Satellite imaging has been around for many years and we use it almost every day, whether it's to access directions on your favorite maps app, monitor the weather, or to look up a bird's eye view of your own home. In the past 5 years there has been an acceleration of satellite imaging startup companies out of Silicon Valley. Terra Bella (now a Google company) and Planet were among the first to be founded and are farthest along in its satellite footprint. Since then, there have been at least 10 others that have launched. This development has caught the attention of many people – venture capitalists, the US government, spacetech enthusiasts – because it could turn into a multi-billion dollar opportunity and change the way we see the world.
You may wonder, what advantages do these startups have over established satellite companies and why are they poised to disrupt the industry?
Historically, commercial satellite imaging has been dominated by DigitalGlobe and Airbus Defense & Space (ADS), who have provided satellite images to the likes of Google and Apple for their map services. However, you may have noticed that some of these images could be up to a few years old. Moreover, traditional satellites providing those images can cost up to $750 million each. In contrast, the startup companies are providing smaller, lighter satellites at a lower price point, and can update their images more frequently. And there is no compromise on the image resolution. Planet's satellites cost less than $1 million each, are the size of shoeboxes, weighing as little as 10 pounds, and can provide imagery resolution of 3 to 5 meters. Their goal is to provide daily images of Earth. Terra Bella's satellites are a bit bigger – they are the size of microwaves – and can provide resolution of less than 1 meter. It can also record video at the same resolution at a rate of 30 frames per second. Established players like DigitalGlobal are embracing this new technology by partnering with other smallsat companies in order to stay in the game and remain a significant competitor. With the arrival of this improved technology, we can expect the satellite imaging industry to change a lot in the near future.
If we were able to observe any location in the world every 24 hours, the potential applications would be endless. Markets that can benefit include agriculture, defense & intelligence, and urban planning, just to name a few. As a property underwriter, I'm interested in how satellites can support the monitoring of natural catastrophes and help us with claims management. During the Fort McMurray wildfires in Alberta, Canada this year, Planet released free high-resolution images of the affected regions in order to assist with disaster response. Terra Bella also provided images of the area as part of the Google Crisis Response map. Both Terra Bella and DigitalGlobe stepped in to provide images of Haiti, Bahamas, and the southeast US in the wake of Hurricane Matthew these past couple of weeks.
The extent to which we use satellite imaging now in property insurance is mostly looking up certain locations to evaluate their insurability, or tracking weather patterns and storms in anticipation of evaluating our insurance exposure. As the satellite industry continues to grow and improve, the amount of image data that will be available would be immense. An insured who had to evacuate their home would be able to examine the damage a day later just by looking at a high resolution image. If satellite imagery were linked to underwriting databases, a claims adjuster would be able to see images of an area post-event and estimate the total loss incurred. The raw satellite images could be used to form contingent products for research, analysis, and more. What other possible applications can you foresee and how do you think this can change the way we do (re)insurance in the next 5 to 10 years?