The Washington PostDemocracy Dies in Darkness

A stunning new look from space at nature, North Korea and Chipotle

A copper smelter in Kazakhstan. Copyright Planet Labs Inc.
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A few years ago, Americans who wanted to invest in China would have a lot of homework -- and legwork - -to do. Most would have to hire someone halfway around the world to check out the investment for them. An investigator might drive for hours over the empty plains of Inner Mongolia, China's far northern region, to make sure a remote mining operation really existed. Others would literally hide in the bushes to count trucks coming and going from a factory, or count the number of trees owned by a lumber operation.

Now, companies have a much simpler solution: monitoring investments across the world through photographs taken from space.

Satellite images contain a wealth of information about how much business a company is doing, and how much a country's economy is growing. A hedge fund interested in investing in a Chinese miner, for example, might use the satellite images below to see how much the mine is really producing. By watching how a mine changes over hours or days, analysts can figure out how active the mine is.

In the image below, taken by satellites owned by space and analytics company Planet Labs, you can see how a gold mine in northern China changes between September and October. (Move the slider on the image back and forth to see the mine get deeper over the course of the month.)

Analysts are now using satellite imagery to examine everything from the lights cast by cities in India, to black market activity in North Korea, to how many people are shopping at Home Depot. As satellite imagery becomes more available, it will reshape how companies monitor their own and competitors' operations, and make investors huge amounts of money. It will also generate privacy concerns, as anyone's activity outside is now visible to the highest bidder.

One company, Palo Alto-based Orbital Insight, has been watching cars come and go from the parking lots of major U.S. retailers, in order to make predictions about their sales.

Orbital Insight's most recent tracking shows that Home Depot is busier than Lowe’s, says James Crawford, the chief executive of Orbital Insight. It also shows that Chipotle is getting more popular -- maybe due to the company's announcement that it would no longer use genetically modified foods, suggests Crawford.

To generate these analyses, Orbital Insight first has its analysts go through satellite images on computers, clicking on each car. In doing so, they teach the computer how to identify cars in the images, and create a heat map like the one below. The company then uses these heat maps to predict the sales of Chipotle and other retailers.

These are just a few of the fascinating ways that companies are beginning to use satellite images to detect patterns in the global economy. By poring over satellite photos, analysts and their computer programs are able to monitor oil and gas shipments, watch buildings as they are constructed, see trains and trucks come and go from factories, and even estimate how many plants are growing in a field.

Here is aquaculture in Hanja Ri, South Korea. Intricate rows of seaweed are farmed in the protected waters of the Myeongnyang Strait.

And here is the Ivanpah Solar Electric Generation System in California, which uses thousands of mirrors to focus sunlight on a boiler held 450 feet above the Mojave Desert. The superheated steam then drives turbines to make energy:

Using satellites to measure the economy is a young industry. Only a few years ago, satellite imagery was mostly restricted to people with official jobs and security clearances. But a new fleet of commercial satellites that are being launched into orbit promises to change that. A group of high-tech start-up companies is building satellites that are dramatically smaller and cheaper than the ones that came before.

“In the Cold War, [satellite imagery] was used only by governments,” says Pavel Machalek, the co-founder of Spaceknow Inc., a satellite image analytics company in San Francisco. “In the '90s and 2000s, it started to be used by very large corporations for commodity trading and financial intelligence. And now, it’s moving into the commercial world.”

These new networks of satellites, some as small as a shoebox, are lowering the cost of taking pictures from space. As so-called “constellations” of satellites are launched, customers might be able to get a satellite photo of any spot in the world in an hour or two for perhaps a hundred dollars.

“It’s a little more than taking a picture with Santa, but not a lot more,” says Jason Andrews, the CEO of BlackSky Global, which is launching a network of satellites.

The global economy is about to get a lot more global

Cheaper, more readily available satellite imagery promises to change the way that many organizations operate.

The “killer application” of all these small satellites will be monitoring the global economy in real time, says Andrews of BlackSky Global. Companies will be able to closely monitor their competitors, and investors will have a better idea of how their investment targets operate.

Andrews points out that satellite imagery will help many companies  streamline their processes – for example, oil and gas companies that have to monitor their pipelines for leaks. Instead of sending workers out in trucks to check out pipelines, in the future these companies can sit back and watch from space.

Faster satellite imagery will also have big consequences for people working in security and defense, for example helping monitor troop movements and drug trafficking. It will be helpful to international groups that monitor climate change, illegal logging and certain human rights abuses.

The broader availability of satellite imagery could also raise privacy concerns. The United States and other countries are now competing to let their domestic companies offer the highest-resolution images. Images that are sharp enough to identify people -- technology that was previously only available to governments -- is increasingly available to anyone willing to pay for it.

But this democratization of data about the planet could also change the way that society functions for the better. “People do illegal logging, fishing and dumping because no one is looking," says Andrews of BlackSky Global. "If you can look from space, suddenly it forces accountability, on people, corporations and governments.”

One project that Orbital Insight is launching with the World Resources Institute, a non-government organization, uses satellite images and big-data analysis to help defeat illegal logging.

Sites that have been cleared of trees stick out dramatically from space. These images from Planet Labs show what the forests near Corvallis, Ore., look like after logging, and with new tree regrowth:

The Orbital Insight partnership aims to actually predict illegal logging before it happens.

To do that, the organizations will analyze high-resolution images of places where illegal logging has occurred, three to six months before the event. That will teach their algorithms what to look for to identify forests that are at risk – like the building of new roads and the movement of logging equipment.

The theory is that there are certain patterns of activity that can signal that illegal logging is about to happen. “The idea is that if you’re going to go cut down a virgin rainforest, you don’t just wake up one day and get your hatchet and start cutting down trees. This is a serious commercial activity,” says Crawford.

Secrets of the world

Researchers are also using satellite imagery to monitor parts of the world that are shut off to outsiders.

Curtis Melvin of the U.S.-Korea Institute at the Johns Hopkins School of Advanced International Studies has used satellite images to track North Korea’s weapons production, as well as its economy more broadly. North Korea is, of course, very restricted to foreigners, making it hard for academics and others to verify information that comes to them from official media or defectors. “Satellite imagery is really the only way we can peer into parts of the country that are and have always been off limits to foreigners," he says.

Through satellite images, Melvin has watched Pyongyang’s recent construction boom, including new theme parks and housing for scientists. He's monitored the weapons factories that Kim Jong Un, North Korea's leader, has visited. And Melvin has also tracked North Korea’s black markets, which have risen up at various times in the country’s history to sell vegetables, clothes and shoes, and even consumer electronics and soap operas smuggled from South Korea.

The markets aren’t legal in North Korea’s Communist system, but the state hasn’t always been strong enough to stop them. When the official economy collapsed and famine became widespread after the death of the previous leader, Kim Il Sung, in 1994, North Koreans began using black markets to sell whatever they could, says Melvin. Since then, the state has periodically tried to roll back the markets, but it doesn't always succeed.

Below is one example where the government succeeded. The Phyongsong Market was the largest wholesale market in the country, but the government had it torn down. The destruction of this market was rumored, but confirmed only when satellite imagery became available, says Melvin. The image on the left shows the market thriving in 2006. By 2010, it was deserted.

How these measurements have evolved

The practice of measuring economic growth from space really began years ago, with night-time lights. Lights indicate the presence of cities, factories, even natural resource extraction -- as you can see from the image below of the Bakken Shale, one of the biggest oil discoveries in recent history, which now lights up the desolate North Dakotan prairie.

In 2011, a group of economists at Brown University demonstrated that lights from space could show long-term differences in incomes – for example, in North and South Korea – as well as short-term fluctuations, like Indonesia’s economy slowing down during the Asian financial crisis. They also used satellite photos to argue that Burma’s economy was growing much slower than the government had reported, and that Congo was growing faster.

The Brown researchers say they don’t see these measurements as a replacement for official economic data. However, they do consider it an important supplement, especially in developing countries where official statistics can be shoddy or fraudulent.

More recently, economists at the Federal Reserve Bank of New York used a similar technique to parse India’s growth. It is notoriously difficult to accurately capture economic data in developing countries.

In India, for example, some surveys showed that per person income grew by 29 percent between 1994 and 2010, while another analysis showed that income increased more than 100 percent in the same time period. The New York Fed researchers used the change in India’s lights to show that the actual growth was much more similar to the second measure.

More than lights

One fascinating way that analysts are gathering information today is by analyzing and measuring the size of shadows.

In China, for example, people are using the idea to monitor China's "ghost cities" -- newly constructed buildings, bridges and roads that are complete except for the people.

Many people believe that construction might be slowing in China as the economy slows, but no one knows for sure -- government statistics on the topic are unreliable. So Orbital Insight decided to look at satellite images of Chinese construction sites in 30 important cities across the country.

By measuring the size of the shadows that the buildings cast each day -- which are marked in red below -- the company can figure out how high the building is. If the red shaded area grows over time, that means construction is progressing. Crawford, the CEO of Orbital Insight, says their preliminary data indicates that Chinese construction has indeed slowed in recent months, but that the analysis is still in its early stages.

Orbital Insight is using a similar strategy to look at the world's oil supply.

In the past, people have relied on ad hoc measurements and surveys, which are often inaccurate, to estimate how much oil, corn or other goods the world is producing. “It’s not insider trading, but if you knew how much oil OPEC produced before OPEC released its report, that is extremely valuable to certain people,” says Andrews.

But that is something that these companies are doing. Crude oil is often stored in massive tanks, which have lids that rise and fall depending on how much oil is inside. By measuring shadows on the tanks, Orbital Insight can estimate how high the lid is, and therefore how much oil is in the tank, as the images below show.

Another fascinating application is the use of satellite imagery to measure the growth of agricultural crops.

Beyond just looking for bare patches in forests, companies can now measure different wavelengths of light to calculate the actual amount of plant material in a field. In the near future, scientists might be able to calculate the amount of every crop in every field around the world, says Will Marshall, the co-founder and CEO of Planet Labs.

Satellite images clearly show how fields grow over time. The image below, from Planet Labs, shows winter wheat growing in fields near Lubbock, Tex. After several months, the fields have clearly grown.

But scientists can use the ratio of visible light to near-infrared light to create a more precise measurement of a plant's photosynthetic activity. In the image below, a company called Urthecast compares the normal satellite image on the left with a "vegetation index" on the right. The green-colored areas in the image indicate dense and healthy plants, while the red areas indicate sparse or stressed vegetation.

By adding up these green areas across the globe, analysts could produce a much more accurate estimate of how the world's crops are growing.

A competitive field

For a world in which people are constantly connected to one another through the Internet and mobile devices, our ability to look at the Earth from space is surprisingly limited. Google Earth allows us to see almost any point on the planet, to be sure. But the image that Google provides is static – usually, between one and three years old. Most people have no way of seeing the Earth in real time.

“How many trees were cut down yesterday around the planet? How much coal was mined yesterday or last week or last month? The basic infrastructure doesn’t exist to answer those questions at all,” says Andrews of BlackSky Global.

Getting satellite images is not yet as easy as having your photos printed at the drug store. Many more satellites need to be launched, and it will take time for companies to develop the big-data algorithms that can accurately analyze images and assess fluctuations in economic trends.

In the meantime, the industry is already consolidating. Just a few weeks ago,  UrtheCast purchased the Deimos satellite operations and its global imagery archive.

Then last week, Planet Labs announced that it would acquire the BlackBridge geospatial companies, which have been collecting Earth imagery for the last seven years. Marshall says that archive of images will allow Planet Labs to calibrate and train their algorithms to better identify certain objects and trends in satellite photos.

“The main limitation today is that the number of satellites is still not as high as we would like it to be. We see a future where we would be able to get images of every commercially important spot on the earth – but that’s not yet the case today,” says Crawford of Orbital Insight.

But that future isn't too far off. As the cost of building and launching satellites drops, companies are able to launch dozens of satellites that cast a web of sensors over the Earth. Since companies are launching so many, they are able to make more frequent updates to the satellite software, and it's not as big of a deal if one of the satellites happens to fail.

At that point, satellite companies will have the ability to take a picture of the same piece of ground dozens of times in the same day. The map below, from BlackSky Global, shows the places their satellites will be revisiting most -- up to 72 times per day in the red regions.

Industry players say that, in less than a year, several platforms could be competing to allow people to request photographs of almost any spot on the globe, with the image available in just a few hours.

"We're going from the old world, where a satellite cost a half billion dollars and was the size of a minibus, to a new world where a satellite costs less than a million dollars and you can hold it in your hand,” says Crawford of Orbital Insight.

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