Players are going to start dropping out of the race to be the dominant farm data platform sooner than later, says a cropping systems economist who focuses on farm data analytics at Kansas State University.
Right now there are still dozens, maybe hundreds, of participants, with agronomy companies, equipment manufacturers, seed and chemical companies, tech providers, farm management firms, and others all competing to own, control and process farm data.
Given the large number of players providing similar services, and the pressure on farm margins, the farm data space is ripe for major consolidation, says Terry Griffin.
“Eventually we should be at five or a handful of data platforms. That’s when the action is really going to start, when farms get real serious about who they’re going to join when it comes to data analytics,” he says, noting the winner(s) could possibly be outside players or companies that aren’t even in the market yet.
He suggests farmers should only sign up when they believe the benefits of joining outweigh the costs.
“A lot of farms feel like they’re in a hurry to join a company and are wondering who that should be, when in reality it’s the data platforms that are in a hurry. Essentially the one who achieves the critical mass of grower, farms, fields, acres first is the winner, and so they’re in a hurry,” notes Griffin.
Before committing to any data platform, he recommends farmers ask three main questions:
- How many farmers or acres do you have participating? There’s network effect with big data analytics, he explains. “If you’re the only farmer in the system, there’s really no reason for you to join. The number of other acres gives insight to the value.”
- What kind of analytics do you provide that benefit my farm today? “A lot of analytics seem to be very similar to each other. I’m looking for something that’s above and beyond what’s being offered by competitors.”
- What steps are being taken to guarantee data quality? How do they process yield data? How are anamolies addressed? etc, explains Griffin.
Griffin joined us following his talk at CropConnect in Winnipeg to discuss the future of ag data platforms: