FANUC, the world’s largest maker of industrial robots, plans to start connecting 400,000 of their installed systems by the end of this year. The goal is to collect data about their operations and, through the use of deep learning, improve performance. Similarly, Kuka is building a deep-learning AI network for their industrial robots.

FANUC, Cisco and General Motors

In 2014, FANUC partnered with Cisco on a 12-month zero downtime (ZDT) pilot project with General Motors. FANUC is now moving forward to connect all its manufacturing robots. The system proactively detects and informs of potential equipment or process problems before unexpected downtime occurs. This lets FANUC and its customers schedule and perform maintenance during a planned outage window, so operations aren’t disrupted. FANUC robots contain sensors that constantly gather data on temperature, cycles, machine operator activities, and other metrics. This data is then dynamically analyzed to predict wear on parts, such as bearings or transducers. An analytics engine captures out-of-range exceptions and predicts maintenance needs. The cloud app alerts FANUC service personnel and its manufacturing customer about the need for service and replacement part(s). The part(s) is automatically shipped to arrive at the factory in time for the next scheduled planned maintenance window.

This kind of proactive, planned maintenance can unleash dramatic savings and is different from present-day equipment- and part-life maintenance and service programs. General Motors estimated unplanned downtime costs thousands per minute and FANUC hopes to help GM save an estimated $40 million in downtime.

FANUC ZDT is part of the FANUC FIELD system which provides end users with an integrated manufacturing solution for interconnecting and analyzing data from CNC devices, robots and sensors. FANUC was named a 2016 Innovation Award winner for its ZDT Application.

“We partnered with Cisco to create highly secure connections from our robotic equipment in GM’s factories to Cisco’s Cloud Data Center where FANUC is able to perform analytics on how the robots are performing,” said Rick Schneider, Chairman and CEO, FANUC America. “The ability to collect data from our robots and analyze it in the cloud, to predict potential equipment issues before downtime occurs, allows us to proactively address our customer’s needs. With ZDT, we can also take advantage of the data collected from our robots to optimize GM’s manufacturing systems by reducing energy consumption, extending equipment life, improving cycle time and quality. Reducing downtime through ZDT has proven to have a direct and positive impact on GM’s plant’s performance.”

“We partnered with Cisco to create highly secure connections from our robotic equipment in GM’s factories to Cisco’s Cloud Data Center where FANUC is able to perform analytics on how the robots are performing,” said Rick Schneider, Chairman and CEO, FANUC America. “The ability to collect data from our robots and analyze it in the cloud, to predict potential equipment issues before downtime occurs, allows us to proactively address our customer’s needs. With ZDT, we can also take advantage of the data collected from our robots to optimize GM’s manufacturing systems by reducing energy consumption, extending equipment life, improving cycle time and quality. Reducing downtime through ZDT has proven to have a direct and positive impact on GM’s plant’s performance.”

Kuka and Huawei

Kuka is working with Huawei, the Chinese phone maker and communications service company, on a similar project to develop a global 5G network enabling the connection of Kuka robots across many factories. The companies say they plan to integrate artificial intelligence and deep learning into the system to help manufacturing businesses remain agile and drive growth. In a March 2016 agreement, Huawei and Kuka said they will collaborate in the areas of cloud computing, big data, mobile technology, and industrial robots.

[Gartner Research says Huawei has 8.3% of the global smartphone market, compared to 23% for Samsung and 15% for Apple. Huawei’s sales in the first couple of months of 2016 were up 59% from 2015 while Samsung’s smartphone sales were flat and Apple’s dipped 14%. Speaking at the Converge technology conference in Hong Kong, Richard Yu, the head of Huawei’s consumer electronics business, said he believes passing Samsung and Apple is a goal within reach.]

ABB and Microsoft

ABB offers an optional software package to ABB robot owners called Connected Services. This is a 24/7/365 monitoring service for their robots but administered by the client; it is not an ABB-wide effort to monitor and learn from their whole network of robots around the world. However, that learning capability is available and may be available in the future as can be seen by ABB’s Connected Service offered by ABB’s power business, where they are working together with Microsoft on a cloud-based e-mobility charging platform for power stations for electronic vehicle recharging. This will include user recognition, accepting payments, and data transfer of streaming data for system stability and monitoring.

“ABB and Microsoft Corp. announced [in March, 2016] the worldwide availability of a new electric vehicle (EV) fast-charging services platform. The collaboration will also take advantage of machine learning and predictive analytic capabilities to drive future innovations. Under the new collaboration, all ABB chargers will be connected to the Microsoft Azure cloud and surrounded by value-adding services, allowing operators and manufacturers and partners to take advantage of a world-class platform.”

 

Black Box Deep Learning

Kuka, ABB and FANUC – as are most robot makers – are late to the AI and deep learning party, but still very welcomed.

Aethon, a mobile robotics company focusing on the hospital industry, started their Cloud Command Center in 2013 from which they remotely monitor, support and even control the autonomous mobile robots installed at their customer’s locations.  Aethon staffs the command center 24/7/365 and has over 400 TUGs in 140 locations online and in constant communication with the command center.  Occasionally a TUG finds itself in a situation where it needs help. Rather than rely on customer personnel to address this, the command center takes over and manages the situation.

Algorithms monitor the status of each TUG in real-time and if the algorithms detect a TUG might need help an alert is sent to an on-duty support staff member who, using a secure VPN connection, can connect to the TUG’s on board sensors to assess the situation. In the simplest of solutions, the operator can drive the device out of the situation. Whatever the case, the command system updates with the solution and the criteria that precipitated the situation. Thus, the system is not only handling problems, it is learning how to anticipate those very same situations in the future and proactively prevent them.

The most visible of the efforts in deep learning are in Silicon Valley which has seen widespread start-ups in AI research by almost every car company, Baidu, Alibaba and, most recently, Toyota’s $1 billion investment in establishing the SV Toyota Research Institute headed by Gil Pratt (of DARPA’s Robotics Challenge fame).

Apple, Google and Facebook have led investments in more advanced uses, but practical deep learning systems such as Aethon’s, FANUC’s and Kuka’s are also becoming prevalent in the industrial sector.

The black box concept, i.e., the storing of streamed sensor data for analysis and learning, is a valuable tool in air safety and may soon become a mainstay in autonomously driven transportation, mobile robots and robotics in general. That data, and super-fast computer processing, are enabling deep learning engines to find and build patterns that can make the devices safer, more productive, and more cost-effective.

The latest acquisition is Gimatic, an Italian pneumatic and electric grippers, sensors and positioners maker, by Agic Capital. The Financial Times reported the sale price to be between $112 and $169 million.

Gimatic is an Italian supplier of robotic end-of-arm tools. Annual sales have grown more than 20% over the past three years, with most of its business coming from Europe. Asia, accounting for less than 1/10 of Gimatic sales, is seen as the market with the biggest potential. Gimatic's gripper product line is of direct interest to Chinese robot manufacturers.

Agic Capital, together with China National Chemical Corp (ChemChina) and Chinese state fund Guoxin International Investment Corp, also purchased Germany's KraussMaffei Group for $1 billion in January. KraussMaffei is an industrial robot integrator and plastics, carbon fiber, and rubber processor.

More recent is the $5.2 billion offer by Midea Group, a Chinese appliance manufacturer, for Kuka AG, the Augsburg, Germany-based manufacturer of robots and automated systems. Kuka is one of the Big Four of robot manufacturers. On the day of the bid, Kuka's stock rose from $84/share to $110 where it's stayed since. Although there has been much political noise about foreign purchases of German companies, no alternate buyers have appeared. In fact, just today, Siemens' CEO said that they weren't interested in making a counter offer.

Paslin, a Michigan integrator of welding robots, automation systems and tooling, was acquired by Wanfeng Technology Group for a reported $302 million. The Wanfeng group of companies, located 125 miles southeast of Shanghai, is mainly known for their auto wheels, aftermarket wheels and auto parts.  But it also has businesses in such fields as robot integration of assembly, welding and painting systems, automation equipment, magnesium alloy parts, aviation equipment and financial investments, with annual sales of $3 billion.

CHINA'S GROWING ROBOT ARMY

In a recent story in the Financial Times, Asia-focused asset management firm Mirae Asset Management forecasts that China's robot army will expand at a compound annual growth rate (CAGR) of 35% until 2020.

Rahul Chadha, chief investment officer of Mirae, says: “Using the rule thumb that one industrial robot replaces four to five workers, this suggests that robots have rendered more than 1m people jobless.” Mr Chadha, who calculates that robots will replace around 3.5m Chinese workers over the next five years, says: “The message that comes from the leadership is on improving productivity via automation. They are paranoid about doing things quickly. They believe they have got to because their competitors will do the same."

THE ACQUISITION MARKETPLACE

According to the International Federation of Robotics (IFR), annual robot sales between 2005 and 2015, rose 9% worldwide while China experienced a growth of 25%. 

Siasun Robot & Automation, China's most prominent robot manufacturer, announced that they are planning to acquire competitive and domestic international component manufacturers to expand their market presence.

“We have been in negotiations with potential companies for over a year and we hope to complete these acquisitions by June,” Vice Chairman and President Qu Daokui told ChinaDaily.com.

At present, more than two-thirds of the robots purchased in China are produced by international vendors but that ratio is rapidly changing. The most recent Chinese National 5-year plan calls for increased use of robots and local governments are supporting the effort with various real estate and tax incentives. Many "deals" have been arranged whereby Chinese venture funds are investing in robotic ventures from Russia, Israel, Silicon Valley and through acquisitions such as the Ninebot acquisition of Segway last year, as well as this year's acquisitions of Paslin, Kuka, KraussMaffei and Gimatic. And it's only June!

Read more

This article was first published on the IEC e‑tech website.

From robots delivering small packages in cities, to driverless trucks transporting bulk loads over long distances, advances in robotic delivery in the next decade will lead to significant changes in retail markets, the freight haulage industry and transport in general.

New capabilities and functions for transportation

Most trials of autonomous delivery services have involved aerial drones or unmanned aerial vehicles (UAVs). Meanwhile, the latest “connected car” technologies are being tested in hundreds of semi‑autonomous cars on public roads around the world. In the words of a report by the US‑based market research and consulting firm Navigant Research in April 2016, “electrification, sensing and actuation technology, wireless connectivity and mobile apps built on the internet have each spawned fascinating new capabilities and functions for transportation.”

As these trends converge, several companies are trialling the use of driverless wheeled vehicles in urban environments for “last mile” deliveries of food orders and small packages, regarded as the most problematic and least efficient step in the e‑commerce delivery chain. These terrestrial drones are battery‑powered and drive themselves along city pavements and cycle lanes without the active intervention of a human operator. They are equipped with sensors and location technology to avoid collisions with pedestrians or street furniture, and microphones for two‑way communication.

Robots, electric trucks and trolleys with a degree of automation have been used for decades in factories and warehouses to transport products and packages or deliver mail to offices. In hospitals, fleets of autonomous robots travel for miles along corridors delivering medical supplies, patients’ meals and other goods. Warehouse and logistics sectors are increasingly automating the supply chain process to meet the growing need for accuracy and faster delivery time. Recently BMW Group has tested suitcase‑size self‑driving robotic trolleys on its factory floors in Germany, as part of an automation drive to help cut costs by 5% per car annually.

Minimizing risks with IEC standards

Autonomous delivery vehicles and self-driving cars have many safety requirements and standards in common. The primary aim is to ensure that automated systems operate efficiently and to minimize the risks to pedestrians and road users as well as goods.

Several IEC Technical Committee (TCs) and Subcommittees (SCs) draw up International Standards for the electronic systems, sensors, motors and batteries used in the driverless technology found in electric-powered autonomous vehicles.

IEC TC 69: Electric road vehicles and electric industrial trucks, prepares Standards for motors and motor controllers, on-board electrical energy storage systems, power supplies and chargers.

Since energy for smaller robot delivery vehicles is supplied mainly by batteries, TC 69 liaises closely with TC 21: Secondary cells and batteries, and its SCs, which prepare International Standards for all secondary cells and batteries. This covers the performance, dimensions, safety installation principles and labelling of batteries used for the propulsion of electric road vehicles. These batteries can be of the lead-acid, lithium‑ion, nickel-metal-hydrid or lithium iron phosphate types, for instance.

TC 105: Fuel cell technologies, prepares International Standards for fuel cell technologies which are already widely deployed in the industrial and commercial electric vehicle sector.

Now you see me

Many road-going trucks already include semi-autonomous safety features such as lane change sensors and cruise control. In Europe, all new trucks sold since November 2015 must by law be fitted with autonomous emergency braking.

The next generation of autonomous delivery vehicles is likely to incorporate even more technology already being tested in driverless cars to detect obstacles and hazards. This typically comprises GPS receivers and detailed maps to navigate roads, and a range of 3D vision guidance systems and electronic sensors including laser‑surveying systems known as Lidars (light detection and ranging). Lidar sensors fire lasers ahead and analyse the signal reflected back, scanning the road as far as 200 m ahead of the vehicle.

Other autonomous driving technology common to cars and delivery vehicles includes electronic stability control, rear‑ and forward‑view camera systems, sensor arrays to transmit data between those systems and a vehicle’s engine, transmission and brakes, and wireless communication subsystems to communicate with a controller and other vehicles.

IEC work in standardization contributes significantly to the sensors that make driverless technology possible. International Standards prepared by IEC TC 47: Semiconductor devices, and IEC SC 47F: Microelectromechanical systems, enable manufacturers to build more reliable and efficient sensors and microelectromechanical systems (MEMS). TC 56: Dependability, covers the reliability of electronic components and equipment.

Robot at your door

Battery-powered delivery robots that interact with customers via a smartphone app are being tested on streets – or rather, pavements – in at least three continents.

Estonia-based Starship Technologies, launched by two co-founders of Skype, has built a fleet of small battery-powered six-wheeled delivery robots with a payload of 9 kg. The robots can operate continuously for more than two hours between charges and are intended for short-range deliveries from local businesses in residential areas, travelling on pavements rather than roads. Tests have been carried out in Estonia, Germany, Belgium and the US, and further trials are under way in the London suburb of Greenwich. Each robot has built‑in 3G and GPS as well as an array of cameras, sensors and obstacle-avoidance software to help it detect pedestrians and travel safely up to its maximum speed of 6.5 kph. Although the robots are overseen by human operators to ensure safety, their creators say door‑to‑door delivery costs could be reduced by 10-15% compared with conventional vehicles like vans or mopeds.

Another autonomous delivery start‑up, Dispatch, is piloting the delivery of mail and packages on college and university campuses in California. Its four-wheeled autonomous vehicle can carry a load of 45 kg and is powered by a lithium-ion battery that allows 12 hours of use. Equipped with cameras and Lidar technology, this delivery robot absorbs data as it navigates along pavements and cycle paths at a walking pace, becoming “smarter” with each trip.

Australian start‑up Marathon Robotics has developed a four-wheeled autonomous vehicle that a global pizza chain is testing in Brisbane to make short‑range home deliveries. This electric vehicle can travel on both roads and footpaths and has a range of 20 km. It uses GPS to navigate and sensors including Lidar detection to avoid collisions.

A nascent market

The US technology research company Technavio predicts the overall market for mail‑sorting robots, unmanned ground vehicles (UGVs) and drones that deliver products to customers from warehouses or manufacturing locations will grow from USD 15,32 million in 2015 to USD 54,07 million by 2020.

“The evolution of autonomous UGVs is in the nascent stage as most of the vendors are testing these robots for end-user delivery solutions… If these equipment pass the testing phase, then we expect them to hit the UK and the US markets by early 2017,” Technavio analyst Bharath Kanniappan told e-tech.

This represents only a tiny share of the overall worldwide market for logistics robots. According to Technavio, the global logistics robots market is expected to reach USD 2,15 billion in the five years from 2016 to 2020, growing at a CAGR of over 32% during the projected period. This market is dominated by mobile factory logistics robots, with a share of 81,9%.

The costs of the sensors and computing power required by autonomous vehicles continue to fall. The price of semiconductor lasers used in 3D Lidar sensors, now USD 1 300, is predicted to fall to USD 150 by 2025. Hardware and computing power costs are likely to reduce further once the adoption of robotic technology in delivery services gains momentum.

Nevertheless, business research and consulting firm Frost & Sullivan does not expect to see fully autonomous trucks deployed on US roads for at least another two decades. From a global perspective, the firm predicts that some 8 000 autonomous‑enabled trucks will be sold worldwide by 2025 for on-road applications, rising to more than 180 000 units by 2035.

Gonna roll this truckin’ convoy

Meanwhile, April 2016 brought the prospect of fleets of larger self‑driving delivery vehicles sharing public roads a step nearer. Six European truck companies each drove their vehicles in connected convoys on motorways in the continent’s first major test of autonomous “truck platooning” technology.

Platooning is seen as the first step in the autonomous vehicle process, leading to greater road safety as well as cost savings. Trucks travel in convoy at very close distances behind one another and communicate with wireless technology, which allows them to brake and accelerate together, cutting down wind resistance and potentially saving as much as 20% on fuel costs. On‑board collision mitigation and cruise control systems enable the driverless heavy goods vehicles to adapt to road conditions and enhance their ability to avoid accidents.

Drones and robots in tandem

Autonomous delivery trucks and robots will transform retail and home delivery, once issues like uneven delivery paths and the possibility of theft are resolved. There is potentially a big home delivery market for supermarkets, using driverless vehicles which are smaller than the current vans used to drop off groceries. New commercial services that combine driverless vehicles and aerial drones working in tandem to deliver to “the last mile” could also significantly reduce the time and costs of transporting packages direct to customers’ doors, provided they clear regulatory hurdles.

Deploying a fully autonomous vehicle, whether a passenger car or a delivery truck, will require further advances in software as well as sensor technology. Other conditions to be met before widespread adoption can occur include legislation on liability, standardization of rules across national borders and more public debate.

The consensus among most fleet operators in the US and Europe is that large-scale full automation of trucks is still some years away. Frost & Sullivan believes that while autonomous highway driving in passenger cars could become mainstream by 2020, platoons of driverless trucks will not appear until closer to 2022.

If you enjoyed this article, you may also enjoy reading:

• Robohub Digest 11/15: Service and consumer robots catching on
• Calculating why we should make a lot more robocars
• Delivery robots from Starship Technologies
• Self-driving trucks are coming — what will that mean?

In China’s relentless state-stimulated quest to grow their robotics industry, Midea Group, a Chinese appliance manufacturer which already owns 13.5% of KUKA’s shares, has offered to buy up to 49% of the remaining shares at a 59.6% premium.

UPDATED 6/13/ & 6/16: Adjusted to reflect news from Reuters that Midea is only seeking a 49% stake in Kuka instead of a full takeover.

KUKA AG, an Augsburg, Germany-based manufacturer of robots and automated manufacturing systems, is one of the Big Four in worldwide robotics sales along with Yaskawa Electric, FANUC and ABB. KUKA also owns Swisslog, a provider of robotics and automation solutions for hospitals, warehouses and distribution centers. Kuka has had a growing presence in China including a new factory in Shanghai in 2013. Based on the share prices stated in the bid announcement, the offer calculates Kuka’s market value to be $5.2 billion.

Midea Group is a China-based manufacturer of household electronics including air conditioners, refrigerators and washing machines.

“Midea wants to build smart factories that use less labor to produce smart appliances, as China’s working population is dropping and they need to adjust to higher labor costs,” said Juliette Liu, an analyst at Yuanta Securities Co. “The company intends to use Kuka to establish a dominance over industrial robotic manufacturing techniques in China.”

Midea has been on an acquisition spree with a cash fund purported to be over $10 billion. Earlier this year, Midea acquired an 80% interest in Toshiba’s home appliance business for around $475 million and established an e-commerce unit for an undisclosed amount.

Henrik Christensen, KUKA Chair of Robotics at Georgia Tech, said:

China wants to become a major player in robotics and by acquiring KUKA they move from a fast follower to being a leader. It is impossible to buy ABB or FANUC, but KUKA is small enough that it is “easy” to do a take over. I suspect they may have to up the offer a bit, but I see it as a foregone conclusion.

In other recent Chinese acquisition of robotics news, China’s Wanfeng Auto Holding Group bought Paslin, a Michigan manufacturer and integrator of welding robots and tooling, for $302 million.

Worldwide sales of industrial robots set a new record: 248,000 units sold in 2015, 12% more than 2014. 66,700 units sold in China of which 20,400 were made in China.

Asia is still the strongest growth market with 156,000 units for the region, a 16% increase over 2014, but that figure is much lower than the 27% projected. The rate of growth of China-made robots penetrating the market also didn’t grow at the projected rate but it did grow at a healthy 31% rate.

At a press conference and CEO Roundtable held today at AUTOMATICA in Munich by the International Federation of Robotics (IFR), where these figures were presented, the consensus rationale for not meeting the overall and China projections was:

1. that the robot-assisted electronics assembly market was nowhere near as strong as projected;
2. that key components still had to be imported at high cost thereby making China’s robot makers have higher costs and higher selling prices than planned;
3. and because China’s  auto industry was over-saturated with robots and needed time to integrate them into their systems before additional orders could be placed.

The IFR, in the remarks of their President, Joe Gemma, strongly believe that manufacturing jobs will change in the new era of digitalization and Industry 4.0. Workers will focus on jobs that require judgement, common sense, creativity, problem-solving and dexterity, and be freed from repetitive tasks. Further, mobile robots will optimize materials handling; collaborative robots will assist workers in a variety of tasks; and simplification of the use of robots will enable more companies to use robots.

For 2016, 2017 and 2018, the IFR is projecting an 18% CAGR (compounded annual growth rate).

At the IERA Awards ceremony held last night in Munich, the IFR/IEEE Invention and Entrepreneurship in Robotics and Automation (IERA) award was given to ABB Robotics for their two-armed YuMi collaborative robot.

A new EU-funded, robot technology transfer partnership is looking to help manufacturing and robotics companies with robot consultancy, networking, and funding.

Four knowledge institutes across Europe — the Danish Technological Institute (DK), Fraunhofer IPA (DE), Tecnalia (ES), and the Manufacturing Technology Centre (UK) — have teamed up to offer highly qualified consulting services at no cost to companies that either want to use robot technology in their production or want to develop new robot technology to sell. This initiative is ROBOTT-NET.

The initiative will combine European competencies in state-of-the-art applied robotics, and enable companies to benefit from Danish, German, Spanish and British expertise.

ROBOTT-NET is not only about technological advances, but also about developing solid business cases, arranging contacts with relevant investors, and so on. The complete package is needed if we are to improve production, bring new ideas to market, and increase competitiveness.

European companies wishing to use or produce robots are invited to apply for a voucher, that can be exchanged for approximately 400 hours of consultancy at four partner locations. Of the 64 winning companies, eight will later be selected to receive follow-on development aid worth more than €150,000, plus, 3,500 consulting hours from the four partners.

Anyone with a concrete idea, challenge or development related to industrial robotics or service robots can apply for support in ROBOTT-NET. Large manufacturing companies, garage start-ups, and everything in between qualify.

ROBOTT-NET has already set sail with four Open Lab events across Europe with four more to follow in autumn. Stay tuned at www.robott-net.eu. At these events, you can hear more about how your company can become part of ROBOTT-NET and also see some of today’s most cutting-edge industrial robot technologies that are being developed in the European robotics labs.

You can also apply for a voucher through our website.

Industrial robots used to be dumb, somewhat inflexible, and mostly blind – but also fast, precise and very efficient.  As the cost of components, sensors and vision systems has been dropping, vision-enabled robots are becoming more prevalent and capable, and the industry is dramatically changing.

Those changes can be seen in recent trends in China, investments in and acquisitions of robotic companies, by an analysis of recent startup companies, new and widening application areas for robot use, and technological developments.

Ongoing transitions

For the past 50+ years industrial robots have picked the low-hanging fruit of manufacturing by handling the dull, dirty and dangerous tasks. But today, as consumers want more personalized products, and want them faster, and as costs have dropped and executives have pushed for greater productivity through automation, mobile and vision-enabled robots are emerging and being deployed in many new application areas, particularly for SMEs and in logistics, but also in government, agriculture, surveying, construction and healthcare.

An analysis of 752 of The Robot Report's global database of robotics-related startup companies shows that 25% of the startups were focused on industrial robotics and 75% address new areas of robotics such as: unmanned aerial, land and underwater devices for filming, marketing, delivery, surveillance, security, surveying, and for the military, science and oil and gas industries (25%); robotics for the agriculture industry (6%); mobile robots as platforms for various uses (7%); personal service bots (3%); professional service bots (7%); medical, surgical and rehabilitation robots (7%); consumer products such as for home cleaning, security, remote presence and entertainment (9%); educational and the hobby market (5%); etc. Support businesses such as AI and software, engineering and design, component manufacturing, 3D printing, vision systems and integrators make up the remainder. More than half of the startups are predominantly software based and indicative of the new metric that the hardware component represent less that 1/3 of the overall cost of the product.

The industrial robotics sector, whose revenues have represented 75% of the industry's overall sales (as reported by the International Federation of Robotics (IFR)) for the past few years, is forecast by various sources including the IFR to have double-digit compounded annual growth for the remainder of this decade. However, when one studies the figures for the biggest five user-countries, all except China are projecting CAGRs of 6% to 9% while China is expected to exceed 25%. Service robots are also expecting double-digit growth with over 80% of those new companies located in Europe and North America. This explosive growth in service robotics, plus the steady growth in industrial robotics, is suggesting that the next 5-10 years will all be double-digit years for the industry as a whole.

Certainly we've all seen some of the reports about this growth and how it will transform work. For example, Oxford Martin School researchers estimate that robotics and artificial intelligence are on track to take over 40% of the US workforce within 15-20 years either as a computer program that will be able to do what many of us do today, or it will be a machine or robot that replicates the physical process of work that we do.

With the hope of staying within the world of facts rather than forecasts, I suggest the following five trends as representing drivers propelling forward movement in the robotics industry:

Trend 1: China’s Appetites

China's economy has and continues to transition through all the economic stages of industrialization, urbanization and consumption-driven growth. This movement is both politically stimulated and self-propelling. In the realm of robotics, there are many factors driving growth: a desire to export cars requiring a level of quality that can only be provided by utilizing proven robotic automation methods; multi 5-year governmental incentive plans fostering a home-grown robotics industry; rising wages changing the metrics of human-robot deployment; and general availability of capable factory workers.

Thus China is eating up the market both as a buyer and an emerging seller. However, for Chinese companies to fully capture the robotic market within China they will have to shore up missing components that are hard to make and improve quality and precision overall. Components such as end-of-arm tools, speed reducers and harmonic drives will need to be manufactured locally instead of being imported. Many retired Japanese engineers are “consulting” to help speed up the process. Chinese venture firms are helping by acquiring international companies, investing in Chinese companies that are attempting to perfect these components, and investing in global companies and reorienting them toward sales and manufacturing in China. One good result: as the industry moves in-country, there will be less blatant thievery, copying and reverse engineering as there has been in the past.

China's government has encouraged this in-country market by providing loans and other incentives to companies and to local governments to get them to provide real estate and tax incentives. An industry plan drafted by several ministries, for 2016 to 2020, aims to have 100,000 industrial robots produced annually by domestic companies, with annual sales of 30 billion yuan ($5.4 billion) a year. Meanwhile, more than 40 new robot ­industrial parks have been built or are under construction according to the CRIA, adding that local governments established ~80 policies to support the sector.

There have been many reports about the misuse of those funds and the falsification of progress reports. The most recent is the 2015 statistics from the IFR showing that even though China did well, the rate of growth has diminished and projections have been halved. See Industrial robot sales for 2015 set new record in spite of troubles in China. Nevertheless, internalization is ongoing and progressively gaining traction. The bid for half the shares of German robot maker Kuka by a Chinese venture firm is an example. Foxconn's deployment of over 45,000 Foxbots (Foxconn's in-house brand of robots) in addition to robots from other manufacturers is another.

Trend 2: Collaborative Robots

Much has been said about the fast-growing market for collaborative robots. The most current are articles describing car companies replacing old-style industrial robots with a combination of humans and co-bots assisting humans to gain needed flexibility. The websites of Universal Robots (UR) and Rethink Robotics both contain numerous video use-cases in a variety of application areas. Bottom line: this is a viable and growing segment of the robotics industry started by UR but with competition coming from Kuka, ABB and others. 

The major benefits of these new co-bots are their flexibility, safety, ability to be rapidly deployed, and ease of training. Improvements on each of these benefits will keep pressure on pricing as can be seen by the new low-cost Franka robots and the forthcoming rebranded Roberta robot. Also, at AUTOMATICA, held in Munich this June, every robot manufacturer was touting their safe collaborative robots even when, by any stretch of the imagination, they didn't really have one.

Turning co-bots into a commodity may not be good for profits but it is good for businesses, particularly those wanting to take their first step into using robots.

Trend 3: Robotics as a Service (RaaS)

In a recent research project on robotics in the agriculture industry, a very cost-sensitive industry, many companies are offering services utilizing robots – instead of selling the robots and having the farmer operate them. Thinning, weeding, spraying, aerial imaging and analytics are examples of the services being offered.

This concept of offering services instead of the products used in providing the services is and has been a way to introduce untested products into the marketplace but many enterprising startups are finding economies of scale benefit the service provider. Using drones to capture sensor and camera data and then developing software to analyze that data and translate it into actionable plans has crossed industry boundaries and is being offered not only to ag companies but to oil and gas companies, and NGOs and governments wishing to monitor hard-to-get-to areas. Security companies are beginning to offer RaaS to supplement, augment and replace interior security, etc.

There is also a blurring of the line between real robots that perform tasks in physical space and software bots that perform a virtual robot-like service. As a consequence, many companies and service providers are going beyond offering SDKs (software development kits for the making of apps) to opening up their APIs (application protocol interface) so that these new bots can increase their scope and effectiveness and make it easier for their users. Apple just announced that they are opening up their APIs and Amazon has been encouraging developers to take advantage of their Echo and Alexa conversational voice recognition systems. This is helping many new startups offer RaaS using customized Alexa-enabled Echo-like devices. An example is the Belgium startup Zora Robotics which is using Amazon's Echo/Alexa system – and their own – in various robots to provide services into the health and eldercare marketplace.

Trend 4: Logistics and materials handling

Better and lower cost vision systems, particularly low-cost 3D vision, navigation and mobility are enabling a variety of existing and startup companies to offer enhanced material handling methods for factories, warehouses and distribution centers. During the financial crisis, capital expenditures for logistics were put off because existing systems seemed to be able to handle the load. But all that changed as we came back from the crisis and consumers wanted their products faster and warehouses couldn't keep up without massive investments in new tech, new methods and, in many cases, new vendors. Further, these new technologies had to accommodate existing facilities and systems; few companies are building new warehouses; they are instead, changing their methods and systems.

Upstarts like Amazon/Kiva, and startups like MiR, Clearpath and Fetch are joining established companies like Swisslog, Grenzebach, FMC and many others as they attempt to bring new tech to help speed up the picking process and the movement of picked items to the packing/shipping stations.

Trend 5: Investments in robotics

The Robot Report reported that in 2015 investment activity, 55 startups received funding totaling $1.32 bn; that 32 acquisitions occurred totaling $2.27 bn (for those reporting amounts); and that there was one IPO. 2016, through mid-June, shows 56 startups received $427.5 million; and that 20 acquisitions have happened thus far totaling $4.53 bn (from the 11 reporting amounts involved). If the $3.5 bn Uber funding from the Saudi sovereign wealth fund isn't objected to, and the bid for 49% of Kuka for $2.5 billion is accepted, the figures are much higher.

Of particular interest are the investments in Western robotic technology by Chinese investors: the bid by Midea to buy 49% of Kuka, KraussMaffei by ChemChina; Paslin by Wanfeng and Gimatic by Agic Capital. China is definitely on an acquisitions spree.

China is also stimulating in-country growth. For example, Tsinghua Holdings, a state-owned fund founded in 2003 by Tsinghua University, kicked off two projects announced at the World Economic Forum in Tianjin. One focuses on helping startups and the other on commercializing scientific findings. The fund will set up 1,000 business incubators in China by 2021 and another 50 in nations including the U.S., the U.K. and Germany. The size of a parent fund will exceed $3 billion.

“Our goal is to cultivate 500 startups that are valued at more than $15 million within the next five years. China is still lagging in terms of indigenous and core technologies, and there needs to be some companies to act as pioneers and push ahead with innovation.”

First the KION Group acquires Dematic for $2.5 billion and a week later Honeywell acquires Intelligrated for $1.5 billion. Earlier KION acquired Retrotech and earlier still Egemin while Kuka acquired Swisslog. What's going on?

Times are changing in logistics and fulfillment. With a greater and growing share of orders occurring online, the need for speedy fulfillment has increased and older warehousing methods are rapidly getting stressed and becoming outdated. These problems were exacerbated by the fact that businesses put off investing in material handling equipment and systems during the financial crisis years and are now buying to make up for lost time. Also, companies need to relieve the strain on their logistics systems by switching to newer technologies rather than building new facilities with all the consequent racking systems, elevators and conveyors.

The days of AGVs slowly following marked paths in carefully secured areas are gone. Mobility, vision and powerful warehouse and order processing software are the new technologies being offered by inventive new providers like Kiva Systems (acquired by Amazon), Symbotic, Dematic (acquired by KION Group), C&D Skilled (acquired by Euroimpiati), Fetch Robotics, Grenzebach, GreyOrange Robotics, Hatteland, Magazino, RMT Robotics (acquired by Cimcorp), and many others.

Thus the timing is right for consolidations and strategic acquisitions amongst the providers of older technologies and those offering newer tech.

Honeywell acquires Intelligrated for $1.5 billion

Honeywell's material handling solutions are somewhat old school providing monitoring and safety systems along with data capture and data collection hardware and software. Their use of the term mobility refers to software on smart tablets rather than mobile devices that roam around warehouses, distribution centers and factories. At the recent material handling tradeshow MODEX 2016, in Atlanta, Honeywell had a small presence showing image and laser-based data collection hardware for barcode and RFID scanning and voice-enabled workflow. 

Intelligrated has been a successful integrator of mobile and stationary robotic solutions and systems for 20+ years for manufacturing, warehousing and distribution material handling and automated storage and retrieval. With $900M in annual sales, 3,100 employees in facilities in the U.S., Canada, Mexico, Brazil and China. In recent years the company has posted double-digit year-over-year growth. Intelligrated brings a large IP portfolio of warehouse automation, order fulfillment and software solutions and has an extensive presence in North American e-commerce and the retail, and food and beverage markets.

Honeywell has money and need, particularly if they want to remain in the fast-changing logistics business, and that’s fodder for making strategic acquisitions before all the good companies get taken by others (as seems to be happening). 

The KION Group acquires Dematic for $2.5 billion

The KION Group has been on an acquisitions tear using funding from their largest shareholder, a Chinese state-owned company. Earlier this year they acquired Retrotech, a US integrator of logistics systems, and last year they acquired Egemin, a Belgian maker of warehouse AGVs. Their most recent acquisition is Dematic for which they are paying $2.5 billion.

A bit of history

The material-handling division of forklift maker Linde AG, including the STILL brand of trucks and lifts, was spun off to create the KION Group in August 2006 and was sold to investment funds KKR and Goldman Sachs in December 2006. The KION Group acquired Baoli, a Chinese lift manufacturer, in 2009. In 2012, Weichai Power (whose massive circular office complex pre-dates Apple's) acquired a 25% stake in KION Group and a 70% stake in Linde. It was, at the time, the largest direct investment by a Chinese company in a German company. In 2013, Weichai, through its subsidiary Shandong Heavy Industry Group, increased its holdings to 30%, and later purchased a 3.3% share from Superlift, the then top shareholder of KION. Weichai subsequently became the new top shareholder with an ownership of 33.3% and the right of control. Recently, the German press reported that Weichai again increased its holdings by another 5%, to a 38.25% stake, which helped Weichai cement control of the group. Weichai Power Co., Ltd is a Chinese state-owned enterprise in Shandong province specialised in the research and development, manufacturing and sale of diesel engines. Its products are used in vehicles, marine vessels and power generators.

Dematic is a manufacturer of AGVs, palletizers, storage and picking equipment including automated storage and retrieval systems, sorters and conveyors, an integrated software platform, and other automation technologies. Revenues were $1.8 billion for 2015 and have grown at a 12% CAGR since 2013. Dematic employs ~6,000 including over 3,000 engineers in software development, R&D, engineering, project management and customer service. 

Coincidentally, at the MODEX show, Dematic had the largest display area (4,000 sq ft) showcasing their AGVs and analytics software.

Kuka acquires Swisslog and then Midea acquires 49% of Kuka

In 2014, Kuka acquired Swisslog (for $357 million), a manufacturer and integrator of two distinct robotics-related activities: healthcare solutions and warehouse and distribution solutions. Earlier this year Chinese appliance manufacturer Midea made a stock offer to acquire up to 49% of Kuka and agreed to a non-takeover posture until 2023. Midea has been on an acquisition spree with a cash fund purported to be over $10 billion and a long-term perspective on their investments (as is evident in the Kuka bid). Earlier this year Midea acquired an 80% interest in Toshiba's home appliance business for around $475 million and established an e-commerce unit for an undisclosed amount. 

Bottom line

There are many reasons for the recent spate of acquisitions. Mostly they are predicated on the fact that the newer technology is better than the old and businesses using the old are feeling the need to replace. Business providers predicated on the old, such as KION's Linde and STILL divisions, or Honeywell's ancillary products, need to invest in the new methods and products and what better way (if you have the money) than by acquiring the leading vendors in the field. Underlying them all is the influence of Chinese money in China's quest to make robotics - including the logistics sub-industry - an in-country industry which is a stated goal of the Chinese government. 

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At Starship, we announced our first pilot projects for robotic delivery which will begin operating this summer. We’ll be working with a London food delivery startup Pronto as well as German parcel company Hermes and the Metro Group of retailers, plus Just Eat restaurant food delivery to trial on-your-schedule delivery of packages, groceries and meals to people’s homes.

(It’s a nice break from Tesla news — and besides, our little robots weigh so little and move so slowly that even if something went horribly wrong and they hit you, injury is quite unlikely.)

Hermes, which does traditional package delivery is very interested in what I think is one of the core values of robot delivery — namely delivery on the recipient’s schedule. Today, delivery is done on the schedule of delivery trucks, and you may or may not be home when it arrives. With a personal delivery robot, it will only come when you’re home, reducing the risk of theft and lost packages. Robots don’t mind waiting for you.

The last mile is a huge part of the logistics world. Starship robots will get you packages with less cost, energy, time, traffic, congestion and emissions than you going to the store to get it yourself. They use a combination of autonomous driving with human control centers able to remotely fix any problems the robots can’t figure out. Robots don’t mind pausing if they have a problem and our robots can stop in under 30cm. As we progress, operation will reach near full autonomy and super low cost.

((More details at the Starship press release. I am on the advisory team at Starship.))

If you enjoyed this article, you may also enjoy reading:

• Robohub Digest 11/15: Service and consumer robots catching on
• Going the last mile with robots
• Calculating why we should make a lot more robocars
• Delivery robots from Starship Technologies
• Self-driving trucks are coming — what will that mean?

Robolliance is a new forum for technology partners and industry experts. Sponsored by Sharp Electronics Corporation, the program is a place for partners and experts in “robotics, surveillance and security to advance the understanding and awareness of the Autonomous Robotics marketplace.” The Robolliance program was created to bridge the gap between end-users, sales channel technology providers, and finding information in security solutions as they relate to emerging robotics technology.

Cliff Quiroga, Vice President & Deputy General Manager for Sharp Electronics Corporation (SEC), states, “There is a growing understanding that ‘Business Robotics’ will play an expanding role in the future of automation and how companies operate. The demands on the security industry, both from a manpower and technological standpoint, are growing exponentially. Robotics is a solution for organisations to expand their surveillance coverage in a safe, reliable way and liberate manpower to focus on the more demanding, intellectual aspects of security.”

“There’s no doubt, technology is disruptive,” says Alice DiSanto, Director of Marketing for SRBD. “Simplistically, every time I upgrade my smartphone there is a feature I must get comfortable using or a glitch I may have to work through. In the case of robotics for security and surveillance, the technology will be highly disruptive and we as sponsors need to be ahead of the curve in building understanding to ease adoption, streamline implementation and help organizations in search of a security solution find answers. Robolliance can be their resource.”

More information about Robolliance can be found on their website.

The number of research reports studying the robotics industry is growing exponentially. To date in 2016 there have been 109 on subjects ranging from overly broad to very drilled-down views of the industry. Prices range from $800 to $6,500.

Below are short profiles of 62 of those reports; the other 47 can be seen here. Many of the reports duplicate the coverage of others and frequently differ in their forecasts about the future. Some of the reports are marginally useful; others are full of valuable information. Bottom line, almost all of the reports are forecasting positive double-digit growth for most segments of the robotics industry.

Consistent with previous reports, and with The Robot Report's monthly fundings, acquisitions and IPOs recaps, the drone segment has the most activity - 35 of the 109.

The official industry reports, which tabulate the results from all the robot associations around the globe, produced by the International Federation of Robotics, appear at the bottom.

Industrial robotics (9)

Frost & Sullivan, in a May 2016, 95-page $4,950 report, analyzed the top 10 technologies in advanced manufacturing and automation. Their list includes: additive manufacturing, digital manufacturing, collaborative robotics, agile robots, exoskeletons, micro manufacturing, multi-material joining, composites manufacturing, UUVs, and Maglev.

• Global industrial robotics market, February 2016, Markets and Markets, $4,650
  The global industrial robotics market is expected to reach $79.58 billion by 2022, growing at a CAGR of 11.92% between 2016 and 2022.
• European industrial robotics market, May 2016, 55 pages, TechNavio, $2,500
  The analysts forecast the European industrial robotics market to grow at a CAGR of 8.42% during the period 2016-2020.
• Industrial robotics market in APAC, May 2016, 70 pages, TechNavio, $2,500
  Forecasts the industrial robotics market in APAC to grow at a CAGR of 8.7% during the period 2016-2020 in the top 5 segments: automotive, food & bev, industrial machinery, electronics and semiconductor, and other (includes oil and gas, pharmaceutical, plastic and rubber, and heavy industries).
• Asia-Pacific robotics technology market, March 2016, 135 pages, Allied Market Research, $2,850
  An analysis of the APAC countries use and planned use by market, component and application.
• Global robot machine tools, April 2016, 69 pages, TechNavio, $,2500
  Forecasts the global robot machine tools market to grow at a CAGR of 5.13% during the period 2016-2020.
• Global rubber & plastic industrial robotics market, May 2016, 53 pages, TechNavio, $2,500
  Predicts the global industrial robotics market in the rubber and plastic industry to grow at a CAGR of 18% through 2020.
• Global assembly robots, April 2016, 196 pages, Grace Market Data, $2.980
  Global assembly robots market is expected to see fast growth and rapid change during the period 2016-2022.
• Global welding robots, April 2016, 199 pages, Grace Market Data, $3,600
  Annual shipment and sales revenue in this sector are expected to see two-digit CAGRs over the period 2016-2022.

Professional service & military robots (7)

• Security robots, June 2016, 174 pages, Markets and Markets, $5,650
  The global security robots market was valued $1.34 billion in 2015 and is forecast to reach $2.36 billion by 2022, at a CAGR of 8.56% between 2016 and 2022.
• Global construction robots, May 2016, TechNavio, $2,500
  The global market for construction robots will exhibit steady 5% CAGR growth during the forecast period to 2020.
• Global military robots, April 2016, 72 pages, TechNavio, $2,500
  Forecasts the global military robots market to grow at a CAGR of 9.36% during the period 2016-2020.
• Global PR robots market, May 2016, 56 pages, $2,500, TechNavio
  The report predicts the global public relation robots market to grow at a CAGR of more than 26% through 2020.  One of the primary drivers for this market is the rising need to improve productivity and efficiency in the hospitality sector.
• Global educational robots market, May 2016, 57 pages, $2,500, TechNavio
  Predicts the global educational robots market to grow at a CAGR of more than 21% through 2020.
• Global service robotics, December 2015, Markets and Markets, $4,650
  Expected to grow from $6.97 billion in 2014 to $18.02 billion by 2020 at a CAGR of 17.36% between 2015 and 2020.
• Global entertainment robots, July 2016, 54 pages, TechNavio, $2,500 
  The global market for entertainment robots and guides will grow at a CAGR of over 20% from 2016 to 2020.

Mobile & collaborative robots (4)

• Global collaborative robots market, June 2016, 200 pages, Grace Market Data, $3,800
  Market is expect to witness an exponential growth, with annual shipment and sales revenue from hardware and software growing at more than 42% annually through 2022.
• Global mobile robotics, April 2016, 98 pages, TechNavio, $2,500
  Forecast the global mobile robotics market to grow at a CAGR of 12.21% during the period 2016-2020.
• AGVs by vision method by use, May 2015, 141 pages IndustryARC, $5,250
  Notes that battery-less AGVs are gaining market momentum because AGVs can work longer shifts without recharging.
• Unmanned surface vehicles, April 2016, 157 pages, Markets and Markets, $4,650
  The Unmanned Surface Vehicle (USV) market is projected to grow from $437.57 million in 2016 to $861.37 million by 2020, at a CAGR of 14.51%.

Emerging technologies (4)

• 5G and robotics, July 2016, 65 pages, Mind Commerce, $995
  The 5G-enabled autonomous robot market (which includes robotics, IoT, big data and analytics, and AI companies) is forecast to reach $14.6 billion by 2030. North America will lead the 5G-enabled autonomous robot market with a 41% revenue share.
• Smart machines market, May 2016, 54 pages, TechNavio, $2,500
  Forecasts the smart machines market in the Americas to grow at a CAGR of 14.96% during the period 2016-2020.
• A.I. market by technology, February 2016, 150 pages, Markets and Markets, $4,650
  Artificial Intelligence market forecast to grow from $419.7 million in 2014 to $5.05 billion by 2020, at a CAGR of 53.65% from 2015 to 2020.
• Global robotic software platforms market, May 2016, 54 pages, TechNavio, $2,500
  Forecasts the global robotic software platforms market to grow at a CAGR of 4.17% during the period 2016-2020.

Remote presence robotics (2)

• Teleoperation & telerobotics in industrial IoT, April 2016, 67 pages, Mind Commerce, $1,995
  Overall robotics market for industrial IoT will be worth $45.73 billion by 2021.
• Global telepresence robots, June 2016, 57 pages, TechNavio, $2,500
  The global telepresence robots market is forecast to record a CAGR of more than 53% until 2020.

Material handling and logistics (4)

• Automated material handling market, June 2016, 108 pages, Knowledge Sourcing Intelligence, $4,200
  Automated material handling market - including robotic solutions - estimated to be worth $18.55 bn in 2015 and will expand to $33.6 bn by the end of 2021 at a CAGR of 10.4%. 
• Global logistics robots industry, June 2016, 153 pages, Big Market Research, $2,000
  Forecasts that the sector will register a 32% CAGR through 2020.
• Global material handling robots, April 2016, 217 pages, Grace Market Data, $3,800
  Unit shipments and sales revenue for the material handling robots sector are forecast to be two-digit CAGRs over the period of 2016-2022.
• US warehouse robotics industry, March 2016, 131 pages, QYResearch, $3,800
  Includes profiles of Amazon, Hitachi, Swisslog, Hi-tech Robotic Systemz, GreyOrange and Fetch Robotics.

Self-driving vehicles and systems (2)

• Global truck platooning systems, June 2016, 71 pages, TechNavio, $2,500
  Truck platooning is perceived as the future of the transportation industry. Multiple trucks travel at an aerodynamically efficient distance and drive cooperatively by maintaining the distance. EU holds a clear lead for truck platooning by 2025.
• ADAS Market, February 2016, 200 pages, BIS Research, $3,999
  ADAS (advanced driver assistance systems include automated cruise control, parking assistance, collision avoidance, rear view, blind spot detection, speed control, driver drowsiness alert, etc.) shipments expected to reach 60.5 million units by 2022.

Agricultural robots and drones (5)

• Ag drones market, June 2016, 166 pages, Markets and Markets, $4,650
  The agriculture drones market Is forecast to reach $4.2 billion by 2022.
• Global precision ag market, February 2016, 234 pages, BIS Research, $3,999
  Industry to grow to over $7.6 billion by 2022.
• Global agricultural drones and robots market, April 2016, Infinium Global Research, $4,795
  Global agricultural drones market is expected to surpass $3.5 billion while agriculture robotics market is expected to exceed $8.1 billion by 2021.
• Agricultural drones, Apr 2016, 288 pages, WinterGreen Research, $4,100
  The worldwide market for agricultural drones was $494 million in 2015 and anticipated to reach $3.69 billion by 2022.
• A.I. in the ag industry, April 2016, 31 pages, Frost & Sullivan, $1,500
  Describes A.I. use cases in 5 areas of ag: precision ag, ag drones, vertical farming, driverless tractors, and open data. Forecasts that all ag providers will become technology providers.

Healthcare/Surgical robots (3)

• Robotic surgery market, June 2016, 51 pages, Koncept Analytics, $800
  Image guided laparoscopic control, rehabilitation robotics and expanded use of robots in general surgery are on the rise but expansion is hindered by effect of soft tissue challenges, challenge of laparoscope control, and regulatory risk.
• Wearable robots and exoskeletons, May 2016, 453 pages, Wintergreen Research, $4,100
  Wearable robots and exoskeletons, at $36.5 million in 2015, are anticipated to reach $2.1 billion by 2021.
• Global medical robotics, March 2016, 122 pages, Intelliroi, $4,025
  Global medical robotics market is expected to reach $11.4 billion by 2020 from $4.3 billion in 2015 at a CAGR of 23.2%.

Commercial & Military UAV/UAS market (20)

Trends for drones show an increasing adoption of hybrid-fueled drones; a growing adoption of nano drones; increasing mergers, acquisitions and consolidations; emerging drone insurance; declining selling prices; rising product bundling; and increasing regulations for commercial drones.

Military drones

• Global military airborne collision avoidance systems (ACAS) market, June 2016, 75 pages, TechNavio, $2,500
  The report forecast the global military ACAS market to grow at a CAGR of 4.5% during the period 2016-2020.
• Global military UAV market, June 2016, 165 pages, Strategic Defence, $4,800
  Global military UAV market will grow at a CAGR of 4.89% to $13.7 billion by 2026.
• Military & commercial drones, June 2016, 185 pages, Mind Commerce, $1,995
  Press release didn't provide any teaser or forecast information.
• Global VTOL UAS market, April 2016, 71 pages, TechNavio, $2,500
  The global vertical take-off and landing (VTOL) unmanned aerial vehicle (UAV) market to grow at a CAGR of around 11% through 2020.
• Military drones market, April 2016, 868 pages, Wintergreen Research, $4,100
  The worldwide market for military drones is $4.4 bn in 2015 and forecast to Increase to $6.8 bn by 2022.
• UCAV - unmanned combat aerial vehicles, March 2016, 44 pages, Strategic Defence Intelligence, $1,950
  Demand for UCAVs will be very high or high in the US, China, and the UK over the next five years.

Commercial non-military drones

• Global commercial drone market, May 2016, 250 pages, TechSci Research, $3,700
  The global market for commercial drones is projected to grow at a CAGR of over 27% during 2016-2021.
• Civil UAS market, April 2016, Frost & Sullivan, $1,500
  The civil unmanned aerial systems (UAS) market is growing rapidly as public agencies are exposed to the benefits of aerial photography, video, and other sensing capabilities.
• UAV payload and avionics market, May 2016, 131 pages, BIS Research, $3,599
  UAV payload and avionics market to grow at a CAGR of 8.3% from 2016 to 2022 and reach over $3.9 billion by the end of 2022.
• Drones for wind turbine inspection, November 2015, 69 pages, Navigant, $4,600
  Revenue for wind turbine UAV sales Is forecast to total $6 billion by 2024; support and inspection services $1.6 billion.
• Smart autonomous flight technology market, April 2016, 212 pages, Wintergreen Research, $4,100
  The worldwide market for smart drone technology (cameras, auto pilots, collision avoidance systems, communication systems, etc.) was $137M in 2015 and is forecast to reach $2.7 bn by 2022.
• Public safety drone market, May 2016, 20 pages, Arcluster, $2,450
  Market for search and rescue and public safety drones is forecast to grow at 127% through 2021.
• Consumer drones, June 2016, 66 pages, Tractica, $3,800
  Forecasts the segment to reach a market value of $5.0 bn by the end of 2021 and that worldwide consumer drone unit shipments will increase from 6.4 million in 2015 to 67.7 million units annually by 2021.
• Consumer camera drones market, April 2016, 881 pages, WinterGreen Research, $4,100
  The worldwide market for camera drones is $2 billion anticipated to reach $21.5 billion by 2022.
• First responder UAVs, January 2016, 344 pages, Market Info Group, $4,950
  Report combines a market and technology forecast with an operating concept and buying guide for the first responder industry.
• Sensors for drones and robots market, March 2016, Yole Development, $6,250
  The sensors for drones and robots market is expected to grow at a CAGR of 12.4% from 2015 to 2021, reaching a total revenue of $709M by 2021. 
• Small drones market, April 2016, 156 pages, IndustryARC, $5,250
  Small drones include medium, micro, mini and nano-sized drones but all vendors seem to be multi-rotor.
• UAV propulsion market, May 2016, 121 pages, BIS Research, $3,599
  The UAV propulsion market is forecast to capture a market value of $2.7 billion in 2015 with gas turbine engine segment the highest share followed by piston, wankel, solar power, electrically powered and hybrid systems.
• Drone transponders, June 2016, 268 pages, Wintergreen Research, $4,100
  The worldwide market for drone transponders is forecast to Start from zero and reach $2.5 billion by 2022.
• LiDAR drone market, May 2016, 125 pages, Markets and Markets, $4,650
  The LiDAR drone market was valued at $16.1 million in 2015 and is expected to reach $144.6 million by 2022 at a CAGR of 35.2% between 2016 and 2022.

The official industry research reports (2)

The fact-based backbone for many of these research reports is the International Federation of Robotics (IFR) annual World Robotics Industrial Robots and World Robotics Service Robots reports. These two books represent the official tabulation from all the robot associations around the world.

The 2016 reports cover 2015 activity. The two 2016 reports can be purchased for $2,000. The reports will be published later this summer.​

Read more

Re-joining the ranks, Sony announced a return to robotics. Momentum is opening a robot hamburger shop. And Starship is beginning to deliver food to three cities in Europe.

Sony

At a recent stockholders meeting, Sony Chief Executive Kazuo Hirai said that Sony, a conglomerate that has divisions in finance, network services and entertainment in addition to hardware, planned to move toward a more ambitious future and that robotics will play a role in that journey.

“We need to push the envelope to really grow Sony into other parts in all of the electronics business, where we know we could make a difference,” Mr. Hirai told The Wall Street Journal, in an interview. “You can have all these great services and content, but there is a device you need to enjoy it, or actually to feed information to the network,” he said.

Hirai also said that Sony is planning a new wave of consumer robots that will be able to bond with humans, suggesting that Sony will begin selling a competing line of products to SoftBank Robotics’ Pepper home robots, Jibo, and Amazon’s Alexa line. Sony already has an extensive electronics line including GoPro and drone add-on gimbals, cameras and other devices.

Years ago, Sony developed the Aibo robotic dog – a charming interactive product that sold 150,000 units from 1999 to 2006. Toward the end, Sony upgraded Aibo to use a camera to recognize its owner and added extra personalities to its repertoire of moves and responses. Competing companies, particularly Dongbu Robot, a Korean company, use newer technology — and lower costs — to offer Aibo-like toy robot dogs.

The business model for new Sony robotic products involves selling a robot that requires a reoccurring subscription service for data and maintenance with frequent software updates, a similar plan to Pepper.

Momentum Machines

A June San Francisco area Craigslist ad advertised for a restaurant generalist to work at a Folsom Street store selling robot-made hamburgers. The store, at 680 Folsom Street, is on the ground floor of a 14-story office building, south of Market Street in the heart of San Francisco.

“This location will feature the world-premiere of our proprietary and remarkable new advances in technology that enable the automatic creation of impossibly delicious burgers at prices everyone can afford. The burgers sold at 680 Folsom will be fresh-ground and grilled to order, served on toasted brioche, and accented by an infinitely personalizable variety of fresh produce, seasonings, and sauces.” [Editorial comment: Wow! What a mouthful!]

SF is home to the popular automat-style restaurant Eatsa which takes orders for quinoa bowls via iPad and places them in cubby-holes ready for payment and pickup. The ordering process for Eatsa is to walk up to an iPad and construct and pay for your order whereupon it gets delivered to a cubby earmarked for you. It is likely that Momentum plans something similar for its new as-yet unnamed hamburger store, perhaps with a more personal delivery method combining other items like drinks and fries.

Starship Technologies

Starship, an Estonian startup funded by two of the founders of Skype, has been testing a mobile delivery robot in 12 countries for the last nine months. The devices have traveled 5,000 miles and met over 400,000 people, according to Starship’s Marketing and Comms Manager:

“We have learnt a lot in those 5000 miles of testing!  We learned that 60-65% of people don’t pay the robot any attention. The robot integrates in public life a lot easier than we thought it would. The remaining % of people are overwhelmingly positive. We were also, of course, trialing the technology and the reliability of the robots. In all of these tests, we were pleasantly surprised.

The tests were conducted mainly in Tallinn, Estonia and London. We also tested in many other countries including the US, Switzerland, Germany, Belgium, Austria, Spain, etc.

[Regarding our new trial], we haven’t changed much, apart from putting more robots onto the streets for testing. We want to increase the number of miles driven on sidewalks around the world to get even more accurate data.  The major difference between our new testing program in UK, Germany and Switzerland is that, for the first time in our history, we are signing up commercial partners like Just Eat. This enables us to enter into a new phase of testing and start doing real world deliveries in real world environments.

[In answer to a question as to the cost of the robot devices] We are a delivery company, and therefore it is unlikely we will be selling the robots. We will be providing a delivery service which includes the robots, the maintenance, the human oversight and everything in-between! All for a monthly fee!”

Starship will be working with London food delivery startup Pronto as well as German parcel company Hermes and the Metro Group of retailers, plus, Just Eat restaurant food delivery to trial on-your-schedule-delivery of packages, groceries and meals.

Since the announcement of the month-long tender offer by Midea to buy 49% of the shares of German robot maker KUKA AG – and private negotiations – Midea now has 85.69% of the shares.

The offer was predicated on KUKA AG having a market value of $5.2 billion, a 58% premium over the share price on the day before the announcement. At that point, Midea already owned 13.51%.

To help that offer, KUKA and Midea negotiated an agreement whereby KUKA got assurances that jobs and plants in Germany will be protected until the end of 2023 and Midea agreed not to pursue a domination agreement or de-listing of KUKA’s shares. As a result, KUKA’s management endorsed the arrangement and their two biggest shareholders tendered their shares to Midea. The public tender, plus the two big shareholders, gave Midea 72.18% of the shares. Combined with what they already owned, Midea now has 85.69% ownership of KUKA.

On July 21, through August 3, Midea announced another tender offer – with the same valuation and share price – to acquire as many more of the shares as possible.

Bloomberg reported that:

“From Midea’s point of view, the more the better. If Midea can get total control it would be greatly beneficial for their plans to expand Kuka’s business in China,” said Juliette Liu, an analyst at Yuanta Securities Co.

“We have reached an important milestone in the expansion of our partnership with Kuka, which offers great value-creation potential for both companies. The investor agreement between Kuka and Midea sets out the future cooperation in detail. We want to help Kuka to grow and expand the business, especially in China,” said Paul Fang, chairman and chief executive officer of Midea.

Bottom Line:

China’s government has sponsored aggressive 5-year plans to make the robotics industry in China one in which domestic companies provide the majority of robots and to change the overall status of manufacturing in China by 2025 to be high tech and high quality instead of low price and labor intensive. At present, in most cases, and particularly regarding robotics, the reverse is the case. Thus this acquisition by Midea of one of the Big Four of global robot manufacturers goes a long way toward bringing high tech and high quality in robotics to China by a now-Chinese-owned highly-thought-of robot manufacturer.

Catch up with past winners: CleverPet (2015), Preemadonna/Nailbot (2015 runner-up), and Leka (2014).

Will you be our next Robot Launch winner? There’s 25 days left to register! You can register by going to 2016 Robot Launch global online startup competition.

Grand prize winner (2015): CleverPet

CleverPet is a smart dog feeder that lets you play, teach, and connect with your pet all day. More than just an automatic dog feeder, CleverPet teaches your dog games, dispenses rewards, and adapts the gameplay as your pet gets more skilled. Robot Launch judges said they picked Cleverpet because they were “a polished company that is poised to serve a big market that people take seriously,” noting that the CleverPet’s adaptability and focus on play distinguishes it from other robotic pet products, and that the team understands the needs of both pets and their owners. CleverPet received a prize combination of $5000 in cash and $5000 in Amazon Web Services, courtesy of c/o CSIRO, SMBC, iRobot.

Since winning last year, CleverPet was unveiled to the public at the Consumer Electronics Show (CES), January 2016. Co-founder Leo Trottier successfully pitched CleverPet to a delighted and enthusiastic crowd, winning first place in the startup pitch battle.

The CleverPet Hub will be sold through their website, although they are not accepting orders yet. But you can sign up to receive an email for when they start accepting orders. The price of the Hub will be $299 (USD).

1st Runner Up (2015): Preemadonna

Preemadonna designed a nail decorating robot aimed at girls and young women. Nailbot uses Hewlett Packard thermal technology, computer vision and a smartphone to allow you to paint custom designs on your fingernails.

Since being awarded 1st Runner Up, Nailbot has amassed a collaborative community of testers, hackers, designers, and nail art fans—early adopters and recruits via the Preemadonna Ambassadors program. Walia has also partnered with nonprofit partners like Maker Girl to help test, design for, and the get the word out. Nailbot is currently in beta, with a limited trial release heading out later this year, after that, they’ll head into mass production. There’s a waitlist to join. Currently, the waitlist has over 20,000 people, and will be doing a preorder campaign September 2016.

From The Creators Project:

“Nailbot is an awesome product, but it’s really platformed by our mobile experience. And it will just get better and better over time the more girls and boys we have using the Nailbot and contributing to our marketplace,” said Walia.

They also recently won The Audience Award, selected by Embedded Vision Summit attendees, based on innovative vision-based products in the inaugural Vision Tank competition.

Grand Prize winner (2014): LEKA

LEKA is a robotic toy that helps autistic children learn to regulate their own emotions through play. The robotic companion is designed specifically for children with special needs, to sparkle their motivation and help them learn, play & progress.

After a recent successful Indigogo campaign, Leka Inc. (formerly Moti) developed a product roadmap for full-scale development. They plan on ensuring that the first version of LEKA meets all safety and security standards for American and European markets:

• July 2016 – Releasing the first manufactured prototype.
• November 2016 – Release the second improved and optimized manufacturing prototype.
• December 2016 – The last prototype will be released just before Christmas as we want to present LEKA to Santa’s workshop.
• January 2017 – LEKA will need to go through the validation process. The production of the pre-series products will start in February.
• April 2017 – Beginning manufacturing for the finished products.
• May 2017 – LEKA will finally be wrapped and delivered to your door.

You can also register at leka.io to keep in the loop for when they officially launch.

Will you be our next Robot Launch winner? Register at 2016 Robot Launch global online startup competition. Pitch your robotics startup online to an audience of top VCs, investors and experts, with live finals in Silicon Valley.

Entries close August 15.

If you enjoyed this article, you may also want to read:

• Meet the winners of #RobotLaunch2015
• One year later: Update from Leka, Robot Launch 2014 Grand Winner
• Robot Launch global robotics startup competition announces top 15 finalists

Despite all the high-profile billion-dollar acquisitions, eg: ARM by SoftBank, KUKA by Midea and Uber China by Didi Chuxing, M&A are down 19% this year according to both Forbes and CB Insights. 

Buyers are buying, but they are seeking cash-positive market-realistic targets. Values (both monetary and vanity) are taking a hit. What’s a startup to do? According to CB Insights, startups can (1) get bought at a lower valuation and take the hit; (2) lower their cash burn rate and play the long game;  or, (3), if they already have strong fundamentals and good growth, continue on.

Nevertheless, July's fundings and acquisitions were substantial, and this month we've added a new ancillary category (Related fundings) to give an indication of the level of funding in AI and deep learning startups.

Acquisitions

• Update: When General Motors announced in March that it was buying Cruise Automation, Forbes reported that the undisclosed purchase price was just over $1 billion. GM chief financial officer Chuck Stevens said in a recent earnings call that it only paid out approximately $600 million (split between cash and stock). Payouts above the $600 million ― including earn-outs related to commercial or technological milestones which are estimated by Forbes to be around $400 million ― are being considered by the company to be employment costs instead of acquisition costs. 
• 5D Robotics acquired Time Domain, a provider in Ultra-Wideband (UWB) product development and services, for an undisclosed amount. 5D has partnered with Time Domain since 2012, adapting the latter's PulsON® ranging radios into precision autonomous navigation and positioning solutions for a wide variety of air and ground vehicles. The transaction strengthens the combined entity's position in vehicle autonomy through a combination of products, intellectual property (over 100 patents), and a staff of over 50 people.
• In a move similar to the 2015 deal where Uber hired almost the complete staff of CMU's NREC, Toyota hired the entire 16-member software engineering staff of Jaybridge Robotics, the company providing software automation of industrial vehicles across a range of industrial applications including agriculture, mining, marine, and rail.  Jaybridge-engineered autonomous systems have logged thousands of hours in the hands of end-users. Jaybridge Robotics, Inc. remains an independent company and will continue to provide support for existing clients.
• Permira, a European private equity firm and the owner of Intelligrated, a Mason, Ohio-based provider of fulfillment solutions, sold its shares to Honeywell for $1.5 billion in cash. Toyota Industries was also bidding on the deal. Permira acquired the company in 2012 for approximately $500 million. 
• Voith agreed to sell its 25.1% stake in German robot maker Kuka to China's Midea thereby cinching the takeover even before the close of the initial tender offer. KUKA and Midea negotiated an agreement whereby KUKA got assurances that jobs and plants in Germany will be protected until the end of 2023 and Midea agreed not to pursue a domination agreement or de-listing of KUKA’s shares. As a result, KUKA's management endorsed the arrangement and their two biggest shareholders (Voith being one) tendered their shares to Midea. The public tender, plus the two big shareholders, gave Midea 72.18% of the shares. Combined with what they already owned, Midea has 85.69% ownership. From July 21, through August 3, Midea announced another tender offer - with the same valuation and share price - to acquire as many more of the shares as possible. Read more.
• Google bought French Moodstocks, a visual recognition machine learning technology company for an undisclosed amount. Moodstocks' engineers and researchers have been developing new algorithms for visual recognition of objects, particularly those viewed by cameras in mobile devices.

Fundings

• Wonder Workshop, a Sunnyvale, CA-based maker of robots that teach kids computer science and coding fundamentals, raised $20 million in Series B funding. WI Harper Group and Idea Bulb Ventures co-led the round, and were joined by Learn Capital, Charles River Ventures, Madrona Venture Group and TCL. 
• UBTech (Union Brother Technology), a Shenzhen startup developing small consumer humanoid robots, got $100 million in a Series B funding round led by CDH Investments with CITIC Securities. UBTech's new $1,300 Alpha2 robot is getting lots of media attention and is going on sale in time for Christmas.
• Cambridge Medical Robotics, a UK developer of a robotic system for keyhole surgery, has raised $20 million in Series A funding. Backers include LGT Global Invest, ABB Technology Ventures and Cambridge Innovation Capital.
• Civil Maps, an Albany, CA developer of high definition 3D maps and centimeter-level localization, got $6.6 million in a seed round from Ford, Motus Ventures and three others.
• Autonomous Marine Systems got $1.6 million in a seed round (in February) that enabled a $1.9 match-grant funding with all the funds going towards fulfilling DoD contracts to provide long duration ocean observation.
• Flyability, got $4.3 million from a Series A funding from MKS Alternative Investments, Go Beyond Investing, and Environmental Technologies Fund. Flyability, a Swiss startup, develops Gimball, a collision-proof drone. Flyability hopes to enable new applications in inspection, rescue and security.

Related fundings

According to TechSci Research, the artificial intelligence (AI) industry is projected to grow at a CAGR of around 75% during 2016-2021. Continuous research and development in healthcare, autonomous vehicles, security and access control, robotics-as-a-service, agriculture, cyber security, and other verticals are expected to fuel the growth as are smart wearables, and the head-up display screen market. Frost & Sullivan’s report about deep learning enabling the unraveling of layers of patterns in data is also propelling the AI boom. This is where it becomes really interesting both users and makers of robotics. Frank Chen, a partner at Andreessen Horowitz, the Silicon Valley venture capital and private equity firm, said of deep learning: 

It is absolutely non-controversial that deep learning is the most fundamental advance in A.I. research since the start [of A.I.] in 1956. We [Andreessen Horowitz] think A.I. and deep learning can be a fundamental and technology platform shift as mobile and cloud have been in the last 5-10 years... All the serious applications from here on out need to have deep learning and AI inside in exactly the same way that all serious computing systems needed to have Intel chips inside of them. I think now about the startups that we see, that deep learning needs to be inside these new systems as a fundamental technique that we expect to see in all serious applications moving forward.

Read and view more about deep learning. With Frank Chen's words in mind, the following companies which got funded recently are blurring the line between robots, robotics and bots powered by AI, cloud computing, and deep learning analytics:

• Prospera is an Israeli startup collecting and providing tools to help growers understand newly available data using computer vision, data science, and machine learning to monitor and analyze crops. Prospera raised $6.75 million in Series A funding in a round led by Israeli VC Bessemer Venture Partners.
• Kimera Systems, a Oregon-based developer of an embedded learning AI, got an undisclosed amount of seed funding. Kimera’s Nigel fuses together a broad range of soft and hard sensor data, achieving moment-to-moment contextual awareness, allowing it to learn and apply what it understands to real-world situations, much like a human does.
• FiveAI, a UK start-up using artificial intelligence and machine learning to accelerate the arrival of fully autonomous vehicles, got $2.7 million of equity funding in a round led by Amadeus Capital Partners.
• Vision Labs, a Russian vision systems startup, raised  $5.5 million in a Series A round from Sistema Venture Capital. VisionLabs will use the funds to improve its face recognition technology, ramp up sales and expand into new markets including the US, Europe and Asia. The company’s core product is a recognition platform - VisionLabs LUNA - which allows near real-time recognition of millions of faces from video and photo streams in order to identify people.
• FogHorn Systems, a developer of IoT software for industrial and commercial vertical markets, got $14.5 million in Seed and Series A fundings from March Capital, GE Ventures, The Hive and the VC arms of Bosch, Darling and Yokogawa Electric. FogHorn is developing edge intelligence AKA "fog computing”. The company's fog computing platform is a critical enabler for a new class of powerful real-time analytics, machine learning models and edge computing applications in a wide variety of industrial and enterprise use cases.

Failures

• NavCPU, a Russian mobile robotics startup

Read more

Spin-offs are disrupting but often necessary. Here are two recent examples: iRobot sold off its Defense & Security Business Unit to a private equity firm, and Harvest Automation sold the IP and work in process of its warehousing robot group to a new venture-backed startup.

iRobot sells Defense & Security Business Unit to Arlington Partners

iRobot's Defense & Security Business Unit, according to their annual report, averaged $50 million in sales for three years in a row (2013, 2014 and 2015) while home robots rose from $428 million to $560 million during the same period. The defense unit had difficulty as the wars ended in Iraq and Afghanistan and the DoD and DARPA reduced spending. Simultaneously iRobot was being hounded by activist shareholders to rid itself of the unit so that it could focus on the consumer market. This led to a heated proxy fight about adding activist board members. iRobot won that fight but also announced that it had changed its strategy and decided not to pursue DoD funded research.

iRobot appears to be going about ridding itself of non-consumer products and services. In February 2016, iRobot reached a deal with Arlington Capital Partners, a DC-based private equity firm focused on DoD and government vendors, to sell the unit to Arlington for $45 million. The deal was concluded in April when Arlington established a new company, Endeavor Robotics, manned by the 100-person iRobot staff and Defense Unit executives, and housed in the same but separate facilities adjacent to iRobot.

Less publicized but similarly focused on getting the company 100% into the consumer market was the announcement by iRobot that they were planning to "end our remaining Remote Presence marketing and business development initiatives. As we reported on our Q4 2015 call, we had already reallocated R&D resources, from a next generation Remote Presence platform, to consumer opportunities. Going forward, 100% of the company’s resources will be exclusively focused on the consumer." Their Remote Presence Unit consisted of the AVA line of mobile robots and their joint ventures with InTouch Health and Cisco. When I asked what this meant, iRobot responded:

During the second quarter, iRobot made the decision to end its remaining Remote Presence marketing and business development initiatives – ending the productizing of Ava 500. While iRobot believes that there is a future in remote presence, the Ava 500 market didn't develop fast enough to justify sustaining the ongoing investment. As iRobot previously reported on its Q4 2015 investor call in February, the company had already reallocated Remote Presence R&D resources, from a next generation Remote Presence platform, to consumer opportunities.

As iRobot’s greatest opportunities currently lie in developing robotic solutions for the home, the company must put its focus toward this effort to reach its full potential. Going forward, 100% of the company’s resources will be exclusively focused on the consumer market.

Through its venture unit, iRobot has invested in 6 River Systems, a startup attempting to provide a warehousing solution to the problems caused by Kiva Systems and their novel goods-to-man mobile robot system taken in-house by Amazon and becoming unavailable to all others. That iRobot investment, plus their forthcoming robotic lawnmower, and their new arrangement with Amazon Cloud Services, which may enable connected home access for iRobot products, all offer new commercial opportunities for growth. Also, their new Shanghai facility and Asian e-commerce operation are coming online and they have high hopes for both of those activities.

Endeavor Robotics

“Our team is developing innovative new technology that will propel our growth, as well as actively reviewing acquisition opportunities that will continue to position Endeavor Robotics as an industry leader. The U.S. Department of Defense is planning at least three major ground robot program acquisitions in the next few years. Based on our combat-proven platforms and leading technology, Endeavor Robotics is well-positioned for all three. We anticipate substantial growth over the next several years, both domestically and with our international customers," said Tom Frost, President of Endeavor Robotics.

“As an independent company dedicated to tactical robotics, Endeavor Robotics will have new flexibility to meet the needs and protect the lives of our customers serving on the frontline and in dangerous environments. We’ve always done our best work when we worked closely with our customers. Our new structure enables us to double down on that strategy. We believe that the future is in open architecture and collaborative solutions and we look forward to making that a reality.”

Shortly after the transfer and their opening vision statements, Endeavor announced two strategic partnerships with RE2 Robotics and Persistent Systems. Both arrangements appear to be geared toward winning the DoD's three upcoming ground robot proposals.

1. The former deal is to integrate RE2's manipulator with Endeavor's robots. “The direct benefit of IOP compliant payloads is that it enables developers to concentrate on their specific areas of expertise. The state of the art manipulation technology that RE2 develops can be easily integrated on Endeavor’s robotic platforms, quickly getting the best capabilities to the warfighter,” stated Jorgen Pedersen, president and CEO of RE2 Robotics. 
2. The latter integrates Persistent's MPU5 radios into Endeavor's robots. Persistent Systems’ Wave Relay MANET technology, enables operators of Endeavor robots to Increase operational range in urban areas and other radio-challenged environments, by providing operators and supporting personnel views of real-time video and telemetry feeds from all robots within the MANET, and enabling a more secure network to protect information through advanced cyber-security protocols.

Although Endeavor hasn't announced any new contracts thus far, there was a year's worth of existing DoD contracts transferred with the sale/spin-off plus they have Arlington Capital to help with funding.

Harvest Automation sells assets, prototypes and IP to NextShift Robotics

Throughout 2015, for a year and a half, Harvest Automation split their energies between their business in agricultural field robots that transported and positioned potted plants, and a new, flexible material handling robot, in a new and separate work division. The new robot would work in factories, warehouses and distribution centers. The results of this new division's efforts were uncertain, optimistic, and costly. During those 18 months the ag business went dormant and key people left. Joe Jones, one of the founders and CTO, left to lead a startup developing a robotic weeding device for home gardens. Others joined Harvest to help transition the single-purpose field robot with a limited skill set into a multi-purpose, self-navigating, material handling robot in an even bigger warehousing pick-and-transport system. MaryEllen Sparrow came with a background in warehousing and distribution center software to head up the software development team. 

Funding got hard because the transition was taking longer and costing more than expected and their first product demonstrations left much to be desired. Although the agricultural side of the business, headed by Charlie Grinnell, was self-sufficient, it didn't generate enough money to fund the warehousing robot project, and the company, in order to stay afloat and preserve the ag business, decided to sell off the assets, intellectual property and prototypes for the material handling operation for an undisclosed amount a few angel investors including Sparrow.

Harvest Automation and its now-strictly ag business is attempting to recover from being inactive for so long, and is also developing new ag services such as helping pickers by moving their harvested items to the packing station and bringing them containers. Harvest Automation is hoping to expand its target audience from nurseries to vegetable and fruit growers.

NextShift Robotics

NextShift Robotics is the entity created by the angel investors that acquired the IP and prototypes. MaryEllen Sparrow became the CEO. She and a very small team are working to get their new robots to be able to take a tote and transport it from point to point as directed by an elaborate warehouse management and ordering system. This involves improving their method of navigation, their approach to getting goods onto the robot's carrying platform, and the warehouse management and ordering system control and integration software.

NextShift expects to trial their new creation later this year at a couple of pilot warehouse locations.

Read more

To many workers, the words “digital technologies” may evoke one simple, dismaying image: a human-like robot sitting at their desk, doing the work that they used to do! This anxiety is not different from the fear of coachmen witnessing the diffusion of cars in the 1920s. In a sense, coachmen were right: cars did replace horse coaches. However, their children and grand-children found new and often better-paid jobs in the wealth of new activities made necessary or possible by cars: automobile manufacturing, car repair, travelling sales, home delivery, mass tourism, road building, the petrol business, and so on.

In short, digital technologies is reshaping business models and firms’ organisation, and making “soft skills”, such as information-processing, self-direction, problem-solving and communication, become more important. Many people, however, do not seem to have such skills for a digital world; as OECD estimates show, less than 40% of those using software at work every day have the skills required to use digital technologies effectively.

Those who have the skills get ahead faster, which could cause higher inequality. In particular, some argue that digital technologies have raised the demand for high and low skills and reduced the demand for medium skills, though the extent to which this polarisation of jobs and wages is due to digital technologies remains a matter of debate. For instance, the OECD finds that while ICT investment led to job polarisation after 2007, the effect was only temporary.

• NPR podcasts discuss automation and the future of work
• Robohub roundtable: Job loss through automation, Foxconn controversy
• Stop talking about bringing jobs back from China
• Obama connects robots to jobs in State of the Union address
• Robots Podcast #202: Automation and Employment, with Michael Osborne

See all the latest robotics news on Robohub, or sign up for our weekly newsletter.

In this Robohub roundtable edition, we are joined by Sabine Hauert, Kassie Perlongo, John Payne, Audrow Nash, Yannis Erripis, with commentary by Andra Keay and Travis Deyle, to discuss the viability, practicality, and (to a degree) healthy scepticism when it comes to robotic crowdfunding. While there have been a number of successful crowdfunded campaigns, there’s no question others are failing to live up to their hype. Should we be holding crowdfunding, especially crowdfunding for robots, to a higher standard?

It begins with good intentions. And as eager, supportive, tech-minded fans, we want to believe. The video marketing, graphics, and technology all look enticing. The prototype when in mass production seems affordable. We, as crowdfunding investors, are intrigued. The campaign does well — congrats, you’ve made it happen!

Some campaigns don’t even make it that far. According to Kickstarter’s stats, only 44 percent of projects meet their funding goal. Of roughly 60,000 unsuccessful projects, nearly 40,000 failed to reach even 20 percent of their goal. Some projects crash-and-burn by over promising and under delivering. Others do make it through crowdfunding, only to lose steam in the manufacturing process.

Why does this seem to happen? Is there a better formula, or better way to future-proof robotic crowdfunding campaigns to prevent it from happening? Or do we call it what it is: a high-risk investment, a gamble. And investments, even robot ones, can fail.

Being honest and truthful is a crucial factor, according to the Roundtable. “You have to be truthful to your customers,” said Yannis. “It’s acceptable to present something as a prototype. You can say: ‘we didn’t have a working camera at the time.’ But, it’s important to not deceive your funders.”

“It is incredibly difficult to design and produce robots,” said Sabine. “It’s not necessarily about getting funded, as we’ve seen in previous examples, it’s about being able to deliver what you promise. Sometimes hype is necessary to get the funding. But there’s a bit of a vicious cycle in which you need to have great marketing, but still need to be able to deliver,” she said.

Understandably, people feel cheated if a crowdfunded project shuts down. One example recently involved CyPhy Works and their six-rotor LVL 1 drone campaign. Despite an incredibly successful Kickstarter raising nearly $900,000 in 2015, plus a $22 million boost from Bessemer Venture Partners, they decided to close and refund Kickstarter investors April 2016 stating (via their Kickstarter):

“After a successful KickStarter tour featuring showings at The White House, TechCrunch Disrupt, DARPA Robotics Challenge and countless flights around the US, CyPhy Works LVL1 Kickstarter has come to an end. We were unable to make the even a delayed delivery schedule due to the maturity of the sourced video components, especially EIS (Electronic Image Stabilization). All money and associated credit card and Kickstarter fees were returned.

LVL 1 was the first gimbal-free hexacopter enabling true-level flight, a user-friendly geofence capability, and real-time photo sharing. This Kickstarter campaign demonstrated the market pull shattered its $250,000 goal reaching almost $900K in backing.”

Funder James, on Kickstarter, commented: “[they] deceived us to use our money to get to where they need to be which is a global interest for large investors or buyers.” Adding that “[it was] such a shame for such a soundly great team of experts” and feeling like “it left with nothing, absolutely NOTHING.”

Funder Richard Whitehead echoed similar thoughts, saying it felt like “a distinct lack of respect for their backers.”

A Twitter post by Helen Greiner on April 5, 2016, confirmed the Kickstarter campaign closure was due to “component sourcing delays” and that it “didn’t seem right to make folks wait til 2017.”

Unrealistic timeframes and hardware startup concerns

So is the real issue unpredictability with components and timeframes? In CyPhy’s case, they cancelled the project due to a delay in the availability of a component. This is not the first time a company has needed more time to complete a project.

Jibo is experiencing issues with timeframes being pushed back, as they have delayed their initial December 2015 release to March/April 2016, and now October 2016.

Now, in an email update to its international backers Jibo writes they will not be able to ship outside the U.S. and Canada, saying: “After exploring all the options, we have come to the conclusion that we will not be able to deliver Jibo to your country”, adding this is because the bot “won’t function up to our standards in your country”.

It’s a bit like the chicken and egg philosophy. On the one hand, crowdfunding should help bolster and encourage start-up innovation. On the other hand, setting unrealistic deadlines could mean alienating and upsetting funders, possibly even damaging your brand. Is there any way to maximise a carefully constructed balance between the two?

“There’s a leap of faith on the part of the backers,” said Kassie. “Some of the campaigns may not even have long-term plans. Are we, as funders, asking for too much and stifling creative innovation?”

“There’s a degree of underestimation, so it’s crucial for [backers] to understand the risks,” said Audrow. “For example, [in our robots podcast], we try to ask the hard questions. Most likely if the company has thought about it, they should be able to articulate appropriate answers about their campaign.”

Another example is with AirDroids, a drone that was said to have the “longest flight time of any multicopter under $500,” as it became a victim of its own success after their Kickstarter project resulted in 20 times more orders than they anticipated, and couldn’t keep up with the manufacturing process. Despite sending some units out to backers, they eventually shut down. This can be viewed as yet another cautionary tale.

Ben Einstein, founder and VC at Bolt.io, provided some great advice on hardware startups looking to crowdfund, “Kickstarter is very appealing but extremely dangerous if you don’t use it correctly. You are amplifying all the decisions you made — in a cowboy style with long shadows everywhere. You’re broadcasting to the world and you haven’t figured out what your retail price is going to be, what your bottom-line costs are, how and where will you manufacture, and so on. Go through product development and early manufacturing first, and then use Kickstarter to launch. That works much better.”

“Kickstarter is increasingly seen as ‘risky’ by many founders,” said Travis Deyle. “Like it or not, recent failures make people inherently skeptical. The skepticism and cheapening of your brand will rub off on your company, by association. Also, the signalling effect this has on your product (eg. for market segmentation) matters a lot,” he says.

“I rarely hear crowdfunding discussed as a go-to option in startup circles anymore,” said Travis. “But to be fair, it seems more like early-stage startups are increasingly moving away from consumer hardware. Even the big publicly-traded consumer hardware companies are suffering right now — eg. GoPro is down 80% this year & FitBit is down 60% this year. Many of the big drone companies (eg. 3DR & DJI) are also transitioning away from the consumer space.”

Is there a model or “start-up style” of success for people to follow?

If there’s something practical that be taken away from these cautionary tales it’s that hardware delays are, to a certain extent, to be expected. But, “if you are promising one thing and cannot deliver on that promise, this can be viewed as incredibly deceptive,” said Yannis.

So, what is good practice for startups? “A good example is Reach Robotics, educational monsters,” said Sabine. “It is a hugely complex platform to design. They decided not to crowdfund because they felt that they needed to figure out how to produce it. They needed a good extra year and half, and they haven’t launched it yet, to figure out how they were going to build it.”

We reached out to Silas Adekunle, Co-founder and CEO for Reach Robotics, for a comment and he offered this advice: “I think more hardware startups owe it to the consumers and the startup community in general to do their due diligence on how to manufacture their product fully before offering it for sale. This will help with consumer confidence issues that we are now seeing in hardware startups.”

While there’s no way to be 100% sure, the Roundtable has come up with a checklist that start-ups may find valuable. Please bear in mind this isn’t inclusive, nor should it be used as the only means to crowdfund, but could provide a valuable guide prior to introducing your campaign to the world. We also recommend reading Hardware by the numbers, by Ben Einstein:

Checklist (a guide, of sorts) for future robotic crowdfunders:

1. Do you have a fully working prototype?
2. Do you know how to produce said prototype? How much will this cost?
3. Is the prototype robust?
4. If you have a marketing video, is everything you are showing in your video doable with your prototype?
5. Who is your target market? Is that clear in your campaign?
6. Do you have beta testers in the field? What have they said about your product?
7. Do you have a clear path to production and distribution at scale?
8. Does your project contribute to the advancement of robotic technology? Is that clear in your campaign?
9. What happens if an angel funder or venture capital fund takes equity in exchange for putting money into the project? Is that transparent in your campaign?
10. (Should go without saying) Are you being clear with the language you are using in your campaign (ie. not a lot of marketing spin?)

Please note the checklist doesn’t include things necessary for a successful campaign, just for building a successful product.

“Being able to build a successful product is just the start of the crowdfunding journey,” says Andra. “You can’t rely on a ‘build it and they will crowdfund it‘ approach. Running a successful campaign these days can involve a significant investment of funds, time and the skills of many experienced marketing professionals, from writers and videographers to community managers and PR specialists. A good rule of thumb is to have 33% of your campaign funds already lined up ahead of launch, so as to be able to hit strong milestones in the first days of your campaign.”

“Crowdfunding is just an amplifier, not an investor or a magic remedy,” she said.

Should companies crowdfund?

“It does provide good klout, getting the word out there,” said Sabine.

“It does show traction to raise money, plus, it’s a way to get interest-free “debt” financing to fund manufacturing and inventory,” said Travis.

While one can make a clear argument that it is a case of “buyer beware” (crowdfunding = investment, and investments are inherently risky) there’s also the way crowdfunding platforms, like Kickstarter, is currently set up as a business model that could be problematic for hardware specific projects.

Tech journalist Mark Harris, in his piece on Medium, says that: “Kickstarter, and other crowdfunding platforms, should reconsider the way that they deal with projects involving complex hardware, massive overfunding, or large sums of money. There should be better mechanisms to identify weak projects before they fund, as well as new processes to provide mentorship, support and expert advice to newly-funded projects.”

Maybe he’s right.

To our readers: What do you think? Is our guide a fair representation? Anything else you think we should add?

Read some of our previous Robohub roundtables below:

• Robohub roundtable: Job loss through automation, Foxconn controversy
• Robohub roundtable: Why is it so difficult to define ‘robot’?
• Robohub roundtable: Robotics and space exploration

See all the latest robotics news on Robohub, or sign up for our weekly newsletter.

International Data Corporation (IDC) has awarded five pioneering players in the warehouse robotics market with the 2016 IDC Innovators Award. Companies selected met the following criteria: revenue of less than $50 million with an innovative technology, or a groundbreaking new business model, or both.

IDC is a global provider of market intelligence, advisory services, and events for the information technology, telecommunications, and consumer technology markets. With more than 1,100 analysts worldwide, IDC offers global, regional, and local expertise on technology and industry opportunities and trends in over 110 countries. Each year they award hundreds of innovator companies in trending industry segments. 2016’s broad trending segments included:

•     Internet of things platforms
•     Cloud services enablement
•     Platform as a service
•     Machine learning and analytics
•     Image analytics
•     Supply chain execution (under which the sub-group Warehouse Robotics was included)

"Robotics are increasingly being leveraged within warehouses to increase productivity and deliver efficiency improvements. Innovators, such as those that we have identified with these awards, are developing intelligent and collaborative robots to help manage the increased flow of goods through modern warehouses and support picking and packing strategies more aligned to the needs of today's omni-channel commerce," said John Santagate, research manager, Supply Chain Execution at IDC Manufacturing Insights.

The five selected IDC award winners

1. Locus Robotics, the Andover, MA startup headed by distribution center owner Bruce Welty. Locus uses sophisticated mapping software for quick set-up and deployment of mobile robots within a warehouse setting. 
2. Fetch Robotics, the San Jose, CA startup headed by mobile robot expert Melonee Wise, provides a "robot as a service" business model, offering a cost-effective solution for businesses who might otherwise select a non-robotics option due to cost constraints. 
3. Rethink Robotics' software allows for ease of set-up and operability with embedded safety features that enable robots to work collaboratively with humans. Rethink, founded by ex-MIT professor and iRobot co-founder Rodney Brooks, has helped define the business need and use case for collaborative robotics.
4. Clearpath Robotics, a Canadian startup headed by Matt Rendall, makes two self-driving mobile platforms enabling factories and warehouses to deploy a fleet of vehicles that can move a wide range of materials. Clearpath also makes the popular all terrain Grizzly and Husky mobile robots.
5. GreyOrange Robotics, an Indian startup founded by Samay Kohil, is producing and selling a Kiva look-alike product line with a goods-to-man robotic system that helps automate inventory management.

Warehouse robotics is definitely an emerging robotics industry segment as old-style AGVs are getting eyes and providing point-to-point movement. Combined with clever picking, storing and stocking methods and devices involving both humans and robots, this industry segment is able to handle more picks at a faster rate more reliably than before, hopefully keeping up with consumer demand. Many startups are focused on this area of warehouse robotic innovation complicated when Amazon decided to take Kiva Systems inhouse and not resell their systems. This caused a temporary technology void which is beginning to be filled by these new award-winning vendors - and many others.

New vendors are being announced frequently, e.g.: inVia Robotics just today came out of stealth mode to launch their “goods-to-box” combination of a grabit robot for picking and a transit robot to move picked goods from place to place. 

Congrats to the winners!

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Chinese consumer manufacturer Midea, after having spent over $4 billion to acquire 94% of German robot maker Kuka, is planning to spend an additional $1.5 billion to turn itself into China's preeminent robot powerhouse. 

It plans to build a factory located in Foshan City to expand its capacity to manufacture and assemble robots and robot components. Much of the production will be to produce automatons for homes and individuals - robots similar to SoftBank's Pepper - which consumers appear to be enamored of. Midea expects to ramp up production at the new facility from an initial 7,000 robots annually to 17,000 or more within 10 years.

Midea is China’s biggest manufacturer of air conditioners, refrigerators and home appliances, employing around 135,000 people. Their investments in robotics as a user and also by buying Kuka, establishing a robot factory, and creating an automaton for home use - underscores their ambition to lead China in automation and robotics.

Midea’s recent investments follow a series of government-led initiatives labeled China Manufacturing 2025, which is aimed at transforming China’s manufacturing industry from low-end mass production into a more profitable model harnessing new technologies such as robotics, artificial intelligence and the Internet of Things.

“Midea’s strategy is to be the Chinese leader in robotics and automation,” said Wang Cairong, secretary general of the China Artificial Intelligence Robot Industry Alliance, an industry association. “It may even be a global giant in this field. Chinese government needs and encourages new “heavyweight” companies in this sector."

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