Airware for Drones

MT4002 Group Project

Arun Kumar Koen Van Vlijmen Raghunath Pradeep Yuli Samantha

Introduction to Drones & Airware1

Value Proposition2

Comparison with Competitor3

Customers & Markets4

Value Capture5

Strategic Control6

Issues & Improvements7


Value Proposition2



Value Capture5

Strategic Control6


INTRODUCTION

• Unmanned Aerial Vehicles (UAVs)– Controlled by ‘pilot’ on the ground OR autonomously via software

• Light weight and mobility permit various applications

Drones Airware

General Atomics MQ-1 Predator firing a

missile

Negative connotation

common

Military, Data collection, Agriculture & wildlifeRecreation, Commercial use

INTRODUCTION

2014: 15.22 Million

2020: 1.27 Billion

2035: 5 Billion

Annual Commercial Drone Market Size

(USD)

In 2035, UAV ops > Manned Aircraft ops

Drones Airware

Drones Airware

Founded in San Francisco in 2010

Raised over 40 Million USD in investments

Making drones more accessible for commercial useby providing novel operating system for drones

INTRODUCTION

Aerial Information

Platform (OS)

a) Flight Core

b) Ground Control Station Software

c) Configuration Manager

d) Airware Cloud

Main Product

INTRODUCTION

Examples of uses

Insurance inspection Damage assessment

Environmental monitoring

S&R

Land management

Public Safety

Survey

Mapping

Drones Airware

Range of Industries


Value Proposition2

Comparison with Competitors3


Value Capture5

Strategic Control6


EcosystemDrones

ApplicationSoftware Components

& Peripherals

Enable anECOSYSTEM

• Vertical disintegration between drone manufacturers, OS developers, application software developers, and component manufacturers

• Different capabilities are required along the value chain, hence Airware focuses on developing the brain

SCOPE OF ACTIVITIES

Value Proposition

Aerial Information

Platform

Drone manufacturerLower development and

integration cost for customized drones, solve interoperability

problem, address safety/Regulatory issuesApp developer

Single common platform, integrate aerial data into

app

Component developerLower development cost, solve compatibility issue

Development of Windows Vista

10000 employeesx

$200000/year/employeex

5 years---------------------

$10 Billion

Value Proposition

Aerial Information

Platform

Drone manufacturerLower development and

integration cost for customized drones, solve interoperability

problem, address safety/Regulatory issuesApp developer

Single common platform, integrate aerial data into

app

Component developerLower development cost, solve compatibility issue

Enterprises

•Safe, reliable and flexible OS•Inexpensive system

•Quick tailoring of drones•Compatible with fleets of

different UAVs•Integrate aerial data into existing business systems

•Common interfaceGovernmentSafety assurance

Drone leasing companies

Wider range and lower cost of applications


Value Proposition2



Value Capture5

Strategic Control6


Competitor

Independent, open-source, open-hardware project aiming at providing

autopilot system

Autopilot SoftwareNuttX real-time operating system

Autopilot HardwarePIXHAWK

PX4 Autopilot Strategy Canvas User Comparison

High

Low

Security Standardization VarietyPrice

Aerial Information Platform

PX4 Autopilot


Competitor

SpecificityAPI Openness Installed base

Competitor

Aerial Information Platform

Aircrafts: Delta Drone, Altavian, Allied Drones

and Drone America

App Software: Pix4D, 2d3 Sensing, Sightline

Components: Mica Sense, Phase One,

Trillium, GE, Amimon, Swift, Sagetech, Alta

Devices

PX4 Autopilot

PixHawk: Available from:

3D Robotics Store, Unmanned Tech, BYOD, UAV store, onDrone UK

App Software: Open source

Peripherals: 3D Robotics

VS



Value Proposition2



Value Capture5

Strategic Control6


Customer Selection

Enterprises and consumer use

(Final Customers)

App & Component

developers

Manufacturers

Enterprises Drone Manufacturers App & Component Developers

CUSTOMER SELECTION

CUSTOMER SELECTION

Dangerous repair work

Major Needs

Information gathering

Inspection

Safer work environment Trucks

Current solutions

Human resource

Helicopters

Satellites



Agriculture Industry

CUSTOMER SELECTION

• Inspecting the crop field

• Collecting information for crop yield

• Spraying pesticides

Microsoft• Diverse user-base• High compatibility• User friendly interface

CUSTOMER SELECTION

• Set Airware‘s integrated platform as an ingredient brand in order to raise assurance of authenticity and trust.

• Build a powerful drone together.

Intel: 1990s branding• Valuable feature in computers• Ingredient brand


Similarities in

valuation

Specifications

Software

Customer review


CUSTOMER SELECTION


CUSTOMER SELECTION

• Provide a platform for third party developers for drone software and applications.

Android and iPhone• 1.5 and 1.4 million Apps• Avenue for start-ups• Network effect


CUSTOMER SELECTION

PIXIEPATH

• Connecting individual drones to the cloud.

• Directing the activities of fleets of drone.

FLYVER• Providing a platform to link

with android ecosystem.• Link to open source app

developers.


Value Proposition2



Value Capture5

Strategic Control6


VALUE CAPTURE

Subscription

2500 USD/year for Aerial Information Program (AIP)Includes software, cloud services, app library, support

Revenue model Indirect Crowdsourcing

Pros for Airware Pros for customers

- Guaranteed revenue for subscription period- Provides time to build customer loyalty higher avg customer lifetime value

- Customers can generate revenue, to finance Airware subscription, by leveraging drones- More cost-effective for repeated usage- Forces Airware to continuously improve to cater to customer needs better r/s

Cons for Airware Cons for customers

- Customers unsure of usage frequency may hesitate to subscribe

- Possibility of vendor lock-in

Revenue model Indirect Crowdsourcing

• Aims to accelerate commercial drone innovation by funding relevant startups

• Enables Airware to specialize in niche areas (value capture) Enhanced value proposition through future acquisitions Airware compatibility

VALUE CAPTURE


Value Proposition2



Value Capture5

Strategic Control6


Establishment as Industry Standard

Strategic Control

LegalProtection

Industry standard Legal protection

• Current U.S. law requires case-by-case FAA authorization to fly a commercial drone

• Establishment as industry standard with authority approval upon satisfying regulatory requirements can boost revenue sustainably

• AIP could become default standard for drone OS to attain authorization

STRATEGIC CONTROL

Industry standard Legal protection

Higher user confidence and security

More extensive compatible 3rd

party product development

Indirect Network Effects

STRATEGIC CONTROL

• Household name in microprocessors

• Provides guarantee of product quality/performance

• “Airware Inside”?

Industry standard Legal protectionSTRATEGIC CONTROL

Public disclosure of invention required

Liability of lawsuits & possible incurred costs

Restrict competitors from gaining market share (AIP only integrated drone

OS currently)

Increase product credibility

+

-

Patenting of key components of AIP source code

STRATEGIC CONTROL

• Technologies being adopted faster than ever• Other companies likely to develop similar Drone OS (e.g. AIP) in

near future• Patent protection advisable


Value Proposition2



Value Capture5

Strategic Control6


i. Government regulation

ii. Security issues

iii. Public skepticism and fear

iv. Data security

ISSUES

IMPROVEMENTS

• Enhancements to value proposition:

Introduction of safety feature into AIP to enable police to override user-directed flight of drone

Authorities more likely to approve AIP for enterprise usage Reduced chance of drone-related accidents/crimes Increased confidence in

Airware-powered drones Airware provides testing and licensing services for drone operators

IMPROVEMENTS

One-time fee

• Charge a fee for acquiring OS

• Charge for every update released and installed

Free OS

• Stop charging customers for OS and updates

• Earn revenue from developing drones and software

Contract-based fee

• Integrated service: customization, data management, etc.

• Alternative methods of value capture:

IMPROVEMENTS

One-time fee

• Charge a fee for acquiring OS

• Charge for every update released and installed

Free OS

• Stop charging customers for OS and updates

• Earn revenue from developing drones and software

Contract-based fee

• Integrated service: customization, data management, etc.

• Updates released to subscribers only to minimize piracy

• Free trial

Data management likely to be highly profitable given IoT trend

Airware can provide enterprise solutions rather than just customized drones

IMPROVEMENTS

• Alternative method of strategic control:

• Develop applications in addition to OS

• Data management and processing

• Security system

Data ownership for analytics

(upon customer approval)

Generate and sell optimized solutions

Sell data as market research

Enhanced capabilities due to IoT

SUMMARYDrones

ApplicationSoftware Components

& Peripherals

ECOSYSTEM

Potentially a winner-takes-all industry

i. Government regulation

ii. Security issues

iii. Public skepticism and fear

iv. Data security

Q&A

Business

Airware for Drones