| From the Publisher
By Roland Mangold GeoTechnology Adolescence A new millennium is just beyond the horizon, and this industry is in the throes of an adolescent transformation. Slow, awkward, almost imperceptible changes are taking place as though, as an industry, we are going through puberty. And, where some might be indignant by the characterization, puberty may be the best analogy. What we are going through right now, the way we look and act, is far from what will be manifest in adulthood. We are changing-the industry is changing-never to be the same again.
As the GeoTechnology industry is pulled into the next millennium, we anticipate what that may bring. So far, it's bringing companies looking to create "roll-ups" that can ride the wave of impending opportunity. Unfortunately, truth be known, most haven't the slightest clue how to make it happen. That is why my friend, Ed Jurkevics, who recently announced his departure from PCI Geomatics Group, started Chesapeake Analytics Corporation.
Chesapeake Analytics is being formed to take advantage of the tremendous opportunities that will be created by the launch of the first high-resolution commercial satellites in 1999. As a consulting firm, Chesapeake will help companies realize business growth opportunities that will be created by the new imagery. The firm predicts that remote sensing imagery will generate sales surpassing $3 billion per year. It is foreseen that the remote sensing industry will undergo broad restructuring with the technological revolution the new satellites will unleash.
"We are putting together a top-notch group of business professionals to help companies grow business in the remote sensing and geomatics industries. There is so much change going on, everyone is scrambling for position. We are predicting that the market for aerial photography, satellite imagery, remote sensing services, and derived information products will show growth rates over 20 percent in 1999 and beyond, creating a world-wide market of over $3.2 billion in 2002," Mr. Jurkevics recently conveyed.
In the meantime, the industry is taking on a dual personality (as can happen when going through puberty . . . just ask any parent of teen-aged persons) of the "Haves" and the "Have-Nots." Right now, the "Haves" are the photogrammetry/mapping services companies and a small handful of GIS software and services companies. The "Have-Nots" are just about everyone else, struggling to get by and hoping to capitalize on the opportunities to which Mr. Jurkevics refers.
Mike Ritchie, president of Photo Science, Inc., said to me at GIS/LIS in Fort Worth last November that "if you can't make money in mapping/photogrammetry nowadays-then you shouldn't be in the business. And, that's before the NIMA outsourcing really kicks-in in 1999."
Many believe that all the NIMA and government outsourcing will be a boon to this industry. But, I am skeptical. It is making this industry more dependent upon government work, and the success these firms are experiencing reinforces their attitude that big government projects are really where the money is, making them less motivated to find and cultivate secondary and tertiary markets.
A possible exception to this rule is The MapFactory, having recently acquired Hammen, Jensen, Wallen & Associates, one of the premier mapping/photogrammetry companies in the world. With a rumored purchase price of about $8 million, the move raises many questions. Will HJW become a very expensive production facility for The MapFactory's AlphaMap product, one-foot resolution color digital orthos, which they hope to acquire for 100 major U.S. cities? Or, will The MapFactory use HJW's reputation and expertise to penetrate the large, custom mapping/photogrammetry projects? Is the luster beginning to rub-off the notion of off-the-shelf (dated) data? The MapFactory is trying to change the paradigm, but what none of us know at this time is just how far ahead of the adoption curve they are.
There are several developments taking place which contribute to the awkwardness the industry is experiencing. I cannot begin to address them all at this time. But, a couple interesting moves to watch are:
Plangraphics, since having gone public, has been on the prowl to make acquisitions, and they have come close. But, unfortunately with this "Haves" and "Have-Nots" scenario in the industry, they are probably finding that they do not have the bandwidth to purchase a "Have" and do not want the increased burden of carrying a "Have-Not." Now, it looks as though they might be a part of another group's "roll-up" plans, and the potential purchaser is about to become the purchasee.
Perhaps the most dramatic reversal in the industry is that Carl Zeiss was betrothed to LH Systems. But, when the marriage could not be consummated, Zeiss turns around and elopes with Intergraph-I guess in spite of what everybody says, size really does matter.
The changes taking place in this industry are certainly interesting to observe. But, they are no doubt uncomfortable for many of the participants. One can't help but wonder if all the machinations taking place are benefiting the industry or only contributing to the delinquency of a minor. Cheers!
 Roland Mangold Back |
