example, drones would have to fly below 500 feet, during daylight and within sight of the operator. Such conditions are impractical for delivering packages, for example. Still, as the FAA gathers public comment (and industry increases its lobbying), the regulations could change significantly between now and 2017, when they are expected to be finalized.

The FAA grants exemptions for commercial use, but as of March had issued just over 50. However, the number of applications for commercial exemptions is rising fast. Kara expects they will become increasingly common as companies start pilot programs and tests for commercial applications ranging from aerial photography and film for Hollywood and ad agencies (which Colin Snow, founder and CEO of the consulting company Drone Analyst, estimates to be the most common use today) to agricultural monitoring, infrastructure inspection and insurance claims adjusting. In fact, the FAA is reportedly considering ways to speed up the exemption process.

Meanwhile, there is a lot of unauthorized drone use, says Snow. He estimates there are 2,000 to 3,000 illegal operators representing economic activity of $200 million to $350 million in the United States.

Creating a business model

As vendors team with commercial enterprises in these pilot projects, they are working out their business models.

"I don't think the industry has come up yet with the ultimate mousetrap to serve the enterprise space," says Andrew Maximow, who spent 15 years in IT at Cisco Systems before becoming director of client services at drone vendor 3D Robotics (3DR). 3DR is working with several potential commercial customers such as BNSF Railway, which recently received an FAA exemption to use drones to inspect its rail infrastructure and operations. The railway will operate 3DR's Spektre Industrial Multirotor Aerial Vehicle, among other drones, during the pilot. The Spektre is not yet commercially available, but is a prototype that 3DR is providing to a handful of potential customers.

3DR's strategy is to develop a drone business based on open software, says Maximow. "We want to be the Android of drones," he says, by making the drones customizable through various hardware add-ons and software applications.

Agriculture is already a big market for UAVs, says ABI's Kara. One reason: Farmlands are privately owned and certain FAA regulations don't apply. For example, PrecisionHawk, a Canadian UAV company founded in 2010, has teamed up with Agri-Trend, an agricultural consulting company based in Alberta. The two companies plan to integrate their software platforms this year and investigate ways to best collect and analyze agricultural data to help farmers get a better return on their crop investment, says Warren Bills, vice president of geo solutions for Agri-Trend. They hope to offer services to farmers in the U.S. and Canada by 2016, according to a PrecisionHawk press release.

However, the "drone as a service" is probably the most likely way for enterprises to use UAVs, says Kara. For one thing, if the UAV vendor flies the drone, it assumes responsibility for meeting any regulations. And storing the data in the vendor's servers removes some of the impact on the customer's infrastructure.

"Any organization considering using data capture from aerial sensors or drones has to determine the impact on its IT infrastructure, and the kind of support that will be required," Kara says. Not only could storage be a challenge, but different ways of analyzing and presenting the data may be required. Thus, "my guess is that a lot of companies will just opt out and have it done as a service."

For instance, PrecisionHawk has a cloud-based platform for storage and analysis of the data collected by its UAVs. If desired, it will also send the data directly to the customer's IT department. However, "the sheer volume of the information, and the requirements of having photogrammetry and GIS staff available, can make that a logistical nightmare," says co-founder and president, Dr. Ernest Earon. For that reason, most of its customers prefer to use PrecisionHawk's cloud.

Drones are for data

Although drones are the sexy new thing today, perhaps the most important thing to remember is that they are only another way to collect data that the business can use to make better decisions. Agri-Trend's Bills says he's seen a lot of companies get mesmerized by the latest snazzy drone hardware or the cool aerial images they can collect. But what he wants, he says, is useful, actionable information.

"The last thing I need as an agriculture consultant is more static images of a grower's field," says Bills. "I can get images in lots of ways. What I need is a system that enables data-driven decisions that farmers can trust."

Copyright © 2015 IDG Communications, Inc.

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