How People Use Planet's Data: Civil Government
How People Use Planet's Data: Civil Government
And the opportunity in sustainability regulation
The first post in this series focuses on agriculture. Read below:
Demand for Planet’s data is heating up in civil government. Management has repeatedly emphasized this development over the last year. But so far, the result of this shift has been longer sales cycles and slower growth as Planet adapts to the different requirements of selling into these organizations.
From a near-term lens, the financial impact is obviously not good. Slow growth and high cash burn are a dangerous combination. Fortunately, Planet’s balance sheet provides it the flexibility to take the long view. If you do take this longer view, the focus on civil government could (and in my view, likely will) produce a positive economic outcome. The stock does not appreciate the probability of this result.
Civil government customers are sticky. Many are building regulatory programs or other workflows on top of Planet’s data (see examples in the US, UK, Brazil, UAE, and more below). Planet is laying the foundation for scaling these contract values over time. It is learning a new market — who to partner with / how to best position its offering, how to streamline the sales process, and ultimately how to deliver the best solution.
But don’t take it from me. Take it from Will Marshall (in response to a question on slowing sales cycles on the Q2 2024 earnings call):
What I'd just highlight is that we are market making here, and a lot of these governments — we're bringing a new capability to them, and they've never done this before. And we don't understand that process fully. As we understand that, we are adapting, and that's why we're doing some of those changes to our go-to-market approach. So I just want to emphasize that even civil government — some of which have used satellite data before — they're changing the motion here from buying satellites and building satellites, to buying data. And in many cases, it's just a totally unique and new data product, so they haven't done this before. Both we and they are learning through this.
At a high level, the evolution of the satellite data market makes sense. If defense & intelligence agencies were the first (and for a long time only) buyers, other levels of government (civilian, state, and local) represent a logical buyer progression.
This evolution is driven by the new capability introduced by Planet: daily, global monitoring at “good enough” resolution (significantly worse than D&I-focused providers like Maxar and significantly better than public missions like Landsat and Sentinel).
Don’t get me wrong: defense dollars still dominate the market, and will for quite some time, but demand from civil government, specifically for Planet data, is growing at a comparatively higher rate. The pipeline reflects this.
Planet’s data uniquely suits the needs of this group, whether it be scientific research, land use planning / monitoring, permit / regulatory enforcement, or disaster response. The difficulty lies in building an effective, efficient sales motion (remember, Planet’s sales team was essentially built from the ground up over the last 2-3 years). Selling into the government is tricky and takes time, even before accounting for the difficulty of selling data in the first place.
That said, Planet is in a good position to build long-term relationships with these customers, who collectively represent a multi-billion dollar opportunity. It will take longer than many would like it to, but for those with the luxury of time built into our investment strategy, this is exactly what creates the opportunity.
The public market’s reaction to slowing growth is never positive. And while slowing growth is never a good thing when viewed in isolation, the market often forgets the context. In more ways than one, Planet is doing the difficult work today to set it up for success tomorrow: learning, iterating, and embedding its data in a variety of programs that will endure for many years.
Customer Examples & Comments
1. BKG (German Federal Agency for Cartography & Geodesy)
Planet’s relationship with BKG began with a trial in 2021. The contract expanded the following year to a country-wide program granting 400 federal-civilian agencies access to the data for crisis response, conservation, and forest / agriculture monitoring.
Will Marshall: “We see this as an innovative model that has the potential to be repeated in other countries.”
This contract is notable for a few reasons. It shows the German government quickly recognized the data’s value for a variety of purposes. And there is huge efficiency in such country-wide data purchasing programs; this way, there is one sales process as opposed to many for each individual organization who wants access to the data.
Planet’s contract with Wales (#9 below) has a similar structure.
2. ORSAC (Odisha Space Application Center) (via SPARC India)
The state of Odisha uses Planet’s daily monitoring to regulate fraud in paddy farming subsidy programs. The data verifies self-reported land cultivations, which were previously subject to widespread inflated claims.
The program covers millions of farmers across 30 districts and led to over INR 1,700 crores (~$206 million) in savings by the exchequer. Those savings are more than Planet’s total revenue last year, implying an opportunity to implement more value-based pricing (as they have hinted at a few times).
Other satellite systems are ill-suited to the requirements of this program given the scale and cadence of coverage required. This is a common theme across civil government and agriculture, as these use cases require reliable, frequent data across a broad area (and at reasonable cost).
Subhadarshi Mishra (Managing Director of SPARC): “Successful delivery of a project of this scale requires well-coordinated teamwork. With daily availability of data at high resolution, Planet has made it possible.”
3. NICFI (Norway's International Climate and Forest Initiative)
The government of Norway funds a global program to monitor tropical deforestation and inform policy development. KSAT runs the program, which began in 2020 and was recently extended through calendar year 2024. Planet and Airbus serve as satellite imagery partners.
Andrew Zolli (Chief Impact Officer) at the 2022 investor day: “In just two years, the NICFI program that we run with our partners has grown to serve more than 14,000 users in 155 countries, all working together to stop deforestation. Together, that community has made Planet data the gold standard surrounding one of the most important challenges on the planet: monitoring deforestation. And there are network effects here. The more people use this data on that problem, the more it becomes a standard, and the more it becomes a standard, the more people use it, and you get the kinds of data gravity that really allow us to have one common view of what's happening on the earth.”
The program remains in relative infancy (four years is not a long time), but it’s not difficult to imagine future deforestation policies being built on top of such a common, reliable data source.
4. Brazilian Federal Police (via SCCON)
SCCON, a Brazilian distributor of Planet imagery, has built a platform to automate monitoring of illegal road and building development across the entire country. The Brazilian Federal Police use this platform to inform their actions. Since 2020, over 3,300 agents have completed more than 120 operations; at this scale, federal agents are conducting missions based on Planet data roughly every week or so.
I don’t see this activity grinding to a halt anytime soon, particularly given the results. Since inception, Brazil’s MAIS program (which governs the data acquisition) has collected over $1.9 billion in fines, seized goods, and frozen assets. Over 26,00 users access the data across 270 institutions.
Another opportunity for more value-based pricing over time.
5. NASA
NASA currently purchases Planet data through an $18.5 million blanket purchase agreement (under the Commercial Smallsat Data Acquisition program) that supports research on disaster response, climate, and biodiversity across 32 federal-civilian agencies.
The relationship began in 2018; the current contract expanded in 2023 and lasts through the end of 2024.
One example of how Planet data is used in this agreement is NASA Harvest, a unique program launched in 2017 whose mission is “to enable and advance adoption of satellite Earth observations by public and private organizations to benefit food security, agriculture, and human and environmental resiliency in the US and worldwide.”
NASA Harvest used Planet data to conduct a country-wide assessment of grain health across every field in Ukraine to measure the effect of the war on global food supply. It will likely attempt to repeat this exercise worldwide given the time and resources.
Inbal Becker-Reshef (Program Director), speaking at 2022 investor day: “Planet has been a partner for Harvest from the very first day. From before we launched Harvest, we recognized the importance of Planet data, but admittedly, I will say that initially, I really thought that we'd be using Planet data primarily for small holder agriculture, for very small fields and for looking at very field-specific activities. I never really thought we'd work at a national scale in a country like Ukraine with such big fields. And instead, Planet data turned out to be absolutely crucial for what we were doing, especially because we were trying to do this in real time in a rapid response manner.”
From my (outside) view, this contract creates much more value than it costs, and it comes from a sticky budget pool with room to grow. $18.5 million is less than 4% of the CSDA program budget ($476 million) and less than 1% of the broader Earth Science budget (~$2.5 billion). NASA’s total budget is over $25 billion and has been growing steadily.
Planet provides a daily, global dataset NASA can’t obtain anywhere else. At the 2023 Fall American Geophysical Union (AGU) meeting, the largest geoscientist conference in the world, 41 presentations used Planet’s data through the CSDA program. I don’t see these funds disappearing anytime soon; too many people have vested interests in the data continuing to support their research.
6. UK Rural Payments Agency (via Earth-i)
Planet’s data supports country-wide agricultural monitoring for the UK Environmental Land Management Scheme (multi-year, 7-figure ACV contract).
The Environmental Land Management Scheme is the UK counterpart to the EU’s Common Agricultural Program (“CAP”) and a clear demonstration of the opportunity that exists at the intersection of sustainability and regulation (and agriculture for that matter).
See next section for more on the sustainability angle.
7. Dutch Paying Agency (via NEO)
Similar to the UK contract, Planet’s data provides country-wide monitoring of the Netherlands to support compliance with the EU’s CAP.
See next section for more on the sustainability angle.
8. Slovenia National Paying Agency
Similar to the UK and Netherlands contracts, Planet delivers country-wide area monitoring for CAP compliance. The relationship began in 2020 via Sinergise.
Since adopting Planet Fusion data (instead of strictly Sentinel), the agency has reduced the number of inconclusive (read: not eligible for payment) fields from 246,000 to 66,000, and the cost of follow-up activities (in person field checks) declined by more than €1 million.
Lea Remic (Head of Dept. for Geospatial Applications): “With the complexity and small size of the average agriculture in Slovenia, where almost a quarter of the parcels don’t fit Sentinel constraints, the whole program would be under risk due to too many inconclusive parcels, were there not for this additional source: Planet Fusion.”
See next section for more on the sustainability angle.
9. Welsh Government
The Welsh government is using Planet’s data to design and implement the Rural Investment Scheme and Sustainable Farming Scheme (replacement for CAP); it also provides access to Welsh universities for research.
The contract grew from 5-figures in 2021 to 7-figures in 2022 and expanded again in 2023.
This contract is unique in that the regulation (commencing in 2025) is being designed alongside Planet’s dataset; in other words, Planet’s capabilities are informing the written rules. This lays the foundation for a sticky, long-term relationship.
The research angle also deepens Planet’s relationship with the Welsh government. A research program at Aberystwyth University (“Living Wales”), which uses Planet data to model future landscape scenarios and monitor progress against them, is being adopted as the national framework for land monitoring. Programs like these are good for business; they add weight to the data’s credibility and don’t disappear overnight.
10 / 11 / 12 / 13. Natural Resources Canada / Govt. of British Columbia / Northwest Territories Center for Geomatics / Quebec Ministry of Natural Resources and Forests
Canadian national and provincial organizations use Planet data in similar ways: to inform disaster response and monitor natural ecosystems across the vast Canadian landscape.
There is a fair amount of debate about the value of imagery over vast unpopulated areas. The Canadian civil government’s use of PlanetScope speaks to the value of such imagery. I see a sizable business opportunity imaging non-critical economic areas at a regular cadence.
14. Philippines Space Agency
Like NASA, Planet’s data supports disaster impact assessments, environmental monitoring, and scientific research.
This contract poses an interesting question: why would any space agency not benefit from Planet’s data? I can’t think of a convincing reason.
15. UAE Space Agency
UAESA is using Planet’s data to build a regional damage atlas for climate change.
Put simply, this program intends to bring some quantification to the usual pontification at UN COP events. The collaboration launched last year and will be a multi-year effort including access to nearly every Planet product: PlanetScope, SkySat Tasking, Roads & Building Analytics, Soil Moisture Content, Land Surface Temperature, and professional services.
This type of long-term undertaking requires a long-term relationship. A climate atlas doesn’t come together in a year; it requires an amalgamation of as much data as possible and continuous refinement of the algorithms that extract insights from that data. Once it’s built, the question becomes how to put it to good use. We haven’t reached this stage, so I’ll leave it there for now. The main point is that the UAESA is building this with Planet; its partner isn’t going anywhere.
16. INRA (Bolivian Institute for National Agrarian Reform)
INRA uses Planet data for country mapping, title enforcement, and public land use monitoring (7-figure, multi-year contract).
The data allows the nation to map and classify different land areas, organize them by suitability for various uses, and develop land management plans for agriculture, conservation, or urban development. Put simply, it enables more effective use of the country’s land, with proper methods of accountability.
17. Cartographic Agency of Colombia (IGAC)
IGAC uses Planet data in a similar vein to INRA (7-figure, multi-year contract). Colombia also uses the data to monitor contentious border areas, particularly with Venezuela, and more precisely track illicit farming.
18. U.S. Department of Agriculture
The Foreign Agriculture Service uses PlanetScope and Planetary Variables to build crop-type maps and overseas planted area estimates. The data is also used in the bi-annual crop report.
Planet’s data directly assists the USDA in its objective to provide accurate and relevant information on agriculture. It’s unlikely to abandon a partner who can provide a valuable dataset unavailable elsewhere.
19. New Mexico State Land Office
NMSLO uses Planet data to monitor trespassing and illegal development on over 13 million acres of protected land. This scale of coverage and demand for regular monitoring requires Planet’s solution.
Historically, NMSLO used outdated imagery and often had to send workers out to remote sites to manage this task. Planet automated this workflow. In its first year, the program identified 53 trespasses worth $2.7 million in back payments; it also converted 53 of those violations into new leases, which generated an additional $800k in revenue.
20. Queensland Dept. of Natural Resources, Mines & Energy (via Geoplex)
Queensland DNRME uses Planet data to monitor natural resources across 1.8 million acres, encompassing farmland, forestry, and coral reefs. Need I say it again? No other provider can offer reliable, regular captures of such a wide area (at reasonable cost).
Steve Jacoby (Executive Director, Land & Spatial Information at DNRM): “The access to high quality, daily imagery for use by all government agencies under this arrangement sets a new benchmark that we expect will have far-reaching benefits for the state.”
Nigel Conolly (Sales Manager at Geoplex): “Now that this technology is in place, other states in Australia are looking at what we’ve accomplished in Queensland with real interest.”
The Sustainability Angle
Sustainability is a compelling angle from which to view the civil government market. Sustainability has powerful economic implications, but the word has become so overused and sensationalized it’s difficult to parse what it really means and where the opportunity lies.
Put simply, sustainability means gradually moving towards carbon-neutrality and preserving natural ecosystems (i.e., preventing deforestation). I think the opportunity is in providing concrete methods of accountability for these goals (i.e., serving as a system of record). Today, we lack the proper means of measurement and enforcement, which is why results have been lackluster despite overwhelming emphasis on the idea.
Planet views itself as a platform capable of bringing accountability to the market at scale. I tend to agree, and I think the opportunity is misunderstood.
Common Agricultural Policy (CAP)
CAP set the stage for Planet’s initial foray into the sustainability market. CAP is a $50+ billion EU program providing subsidies to farmers who follow sustainable agriculture best practices. The program covers more than 10 million farms and over 160 million hectares of land. Reliable coverage of such a large area is Planet’s bread and butter.
Today, Planet’s solutions appear to be used mostly for small fields — in the Netherlands and Slovenia, for example — which account for only 5-10% of the program’s total area. Sentinel remote sensing data lacks the resolution to effectively monitor these fields, which leads to more expensive on-the-spot (in person) checks. Planet Fusion directly addresses Sentinel’s shortcoming by integrating its data into PlanetScope, thereby providing daily, cloud-free monitoring.
I think early adoption by countries with large numbers of smallholder farms will eventually translate to large-scale monitoring of farms of all sizes. This wouldn’t be the first time. NASA Harvest initially thought it would use Planet data for smallholder agriculture, until it recognized the value of country-wide analysis in Ukraine (one of the largest crop producers / exporters in the world). Bayer’s use followed a similar trajectory. What starts with targeted, small scale use extends to large scale (country-wide) use given the advantages of one common field of view, as well as Planet’s ability to easily scale up to the requirements.
Sentinel Hub offers an end-to-end area monitoring solution purpose-built for CAP. Several EU partners (Earth-i and NEO, for example) also offer specific solutions. By working with its current customers, Planet can refine its solution and create a more compelling proposition to the paying agencies charged with monitoring for CAP compliance.
Again, the challenge seems to revolve around selling into these organizations — the offering is clearly valuable. Changing methods of compliance accounting requires significant updates to IT systems, budget allocations, and workflows. It takes time.
I’m optimistic that more paying agencies will bear the burden of shifting their compliance systems as Planet further proves the value of its data to customers.
European Union Deforestation Regulation (EUDR)
CAP is not the only program where Planet’s data is uniquely suited to provide a means of accountability. EUDR is set to take effect on January 1, 2025, and will require all products in or exported from the EU with inputs from seven commodities — soy, beef, palm oil, wood, cocoa, coffee, and rubber — to prove and independently certify a deforestation-free supply chain.
This is a monumental task, and the annual cost of compliance is estimated to be north of $5 billion. Eurostat estimates 1.2 million companies will have to comply with these new requirements. Geospatial data is the only tool with the requisite scale to track global deforestation activity on a frequent basis. In fact, the use of geospatial data for compliance is written into the regulation.
Planet expects to play a meaningful role in these compliance programs, and partners such as LiveEO have already developed solutions tailored to the regulation. In most cases, Planet will not be the one delivering a specific solution, but it will underpin solutions provided by other companies. It will be a form of infrastructure, which tends to be a more stable (and lucrative) position.
If Planet captures just 10% of the estimated compliance cost, it’s a $500 million business. Today, Planet’s revenue from civil government is roughly $60 million. Though this revenue won’t all arrive in the first year, I tend to think it is a very reasonable estimate of the opportunity long-term.
I won’t explore this avenue any further until we have concrete examples of how customers are using the data, but it is a large and compelling opportunity in the relatively near-term. Stay tuned.
The Long Tail
The larger story in sustainability revolves around the development of more regulation like CAP and EUDR. Europe is clearly the first mover with such programs, but other regions and nations could follow, especially now a viable method of ensuring accountability has emerged. Andrew Zolli alluded to this opportunity at last year’s investor day:
I obviously can't predict with certainty, but the likelihood of knock-on effects of those [mandated sustainability requirements] being carried to other markets in the U.S. and other places is not zero.
If you can bear to think five or ten years ahead, I’d argue the probabilities are much higher than non-zero — favorable, even. Sustainability isn’t going anywhere — the question is whether we will start to see concrete directives based on objective data sources. I think yes.
Wrapping Up
The overarching story of how people use Planet’s data in civil government is simple. People use the data to do their jobs more effectively. Whether it’s a paying agency monitoring for regulatory compliance, a local government enforcing permits, a research organization disseminating insights, or a federal-civilian agency mobilizing disaster response units, Planet’s data supports better outcomes.
This is ultimately why the company is seeing more demand in this section of the market. Customers are reacting to a new capability, understanding how to leverage it, and determining how to gain access. In the government, this process takes time (a repetitive point, but an essential one).
The last point I will make is that civil government may prove to be a leading indicator of commercial demand. There are two sides to regulation: the regulator and the regulated. Companies are the ones being regulated, and they will have to buy solutions to demonstrate compliance. We see this in EUDR, which opens the door to CPG companies who have likely never bought satellite data before.
We’ll see — it’s early days — but I’d argue the evidence points to civil government as a leading indicator. In the meantime, I’m content to patiently watch the market develop.
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