Category Archives: Small caps

EU mandates DMS for 2020

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As part of a move to make European roads safer the EU today recommended making driver monitoring systems mandatory for new cars. It’s a momentous decision that is great news for Seeing Machines, causing its share price to shoot up today and Cenkos to upgrade its price target from 10p to 16p.

I asked Colin Barnden Lead Analyst at Semicast Research for his reaction and this is it:

Colin Barnden: So the paint is still wet from the announcements today, but I can draw some basic conclusions.

The EC has today announced the WHEN for a series of automotive systems to become mandatory, a list which includes distracted & drowsiness driver monitoring systems (DMS). My reading of the timeline is as follows:

  • 1 September 2020 for Type Approval (the certification process for new models, facelifts, major changes etc.).
  • 1 September 2022 for all other new cars, irrespective of Type Approval.

That is a two year phase-in period, and from today to the beginning of September 2022 gives a little over four years. That is a sensible timeframe over which to introduce a new technology like DMS.

The EC appears to have left the WHAT of a DMS to be defined by Euro NCAP and I expect the specifics of DMS requirements to follow in short order. This doesn’t guarantee that camera-based DMS will be mandated, nor specified by Euro NCAP. However looking at some of the other systems on the list (AEB, LKAS, ISA, EDR) these are all electronic systems so it would not follow that a mechanical (and very poor) DMS would be specified, even more so for a primary safety feature. Also the entire focus of this regulatory announcement is road safety. I regard AEB, ISA and LKAS as systems needed to compensate for distracted and drowsy drivers, so the obvious way to improve road safety is not so much to correct speed and steering errors, but to keep hands on the wheel, eyes on the road and minds on the task [of driving]. The very best DMS is the obvious way to do that and that points to a camera-based system, from the likes of Seeing Machines for example.

There are two excellent articles I would suggest as backgrounders for your readers for DMS:

http://www.thedrive.com/tech/20843/elon-musk-reportedly-rejected-driver-monitoring-for-tesla-autopilot-but-why

https://www.eetimes.com/document.asp?doc_id=1333236

If I were to also speculate on the WHERE; my view is that Japan will go next for mandatory DMS, probably followed by South Korea. Also, OEMs in the US are on a voluntary agreement (not mandated by NHTSA) to introduce AEB by 2022. I would speculate that they would be highly likely to add DMS on the same timeline.

The key is now what Euro NCAP announce.

Chris Menon: What exactly is the difference between ‘Type Approval’ cars and other new cars?

Colin Barnden: Okay. So, as an example, take the VW T-ROC. It was just launched and would have gone through Type Approval probably late last year. Type Approval is a bit like a new car MOT, someone looks over it and says: “Yes it has seat belts, yes, it has airbags, yes, it has brakes etc.” If it meets all the legislation in place at the time it gets
 ‘Type Approval’. Provided no changes are made to the car it maintains Type Approval and no more need be done. Sometimes this can last for four or five years until the model is refreshed. However, from 1 September 2022, new T-ROCs would need to have DMS added, not for Type Approval (which it already has) but to be legal for sale.

Now take a next generation Golf going for Type Approval on 2 September 2020. The list will have another entry “yes, it has DMS” and you get Type Approval. If it doesn’t have DMS, it doesn’t get Type Approval and cannot be sold in the EU.

So on 1 September 2020, only cars going through Type Approval will have to have DMS (or a bit before most likely). By 1 September 2022, it will be in 100% of new cars sold in the EU. This is how the phase-in is managed.

Seeing Machines set to win 75% of global DMS market

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Multiple industry sources are telling me that Seeing Machines’ Fovio technology is so advanced compared to rival systems that it is set to dominate the global auto market for DMS.

This market is growing fast and last year was estimated by ABI Research to be around 65m cars a year by 2020. Although I personally think this figure is now likely to prove an underestimate, given the fact that a driver monitoring system is becoming a standard feature in forthcoming car models. This trend is being driven (I love my puns) by increasing autonomy in cars, higher safety standards and legislation to reduce road deaths caused by driver inattention and drowsiness.

By my calculations, just using the 65m figure for 2020: Fovio will have at least 75% of that. As Seeing Machines (SEE) gets approximately US$25 for each car that uses its Fovio chip it should obtain annual revenues from autos of US$1.2bn.

How can I be so sure of this 75%+ figure?

Ford, Volvo and Audi

Admittedly, it is an estimate. But based on research.

I’m being told that Fovio will soon be contracted to Ford, Volvo and Audi. (That’s in addition to General Motors, Mercedes and BMW). Moreover, those same sources are telling me that by the end of this calendar year Toyota will definitely be committed to using it and, most likely, Honda.

Don’t expect absolute confirmation immediately. When they are eventually announced these contracts will be released as nameless wins, contracts for ‘premium’, ‘mass market’ country-specific OEMs. Seeing Machines will also have to be very conservative about the revenues forecast.

For those who know Seeing Machines as a perennial disappointment, a ‘jam-tomorrow’ stock, I urge them to look again at its growing dominance in the global automotive sector. This dominance in DMS now rivals that of Mobileye in external auto vision.

Fund Manager

If you don’t believe a dumb ‘ol journalist, maybe a super smart fund manager may make you look again at Seeing Machines?

Max Ward, Manager of The Independent Investment Trust, recently took a 4.46% stake in SEE. I wanted to know why and he kindly furnished me with the answer: “What attracted me to the business is the scale of the potential in the automotive division together with the evidence of clear market leadership in the DMS field.”

Previously, SEE successfully flew beneath the radar.  This was partly helped by its not having a PR agency in London, the harsh non-disclosure terms prevalent in the auto industry and the fact it was an AIM-listed minnow.

Fortunately, all that hasn’t prevented the global auto industry rushing to knock on its doors as increasing automation and safety concerns have led to tightening regulation, making its Fovio technology a vital ‘must have’ feature in future car models.

Now, at last, Seeing Machines is about to have the spotlight focused directly upon it. For dominance in global DMS makes it a very attractive strategic acquisition for big industry players.

Takeover time

Just as Mobileye was snapped up by Intel for US$15.3bn, Seeing Machines is likely to be bought fairly soon.

Indeed, I believe numerous companies now have Seeing Machines in their sights as a target this year. Who will pull the trigger first, I wonder? Names that have been mentioned to me recently include: Intel, Nvidia, Xilinx, Autoliv and Bosch.

Let the takeover battle begin.

The writer holds stock in Seeing Machines.

Seeing Machines compared to Mobileye

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I recently asked Colin Barnden, Lead Analyst at Semicast Research for his views on Seeing Machines. I’ve reproduced my original questions and his reply in full, as his insights are worthy of a wider audience and deserve to be accurately reported.

Chris Menon: I’m very keen to find out what you think might be the likely valuation of Seeing Machines in the event of a takeover, if you’d care to speculate. Can it be likened to Mobileye in terms of its dominance of DMS? I’m also eager to know if you think there is much real competition? From what I hear Smarteye is a very distant second and its technology is in no way of comparable quality or reliability.

Colin Barnden: “I’m a market analyst not a financial analyst so the issues of valuation are out of my areas of expertise. That said, I don’t think there is a single financial analyst who could accurately value Seeing Machines (SM) as the company is active in so many markets and at so many points in the supply chain. SM also seem to be creating markets as they go along, which is highly cash intensive and has a long “time-to-money”. However get the strategy right and the rewards can be extraordinary. See Google, Facebook and Netflix as examples.

Mobileye is probably a good comparison to SM. Yes there is plenty of serious competition in DMS but what I see tends to happen in IP markets is that one company dominates and then everyone else is competing for what’s left. For example Mobileye has something like 65% of the automotive front camera market, with Xilinx the clear number 2. Which Tier 2 becomes number 1 for DMS depends largely on whether price or features matters most to OEMs.

I suspect it will be features
here is a document I have been reading that I believe pre-announces changes to vehicle legislation [for automotive] for the EU, to be made on May 16: https://www.governmenteuropa.eu/important-year-vehicle-safety-europe/84888/

My reading of it is that DMS becomes mandatory for all cars in Europe from 2020 and with a focus on both drowsy driving and distraction. That suggests camera-based DMS eye-gaze tracking for distraction and PERCLOS (PERcentage CLOSure) eyelid measurement for drowsiness. This is really complex to do well and not many Tier 2s can. The mention of an event data recorder also suggests a Tier 1 might go for a more complex DMS in order to save cost on the DMS/EDR combination. I also read into the announcement that alcohol impairment detection is likely to be a future feature for DMS.

I don’t cover trucks but the legislation there tends to front-run that for automotive by a few years. I really would not be surprised if DMS was made mandatory in Europe for all trucks and buses too, and to my knowledge SM is in a party of one for aftermarket fleet systems (with Guardian).

I’ll be watching on May 16  to see what the EU formally announces. If they mandate everything listed in that article, that would be a step change in road safety. In my view DMS will be the story of the 2020s, with autonomous driving not likely in any meaningful volume until the 2030s.”

Seeing Machines is worth ÂŁ2bn

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I know a few investors thought I was ramping when I wrote in a previous blog post ‘Seeing Machines wins BMW contract worth between US$125m to US$250m‘ that this AIM-listed minnow was worth ÂŁ2bn (89p a share).

My reasoning is simple: it’s currently the leading specialist supplier in the global automotive market. (Read that slowly and ponder the implications as automotive is one of the hottest tech sectors in the world).

You want proof? Fovio, Seeing Machines’ world leading driver monitoring technology is currently being used by General Motors in its Super Cruise system for semi-autonomous cars, and is set to go into production in Mercedes and BMW cars within the next couple of years. 

Note that even before the BMW win, house broker Canaccord Genuity affirmed Seeing Machines was worth 21p in note dated 9th January. Analyst Caspar Trenchard also indicated that “the Fovio ‘platform’ technology might well be of specific additional worth to a corporate acquiror.”

Increased regulation is driving this adoption and many other car manufacturers and Tier 1s are queuing up to use Seeing Machines over the next year. I fully expect Subaru, VW, Audi and a host of others to follow in due course. (Tesla really ought to be banging on Seeing Machines’ door to get their kit into its cars.)

Lorne Daniel

Lorne Daniel, Head of Research at FinnCap, is a well respected tech analyst who has previously compared Seeing Machines to Mobileye, which was bought by Intel for US$15.3bn. 

I needed a sanity check to ensure I wasn’t deluding myself as to its intrinsic value, so I asked Lorne Daniel a simple question: “Do you think a £2bn valuation on Seeing Machines is unrealistic, given its increasing dominance in the auto OEM market?”

His reply: “Absolutely it’s a realistic valuation. The end markets are enormous and time and again the company is delivering on its promise with very big companies.”

Of course, I can imagine many readers moaning, “But its price is less than 5p!”

Well, as Warren Buffet once famously said: “Price is what you pay, value is what you get.”

Low-ball bid

Given the fact the stock is currently languishing below 5p, my own concern is that there is a distinct possibility an opportunistic bidder may soon seek to take advantage of this valuation anomaly with a low-ball bid.

Should that event materialise, my hope is that the management and quality institutional investors, such as Herald’s Katie Potts and Miton’s Gervais Williams (who’ve been invested here for years and fully realise what it is now worth), would resist any such offer and seek a price that fully reflects its value.

After all, the likes of Apple, Google, Samsung and Tesla — not to mention a host of Tier 1 automotive suppliers (Autoliv, Bosch, Aptiv, Denso and Continental etc)— are likely to be keen to acquire Seeing Machines’ technology. 

Think about it. £2bn is a realistic valuation for Seeing Machines. Moreover, £2bn for some of these companies is money that they can easily afford to spend in order to build market share in the automotive market.

The writer holds stock in Seeing Machines.

Seeing Machines wins BMW contract worth between US$125m to US$250m

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I’m convinced that Seeing Machines has recently been awarded a contract worth more than US$25m a year by BMW to supply its driver monitoring system in its cars, some of which should be available for sale by 2020.

From discussions with auto industry contacts, I believe the contract is for many forthcoming models (several million cars) and the DMS is likely to eventually end up being standard issue within the instrument cluster of all BMW cars. Given that BMW sells roughly 2.3m cars a year and that Seeing Machines would get approximately US$30 a car, that makes a potential annual income of US$57m a year by 2020, rounded down to US$50m.

Given that in the auto industry the lifetime of a model lasts for roughly 5 years, the lifetime value of this contract should be at least US$125m, though it could be as much as US$250m.

When this news is officially announced I’d expect broker upgrades to be the order of the day.  FinnCap currently has an estimate for full year revenues of A$141m for 2020 and Canaccord Genuity has an estimate of A$128.5m — of which only A$24m is from auto!

Aptiv

There has been no official announcement of the contract win aside from an announcement by Aptiv on page 9 of this document that I take as confirmation. 

When questioned, Aptiv were unwilling to discuss any details, saying: “
unfortunately we have nothing incremental approved to share beyond what’s in the document.”

Given the scale of BMW’s operations, the BMW contract may be shared with at least one other Tier 1 but no others that I’ve contacted are keen to confirm or deny involvement.

BMW itself remained rather coy. Asked how it plans to solve the problem of driver disengagement and the associated issue of ensuring the driver is alert and ready to take back control from the car, whether it would use a driver monitoring system and who would supply it, a spokesman said: “So far we have only announced that interior cameras will play a role ensuring the vaild point you mention. Details on functions and suppliers have not yet been announced. We have to ask for a little more patience.”

Seeing Machines was contacted but declined to comment.

Winning BMW so soon after it won a huge contract with Mercedes last year truly cements Seeing Machines’ Fovio driver monitoring system as the leading DMS in the auto industry. The premium choice for premium auto manufacturers.

Note that General Motors Cadillac already features Seeing Machines Fovio DMS.

Not only is Seeing Machines working hand in glove with Autoliv and Bosch, but I believe its DMS is now being used by LG (Mercedes), Aptiv and probably others that I don’t know about.

Driven by regulatory changes many other car OEMs are going to be tendering for DMS systems and Seeing Machines is set to be the industry standard. A standard that i’m consistently told no other company can yet match.

Thus, I’m confident that Fovio is likely to be chosen by many other global OEMs as they gear up new, increasingly semi-autonomous, vehicles for production over the next year.

Valuation

By my reckoning the automotive side of Seeing Machines must already be worth ÂŁ1bn and with every new win is only increasing in value.

Moreover, there’s a strong case for arguing the rest of the business (Fleet, Aviation, Rail and Off-road)  is worth another £1bn.

Given the success of Seeing Machines in winning large contracts and the increasing momentum of M&A activity in the auto industry I believe it’s only a matter of time before a bid is forthcoming from an industry player. Let’s hope the price soon reflects the value of the business.

The writer holds stock in Seeing Machines

Seeing Machines delivering on long-term strategy

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In an exclusive interview with Seeing Machines interim Chief Executive Ken Kroeger, he has confirmed that the company remains on track to hit its first half financial targets and is making no adjustments to its full year figures.

Following the departure of former chief executive Mike McAuliffe, who had only been in place a few months, private investors have been concerned as to whether there was likely to be any strategic change of direction. Happily, as Ken Kroeger confirmed: “The strategy that we’re executing is exactly the same one that we were executing when he arrived. Moreover, the executive team that is delivering that strategy remains the same.”

It’s a point that was well made by Lorne Daniel, analyst at house broker FinnCap a week ago, when he wrote: “We know that the second tier of management in this business is particularly strong and will continue to follow the strategy and deliver on the milestones as expected.”

The business certainly seems to be making steady progress across fleet, auto and aviation and Kroeger stressed the efforts of the executive team in having built them up. “These are businesses that didn’t even exist a few year ago and Paul Angelatos (Fleet), Nick Di Fiore (automotive) and Pat Nolan (Aviation) have done a great job in creating and building these markets for Seeing Machines.”

Auto industry

Not only is Seeing Machines working with GM to deliver driver monitoring systems for its cars (most notably the Cadillac CT6 whose Supercruise system uses it), but on October 30, 2017 its Fovio Driver Monitoring System was chosen by a premium German OEM (who I believe to be Mercedes).

Kroeger wouldn’t comment on who the German OEM is but did confirm: “It is extensively pushing the boundaries in driver monitoring, taking it to a whole new level. That is underway. That is a real state of the art delivery, very technically challenging but it sets a completely new performance standard for DMS.”

Given recent bulletin board discussions as to the respective merits of Seeing Machines technology vs. SmartEye, Kroeger was happy to explain: “We have the best technology, there is no doubt about that at all. SmartEye has an okay technology, which is cheaper
we’re much better positioned to take the premium car models that are interested in performance, who need this to work because it is a safety critical feature. For models that are being rolled out where it is nice to have comfort features in the car, which only require rudimentary head and eye-tracking, SmartEye is a viable option.

He added: “Right now we definitely have a leadership position from a technical perspective. That is very much respected by the auto OEMs.”

In addition, I’m optimistic that other OEMs will select Seeing Machines DMS technology, doubtless driven by the NCAP requirement for any car model wishing to have a 5 star safety rating from 2020 to have a DMS in place.

In Japan strong market opportunities are being helped by the effort of Kevin Tanaka working out of the West Coast in the US. Also Kroeger confirmed: “There is a very strong alignment with Xilinx in Japan, who are doing a lot of our on the ground marketing for us. It is definitely getting well received by the Japanese.”

Fleet

While a comprehensive Fleet update is due this week that should provide much awaited news on further wins, Kroeger did reveal that the Guardian 2.0 device will start shipping by the end of March. The upgraded system is significantly cheaper to manufacture, smaller and easier to install, which should also help increase penetration rates.

Takeover

Given the much higher profile of Seeing Machines since the launch of the Cadillac CT6 and the most recent CES show, where it was showcased by both Bosch and Autoliv speculation is increasing daily over whether it is being tracked for takeover, whether by a Tier 1, a telematics company, or even Google or Apple.

Asked about this Kroeger coyly replied: “There is always interest. We would never say ‘no’ to a conversation but we also recognise that there will a time when the time is right to return the best value to shareholders. We’re very cautious about the conversations we do have and, if we were to contemplate selling the company, we would have to find somebody who valued the entire organisation to obtain the full value for it.”

When pressed further about Google, Apple or Amazon seeing the long term value in Seeing Machines technology, which has applications far beyond transport alone, given it can enable robots to see and perhaps eventually even empathise with humans, Ken Kroeger commented: “I agree it is either someone like that who can see the full value or a really diverse Tier 2 or Tier 1, as opposed to the OEM. The Tier 1s sell to the OEMs but some of the Tier 2s which sell to the Tier 1s are exceptionally diverse. They might be building stuff for automotive, stuff for aviation and stuff for medical devices, stuff for consumer electronics. They might not just be an automotive-centric supplier. They are really hard to find and pinpoint but they are out there because they are always talking to us.

Of the partners that Seeing Machines currently has some are definite possibles. “Or, it could be someone who sells image processors and wants to start packaging it with software already on it on a smart camera or smart sensor,” teased Kroeger.

Despite being a world leader in DMS tech, a key plank in the forthcoming generation of semi-autonomous cars and increasingly being considered in trains, planes, trams and buses, it’s current share price languishes at approximately 5.5p. This valuation anomaly cannot last much longer, especially as with the recent fundraise it has been largely de-risked as an investment provided sales continues.

Ironically, such a deeply discounted valuation could well be the catalyst for an opportunistic bid from a cash-rich global player before the year end.

The writer holds stock in Seeing Machines.

Seeing Machines on track for first rail sales

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Seeing Machines (AIM: SEE), an industry leader in computer vision technologies that enable machines to see, has confirmed that it expects the first firm sales of a new driver monitoring rail product by Progress Rail before the end of the financial year.

This follows an announcement on September 8th that it had signed a new extended Partnership Agreement with Progress Rail Services Corporation (Progress Rail).

In an exclusive interview, Paul Angelatos, Senior Vice President & General Manager Fleet, Rail and Off-Road at Seeing Machines, told Safestocks: “As you know, we have undertaken various trials, using the mining tech, for rail. Through these trials, we have learnt more about the way an engineer operates in a locomotive cabin (for example, they get up and move around), so there are specific things that will change within the product, but the core product technology will not change. This is a fine-tuning, so we do expect to have sales by end of the financial year.”

Revenue streams

Seeing Machines will derive revenues in two ways from these sales:

  • From a royalty on hardware sales;
  • An agreed fee for services (tech support and monitoring).

In addition, as part of the new agreement both parties have an agreed overall minimum revenue target for each year, which Progress Rail needs to deliver on to retain exclusivity.

Angelatos declined to reveal the level of royalties but it is expected to be well in excess of the mid-teens percentage it receives from Caterpillar in mining vehicles. Confidentiality agreements similarly prevented him disclosing the minimum revenue targets each year, although he did state: “This is a 5-year agreement. By year 5, we expect that this deal would be returning in excess of US$6m per year.”

Fatigue is a contributing factor in over 20% of rail incidents, according to research from the Rail Safety and Standards Board in the UK. Given that there are 200,000 freight and passenger trains worldwide, Seeing Machines has first mover advantage in a potentially huge market.

The writer holds stock in Seeing Machines.

Seeing a CES bonanza for Fovio

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This year’s CES show in Las Vegas has demonstrated strong interest in driver monitoring systems (DMS), from automotive manufacturers and their Tier 1 suppliers. All good news for Seeing Machines’ Fovio division, which is fast becoming the dominant supplier of driver monitoring systems to guard against driver fatigue and distraction.

It was at CES in 2015 that Seeing Machines first showed its driver monitoring car technology with Jaguar. In addition, Seeing Machines has confirmed that Bosch, Takata and Volkswagen are showcasing Fovio tech at this year’s CES.

  • Bosch’s vehicle demonstrates new intelligent driver interaction capabilities enabled by Fovio
  • Volkswagen demonstrates a vehicle cockpit concept with integrated Fovio DMS
  • Takata demonstrates steering-wheel integrated DMS

I think it is only a matter of time before many other OEMs and Tier 1 suppliers are linked with Seeing Machines as the auto industry introduces advanced semi-autonomous vehicles, then fully autonomous vehicles.

As Mike McAuliffe, ceo of Fovio has noted: “We’re seeing a groundswell of demand in the industry for our Driver Monitoring technology.”

Tesla, Jaguar, Land Rover and Porsche are all marques that I personally think are likely to adopt its technology. For instance, Elon Musk would be in ‘ludicrous’ mode if he didn’t appreciate what Seeing Machines DMS could do to enhance safety features in his cars.

Ludicrous valuation

What is undeniably ludicrous is that this stock languishes at a market cap of ÂŁ45m when it is about to crack not only the auto market with Fovio but the fleet market with its Guardian product. (Caterpillar liked its driver monitoring product for the mining industry so much it bought the whole operation in return for an upfront payment and ongoing license and royalty stream for Seeing Machines).

Seeing Machines now has only to lie back and wait for the money to roll in from the Caterpillar sales team. Similarly, holders of this stock who hold it for a couple more years should make a stellar return.

According to projections from Lorne Daniels, a well respected analyst at house broker FinnCap, Seeing Machines will deliver sales of Aussie Dollars 141m (ÂŁ84m) in 2019 with pre-tax profits of A$22m (ÂŁ13m). I expect this figure to be revised sharply upwards along with his target price of 12p by the end of this year.

Any lingering doubts about the take up Seeing Machines offering in the fleet space were certainly dispelled with its tie up with Mix-Telematics, a global telematics provider in late December.

Following its fundraise this month, I’m convinced Seeing Machines is set to rise steadily.

However, don’t take my word for it. Do your own research and then make your own mind up.

The writer holds stock in Seeing Machines

Seeing Machines gains global partner to boost fleet sales

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Today’s announcement by Seeing Machines (AIM: SEE) that it has signed a non-exclusive global distribution partnership with telematics provider Mix Telematics is great news on a number of levels.

Firstly, it provides a ringing endorsement of SEE’s Fleet technology, designed to drastically reduce accidents due to driver fatigue and distraction. Moreover, as a major player in the global fleet industry, with 578,000 subscribers across 120 countries MiX Telematics will enable SEE to leverage its global distribution and installation network.

As Lorne Daniels, analyst at house broker FinnCap notes: “Fatigue and distraction is a huge and growing issue for both private drivers and fleets, particularly with the growing mobile functionality and dependency. Telematics is vital for modern fleet management. Yet installing and subscribing for a number of different in-cab systems is difficult for fleet managers. Combining telematics and driver monitoring solutions in one device and from one supplier clearly makes sense, reducing cost and complexity.”

It should be a win for customers of both customers and Lorne confidently states: “
we expect a substantial increase in Guardian sales volumes over the next few years.”

I’m therefore very optimistic that within the next 6-12 months we should see substantial upward revision of sales estimates for Fleet.

Exclusive interview

Today, in an exclusive interview with Paul Angelatos, Chief Operating Officer at Seeing Machines, I put a few questions to him regarding this latest development. I’ve provided the full text in Q&A format below:

Chris Menon:  Given the amount of injuries and deaths caused by driver fatigue and distraction in trucks/lorries etc, how great an impact do you think the combined offering will have in reducing accidents among your customers?

Paul Angelatos: We have shown (peer reviewed paper written by Prof Mike Lenne and presented at this years ITS Conference in Melbourne) that when our Guardian solution is implemented, coupled with real time monitoring, we can reduce the occurrence of fatigue events and distraction by up to 91%.  When we integrate with MiX telematics, who are industry leaders in fleet safety in their own right, we will also have a greater understanding of what is occurring in front of the vehicle, how the vehicle is being driven (based on data MiX take from the vehicle), and then provide detailed analysis of a whole range of factors, including the driver’s state, in a single report.  This is a powerful tool for fleet operators who are focussed on safety.

Chris: What are the projected sales of the new offering over the next 1-2 years?

Paul: That is difficult to put a figure on this. What both companies know is that we are independently increasing our sales each year and both companies have identified demand for the other parties services with current and prospective customers. We already have overlapping customers that present opportunities for integration and we have a product that is complementary (rather than competing with each other). Even small percentages of the addressable market (both companies existing sales pipelines) will lead to solid returns.

Chris: Is it an exclusive global agreement across the world or is it restricted to certain territories?

Paul: It is a Global non-exclusive agreement. This is the first stage in our relationship and it is important for both companies to pursue opportunities as they see fit. As we progress and demonstrate our relative value to each other, the relationship may take a different shape.

Chris: Have you committed to a minimum order immediately?

Paul: There is no minimum commitment from either party.  This is an agreement that has been a long time in the making. We have developed a strong degree of trust with each other and are comfortable that our cultures a well aligned and we share the same motivation. An arbitrary minimum commitment from either party wasn’t deemed necessary.

Chris: What will be the approximate cost of the combined product in terms of upfront purchase and then monthly fees?

Paul: We will shortly be undertaking some joint marketing with MiX. We will save the release of our pricing for that occasion.  Needless to say, our customers will receive greater value by installing our combined integrated offering than they would by taking the two solutions independently.

The writer holds stock in Seeing Machines.