Hindsight, Insight, and Foresight

In Tuesday’s panel discussion on the main stage, moderator Sanjay Kumar, CEO of Geospatial World, set the scene regarding the economic impact of the geospatial industry in his opening remarks: He estimates that geospatial comprises a $400–500 billion industry globally and a market capitalization of $1.7 trillion. Furthermore, when downstream uses and capabilities are accounted for, “we are talking about a socioeconomic impact in the economy to the tune of $7.5 trillion.”

With this level of economic power, the policies by which geospatial is funded and utilized becomes critically important. Jim Bridenstine, former NASA Administrator and Member of Congress, expressed his opinion that government needs to shift its approach to underwriting the costs of acquiring geospatial technology, data, and services. “I think the role of government and policy in enabling these markets to work is actually to create the market. So, the government needs to —and we’ve done this at NASA—instead of purchasing, owning, and operating hardware, we need to buy a service or buy data,” Bridenstine says. “NASA has made that transition. People are seeing it with commercial resupply and commercial crews for the International Space Station. We’re now seeing it with commercial low Earth orbit destinations to replace the International Space Station with commercial space stations.”

Mike Cadenazzi, Managing Director, Ernst & Young, also relayed some of the difficulties commercial providers might face in the current purchasing and usage scenario if, for instance, there was a new intelligence need in the event of a military engagement in Asia. “The Ukrainian-Russian war has created a new environment, leveraging a whole variety of visualization mapping techniques for use that drive combat changes that are actively involved from the U.S. side,” Cadenazzi says. “The availability of basically constant transparency across the battlespace is providing new opportunities for UAVs, for sensors, but also the background large-scale data models that enable rapid targeting and changes. Flip that over and think about sort of the near-peer pacing threat in the Indo-Pacific timeframe and what that might mean for government agencies having to fight a similar war against a similar peer on vastly different geospatial bounds—so longer distances, wide open spaces, fewer nodes, more important nodes, and what that means for the capabilities we’re delivering.”

Cadenazzi points out that a change in mindset on the part of end-users will be needed for commercial GEOINT enterprises to be comfortable committing to supplying these services, and it will be up to the private sector to show government customers the value and trustworthiness of the products they want to provide.

“Conversion of those capabilities into serving the needs of those edge customers is going to be incredibly important,” he continued. “I also think you will have a huge number of opportunities for those as-a-service models in the future. There’s a long tail of businesses that are using satellite information off of birds that are coming now, and they’re doing analysis, reporting, and mapping. Still, the customer has a problem buying as-a-service capabilities. It’s not that they can’t do it legally, it’s just that they’re not comfortable with it. And those are challenges that basically require you, as an owner or an entrepreneur, to think through what your customer needs, articulate the value proposition, and explain why this particular approach is going to give you more capability for less money, which is exactly what you need when budgets are being pressured.”

From an investment standpoint, the current financial climate of inflation and an impending debt ceiling crisis could present unexpected opportunities. Frank Hopper, managing partner at Capital Innovators, sees the possibility of silver linings.

“Within this industry and more broadly, investment is what fuels innovation, and innovation is what is going to continue to propel the industry forward. It increases competitiveness across the board. It is what is going to keep gearing everyone into the future,” Hopper said. “Of course, right now no one is surprised by capital being more conservative than it has been. The good news is that it is in these tightening’s where we see—at least in the commercial sector, as in contrast to what Mike said about the government sector—this is where we see innovation happen the most. This is how in 2008, we saw Uber and I think it was Airbnb along with more ‘unicorns’ than you’d seen in a long time. This is the time when great companies get created. So, the more that we can continue to feed the industry now, the greater we’re going to be going forward.”