DGI Digitalglobe, (delisted)

COMMERCIAL REMOTE SENSING A commercial imaging pioneer analyzes the changing landscape In February, the wave of consoli-U.S. arm MDA established in 2016 when it acquired satellite manufacturer Space Systems Loral. In recent years, DigitalGlobe has been on its own buying spree, gobbling up The Radiant Group in 2016, Spatial Energy in 2014, and Tomnod in 2013. Tomnod relies on crowds of people to identify places and objects in satellite images. Those human observations, with their ability to train and improve the machine learning algorithms that feed off vast quantities of Earth-observation data stored in the cloud, are spurring dramatic changes in the industry. Scott discussed those changes and DigitalGlobe’s future during an in-terview at the Space 2.0 conference with SpaceNews correspondent Debra Werner. dation sweeping the Earth-obser-vation industry struck its biggest target, DigitalGlobe, when MDA announced plans to buy the Longmont, Colorado, company for $2.4 billion. That scenario would have been impossible to imagine in 1992 when Walter Scott founded the first commercial remote-sensing com-pany, then known as WorldView Imaging Corp., 10 months before Congress passed the Land Remote Sensing Policy Act to allow U.S. companies to begin operating remote-sensing satellites. DigitalGlobe now dominates a global, multibillion dollar Earth-observation industry. With five satellites in orbit, WorldView-1, GeoEye-1, WorldView-2, WorldView-3 and WorldView-4, Digital-Globe collects more raw imagery than its commercial competitors combined. Through its EnhancedView contract with the National Geospatial-Intelligence Agency, DigitalGlobe also is the U.S. government’s leading supplier of commercial imagery and imagery-related products. Canada’s MDA plans to operate DigitalGlobe as a subsidiary of SSL MDA Holdings, the Walter Scott, DigitalGlobe founder CTO and executive vice president What benefit do you antici-pate from MDA’s acquisition of DigitalGlobe? It’s basically hitting a go-fast button for DigitalGlobe. It brings scale and comple-mentary capabilities, including radar. Not just RadarSat-2, but a deep competency in radar. It diversifies our revenue stream. It brings the combined company’s Below: The Kimberley Coast, Australia captured by GeoEye-1. The region remains largely un-touched by human activity and is an example of how satellite imagery enables remote monitoring for environmental change and protection. SPACENEWS.COM | 13 DIGITALGLOBE

COMMERCIAL REMOTE SENSING retire the existing Worldview satellites? Worldview-1, Worldview-2 and GeoEye-1 will even-tually go out of service. The numbers that I gave you for improvement in capacity survive even after we lose Worldview-1, Worldview-2 and GeoEye-1. We will have a step-up in the capacity parameters that mat-ter most to our customers: higher resolution, higher revisit, more capacity in the highest demand areas. concentration on the EnhancedView contract from 46 percent of revenue down to 15 percent. It brings together companies that are very famil-iar. MDA was an early investor in DigitalGlobe. They have been part of our ground system architecture for a long time. They are our prime subcontractor for our international direct-access facilities, the sys-tems we use to support allied government custom-ers around the world. More recently, we have been working with Space Systems Loral (SSL) on our next generation satellite program. MDA not only brings us complementary capabilities, but ones we have known for a long time. It’s not like we are meeting for the first time on our wedding day. It’s been a 20-plus year courtship. Is that because you will be adding satel-lites to the Worldview Legion constella-tion as the older satellites retire? I’m not going to get into detail on the reasons, but the design of Worldview Legion allows us to improve in all of those performance metrics. It is a multi-sat-ellite constellation. What we’ve shared publicly is it will cost $600 million or less to deploy the complete Worldview Legion constellation. Did you work with SSL on Worldview Legion before the acquisition? We started working with SSL on Worldview Legion in a stealth mode a couple of years ago. Unlike some of our rivals who are trying to raise financing, we fund Worldview Legion by writing a check. So we haven’t had to talk about it. Will the first Worldview Legion satellites launch in 2020? Yes. It’s a multi-satellite constellation. Not everything is going to take place in a single launch. Why is Worldview Legion important? It will increase capacity in parts of the world with the most demand. It will triple to quadruple the number of minutes of observing time over those areas. It’s going to roughly double our call capacity. It’s going to double our 30-centimeter capacity. And it’s going to give us revisit throughout the day. Instead of having satellites in morning and af-ternoon orbits, with the combination of Worldview Legion, Scout, the partnership with the Saudis, and our existing Worldview constellation, we will have multiple dozens of revisits of a given point target and roughly 40 per day over a relatively small country. It de-pends on geography. In some parts of the world you will get more than 25 revisits per day of a point target. In some, you will get a little bit less. What is unique about Scout? The first is the business model. It’s a partnership where the King Abdulaziz City for Science and Technology and Taqnia Space own the satellites. We have access to capacity on those satellites and there is a revenue sharing model. It’s a model we’d love to scale up and potentially replicate. The second thing is that because of the way that the satellites are built and deployed, they are designed as an augmentation to the rest of the DigitalGlobe constellation. It’s hard to imagine a purely standalone system that does point-target monitoring. But when you combine the ability to do large-area collection to identify the areas of interest with the ability to monitor those areas frequently to observe change, and then when you see the change, zoom in with a high-resolution asset to understand the nature of the change, that’s where the value un-lock happens. It’s not with any one of those pieces, but with the combination of all of those put together. Worldview Legion will contribute to that because not only does it have high resolution but because of the number of satellites, it contributes to that high fre-quency revisit as well. Worldview-4 launched in November, 2016. How many Worldview Legion satellites will you launch? Multiple. We are not saying the number. Is the ground architecture unique, too? Yes. People used to build satellites and stovepipes for dealing with the satellites. They would build What happens when you 14 | SPACENEWS 05.22.17 DIGITALGLOBE

COMMERCIAL REMOTE SENSING their own ground station, their own processing environment, their own data storage. If you only have one satellite, that model works. But when you have a large number of satellites or satellite constellations, it’s insane to have everything be a stovepipe. We’ve taken the approach of building a com-mon ground architecture, whether it’s the remote ground terminals around the world, the operations center, the data processing environment, the use of the Amazon cloud. We are applying that across the Scout constellation as a way of ensuring the Saudis don’t have to replicate all of that ground investment to derive benefit from the Scout constellation globally. Think about what Amazon did. They took their infrastructure and exposed pieces of it to a broader community so that community didn’t have to build Amazon-scale data centers or warehouses. We are doing the same thing. to get the restrictions lifted for shortwave infrared. Adelaide Hills Bush-fire in Australia. How would you replicate Scout’s reve-nue-sharing agreement? One way would be to build more Scouts, which could be added to the constellation or made available to another customer who wanted to have a piece of the Scout fleet with their own logo. Another possibility is to build more Worldview Legions in a similar sort of model. We are quite open to that. Why should restrictions on shortwave in-frared imagery be lifted? In Colorado, we worry about fires. Fire is a big deal in Australia and Canada. When fires happen, they move fast and produce a lot of smoke. In Australia, the fires burn so hot the smoke goes up to 80,000 feet. You can’t fly an airplane over that. Those fires have the ability to do incredible amounts of damage. There are com-munities in Australia where the roads in and out rep-resent a bottleneck. Shortwave infrared sees through the smoke. To have the information available to the incident commanders in a timely fashion is critical. How would you share revenue? Many of the people who use remote sensing systems have regional interests. Satellites don’t hover over regions. To monetize it outside the area of interest, having that revenue sharing model is quite attractive. It’s economically attractive for a partner who wants a satellite within a region and it’s economically attrac-tive for DigitalGlobe. That’s the basis of our Direct Ac-cess model, which gives customers access to capacity within a region. In that case, we own the satellite and we have the ability monetize it outside that region. Do you see growing demand for shortwave infrared imagery? Yes. Fire is one example. There is another very prosaic example. We are creating a dataset called GeoScape for a company in Australia called PSMA. GeoScape is a database of the built-up areas: buildings, solar panels, trees, swimming pools, dozens of different parameters. We are using shortwave infrared. We have to do the work because we can’t expose the shortwave infrared to anyone else. To share shortwave infrared now, we have to throw away 75 percent and fuzz it out to 7.5-meter resolution. Algorithm developers don’t have access to the most valuable stuff. Think about how ecosystems develop. They don’t develop because one company does everything. They develop because a company enables many to build on that platform. The restrictions are throttling the ability of the industry to do that. Is the new administration relaxing Earth imagery regulations? It’s too early to tell. We are actively engaged with both the administration and Congress with a review of what are really 25-year-old operating rules. We have seen some very positive signs in terms of public state-ments made by the chairman of the House Science Committee. We are optimistic that we will see a more forward-leaning regulatory environment. A couple of years ago, we had the relaxation of the resolution restriction on electro-optical imagery. We are working 16 | SPACENEWS 05.22.17 DIGITALGLOBE

COMMERCIAL REMOTE SENSING DigitalGlobe’s role seems to be chang-ing. Instead of analyzing data for custom-ers, you seem to be sharing data with a much wider audience. There are a few factors behind that. One is that the industry as a whole has matured. The second is that technological tools are eliminating barriers to ana-lyzing data. Machine learning algorithms enable you to extract value from the vast quantity of imagery in the public clouds. The third has been the advent of crowdsourcing to create the training data necessary for the machine learning algorithms to produce high-quality results. All the pieces are in place now. Companies harnessing machine learning for complex analysis and prediction Until recently, commercial firms were wary of jobs as large as tracking all the ships in the Per-sian Gulf because 10 analysts would need a year to study all the satellite imagery. By combining Is that allowing a wider audience to use the data? Yes. You don’t have to be a data guru to leverage data. The Geoscape data is designed to be consumed by telecommunications companies, insurance com-panies, city managers. Those are three example use cases. For telecommunications, you need to know about buildings and trees for 5G telecom to be able to determine signal propagation and the optimal place to put the large numbers of cell towers. If you are an insurance company, you want to understand, where the trees are relative to the buildings. If you are a city planner, you have to identify heat islands, areas with-out enough trees that retain heat throughout the day. Those are a health hazard. None of those uses require imagery. They require databases on the built-up area. DigitalGlobe’s imagery archive with its own deep neural net-works, San Francisco-startup Spaceknow was able to perform that job in a little over five days, finding 445,936 ships in a 10-year period, said Pavel Machalek, Spaceknow co-founder and chief executive. Spaceknow, OmniEarth, Ursa Space, Descartes Labs and Orbital Insight are among the firms harnessing the power of computer vision, machine learning and an ever-expanding trove of satellite data to tackle problems far larger and more DEBRA WERNER “You don’t have to be a data guru to leverage data. The Geoscape data is designed to be consumed by telecommunications companies, insurance companies, city managers. ” Walter Scott Some estimates put the value of the geo-spatial data ecosystem at trillions of dollars. We don’t try to project. We have put the tools out there. The tools are being used. We are seeing growth. The vector is pointing in the right direction. It’s acceler-ating. I don’t know where it’s going to end up. SN Orbital Insight applied machine learning to Airbus satellite imagery to count cars parked in the vicinity of Levi’s Stadium in Santa Clarita, California, during the 2016 NFL Super Bowl. 18 | SPACENEWS 05.22.17 ORBITAL INSIGHT