RE: Broker Coverage7 Nov 2020 07:56
On 21st Oct Cenkos issued a note regarding the Aviation MOU
MOU with L3Harris Technologies
Seeing Machines has announced that it has signed a non-binding Memorandum of Understanding with global aerospace and defence
technology company L3Harris Technologies. The MOU frames the intent to enter into a global non-exclusive license agreement to enhance pilot
training technology with Seeing Machines’s dedicated precision eye-tracking system for flight crew training in the full flight simulator (FFS) environment. A license arrangement is currently in advanced discussions between the parties and subject to the negotiation and execution of definitive, binding licensing and other legal agreements. Further announcements regarding the progress of the negotiations in relation to such binding documentation will be made when appropriate.
? Comment: Seeing Machines first announced a collaboration with L3 for flight simulators in December 2018 with the partners having subsequently and successfully delivered the world’s first fully integrated eye-tracking system into a Boeing 787 FFS for a major Australian airline in 2019. With other airlinessuch as Emirates and Alaska as well as the RAAF extoling the use of Seeing Machines eye tracking to improve pilot
training and safety in modern ****pits, the customers (major airlines and the RAAF)
are undoubtedly putting pressure on the simulator suppliers to formalise access to
the Seeing Machines technology. Clearly the commercial aviation industry is facing unique challenges during the coronavirus pandemic; however, we believe the adoption of this technology by the FFS industry is effectively delayed by around a year and customers that have already committed to the technology are likely getting impatient. We therefore believe today’s unusual announcement of a non-binding
MOU’s more likely reflects a desire by L3Harris to show its customers that it is closeto formally securing access to the technology, than a desire by Seeing Machines to provide a status update. A potentially interesting knock-on effect of this
announcement though could be to wake the larger competitor in the FFS market,
CAE with c60% market share versus L3 Harris at c20%, and potentially introducing some valuable competitive tension to secure the technology through a licence deal. We note this technology is now publicly regarded by several major airlines
fundamental to the cUS$5bn pa simulator market, without eye tracking, it is virtually impossible to know what a pilot is seeing or not in modern aircraft that have Heads Up Displays
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