Few modern products elicit as many polarizing comments as Segway’s Personal Transporter (PT), unveiled in 2001 by Dean Kamen and the Bedford, N.H.-based company of the same name. Some consider the product revolutionary and successful, while others note that sales of the system have lagged expectations since the day it was launched. Segway Inc. has sold roughly 50,000 units of the two-wheeled, dynamically stabilized transporter. That is impressive, but not when compared with the transportation revolution the early hype promised. Was the $175 million in venture capital funding an investment in a better future, or good money thrown after bad? Furthermore, now that the company has been acquired by its U.K. distributor, will it be able to reach a new level of success, or was the sale a sign of desperation?
More Experience, More Parts
While the public perception of Segway is limited to the Personal Transporters seen on the news and in tour groups, the company has quietly developed an interesting set of products useful for mobile robotics systems (click on the robotics tab on the Segway website at www.segway.com). In fact, company insiders indicate that the Segway Robotics website has become a popular destination for Segway employees excited by the novel products.
Although many companies offer mobile platforms, few, if any, have the real-world production experience that gives Segway robotics solutions their reliability and robustness. Even the static stabilization models that use static balance (three- and four-wheeled units) have robust, field-proven Segway technology inside, including batteries, motors, gearboxes, and so on. A company spokesperson claims that Segway has produced at least two orders of magnitude more parts than its competitors. Whether those figures are exact or not, Segway definitely does have the experience of selling and maintaining 50,000-plus commercial units used on a daily basis.
The Product Line
The Segway Robotics product line includes both dynamically and statically balanced models (see Fig. 1). At the low end is the RMP 50, a two-wheeled unit that has a small third wheel for static balance. The RMP 100 is a two-wheeled, dynamically balanced model that is similar in appearance to the commercial Personal Transporter unit, but with a mounting platform rather than handlebars. The RMP 200/ATV is a slightly heavier-duty version of the RMP 100 unit that can travel farther and faster, and includes the option to use ATV wheels rather than the standard wheels found on the PT. Another four-wheel Segway product is the RMP 50 Omni, which is equipped with Mecanum wheels that allow it to move sideways as well as forward and reverse.
Segways’s two heaviest-duty units are in the RMP 400 family. The RMP 400 is a 240-pound platform that can carry up to 400 pounds of payload over long distances and challenging environments using ATV tires. The RMP 400 Omni trades speed for movement flexibility by adding the Mecanum wheels. The RMP 400 provides more than twice the speed, range, and payload capacity of the RMP 50 Omni. Both RMP 400 models are powered by four lithium-ion battery packs.
RMP 400s also have the highest price tags, around $46,000. They are not yet a high-volume product, but the product’s margin appeals to Segway management. At the opposite end of the price spectrum is the RMP 50, which is based on the PT but adds a third wheel for balance.
The Segway pitch to potential customers searching for a base platform for mobile robotics products is that it has already solved the platform and mobility issues, so buyers can focus on providing value-added technology to their systems. That is the same pitch their competitors use, of course.
Platforms and Products
It is common for robotics researchers to base their prototypes on Segway platforms. A number of commercial companies are also basing their product offerings on Segway platforms, although most systems are not yet market ready. One company that does offer product, Australia’s Marathon Robotics Pty. Ltd., uses the RMP 100 as the platform for its Rover system of programmable targets for live-fire sniper training. Using the Marathon Robotics’ Rover system, customized mannequins can be programmed to wander realistically around a target area. A single instructor can manage a group of Rovers, rather than needing one tech to directly control each robot with a joystick. When one target is hit by a sniper round, all other units scatter in various directions. The realistic movement, human speed, and programmability provide a much more intensive training exercise compared with pop-up targets that always appear in the same place.
UniFire AB, a Swedish company with the slogan, “The Future of Firefighting,” is perhaps the closest to shipping a commercial product based on Segway’s RMP 400. While still a custom project, a working prototype has been developed featuring a remote-controlled fire hose nozzle mounted on an RMP 400 with ATV tires. The resulting robot is designed to allow hose placement in areas too dangerous for firefighters. Although expensive, this tool has high sales potential within the niche firefighting market. In addition to entering an important new market, the UniFire systems will increase market awareness of both Segway and the company’s four-wheel offerings. That said, the RMP 400 is only available for custom pilot projects like the UniFire firefighting apparatus, but not for general sale.
For the Expo 2010 in Shanghai, Segway partnered with General Motors in a high-profile project. The companies created three models of the EN-V (Electric Networked-Vehicle, pronounced “envy,”) concept “cars” (or, at least, two-passenger fiberglass housings on customized Personal Transporter bases). Maximizing the dynamic technology Segway is famous for, the battery pack powering the EN-V’s 3-kW electric motor slides back and forth to balance the occupant’s weight. Two small parking wheels support the unit at rest, but not while in motion. This project, a custom design contract from GM, has been finished, and engineers are being reassigned throughout the company. However, Segway’s website still displays the EN-V eye-candy prominently.
Segway Business
The first half of 2010 has been unusually eventful for the privately held, venture-backed company. On Christmas Eve 2009, a controlling interest in Segway had been gained by a group headed by Jimi Heselden, a prominent U.K. businessman and the chairman of Hesco Bastion Ltd. Heselden is also an investor in the independently owned Segway U.K. distributorship. While officially labeled a merger, the company admits that for all intents and purposes, it was acquired by its former U.K. distributer.
Rumors swirled around the delayed announcement (mid-January) of the acquisition, as well as the potential for layoffs, but as a private company, Segway is not mandated to provide any details and has not done so. The company noted that the decision to delay the announcement was made out of respect for the new owners. Since Hesco Bastion’s Heselden is routinely described as reclusive, news will likely be in short supply. Segway is not a division of Hesco, but of the independent U.K. holding company and distributorship owned by Heselden.
Following the acquisition, layoffs were minimal, but the transition and internal changes triggered some employee resignations. Headcount is reported to be at about the same level as before the acquisition. There are currently about 80 employees, not counting independent contractors or recent tour guide hires. Segway is also opening its first retail outlet in July in Manchester, N.H., and some employees have been added for that location.
Segway’s robotics division reports no cutbacks from the acquisition, and in fact, claims that a greater amount of resources are available to the department than ever before. Focusing on universities and research departments as sales targets, as Segway Robotics has done for its platforms, is the traditional path many robotics firms take as the first step toward generating revenue and creating products for boarder market appeal. Segway, too, must leverage the experience gained while developing and selling research platforms to create applications and products with mass appeal (often through partnerships).
Segway’s Future
No matter how friendly, a change of ownership can be unsettling for a company. Former Segway CEO James Norrod, after five years on the job, officially “stepped down” with the acquisition. Wayne Mitchell, originally from the from the U.K. distributorship, has been appointed chief operating officer and is in New Hampshire on a regular basis. The few news bits released follow the typical “all is well” script common to most acquisitions.
The economic downturn the last two years has softened sales on Segway’s consumer side, but the most significant part of the PT business was already commercial and municipal in nature, so the downturn was not severe. Reportedly, there is currently a backlog for PT products that extends for a few months. Given the troubles in the municipal sector, however, a product backlog may not reappear for a time. Sales cycle times for government are notoriously long, and it is clear that the overall government sales pipeline has slowed as tax revenues have dropped, squeezing every public budget across the country.
The balancing act for Segway is to increase sales in its new robotics market, keep happy those venture capitalists who have $175 million on the line, and adjust to the new ownership. One hopes dynamic stabilization works for Segway management as well as it does for Segway Personal Transporters.
The Bottom Line
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