Investors were surprised late last year when Ark Investment included Deere & Company among the companies in its new Ark Space Exploration & Innovation ETF (NYSE: ARKX). The equipment maker, best known for its tractors and other farm machinery, is the 13th largest holding in the new ETF. The rational at the time was that Deere was a company that could benefit from the growth of space. In an interesting twist, Deere actually is becoming more of a “pure” space play with the company announcing plans to get into the satellite business.
The ag equipment giant began exploring a strategic partnership with satellite communications (SATCOM) vendors last year. Now, Deere says it is officially finalizing an agreement, though they’ve not named the satellite provider. The company did reveal that it met with “60 representatives from various satellite communications providers at a test farm” in Iowa last fall when it issued its request for proposals.
The move is designed to ensure that farmers have the connectivity they need to fully utilize Deere’s technology solutions, including in-field data sharing, remote display access, autonomy, faster machine learning, and wireless data transfers. Despite generous funding from the US government to build out broadband service in rural America, between 20% to close to 30% of Americans in rural areas are estimated to still lack coverage.
“When you just have the brawn of a tractor, and you get bigger tractors, and you get tractors that have higher horsepower and things like that, you start to run up against—or bump up against—some limitations,” Jonny Spendlove, senior product manager of connectivity at John Deere, told Emerging Tech Brew. “At some point, there’s only so much you can do with brawn. You need to start thinking about what can you do with the brain of the machine. And that brain requires connectivity.”
Spendlove says Deere is “still working through the details of what SatCom-enabled connectivity will look like.” He did note that the company wants to “have a satellite solution in the market by the end of 2024.” Spendlove adds that the company is also “willing to make a substantial investment” in the initiative.
It’s worth noting that Deere’s crop of companies for its 2023 Startup Collaborator program include several companies that could further expand the equipment maker’s digital technologies. One of those is Precision AI, a startup that’s creating the world’s first artificial intelligence-powered agricultural drones for plant-level herbicide applications at broad-acre scale. Another interesting one is Albedo, a startup company developing low-flying satellites that will collect visible and thermal imagery at ultra-high resolution. (Sources: Emerging Tech Brew, CNBC, Gizmodo)