Google Inc (NASDAQ:GOOGL) recently announced that they have agreed to buy Skybox Imaging for $500 million and the deal is not just about using satellites for mapping, David Cowan said in a recent interview on Squawk on the Street.
According to Cowan who is a managing partner at Bessemer Venture Partners, the satellites purchased by Google Inc (NASDAQ:GOOGL) as part of the Skybox deal carry geospatial imaging sensors which take pictures and high-definition movies of the Earth.
He added that the search and advertising giant will likely take advantage of the ability of their newly-purchased company to take pictures and movies of the planet using a constellation of capable satellites to beef up their mapping service. However, this acquisition is not just about maps, he said. According to Coway, this is really about “access to space as a platform for deploying information systems.”
The Google Inc (NASDAQ:GOOGL) acquisition comes on the heels of the company’s announcement of investing over $1 billion in satellites to expand the reach of the internet to underserved regions. In a statement about the Skybox acquisition, the company confirms it will use Skybox technology for partly that very reason. They explained:
“Their satellites will help keep our maps accurate with up-to-date imagery. Over time, we also hope that Skybox’s team and technology will be able to help improve Internet access and disaster relief — areas Google has long been interested in.”
CNBC’s Simon Hobbs then went on to mention that one of the selling points of Skybox was that its team has reduced the cost of launching satellites to about $9 million. He then asked Cowan what the original aim of the company was, given that it isn’t likely that it was to get bought by the Mountain View, California-based giant. Cowan said that team aimed to change the way people think about space development. This was being done by the team of Stanford engineers by dramatically reducing cost from hundreds of millions of usually taxpayer dollars to tens of millions and deployment time from decades to years.
The video of the interview can be seen below.
Google Inc (NASDAQ:GOOG) includes William B. Gray’s Orbis Investment Management which reported 157,408 shares in the search, advertising and mobile giant by the end of March. Crispin Odey’s Odey Asset Management Group also reported 157,035 shares in the company as of the first quarter of the year. Both stakes were valued at about $175 million.