In 1858 a French photographer perched in a hot air balloon took the first aerial photograph the world had ever seen.  Despite the limitations posed by clumsy photographic equipment the enormous potential for aerial photographs started a cycle of development leading to contemporary orbiting satellites recording images of the earth from the stars.

However, even though satellite imagery can be high resolution, it lacks the detail and depth perspective of photographs taken from an airplane.  In addition, satellite coverage is limited due to time, cost, and location. Aerial photography at low-altitudes offers improvements but still lacks the scale of photographs taken from higher altitudes.

The digital revolution allows the photographic geospatial imagery to be converted into usable maps.  Our own Nearmap Limited (NEA) is credited by industry experts as having breakthrough technology comprising of a unique camera system, the “Hyperpod”, mounted to aircraft that can fly at high altitudes, capturing geospatial images of entire cities.  The company uses super-computers and its own Hypervision software to create Photomaps™.

Nearmap was acquired by a technology intellectual property company, Ipernica, back in November of 2008. The attraction was the combined technologies at Nearmap that offered “turn-key” solutions for businesses and government agencies in need of geospatial mapping.  The Hyperpod camera is actually five cameras with its captured imagery processed by the Hypervision software with the Hyperweb ultimately delivering mapping online.

Today Nearmap is cloud-based and serves government agencies and businesses in all phases of construction, defense, and utilities.  One of the many advantages Nearmap offers is updating of its Photomaps™ several times a year, as opposed to the “one and done” model in place with other aerial surveyors.  The company updates major cities monthly with mapping data available almost immediately, in sharp contrast to the time lag with its competitors.


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The stock price has done well over the past five years.  At the time of the acquisition Ipernica was trading at around $0.09.  Here is a price movement chart comparing NEA to both the ASX 200 and the US DJIA over the same period. 

The big bump began shortly after Nearmap changed its pricing policy to a user-subscription base.  In October of 2014 the company, already the leading geospatial imaging company here, expanded into the United States market, sending the share price higher.  2015 saw Nearmap investing in maintaining its technology edge, with an expected 2017 launch of a second generation version of the Hyperpod to be named HyperCamera2.

Nearmap is transforming itself into a full-service provider with a complete geospatial imaging platform.  Not only does the company provide up-to-date mapping, it also offers archiving and assists customers with the tools needed to analyze geospatial data to improve their own productivity.

Nearmap in Australia has suffered somewhat from the death of the mining boom, but sales in the US are encouraging, with the first recorded sales coming about one year ago.  The company has said nothing about the use of drones, but it doesn’t take much imagination to envision a HyperCamera2 mounted to a drone.

The US venture proved costly but the latest financial results reported showed positive movement with a 12% increase in sales in Australia and the US and an impressive 32% rise in subscription revenue here in Australia.  It is noteworthy the company has funded its expansion out of existing cash flow and as of the most recent quarter has no debt and $14 million cash on hand.  The US market is lucrative but there is competition there, and now there is competition here.

In February of 2015, miner White Star Resources made the transition from minerals to tech when the company bought fledgling geospatial imaging company Spookfish Innovations Pty Ltd.

In essence it appears this company is developing for commercial use what Nearmap already has in place, only better, at least according to Spookfish!. Spookfish claims its offerings will have superior resolution and accuracy, 3D visualization, and faster and cheaper acquisition, “disrupting” existing providers. Spookfish also plans to provide turn-key service, from the geospatial imaging to product delivery to its clients.

That of course remains to be seen but prior to the White Star acquisition Nearmap filed and then withdrew a discovery application for potential patent and copyright infringement.  In March of 2015 the Australian reported that Stuart Nixon, the Nearmap founder who left the company following the Ipernica acquisition, had a major stake in Spookfish and had been retained as a strategic adviser.  According to the Australian, Spookfish has other former Nearmap employees on the payroll.

The company’s Generation One Camera System or “Technology Demonstrator” has been tested in anticipation of commercialisation.  Spookfish is simultaneously developing a larger Generation Two system for larger applications, incorporating learnings from the Generation One testing.

Spookfish claims its platform can capture, process, archive, and deliver geospatial imagery in 3D on a staggering scale – whole continents. The following table compares the price action of these two companies over the last year.

Nearmap is already fully operational, generating revenue and anticipating profitability in the near future. Spookfish is still in the developmental stage, but it already has a licencing agreement in place to bring its product to the US market.  

On 17 May the company announced a deal with one of the leading geospatial imaging firms in the US – EagleView Technologies Inc. The deal includes a long-term contract licencing EagleView to “operate, market, promote, sell, and distribute” Spookfish products in North America.  In addition, EagleView has the option to acquire a 19.5% stake in Spookfish via $6 million dollars in convertible notes, interest free, with the rights to add another 9.9% stake, subject to revenue milestones.

This agreement gives Spookfish funding needed to fully commercialise its products and also serves as a note of confidence from a major US firm. The stock had been in a trading halt, pending the announcement. Investors liked what they heard.  Here is the chart.

Geospatial imaging is at the core of what has come to be known as Geographic Information Systems (GIS). The global GIS market is expected to rise from 2014’s $7,612.9 million to $14,623.8 million by 2020.  That is a compound annual growth rate (CAGR) of 11.4%.

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