When the GoPro Karma drone was launched last month it was dubbed by the stuggling GoPro management as their route back to profitability.
This week they announced a fall in sales of 40% to September 30th and the GoPro stock went into free fall. CEO Nick Woodman was still preaching the mantra to financial analysts about Karma generating great sales and their quest to the Holy Grail – profitability.
DJI the industry leader launched the Mavic a week after the GoPro Karma and clearly upstaged their weakened rival.
The public can now read about it and watch on YouTube the three key weaknesses of the Karma:
- it cannot be controlled by a smartphone
- it does not avoid objects
- it won’t follow you
The other main issue is the GoPro camera itself, its fisheye lens is great for a helmet cam on a mountain biker or skier but it distorts the horizon on any aerial landscape filming or images.
Roll back to March this year to see 3D Robotics the largest consumer drone manufacturer in North America fail. In less than 12 months the company has crashed from the industry leading US drone startup to basket case, struggling to survive.
3D Robotics pinned its hopes on their black Solo black flagship quadcopter drone launched in April 2015 and in the process spent it’s way through $100 million of venture capital funding.
Silicon valley to Drone Death valley in less than a year 3D Robotics has gone from a company valued at $360 million, to virtually worthless, caused by missed product deadlines, problem components and stiff price/ product competition from Chinese industry giant DJI.
3D Robotics former chief financial officer said:
“What we realized is that it’s just going to be inherently much more difficult for a Silicon Valley-based, software-focused company to compete against vertically integrated powerhouse manufacturing company in China,”
3D Robotics spent most of its money on manufacturing the Solo for inventory. Now to survive it has changed direction, developing enterprise software for the drone industry with its last remaining funds.
3D Robotics has closed offices, laid off most of its people. At the end of 2015 they had only sold 22,000 Solo drones, half of the company sales prediction.
The Solo used the GoPro camera and was more expensive that it’s competitor the DJI Phantom Pro. By February 2016 3D Robotics had over 60,000 unsold drones.
They could not pay their contract manufacturer and had to enter into a load agreement. According to ex-employees and press reports, the terms of the loan agreement supposedly stipulated that the income from leftover inventory sales went directly to the contract manufacturer.
The Solo without a camera cost $750 to manufacture and ship, it is now retailing in Best Buy for $500.
“3D Robotics will never make another drone” according to company founder Chris Anderson. Their enterprise software SiteScan which they have choose to concentrate on, helps companies capture and analyse aerial data.
This now puts them in direct competition with a number of venture capital funded drone related software companies like DroneDeploy and Kespry.
We think that within 6 months GoPro could be in a similar position to 3D Robotics and where will they look for revenue then.
GoPro is now spending on software and apps for people to upload, edit, and share its videos and pictures. They are planning to launch a desktop editing platform called GoPro Plus and the new Hero5 Black will automatically upload footage.
Are the fortunes of GoPro following a similar path to 3D Robotics ? Time will tell.
Roy Horton writes about aerial photography in Cornwall