ROME — Drones are creating a revolution. I’m not talking about male honey bees whose role is to mate with the Queen bee, nor am I referring to the musical harmonic or one of my former professors at college who doubled as a soporific. The drones in question are unmanned aircraft which, in just a few years, have expanded from a consumer hobby to a commercial necessity.
Microdrones, established in Germany, is helping to lead the commercial-drone revolution by ramping up its American location in Rome. “On Oct. 10, the company struck a deal with Trimble, Inc. (NASDAQ: TRMB) to be designated a preferred provider of multi-rotor, vertical-take-off-and-landing (VTOL), unmanned aircraft systems (UAS) solutions,” says Vivien Heriard Dubreuil, Microdrones’ president. At the same time, Trimble sold its Gatewing UAS assets to Delair-Tech, a French company specializing in large, fixed-wing drones, and also designated Delair-Tech as a preferred provider.
“Trimble provides software, data processing, and other deliverables to UAS operators across multiple vertical markets and now, through its strategic alliances, provides a wide variety of platforms and technology solutions to its clients. Microdrones already had a relationship with Trimble through the purchase of Trimble’s Applanix boards. The preferred providers receive access to Trimble’s global dealers and distributor channels … The Trimble deal positions Microdrones for a rapid increase in sales,” Heriard Dubreuil says.
Microdrones was founded in Siegen, Germany in 2006 by Udo Juerss. The company has focused on VTOL, quad-copter drones for use in precision agriculture, infrastructure inspection and planning, and surveying and mapping. The drones can fly either in automatic mode or by remote control. The newest model has a payload capacity of 6.11 pounds, operates in temperatures up to 266 degrees Fahrenheit, and has a ceiling of 13,200 feet above sea level.
In the past decade, Microdrones has sold several thousand units in Europe, Asia, and Russia before entering the U.S. market, notes Heriard Dubreuil. Following a merger this May with Avyon, Microdrones currently employs 70 people at its locations in Siegen, Montreal, and Rome. The Rome office has five employees with a sixth person set to start in January. The president projects that the company will produce 100 units this year. Heriard Dubreuil and the Juerss family own the stock of the privately held company. The Business Journal estimates the firm’s 2016 revenue at $12 million to $15 million. For U.S. operations, Microdrones established a company called Pro Drones USA, LLC, but conducts business as Microdrones.
Avyon was the brainchild of Heriard Dubreuil. “I started working with drones in the European defense industry in 1997,” he recalls. “I made the decision in 2013 to pack up my family and move to New York [City], because I saw huge opportunities in the U.S. market. In 2012, I had launched a company called Flyterra, LLC to provide surveying services and to distribute European technology to the American market, which was slow to develop because the country was late in writing regulatory guidelines.
“While waiting for the U.S. market to develop, I opened an office in Canada, and became a distributor in 2013 of Delair-Tech as the sole American and Canadian reseller of its UAV DT family. In 2013, I set up a Canadian company called Flyterra Canada, Inc. In 2014, I renamed the company Pro Drones Canada, Inc. and filed for two trademarks: Flyterra and Avyon. Pro Drones negotiated rights to manufacture, distribute, and develop custom solutions for Microdrones.
“In December 2013, the Federal Aviation Administration (FAA) finally designated six locations where businesses could test commercial drones; my company became the first client at the Griffiss site. The FAA granted Avyon several 333-exemptions in the spring of 2015 to operate drones for commercial flights, and the same year my firm was designated a Start-Up NY company working through Mohawk Valley Community College. (The designation allows the business to operate 100 percent tax free for 10 years, paying no state income taxes, sales taxes, property taxes, franchise fees, or local business taxes.)
“The decision in 2016 to merge my company with Microdrones was a … [no-brainer]: the two companies are complementary. Microdrones builds a stable platform with a long flying time, substantial payloads, and outstanding resilience, while Avyon focused on integrating the best components and figuring out how to use the collected data.” At the time of the merger, Avyon employed 30 people.”
Trimble, headquartered in Sunnyvale, California, is publicly traded and posted $2.3 billion in sales in 2015. Founded in 1978, the electronics-measurement and instruments company has regional offices and manufacturing in 39 countries, research and development in 15 countries, and third-party distributors in 125 countries. Trimble is a provider of advanced, location-based solutions that integrate its expertise in GPS, laser, optical, and inertial technologies with application software, wireless communications, and services.
Over the past decade, its consolidated annual revenue growth rate (or CAGR) has averaged 11 percent. Since 2000, Trimble has acquired more than 100 companies, most purchased for less than $25 million. Corporate strategy focuses on developing five markets — heavy civil construction, buildings and geospatial in engineering and construction, agriculture in field solutions, transportation, and logistics in mobile solutions.
According to the president’s statement in the 2015 company annual report, Trimble is focusing on restoring its revenue growth, which slipped to 5 percent in 2015, by expanding operating margins; accelerating penetration of underserved market segments; and speeding up product development. The company’s market cap is about $6.7 billion. In April 2012, Trimble acquired Gatewing, a privately owned company founded in 2008 and headquartered in Belgium. Gatewing manufactured lightweight UAVs for photogrammetry and rapid terrain-mapping applications.
Creating an Upstate drone industry
In December 2013, the FAA designated Griffiss International Airport in Rome one of six drone-test-sites nationwide. The designation was not accompanied by any funding. Subsequently, NASA contracted with Oneida County, which owns the test site. The contract included NASA’s commitment of up to $5 million over five years. In December 2015, New York State kicked in $250 million for drone development through its Upstate Revitalization Initiative. The funds are earmarked to build an indoor testing-and-certification facility, develop an air-traffic-management system, and promote policy research.
The region created a nonprofit entity called NUAIR Alliance to manage the test site for researching unmanned and autonomous flight technologies. NUAIR currently has 128 private, public, and academic members, including national corporations such as Lockheed Martin, Raytheon, Saab, Syracuse Research Corp., and Harris; a gaggle of colleges and universities including Clarkson, Cornell, MIT, RIT, and Syracuse; and research labs such as the Air Force Research Lab and the Georgia Tech Research Institute. The alliance offers its customers unique assets and capabilities: 7,000 square miles of diverse airspace; renovated facilities in New York, Massachusetts, and Michigan; range instrumentation; concept and design testing; and UAS equipment.
In April, NUAIR participated in a NASA UAS traffic-management research platform. The test included 22 drones flying simultaneously at six different FAA test sites around the country. The successful exercise confirmed progress in complex, drone-traffic management.
“Microdrones has committed to invest $1 million in the Rome office over a period of three years,” states Mike Dziok, the company’s marketing director. “Things are moving more quickly now that the FAA has established additional guidelines for drone operators. For example, in August the FAA published Part 107, which eliminates the requirement that commercial drone operators need a pilot’s license. We’re also pleased to see that NUAIR has made … [substantial] progress in developing and testing not only collision-avoidance systems but also the policy to deal with the public’s concerns about safety, noise, and privacy. The FAA has also recognized [the industry segment of] micro drones by establishing a separate category called micro unmanned aircraft systems (microUAS). Microdrones is well positioned to sell solutions globally to a variety of industries, and to the U.S. market as it continues to open up.”
Dziok’s optimism about the industry potential is supported by market research. In March, Goldman Sachs reported that the global-drone market would reach $100 billion by 2020, of which $21 billion will come from commercial-drone sales. That same month, the FAA estimated that the sales of commercial drones would grow from 600,000 in 2016 to 2.7 million by 2020. A 2016 report released by the research company marketsandmarkets.com forecasts that the global, small-drones market will expand at a CAGR of 11.6 percent between 2015 and 2020, driven largely by the agriculture and logistics markets. Asia is projected to remain the largest market for the next four years, but the North American market is the largest potential market.
Confirmation of Dziok’s optimism is reflected in the $1 billion pumped into new drone companies, 90 percent of which was invested just last year. The deals included national players such as Kleiner Perkins and Lux Capital. Not included in the $1 billion is corporate spending from the likes of Boeing, General Atomics, Qualcomm, and Intel. The drone trade association — AUVSI — forecasts that drone commerce will add $80 billion to the U.S. economy in the next 10 years.
Heriard Dubreuil graduated from ESME Sudria, a multi-disciplinary, French engineering school focused on technologies of the future. He received a master’s degree in project management from HEC Paris, which specializes in research in management sciences. From 2003 until 2008, Heriard Dubreuil worked at Sagem DS, a French company involved in defense electronics, consumer electronics, and communications systems. In 2005, Sagem merged with SNECMA to form Safran. The new company focused on aeronautics, defense, and security. In 2008, he joined Amesys as the marketing and export sales manager. Amesys is a consulting company and an industrial group active in aerospace, aeronautics, transportation, and homeland-security markets. In 2010, Amesys became part of the BULL Group, a French-owned computer company. In 2012, he launched Flyterra/Avyon before merging with Microdrones in May 2016.
Dziok. a New Hartford native, graduated from Syracuse University’s S.I. Newhouse School of Public Communications in 1998 with a bachelor’s degree in electronic-media production. He earned an MBA from SUNY Polytechnic Institute in 2005, while running his own small business. After eight years in media, Dziok joined Carrier Corp., first as a marketing manager and later as director of marketing for Carrier Northeast. In November 2014, he joined Hollowick, Inc. as the marketing-communications director, and in March 2016 assumed the mantle of marketing director at Microdrones.
Microdrones is not the only manufacturer of micro drones. Dozens of other small, private companies offer a micro UAS. The competition, however, doesn’t faze Heriard Dubreuil. “We have no equivalent,” he contends. “We are pioneers in developing micro drones for commercial markets. The company is not just a platform, sensor, or software … [enterprise]; we are totally focused on developing integrated solutions for specific industries. Microdrones now has a variety of products designed for different sectors, and each can be modified to suit a customer’s particular needs. With the Trimble deal, we have new channels for sales and distribution that position us as a global … [player]. I also expect that Microdrones and Trimble will collaborate on further research and development to keep us ahead of any competition.” Perhaps the best confirmation of the company president’s statement is Microdrones’ sales record: sales have doubled each year of operations, a record Heriard Dubreuil expects to continue.
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