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Tracing a Growth Trajectory

As the utility of GNSS grows beyond surveying, LBS and navigation with new satellites and constellations, the market size of the GNSS industry is all set to leapfrog in the coming years. 

Galileo Sat Constellation in Orbit

“The global installed base of GNSS devices has surpassed 2 billion units, despite the economic slowdown. Mindful of recent milestones and the fact that multi-constellation GNSS is becoming a reality, the prospects for the future are highly promising”.

– GNSS Market Report 2013, the European GNSS Agency (GSA)

The only thing more difficult than describing the GNSS market is predicting its future growth. In an ever more connected world, people’s use of high-integrity positional, navigational and timing data is growing like never before. The easy and cost-effective availability of location data is enabling its access in an increasing number of products and services.

The demand for satellite navigation and communications was initially driven by the militaries. However, the largest growth by far today comes from civil applications of GNSS, driven by the ‘traditional’ applications including surveying, geodesy, engineering and GIS, says Elmar Lenz, General Manager, Geospatial GNSS, Trimble.

Not without reason then that the GSA predicts that there will be 7 billion GNSS devices by 2022, almost one for every person on the planet. Over the coming decade, the installed base of GNSS devices will increase almost four-fold, largely driven by increased penetration in regions outside Europe and North America. “The major part of the value is in the downstream market,” says Carlo des Dorides, Executive Director, GSA. He is categorical that the value is on the receiver, application and services side. “I see an increased potential and growth in the number of companies, especially SMEs, in the application and service provision. It is a continuous and fertile growth,” he adds. GSA has recently been holding talks with chips manufacturer for embedding Galileo signals.

The GNSS Market Report 2013 from the GSA foresees a compound annual growth rates (CAGRs) for “GNSS core” and “GNSS-enabled” revenues increasing by 9% through 2016 and 5% through 2020, respectively, to attain €350 billion ($478 billion) per year. By 2022, GNSS core revenues will comprise about €100 billion ($137 billion). These market results remain the current benchmark for the evaluation of market opportunities for the upstream and downstream industry.

The projected long-term growth revenues indicate significant business opportunities; however, the changing technology ecosystem (use of communications and other positioning technologies alongside GNSS, and the emergence of new constellations) requires constant innovation on the supply side. Although various location technologies are integrated in one device, GNSS will remain one of the main sources of outdoor positioning information.

Worldwide, regulatory measures are being put in place to promote the use of GNSS. For example, regulatory requirements for emergency location sharing, such as the European eCall, the mobile 911 (North America) and 112 (Europe), or Search and Rescue (SAR) services, promise to provide further impetus for growth in Europe and North America over the next five to ten years.

Multi-constellation devices that use all navigation signals in view are becoming more common in the market, offering increased availability (appreciated especially in urban environments) and more robust performance in professional applications (e.g. in Surveying). More than 70% of models available on the market are GPS-SBAS (satellite-based augmentation system) capable (SBAS like WAAS, EGNOS, and MSAS) and the penetration will grow further with the expansion of SBAS coverage around the globe.

The biggest step forward is the availability of satellites, says Alois Geierlehner, Director, Business Development at GeoMax, a Hexagon Group company. “Simply said, the more satellites you have up there, the higher are the chances that you can fix your position even in bad conditions such as under a canopy or in urban canyons. In this way, the areas without sufficient satellite coverage shrink dramatically and you can use GNSS in locations not possible only a few years back.”

As of now, only the United States NAVSTAR Global Positioning System (GPS) and the Russian GLONASS are global operational GNSSs. China is in the process of expanding its regional BeiDou navigation system into the global Compass navigation system by 2020. The European Union’s Galileo positioning system is a GNSS in initial deployment phase, scheduled to be fully operational by 2020. France, India and Japan are in the process of developing regional navigation systems.

Applications galore
Scientific applications of GNSS are widespread and include surveying, environmental and atmospheric monitoring, meteorology and climate research. But it is the free availability and accuracy of GNSS signals, combined with falling costs of hardware, that have made GNSS the chosen solution for several industrial applications too. While Trimble’s Lenz says the past 15 years have seen strong demand coming from the construction and agriculture markets, Charles Rihner, Vice President of the Topcon GeoPositioning Solutions Group, sees the uses for GNSS technology continually broadening. “We provide precise positioning solutions for the global surveying, construction, agriculture, civil engineering, BIM, mapping and GIS, asset management and mobile control markets that result in tremendous productivity growth. Highways, infrastructure, buildings, pipelines, mining, and more… the application opportunities are there and we are continually introducing new solutions for emerging markets.”

LBS, the obvious gainer
“If your smartphone recommends the nearest restaurant suited to your tastes or tracks your fitness level with a special app, this is far beyond what GNSS was originally designed for. To have a position and knowing where you are is key to a lot of applications and we still see this expanding,” says Geierlehner. The increased affordability of smartphones and other GNSS-enabled platforms will drive the growth of the LBS market; expected to be 10% CAGR over the next decade. Smartphones comprise 90% of LBS devices sold. However, with the growing penetration of tablets and increased GNSS usage in digital cameras, the smartphone share will decrease over the next decade.

With LBS devices increasingly supporting navigation and services in other applications, new smartphone capabilities alongside integrated technologies are blurring the market segment breakdowns. LBS is forecasted to be the largest market segment by revenue, overtaking road, where the PND market continues to decline, being cannibalised by the use of smartphones in cars. LBS devices are also being used in general aviation and leisure maritime.

GNSS capability in receivers

Navigation leads the way
At present, road transport applications are the majority users of GNSS signals, for in-car navigation, commercial fleet management, taxi services, public transport monitoring and passenger information, and emergency vehicle location, dispatch and navigation. In road transport, emergency vehicle location, dispatch and tracking require medium availability and accuracy. Future applications such as automated highways and lane control will need very high availability, integrity and accuracy.

The number of embedded devices and On- Board Units is growing, replacing traditional nomadic devices (e.g. PNDs). As smartphones are increasingly used for road navigation purposes, new Intelligent Transport System (ITS) services are expected to be deployed in the coming years, taking the use of GNSS far beyond in-vehicle navigation. For instance, every third new car on the road is equipped with in-car navigational devices in Europe. “This alone can give you an idea about the reach and penetration of this technology,” points out des Dorides. “The big numbers are there, and that is why we are focusing on them. We have been quite successful in having a good number of them in the transport sector”.

Further, there are applications beyond traditional navigation, such as pay-per-use insurance (enabling pricing policies based on timing, location and driving behaviour); driver assistance systems and connected vehicles where GNSS, complemented by sensors (e.g. camera, radar) and communications systems (e.g. Wi-Fi, 3G), is used to enhance intelligent vehicle safety systems (e.g. intelligent speed adaptation, lane change assistance, curve speed warning, collision avoidance, automated driving; road user charging solutions), determining the position of vehicles using GNSS data received by OBUs, which calculate road tolls based on distance travelled at a particular location and time; and Satellite road traffic monitoring using real-time traffic information where the floating car location data, collected in real-time from vehicles, are sent to a central processing centre and shared with interested parties.

core revenue share 2012-2022

In aviation, most commercial aircraft now use GNSS for en-route navigation and several countries have licensed GNSS for initial approach and non-precision approach to specified airfields. Automatic Dependent Surveillance – Broadcast (ADS-B) is increasingly used where there is no radar coverage; this involves aircraft calculating its position using GNSS and other sources and broadcasting it to other aircraft. Use of GNSS in aviation sector is expected to go up as more flight procedures are designed to take advantage of performance-based navigation (PBN). For example, Europe is rolling out EGNOS-enabled instrument approach procedures for increasing safety and business continuity at aerodromes. Similarly, India has launched the GPS aided geo-augmented navigation (GAGAN), a regional SBAS, to improve the accuracy of a GNSS receiver with reference signals for the aviation industry. PBN is expected to be a key enabler for Ground Based Augmentation Systems, resulting in lower minima to CAT II or CAT III standards, demanded by some commercial operators. Commercial aviation GNSS manufacturers are expected to capture about 30% of the aviation market revenue by 2022.

Maritime applications include ocean and inshore navigation, dredging, port approaches, harbour entrance and docking, vessel traffic services (VTS), automatic identification system (AIS) hydrography, and cargo handling.

Railway applications include the management of rolling stock, passenger information, preventing doors opening unless they are alongside the platform, cargo tracking, train integrity and level crossing approach. As a combination of technologies such as balises, RFID and GNSS enables a train to detect its own position, the railway signalling system is expected to gradually become more intelligent. GNSS will support this programme by providing an additional source of positioning information, especially in the evolution of signalling system. The GSA report sees 30% of trains across the world to be equipped with GNSS by 2022. As market needs for cheaper and more sustainable transportation systems favour GNSS-based RUC schemes and PPUI applications, the combined shipments of devices in these two applications is likely to grow to around 20% in 2022, says the report.

Dealing with multiple signals
GPS is modernising. GLONASS is here. BeiDou is functioning well at regional level. Galileo is in the advanced stages. India and Japan are in the process of launching their own constellations. So how do the multiple GNSS signals enable the industry?

“Improvements to GNSS provide important benefits to end users in all disciplines,” says Lenz. Beginning with the introduction of the L2C GPS signals, Trimble has provided support for new signals as they come available. We can use these advances to achieve positions in difficult situations such as urban canyons, buildings and dense vegetation canopy. The enhanced satellite segment enables us to increase the availability of accurate, reliable positions in these harsh environments.

Similarly, with companies like NovAtel, the world’s leading supplier of GNSS boards, Leica Geosystems and GeoMax, Hexagon has direct access to the latest developments in the market and its products are ready for new signals as soon as they are launched, says Geierlehner. “Our strength in working with multiple GNSS signals from different systems is that we are able to treat them not as separate, but as a combination. This means we don’t just get one position from GPS and one from GLONASS and average them, we use all the information we receive to provide the best and most accurate single result. This is not as easy — due to the fact that the independent systems were not designed to be used together — but the results we get show that we can increase availability as well as accuracy and reliability dramatically by using this approach.”

Galileo was designed to have a frequency band and modulation which is very beneficial for having a complete interoperability with GPS and Galileo. Therefore, there already exists good cooperation and interoperability between the two systems. Further, there are regular EU-US meetings which discuss specifics in details. “Cooperation with GLONASS and BeiDou is certainly not at the same level as we have with GPS,” says des Dorides.

The key consideration is the Interface Control Document (ICD) that is published by the various organisations and governments that operate the GNSS constellations, says Lenz. The ICD defines the signals and provides the information needed to design a GNSS receiver. GPS, GLONASS, Galileo, QZSS and BeiDou all have public ICDs, but IRNSS does not. A second important document is a performance standard, which defines the guaranteed performance level. This is important because many of the differential systems (such as RTX) need the best possible estimates for clocks and orbital parameters.

“The only problem is when satellite signal providers do not provide accurate Interface Document publicly and on a timely manner,” says Javad Ashjaee, CEO and President of California-based Javad Group, which specialises in GNSS hardware.

Once the key documents are available, most of the system interoperability issues can be solved as part of the detailed receiver design. The UN-based International Committee on Global Navigation Satellite Systems (ICG) was established to promote cooperation between the governments providing GNSS services on civil satellite based positions.

Sowing seeds in agriculture
Agriculture is one area that has jumped to take advantage of acute positioning. The use of GNSS together with EO data enables a new range of applications in agriculture (e.g. assessment of land use and the impact on biodiversity and landscapes, crop conditions and yield forecasts or management of irrigation), and has been put to use by governments across the world. However, what is interesting is the uptake in precision agriculture, mostly in developed countries, which have larger farms and fewer farm hands.

Precision farming is perhaps the clearest example of the commercial application of GNSS. Machine guidance, precise planting and harvesting, fertilisation advice, yield monitoring, and water management advice at farm level all contribute to increased production and cost savings. Often the first GNSS application a farmer adopts is Tractor Guidance (making use of a digital display which assists drivers to follow a predetermined path, minimising risks of overlap/ gaps). Automatic Steering, the most advanced form of tractor guidance, is used mainly on large farms and allows tractors, harvesters and other farm vehicles to be automatically steered along a predetermined path. The operator can concentrate solely on monitoring the overall process. Variable Rate Technology (VRT) leverages local conditions on the field for precise control over farming inputs (e.g. fertilisers, nutrients). Farmers are also using GNSS for asset management, involving the use of real-time information for monitoring the location and status of farm equipment.

The uptake of GNSS-based precision agriculture in less industrialised regions is set to accelerate, supported by consolidation of farms. Precision agriculture responds to the need to improve yields and efficiency, while controlling costs. GNSS is used together with augmentation systems like RTK, and SBAS to increase the accuracy. Solutions based on SBAS initiated the diffusion of precision agriculture into smaller farms thanks to more affordable equipment and a medium level of accuracy.

No wonder then that between 2006 and 2012, global shipments and the installed base of GNSS devices is said to have more than tripled. North America and Europe naturally are the most technologically advanced region with respect to precision agriculture. The rest of the world comprises countries with markedly different levels of technological development, varying from Japan and Australia, with extensive adoption of precision agriculture, to nascent markets such as China and India.

Surveying new territories
Surveying is an early adopter of new location technologies including GNSS. Currently, professional surveying receivers are using all available GNSS signals (multi-constellation and multi-frequency) and differential correction techniques (e.g. SBAS, RTK, DGPS). The role of GNSS receivers in the surveying equipment market has demonstrated the added value of satellite positioning to optimise survey operations and fruitful co-existence with other land measurement technologies, such as laser scanners and photogrammetric/LIDAR cameras. The trend in surveying is to adopt all new signals in one device, maximising accuracy of measurements and improving availability in places with poor aerial exposure (e.g. urban canyons and forests).

All total stations now come GNSS-equipped, a trend observed over the last few years. “But I still believe we are at the start of this development, as it is concentrating mostly on the high-end segment,” says Geierlehner. He, however, adds that more and more users are no longer exclusively using total stations or GNSS, but both. “By bringing these two technologies together, you get the best of the two worlds. Above all, GNSS made a major step over the last years in terms of usability and being affordable to a much wider base of users. And a wider user base results in a bigger market.”

Major growth in surveying depends heavily on economic conditions in high-growth economies. Cadastral and construction segments are the largest applications of GNSS in surveying. New professional users in environmental and engineering disciplines together with mapping communities are fostering the use of geoinformation and the development of new applications. “Professionals in the surveying, engineering and construction segment face increasing competition. No geographic region or segment is immune to this,” emphasises Geierlehner.

In the coming years, the surveying market in the developing world is expected to experience major growth since land boundaries and their measurement are likely to become an important issue. Add to that the high level of construction and infrastructure activities in these regions. GNSS is expanding faster in the emerging markets because often there are no alternative legacy systems, and dense geodetic ground networks to support surveys frequently do not exist.

Mapping applications will also support further market growth by enabling new applications, requiring lower levels of accuracy. Volunteered Geographical Information (VGI) initiatives are fostering the use of GNSS devices to share instant updates of geoinformation within mapping communities.

The surveying market in rest of the world is expected to develop much faster than in Europe or North America owing to the high level of construction activity in these regions.

Other positioning technologies are used to complement GNSS. In mobile mapping systems, inertial measurement units and wheel sensors help refine GNSS-measured positions. The results are georeferenced datasets from LiDAR and imaging sensors that can produce detailed 3D models over large areas and corridors. For instance, Trimble’s newest GNSS rover, the Trimble R10, can be integrated with the Trimble V10 imaging rover to provide survey-grade georeferencing for panoramic images captured on site.

gnss pricing factor The Pricing Factor
Low-cost, high-precision GNSS chipsets are still a couple of years away even though prices of high-precision GNSS receivers have been declining in parts of Asia, Africa, Europe and South America even though it is still very high in US and Canada. The price erosion in the last few years has largely been supported by increased competition and demand, and lower production costs. Leading manufacturers have introduced low-cost devices sometimes under other brand names to satisfy the increasing demand in emerging economies, which are more eager to buy less expensive devices. These systems are usually less technically advanced so as not to undermine sales in more developed markets.“Users in developing countries no longer accept working with out-of-date technology just because they cannot afford high-end brands. We are seeing increasing demand from customers outside of the traditional surveying market, for example, a foreman on a construction site conducts many tasks traditionally done by surveyors,” says Alois Geierlehner of GeoMax. He adds that GeoMax was developed from scratch to fill a gap the Hexagon group was facing – high-quality yet cost-effective products and solutions.

Another factor that has skewed the market is the tough competition from Chinese manufacturers. A typical Chinese receiver is made using the guts (GNSS receiver boards) from mainstream GNSS receiver designers like Trimble, Topcon, NovAtel, or Hemisphere, and are available at a fraction of the price.

However, big players do not see that as a threat. “When you buy a product as a customer, you don’t only buy the hardware but also the service, support, accuracy, compatibility, durability and a lot of other factors. To be the least expensive in price does not mean that the cost of ownership is also the lowest,” says Geierlehner.

Lenz also feels that providing position using GNSS is just the beginning. “Regardless of the application, a user has a reason for collecting GNSS data. By understanding why the data is needed, where it will go and how it will be used, we can help our customers increase the value of the service and deliverables that they give to their clients,” he adds. The entire flow of data — collecting, processing, modeling and analysing — can be managed to improve productivity and value. This includes software in the field and office, specialised hardware, communications and interfacing to downstream systems.

However, some Chinese manufacturers like CHCNav are addressing the servicing issue by setting up regional centres around the globe for support and repair. But it’s yet to be seen if they can disrupt the high-quality GNSS market with products that will meet the expectations of US and Canadian buyers.

Construction is a whole new world
Site surveying apart, GNSS technology is being integrated into construction equipment such as bulldozers, excavators, graders and pavers to enhance productivity in the real-time operation of this equipment, and to provide situational awareness information to the equipment operator.

Increasingly, large-scale infrastructure projects are incorporating augmented GNSS positioning across the design phase to construction lifecycle and on into asset management post construction. Most of these applications require accuracy of around 2 cm although some can operate with accuracies at 5 cm. Productivity benefits are significant, in addition to increased safety for construction workers through the use of machine guidance and automated systems that remove operators from dangerous situations and from exposure to dust and contaminants.

GNSS information can be used to position the cutting edge of a blade (on a bulldozer or grader) or a bucket (excavator), and to compare this position against a 3D digital design to compute cut/fill amounts. Productivity studies have repeatedly shown that the use of 3D machine control results in work being completed faster, more accurately and with less rework than conventional construction methods.

For instance, a report prepared by the Australian government’s Department of Industry found that machine guidance enabled with augmented GNSS in construction projects has the potential to deliver a 20–40% reduction in labour requirements, and a 10% reduction in total project costs and subsequent asset management.

Tracking the future signals
In the evolving markets, GNSS is now found in many industries where positioning can be combined with other information to simplify and accelerate work processes. For example, integrating GNSS with gas detection sensors helps workers detect emission levels at landfills and industrial plants, says Lenz.

GNSS timing is important for telecommunications applications. Synchronous technologies are much more efficient than asynchronous technologies but require a time source with appropriate accuracy, stability and reliability to operate effectively or at all, and GNSS can provide this. Similarly, financial systems increasingly need precise time stamping to prioritise trades and to provide an audit trail.

GNSS will remain an exciting field over the next years and decades to come, and what for sure is that it will merge into a lot of other industries, feels Geierlehner. For several people, GNSS is already a commodity — a smartphone user does not care who owns or which technology runs on the satellites to navigate to their favourite shop.

Players like Trimble, GeoMax (Hexagon) or Topcon keep a close eye on any new developments and opportunities. “We are positioned to extend our core technologies to new markets. In some cases, this involves developing new solutions to present to existing customers and applications. In others, we can adapt an existing solution to enter new markets. We learn from what we are good at and leverage our knowledge into new arenas,” adds Lenz.

There are newer challenges like a number of applications want to use GNSS to operate at the centimetre level now. But for many more applications, it is easily sufficient to work at precisions of 10 cm up to a few meters. “By understanding that — together with domain knowledge of the users’ workflows and deliverables — we can develop solutions that provide exceptional value,” says Lenz. As with any technology business, geopositioning is certainly cutting edge and fast moving. “Sometimes new applications are presented to us from our customers that we had not even dreamed of. In those instances, we work together to come up with technology solutions to suit the applications at hand,” says Rihner.

Often GNSS technology itself drives market expansion and new applications, allowing people to do what they hadn’t been able to do before. For instance, the partnership between Topcon and MAVinci brought about the world’s first UAS to incorporate RTK GNSS positioning, allowing for 2-5cm accuracy without the need for ground control points. Imagine the power to be able to quickly collect high-accuracy images by air of ground sites that cannot be reached on foot! “Through the creation of this new technology, we bring GNSS aerial mapping to construction, disaster management, mines and quarries and other diverse environments,” adds Rihner.

The accuracy, pervasiveness and convenience of GNSS mean that its application has moved far beyond navigation and the list of the same continues to grow.