A friend recently asked me if precision agriculture is going the way of the airline industry. In other words, will the various companies, large and small, begin to consolidate so that over time there are just four or five major players? This is a fascinating question, especially in light of recent acquisitions and partnerships in the agricultural sector. Before answering this question, it may be helpful to provide some background on where precision agriculture is today relative to its beginnings some 30 years ago.
Like most other technology-oriented industries, precision agriculture is going through evolutionary phases, though at a relatively faster pace. Using a human habitation analogy, precision agriculture began in the early 1980s with trailblazers. Trailblazers consisted of pockets of one or two individuals scattered across the country. They saw a vision of what a personal computer coupled with a geographic information system (GIS) and a global positioning system (GPS) could mean for agriculture. These innovators in government, university and industry took advantage of later generations of these systems that were becoming both practical and cost-effective. Most of their energy was focused on adapting the software and communication components of these systems so that they could work together in an agricultural field setting. While far from commercial services, these individuals were able to demonstrate the value of geographically-addressed points in a field to record observations and to make derivative products such as a variable-rate map. One forgets that during the late 1980s, fax machines could only transmit text at very low baud rates at a cost of thousands of dollars and that the Internet was in its infancy.
The Early Pioneers
The 1990s was the decade of pioneers. Small start-ups were introducing more accurate GPS units, yield monitors and software programs that assisted growers in the collection of field data and the interpretation of that data for production decisions. Most software was distributed on floppy disks but a few companies were taking advantage of the Internet with Web-based programs. Larger equipment companies were incorporating GPS units into their hardware so that the geographic positioning of material applications or harvested biomass could be tracked across a field. The 1990s saw the widespread use of laptop computers and handheld devices in the form of personal digital assistants (PDAs). Laptop computers and PDAs gave individuals mobility in the field. Software followed these mobile devices allowing participants in precision agriculture to trace a boundary, record a soil sample location and make crop and pest observations.
The pioneers, be they growers, consultants, retailers, distributors or companies, faced two major hurdles in the adoption of precision agriculture. The first hurdle was the incompatibility of hardware and software. Every equipment company had their own proprietary wiring, devices and file formats for recording and transferring data to and from the field. It was a meticulous and painful process to get machinery and programs to talk with one another. Incompatibility resulted in a high level of frustration among growers and their providers and slowed the adoption of a beneficial technology. The second hurdle was the learning curve among agricultural participants. Precision agriculture demanded not only new technical skills but a new mindset. A hundred years of whole field practices had to be adjusted to subfield information. Consumed with getting things to work, the second hurdle was rarely addressed in the early decades of precision agriculture.
The 2000s was the decade of settlers. During this period, the basic elements that would ultimately define a precision agriculture service came to fruition. Whether offered by small or large companies, these elements consisted of boundary making, recordkeeping, field notes, crop and pest scouting, field sampling in coordination with soil labs, variable-rate applications and other software tailored to crop-specific production practices. Nearly all companies staked out well-defined market geographies with little overlap. Some companies targeted growers while others worked through retailers, distributors, consultants and other entities who engaged growers.
During this decade of settlers, customers jumped from company to company in quest of new offerings or price advantages. The 2000s witnessed the widespread use of tablet computers and cell phones. In the latter years of this decade, cell phones evolved into smartphones, with their built-in accessories and ability to access the Internet. Flash drives and cloud computing also made their introduction in the 2000s. Flash drives made an immediate impact on precision agriculture with their ability to shuttle data to and from a desktop or portable computer to hardware in the field.
The present decade, 2010s, is seeing the rise of cities. As precision agriculture becomes more main stream, the larger equipment, seed and chemical companies, distributors and retailers are either buying or partnering with smaller companies offering new technologies or solutions. Simply put, to compete, any entity supplying products or information to growers must have a precision agriculture service. At the same time, venture capital outside of agriculture is buying up farmland and retailers across the country. As each retail location comes into the venture capital fold, a local precision agriculture program is replaced with a corporate one. The continual acquisition of farmland and retail outlets reduces the market for other competing companies.
The present decade also marks the movement from “precision” agriculture to “decision” agriculture. The earlier learning curve for technical skills and data solutions went from being voluntary to a requirement for participation in precision agriculture. Customer desire for both technology and knowledge fueled the vertical integration of entities in order to provide a “one-stop shop” not only for a precision agriculture program but also for a decision support system. A decision support system that supports best management practices and covers the risk for their implementation. The decade saw the introduction of calculators to assess the sustainability of production practices. A sustainability assessment helps growers be more efficient with their resources and better stewards of their farmland.
New technologies, such as described in this PrecisionAg magazine edition, will continue to define precision agriculture in the future, but the vertical integration of entities with its focus on decision making will change the composition of competitors. In answering my friend’s question, precision agriculture in the remaining years of this decade will, like the airline industry, end up with four or five major players globally. And, to the surprise of some, the monies fueling this integration will very likely come from outside the agricultural community. While many of the early and later entrants in precision agriculture will be absorbed in the current and future consolidation, others will redefine themselves. Even as precision agriculture matures like other technology-oriented industries, there will always be new innovations creating new opportunities due to the complex and changing nature of agriculture.