The Business Case for Drone LIDAR - The Outlook in Spring 2021
Author: Martin Flood
Published On: April 19, 2021
In spring last year, just as the COVID pandemic was breaking, we did a short article about the business side of the market for drone LIDAR surveys as we saw it. We thought now would be a good time to re-visit that discussion and update it with our observations from what has been a very challenging, but very successful year for our True View product line and for the adoption of drone LIDAR in general. If you have joined us for any of our webinars over the past twelve months, you know we have talked a lot about the technical capabilities of our True View 3D imaging sensors. We have explored the design trade-offs we have to balance and the resulting technical capabilities of our sensors as it impacts accuracy, data quality and ease of use when conducting small site surveys and performing topographic mapping. But we do not want to ignore the business side of this amazing technology. After all, most of our True View customers need to be profitable and want to see a good return on the investment in their equipment.
With the initial launch of our True View 410 in July 2019, the launch of our RIEGL-based high-accuracy 6xx models in June 2020 and the most recent release of our True View 515 in February 2021, we now have an established portfolio of 3D imaging (LIDAR+camera in a single payload) drone-mounted sensors that have been in everyday use by professional surveyors for nearly two years. The True View portfolio covers a range of price/performance options that can fit many business's needs. We have learnt a lot from our customers over the past two years and use this feedback to continuously improve our hardware, software, and workflow. We also listen, very closely, to what they say about their businesses. Are they winning work? Are they making money - are they profitable - when they do win work? How could they win more work? How could they make more money? Where do they see their businesses going in the next few years?
Based on what we hear from our customers, here are five important aspects to consider when building a business case for purchasing or subscribing/renting a True View sensor.
1. On-Demand Capability
When building a business case for drone LIDAR, often your analysis will show that deploying drone LIDAR on a project is clearly the most cost-effective, and hence profitable, option for that project. But unless you have a large volume of such projects in your pipeline, it is hard to make the business case for a sensor purchase. This is where True View's subscription option - Hardware-as-a-Service - comes in. By allowing you to access a True View sensor on a monthly "as-needed" rental basis at very affordable rates, we work with you to build-up your market presence, customer portfolio, staff experience and project backlog. You can build on this initial investment to prove out your business case for an eventual sensor purchase or continue to use our subscription option if it turns out this is the better financial choice for your business.
Our experience with the subscription model over the past year has further reinforced to us the importance of this on-demand capability. While many companies are committing to the long-term growth of the drone LIDAR market by purchasing a True View sensor, we continue to see strong demand for a robust rental market. In fact, through 2020, most companies that rented a sensor did not move on to a purchased system. Often, they simply continued to rent when and as individual project demand required it. This suggest to us that the range of drone LIDAR projects available in the market today - the projects people are willing to pay you money to go fly - is going to be broad enough to support both firms with dedicated capabilities and those who can effectively deploy on-demand capability when and where needed. As we move forward, we intend to continue to build-out and improve our True View subscription program to support this "drone LIDAR on-demand" customer base.
2. Dealing with Forest Canopy
Drone lidar surveys differentiate themselves from standard imagery collects in several ways. Most important, and most well-understood, is they enable you to map beneath canopy to get a bare earth ground surface. If you are dealing with any type of forested area or any obstructing vegetation canopy, LIDAR is your best choice - perhaps only choice - for mapping a site. From a business perspective, if you map forested areas, drone lidar is the best alternative to a traditional ground survey (time-consuming) or a fixed wing/helicopter LIDAR survey (expensive). It will be faster than a ground survey and much cheaper than an aerial survey.
High-accuracy, survey-grade lidar sensors, such as our 6xx RIEGL-based models, offer the best canopy penetration and achievable accuracy for their class of LIDARs. But at a higher price point than their automotive-class lidar cousins, of course. One trade-off we have been discussing with our customers over the past year, is what do you use if you need best-in-class canopy penetration, but do not need the high-accuracy of a survey-grade sensor? With the launch of our True View 515 earlier this year, we introduced a sensor we feel addresses this question very effectively for those companies that need excellent canopy penetration in a general-purpose drone lidar. From a business case perspective, a True View 515 allows you to pursue projects that need excellent performance in canopy (or in detecting wires!) without having to invest in a high-accuracy, survey grade system, if your customer base and project volume do not justify such a level of investment. Our 515 design is an excellent middle-ground choice for businesses trying to balance the demand for performance in canopy against the higher ROI needed to justify purchasing a high-accuracy RIEGL-based sensor like a True View 635 or 640. Not everybody needs to pay for 2-3 cm accuracy on every project.
3. Reduced Field Costs
In addition to the cost-savings offered by drone surveys in general - faster data collection, smaller crews, lower mobilization costs, higher work rates - drone lidar's effectiveness on the most difficult sites, such as heavily forested, steep terrain, reduces these costs even further. Put another way, drone lidar reduces costs the most on the most expensive sites to survey using other methods. This creates significant value you can sell to your customers, while still improving your overall bottom line.
4. Time is Money
Post-processing of True View data in True View EVO offers very rapid turnaround from data collection in the field to final bare earth product generation. Processing times can be 1:1 or better compared to the collect time. This is a significant improvement over photogrammetric processing of large image collects due to the time required to complete the image correlation (SfM). This advantage applies even if you are mapping sites with little or no canopy cover. Time is money and if your business captures this value for your customers, drone LIDAR offers you a clear competitive advantage. This advantage can be a particularly valuable in rapid-response scenarios or when dealing with tough "on-demand" customers.
Not surprisingly, in 2020 we continued to see efficiency gains and workflow improvements leading to reduced costs and time-savings across the board for our True View operators. In part this is attributable to experience - our customer's and our's - and mastering the learning curve, but it is also due to incorporating much of our customer feedback into our field processes and True View EVO workflow. New tools like point cloud smoothing on hard surfaces, point-and-click oblique image viewing and direct integration with photogrammetric packages such as Agisoft's Metashape or Pix4D's software suite have made it easier and faster to get from field collection to delivered product. Reducing field costs, improving turn-around times from collection to delivered product, these both lead to a more competitive operation and a better ROI on your investment in drone LIDAR.
In addition to the speed and cost-effectiveness of drone LIDAR surveys, both of which will improve your bottom line, offering drone-based lidar services significantly increases the types of projects you can compete for in the market. We are seeing True View sensors being used across numerous vertical markets and for a widening array of applications from sea wall monitoring to slope stability studies to archeological work. Since True View is a true 3D imaging sensor with integrated LIDAR and dual mapping cameras, it can be used effectively across a range of projects with a variety of end user requirements. All using the same seamless integrated post-processing workflow in our True View EVO software. This increased flexibility means you can go after and win more work and grow your revenue base by expanding into new accounts, not simply sell drone LIDAR services to your existing customers.
Everybody's business is different and your business case for drone LIDAR will be unique to your goals and your customer base, but we think it is clear the speed, flexibility, on-demand availability, reduced operating costs and ability to deal with forested sites that a True View 3D imaging sensor offers, make a very compelling business case for drone LIDAR for most survey and mapping firms. Our experience over the past year has only reinforced our belief that this technology is going to be a major disruptor in the way our industry thinks about capturing and delivering 3D models of small sites.