Building a Google, Amazon, Apple-App-Store for Geodata
I am Manfred Krischke, CEO and founder of cloudeo.
As a trained rocket scientist (as the saying goes), I have acquired the discipline of looking at a problem holistically. What better holistic view can there be of the earth than looking at it from above?
When I founded the company RapidEye in 1998, I thought the best business model was to create a unique data source by putting satellites in the sky, operating them, producing earth images and selling derived services from these images. But what I dramatically underestimated was the importance of a healthy ecosystem for commercial success. By trying to control the whole value chain, you create a competitive environment. One company can’t succeed trying to control everything from high-cost space assets to the individual end user application. Instead of creating a healthy ecosystem and welcoming everybody to use your investment-intensive space assets, you start competing with other firms who could potentially be collaborators. While many share the vision of holistic applications based on satellite data, rather than stimulating a community to support for the marketplace, the siloed approach pushes other companies away, and even worse, fosters head-on competition.
Today, quite a few companies still consider keeping their tech to themselves as a great business model. And, of course, many satellite operators are driven by the expectation that they will create the ultimate “killer application” to commercially exploit exclusively. But reality shows that this is wishful thinking. There is no such thing as a “killer application” because the power lies in the ecosystem itself. We’ve seen the sale of RapidEye to PlanetLabs a few years ago, proving the validity of the underlying technical value proposition and design but trying to supply the end services directly to end customers was probably not the right approach by RapidEye.
Recognizing the power in the ecosystem, as the next crucial evolutionary step, I concentrated on how to unlock the value of geodata without having to maintain a space infrastructure worth hundreds of millions of dollars. The key to doing so is to create an ecosystem where all participants have aligned interests. As individual companies, we don’t have a billion dollars for the space infrastructure, but as a collaborative coalition, we do.
For that purpose I founded cloudeo in 2012. cloudeo is a cloud-based platform for geodata and geodata based services. Today cloudeo enables access to most relevant earth observation data, and we have partnerships with some of the largest players in the geospatial industry. Today, our mission-driven team has grown to approximately 30 people, and the platform is growing quickly.
Unprocessed geodata in general is a commodity that has little or no value for the mass market. That’s why the market today consists mainly of large corporate or governmental players who have the resources to process the data for their own benefit. The providers of this kind of data are the venture-capital-financed satellite image producers and, typically for the lower spatial resolution type of business, governmental sponsored platforms. The state of the industry today reminds me of the pre-industrial era. Like back then, today if you want to create a new product, you need to be an expert at all levels of the value chain: generating raw data, designing the manufacturing process, analyzing data, and selling it to the end user in a specialized vertical. Each time, you have to build the product or service from scratch with a considerable investment of money and time. It’s incredibly inefficient and it’s clear that there is a better way.
Let’s take a look at another large group of geodata providers, namely yourself and almost anyone you know. Anyone who owns a smartphone collects geodata and gives it away for free so that large corporates can build their business models on top of it. None of these smartphone owners makes any money from geodata. As we have seen recently with the Facebook example, people don’t want to give away their data, but the system forces everyone — consciously or not — to contribute their data without getting any benefits, unless you think “personalized advertising” is a benefit.
Today we collect geodata with our smartphones, tomorrow we will do so with our cars, connected devices, and sensors. Potentially, we will be able to sell the data, or allow access and to participate revenue-sharing with apps that use our data. Anyone with a device can become an active member of the geospatial community.
If people were given the possibility to decide if they want to share or sell their data, the vast majority would certainly choose selling over giving it away to corporations for free. We have been reading headlines saying “data is the new oil’ for years. But can we monetize our data today? No, we can’t, but search engines like Google and social networks like Facebook seem to be quite successful at it. This will change. New technologies like blockchain and smart contracts are on the rise, and as technological barriers erode, the democratization of geodata will emerge. cloudeo will be at the forefront of this development.
As mentioned before, today’s geo-industry is not highly industrialized. cloudeo does for geo-data collection what the 3D-printing innovation brings to the manufacturing industry. In other words, today, anyone can simply and easily create and deliver a new product through digital printing with nothing more than a good digital design file. In that same way, cloudeo is looking to create an infrastructure so easy-to-use that anyone can tap into geodata for delivery of any service.
The way I see it, cloudeo will be a bit like a Google of geodata: a host of large archives of geodata from all kinds of sources, accessible through indexing. Handling the data as structured data cubes will make it easier to process them for higher level information products. cloudeo also will be the “Amazon” of geodata. Not only will service providers offer their geodata based services to individuals and small and medium sized enterprises, but anyone will be able to create a market for the data they have collected or possess. And last but not least, cloudeo will be like the Apple app store for geodata. All information with a geo context can be produced and offered on the cloudeo platform by third parties. The “storefront” can hold services, algorithms, raw data, specialized datasets, software tools, components or ready-to-use products.
I said before that unprocessed data has little or no value for the mass market. Today that is true. But the true value for the mass market results from the multidimensional combination of data sets and the analytics applied to it. It is these combined sets of data that constitute the fuel for algorithms, machines, artificial intelligence and applications. This multidimensional approach is what makes cloudeo unique.
As an example, let’s take a service providing farmers with the right information on how much fertilizer to apply. For this service, the provider needs the multispectral imagery of satellites over several months, soil data, weather predictions and trends, information on the specific plants, the fertilizers, and the elevation of the field. All that data needs to be processed by application-specific software. However, today most companies only have a fraction of the above data points at their disposal. While this might be enough to run behavioral analytics, it`s insufficient for tasks that require multiple sources of information. For that reason, a platform like cloudeo is not a competitor or threat to existing data providers. Cloudeo enhances their offering, widens their distribution channel and provides them with additional sources of revenue.
Cloudeo has approximately a thousand registered business customers today and aims to have millions of customers or devices trading geodata automatically in a not so distant future. This will foster the development of new technologies, applications and services and artificial intelligence will come a few steps closer to be able to deliver on its promises.
The key to all this is the introduction of smart contracts. Smart contracts make it possible to create multidimensional automated geo-intelligence analysis, bringing together a variety of datasets as well as revenue sharing features. A data purchase and the corresponding analysis in the geospatial sector used to be in the four- to six-figure range. But by selling access to data versus selling the actual data, cloudeo has brought the cost down by up to 95%, allowing purchases of data for hundreds and even tens of dollars. Going forward, as the data sources become more diversified, the system will require micro transactions, making the fiat currency payout and accounting services obsolete.
It is now becoming obvious even to skeptics that crypto payment methods are here to stay. Decentralization is spawning the introduction of data-driven business models on a large scale, without the interest of monopoly-like conglomerates. Today’s business is driven instead by communities where each individual is incentivized and rewarded for their contribution. To do that is simply not feasible without the implementation of crypto tokens of some kind. The development of the cloudeo ecosystem is leveraging blockchain technology and the “infamous” cryptocurrency solutions to dramatically accelerate the ecosystem’s development and distribution. While the market will continue to experience some volatility in the short term, the dust will settle, and being rewarded in tokens will become the norm for geodata, as well as other markets.
In this spirit cloudeo is supporting the CLEO Blockchain Network (CBN), driving the introduction and implementation of smart contracts in the geospatial industry. Blockchain, and especially smart contracts, are game changers for the industry. They bring scalability and innumerable new business models and applications. All of this was unthinkable when I started my career in the geospatial arena. At that time, I had only blurry vision of what could be accomplished by the use of geodata. Today, I can see clearly how geodata and smart contracts will have an impact not only on new technologies, but on our lives and society as a whole. And this time development won’t be driven by a handful of unicorns but by a community: it will be driven by the community itself. Join us — Let’s create and think geo!