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Behind the scenes at

Business analysis unveils a national need for further ramping up robotics education, direction and investmentFrank Tobe has done an outstanding job analyzing the business of robotics and our national standing in the growth of this technology. Please read this interview and consider sharing it with others who care about this important subject. The article will be posted online when the magazine is off-sale.
Robot: What is your background as it relates to business and robotics?
Frank: I have been a consultant and researcher for businesses and politicians over the years, and I have a background in identifying business and investment opportunities.
Robot: How did TheRobotReport come into being?
Frank: I started because it was my belief that this was the next big wave of economic development. I wanted to find public companies that I could invest in. I called my broker and asked for a list of robotics companies. He could not provide a list. So I went on Bloomberg and typed in robotic and got four hits, just four. I called another broker which had a research department and not a lot of answers, so I decided to do it myself!I tried to find public companies that had a track record that I could invest in. But when you look at them, ABB for example, which is the second largest robotics provider in the worldonly 1/3 of their revenue is from robotics. The rest is from powerthey make generators and transformers and all that kind of stuff.Boeing is one of the larger providers of military robotics. But Boeing is in another business (aircraft), so what I was trying to do was find stocks that fit my criteria, that I could invest in, that were primarily robotics stocks. Then I thought maybe I could find some privately owned companies, for example, supported by a venture capitalist, that I could invest in. But nobody would want to talk to a junior, so I decided to become a senior, a researcher/analyst, which is a discipline that I know how to do.
I developed a database of over 1,000 companies that are involved in robotics, and another 300 research facilities involved in robotics. Not just the ones we know about here like MIT or Stanford, but places like the University of Heidelberg. Youve got to understand that this is a worldwide phenomenon, not just here, and basically, robotics has more of a structure everywhere else than it does here. That got me more interested in worldwide stocks, which enlarged my database.I now have over 1,300 companies and research facilities worldwide that produce or are directly involved in robotics. I had to decide how to present my information on I love the Drudge Report. The guy is phenomenally conservative. But, on hissite, you get a quick view of the news, fast. There is always a catchy headline with a wonderful pictureyou say to yourself this guy is crazy but thats the news, todays news. So I decided Id build a website like his, but I would not be as flamboyant (or conservative), so Id not get as much traffic. As I built the website I realized you cant just link to someone elses story, you have to say why it is important. When you do that you realize there is more than one story about the same subject or about a category of subjects. So I attempt to sift through these multiple stories and condense them under one title.For instance, the two stories about NASAs new Global Hawk drones and the Air Force hand-me-down drones. Theyre really part of a bigger picture about equipment returning from Iraq. Im interested in that because there is opportunitywhat can I invest in? And thats what I attempted to report when I presented the stories and links.

The last interview I did with Henrik Christensen or my rant on singularity, whatever, required a place where I could put longer stories of my own creation – thats how the blog, evolved.

I keep this these two sites going via a bunch of news sources that I compiled. They are a combination of everything from DARPA-Watch to five or six sources covering medical robotics, to five or six on Japanese robotics, to Google News.

Robot: Do you pay for this information?

Frank: I refuse to pay and I refuse to charge. Robotics Trends gives away a lot of free information but they also charge. I watch and listen to the

podcasts coming out of Switzerland (, all of that stuff is free.

Robot: Can you tell us a little about your background?

Frank: For 25 years I owned and operated a computer services company that developed and maintained voter databases and printed and mailed political mail. The databases were organized so that they could be sliced and diced to make them useful to election campaigns. We were the largest provider of Democrat data and mail in the country. In this 25 year period we went from mainframes to PC based software.

Robot: Can you tell us about the RoboStoxâ„¢ chart?

Frank: I needed a way to visualize how the stocks were doing independent of what I was reading in terms of news. Stock performance is often independent of whats happening, so I developed RoboStoxâ„¢, which is a summary of the percentage change from period to period, year to date and year to year. It compares stocks

worldwide to the NASDAQ Index, for instance. NASDAQ is Americas biggest technology index, and robots are technology so I decided to compare it to that.This brings up the issue that robotics is not just American, its worldwide. The biggest stock moves are in India, Israel, China, Korea and Canada. Everywhere but hereeverywhere there is national leadership and a strategic plan to develop robotics technology. As you know, we have a proposal for a plan (, an outlinethe Robotics Roadmap, but we do not have a plan for America. [To see this report online with a scan app on your smartphone, scan the barcode at the top of this article or type in]In Europe they have a plan that is now into its eighth year and there are all sorts of neat things coming out of that plan. Korea has a plan in its fifth year and they are really coming along. In Japan they have a plan, and so on.Robot: Are the companies you follow just publically owned entitiesin other words, what you follow is just a slice of the robotics market place overall?Frank: Yes, thats correct. You cant evaluate performance of private companies because thats proprietary data that isnt public information.
Robot: You divide your chart between industrial and service robotscan you expand on why you make this distinction.Frank: Industrial robots are those that are used for manufacturing. They are generally stationary, big, somewhat unsafe and costly. Service robots are every other form of robotics. They are everything from mobile platforms to companion robots and toys, mobile and embedded, in the air and below the sea. To me, a service robot is everything that is not a manufacturing robot.In my database I separate companies into four categories Theres also an Ancillary Businesses directory covering integrators, servo providers, software providers, vision systems and engineering/consulting firms which are still part of the robotics industry.For the Robo-Stoxâ„¢ chart there are only two: Service and Industrial Robots for Government and Corporate Use and Service Robots for Individual and Entertainment /Personal use.Looking at the 2010 year-end chart, you can see that industrial stocks like KUKA, Fujitsu or Fanucthese are robot manufacturers that are quite large or its a good portion of their businessare rebounding from a terrible 2009. If you look at the chart, in Korea, industrial robots are coming back like gangbusters. Business is up in the U.S. and Japan as well and you have to replace, replenish and refurbish industrial robots. Industrial robotics is a growing business, even after 50 years. A recent Robot Industry Association Report shows orders for new robots increased a healthy 34 percent in North America and an eye-popping 143 percent outside of North America over the first nine months of 2010 when compared to the equivalent period in 2009.

The real future growth in robotics, however, is in the service sector. Medical robotics, bionic prosthetics, robotic vacuum and floor appliances

unmanned vehicles in manufacturing, healthcare and agriculture, UAVs, ROVs, AGVs and mobile robots of all kinds are being manufactured and sold all over the world, not just for the US Army and DoD.Robot: Do you have a conjecture whether there is something to be done to help the situation improve? This brings up the second subject: what do you see happening in the service sector?Frank: Yes and No. Our economic drivers will change things. And America will tend to be the leader with those drivers. To really look at things, you need to look at whats driving them. A long time ago, when the PC revolution started, it didnt start because there was great equipment that you could, you know, carry. It started because of WordStar, VisiCalc and dBase. Three software packages that were wonderfulnobody had ever had those capabilities before.
dBase was the first relational database. People didnt know what relational meant. But now they do. People now know what artificial intelligence (AI) is, what the capabilities of a robot are. They see it every day as they get more smart products. The iPhone and iPad come out, and the Android productspeople know what a smart product is and can do. So, when they hear about an artificial robotic smart pancreas for a diabetic, they know exactly what you are talking about. Wow, its a robot thats inside you that is monitoring blood sugar and checking you and is adaptive. This includes nearly every definition of a robot: it is adapting to the outside environment that it monitors, its making its own decisions, its working interactively with a human and people understand that.Robot: You mentioned a moment ago that to understand where we are going one needs to look at the economic driverscan you define these? Frank: Anyone who must consider surgery will want minimally invasive surgery, which usually means a robotics device. If the doctor says we dont do that here then the patient will say then Im going to a place where they do do it. Minimally invasive surgery is what people are demanding.Doctors are responding to that and are not happy that Intuitive Surgerys DaVinci is the only player. They want more competition and more devices. At a European robotics conference I met a couple of guys from the University of Heidelberg who said in Germany alone there are 457 robotics surgical devices actively in use, but only 10% of these are commercially available. This means they know there is demand and they are trying to adapt to it to give the doctors the kinds of equipment they need to satisfy that demand.

Another type of demand is defense and security. We have had great success in Iraq and Afghanistan with unmanned robots of all types, land, air and underwater. As these have been developed, others have paid attention movie companies use unmanned helicopters for helicopter shots. Every real estate agent wants one. Every farmer wants them to take aerial pictures and monitor crops with sensors and potentially to spray crops. They may not necessarily want to own one, they may want to rent one. Theres the demand.

Robot: So you are saying there is latent demand for smart technology that is pretty much permeating our whole culture?

Frank: Yes, and we are all seeing this in the mediawe are seeing what DARPA is developing, and people now are saying I understand that and I want that.

DARPA right now has two projects that probably four years from now will have such great impact in robotics that Im surprised people arent already jumping up and down and trying to get a piece of it. One of them is the hand project, which they call the ARM. Autonomous Robotic Manipulation (both hardware and software tracks). DARPA is saying we need two hands working together to do a duffle bag search. That is both a military and a security driver.

The other one is whats called the smart camera, and the project is called Minds Eye. Im most familiar with the European version and youve got to believe this is a wonderful project. The European project has an autonomous movie camera filming two people, and it will know when to switch from person to personand when to intersperse photos from the internet about the topic they are talking about. The camera will know when to zoom in and when to zoom out. Think about this just from the point of view of a TV interview. So, we have a DARPA project called Minds Eye, the European project and, also, a Japanese project doing the same.

All over Europe, there is all sorts of hand development. They dont have a project like the DARPA ARM, but they all have a timetable for completion of around 2014 or 2015 and just imagine how it translates. Its big moneylook at all these people rifling through stuff at airports, in customs and in security, and imagine robots doing this that are equipped with extra sensors humans dont have. There is lots of neat stuff like this happening. That is another driverresearch projects like the hand programs that are already funded and underway.


Another economic driver not presently available is disposable income. We are still in an economic crisis. But the minute we do have disposable income, there are a few things that people say they want and demand for these will climb.

Young people say they want robots to do their household chores. Health care people say they want robots for the elderly that can provide a combination of security and assistance. People in between want a diverse range of robots for entertainment, and gamers want improved games that involve artificial intelligence and haptics. They are interested in robotic gloves and vests and stereoscopic vision. They love the new controller-free Kinect for gesture and voice recognition. At CES in Las Vegas this year I saw an iPad smart toy that was a little risqué. Last year a life size robot female doll was introducedthe company claims to have 4,000 orders at $3,000 eachthats $12 million. So, there are many demand driverssome are latent and some are right here.

Consider companion robots like the Pleo, or the Pero or the MIT Huggable and Fujitsus teddy bear. These companies are waiting for just a modicum of available disposable income to bring these products to market.

Robot: What should our national stance be with regard to robotics education and business development that would make our country as competitive as it can be, and that will enable us to be world leaders in robotics innovation?

Frank: I was disappointed with the section of President Obamas 2011 State of the Union speech regarding investing in selected new technologies for future growth.

I had hoped he would use the word robotics and include the necessity for an American robotics industry in his speech and it is unfortunate that he did neither. That he focused his investment scope to exclude robotics might just be the death knell for the American robotics industry because, without national strategic focus, things will go on as they have VERY slowly and very dependent on Space and Defense for research dollars.

A thriving robotics industry provides jobs, helps the nation increase efficiency, profitability and productivity and upgrades the mix of workers involved. Yet America doesnt presently have a national robotics agenda. Europe does. Japan does. Korea does. And each of these countries is gaining success and momentum worldwide.

InformationWeek just did a piece on 12 Advances in Medical Robotics but failed to note that 2/3 of the vendors were not American. Eight out of the 12 were Japanese, Korean or European. The ratio of industrial robot providers in America is even worse: 83% are foreign-owned although integrators, engineers and consultants tend to be Americanowned. All the major robot providers (KUKA, ABB, Comau, Denso, Schunk, Motoman, Daihen, Reis, Fanuc) are foreignowned even though they have offices in the US for sales, service and integration.

Weve already given the industrial side of robotics to offshore providers. The service side, however, offers much hope. So many areas for robots: exploration, getting minerals from strange places, going to new markets where others have not, doing tasks that humans cannot or should not these are all wonderful new areas where robotic technology can make inroads. Yet without the formulation and acceptance of a roadmap and the establishment of a public-private consortium to implement it fully, America may well lose leadership in these new frontiers as well.

A roadmap was presented in May, 2009 and some of its provisions are slowly making their way through the halls of Congress. But there is no executive leadership thus far and thats what is needed to attack, head on, the bugaboo of robots taking jobs. Service robots are likely to be embedded and unseen in your cars, homes and offices well before they fold your laundry and do your dishes. They are likely to take over all the dangerous jobs that humans shouldnt be doing well before theres a human-like robot accompanying you to work. And they are likely to provide assistance and multiply functionality when they do begin to work alongside humans.

I think its an amazing future in robotics and Im thrilled to offer what I can by providing a news portal to track the business side of robotics and also to produce the Robo-Stox charts to monitor how the stocks are performing.

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