Google has reportedly been in early talks to buy Californian satellite observation start-up Skybox Imaging as it looks to build on its mapping ambitions. Skybox is also seeking additional venture funding after raising US$91m since being founded in 2009,…
Google has reportedly been in early talks to buy Californian satellite observation start-up Skybox Imaging as it looks to build on its mapping ambitions.
Skybox is also seeking additional venture funding after raising US$91m since being founded in 2009, reported The Information citing sources.
The company last tapped investors two years ago when it raised US$70m to fund the SkySat-1 satellite that was launched in November 2013, as well as the SkySat-2 bird set to be placed by a Soyuz in mid-2014.
But it recently tapped Space Systems Loral to build 13 more satellites, with the first six targeting an Orbital Sciences launch in late 2015. SatelliteFinance understands that it is seeking support from the US Ex-Im Bank to fund the manufacture and launch.
Google and Skybox declined to comment on the speculation.
The Californian firm’s third and latest round of funding was led by Canaan Partners and Norwest Venture Partners, with existing investors Khosla Ventures and Bessemer Venture Partners also taking part.
Each Skybox satellite is capable of sub-metre colour imagery and up to 90-second clips of HD video at 30 frames per second, and the company’s business model centres on giving mainstream consumers access to the image and analytical capability that is typically confined to governments and militaries.
Google, meanwhile, has been heavily investing in its mapping software with consumer-focusing products such as Google Earth and Street View.
Competition fears hit DigitalGlobe
Despite being government focused and using more powerful satellites, shares in Colorado-based imaging giant DigitalGlobe fell 4% on the Google rumours, as investors feared the impact that a beefed-up Skybox could have on the group.
However, Raymond James analyst Chris Quilty argued that a deal could also have positive ramifications for the sector.
As well as being a “forceful endorsement” of the EO market opportunity, he said it could prompt a Google competitor like Apple or Microsoft to acquire or invest in DigitalGlobe.
“Regardless of Google’s decision, it is important to remember that DigitalGlobe generates ~85% of its revenues from government customers (both domestic and international) for whom resolution and accuracy are of the utmost importance,” said Quilty in a research note.
“And, there is a world of difference (life vs. death) between 30 cm and 90 cm resolution when trying to detect a roadside bomb. Consequently, we believe DigitalGlobe would face minimal direct competition from Skybox in the government market, although Skybox could find some traction providing monitoring services to certain government customers.”
Rumours of a possible Google deal comes as Facebook buys Ascenta, a British drone technology company, as the social media behemoth fleshes out plans to provide internet in remote locations through satellites, lasers and unmanned high-altitude aircraft.
