RHEA Talk: Growth of the Commercial Space Market
On 1 July 2021, we held our fourth RHEA Talk webinar in which four experts discussed the changes in the commercial space market and the potential areas for future growth, hosted by John Bone, RHEA’s Chief Commercial Officer:
- Pascal Rogiest, Chief European Institutions Officer, RHEA Group
- Andy Shaw, Director at Assimila
- Eduardo Cruz, GOMSpace Luxembourg Country Manager
- Mark Roberts, Defence and Security Director, RHEA Group
RHEA is a leader in space services and solutions, working with national and international agencies and commercial space companies. Globally, we are seeing the space sector evolving at an ever-increasing rate, with private operators, entrepreneurs and a wealth of SMEs creating new technologies and solutions that are changing the dynamics of the sector. So what is in store for the commercial space market and where should people focus their attention?
Here we summarize our experts’ answers to some of the questions raised at our recent RHEA Talk. These include:
- How is the commercial space sector changing?
- How is the market evolving around the concept of ‘space as a service’?
- What is the future of the commercial market outside the Earth observation domain?
- Which areas need more investment?
Watch the video of the complete webinar to find out more.
How is the commercial space sector changing? And what opportunities lie ahead?
Pascal: Until 10 years ago, the space market was dominated by big players because it was limited to organizations with strong investment capabilities. But space activities now impact everyday life and that is stimulating more investment and easier access to finance by smaller players, including start-ups. This is happening across the entire space value chain, from launch to satellites to downstream services. Thanks to this, the space market is far more open, which is a good thing for end-users as it creates competition. It also creates opportunities for businesses that could not exist before, which is highly exciting.
We have to seize this opportunity and make sure that at a European level we make the best of it for society as well as for business.
Andy: There is so much going on! There is not a day goes by when I do not see an announcement of the launch of a new constellation or investment being raised by an upstream or downstream company.
Publicly available data sets are reducing the barrier to entry in terms of access to data. In that respect, Copernicus has been one of the most revolutionary developments for the downstream sector because it has been a massive boost in terms of providing full, free, open data that can be used for many applications. But the available Earth observation (EO) data is still limited and that is driving interest in constellations of small satellites that can provide additional data. When you combine that with things like on-board data processing and using AI to download only the data you need, that is very exciting.
Eduardo: A lot has happened in the last 10 years, especially related to the use of CubeSats, with reductions not only in the price point but also other barriers, such as lower launch costs, the ability to use spare capacity in launches of bigger satellites and the miniaturization of technology. This has enabled new businesses to enter the market.
In the past, CubeSats were primarily enablers of technology demonstration in space, but we are now seeing more commercial applications. Their lower orbits, for example, reduce latency in communications and the increased power per kilogramme is enabling constellations based on smaller satellites.
Space is becoming progressively more accessible and will provide a lot more options for customers in future. But in the UK – and in other countries too – we need to be extremely agile in terms of regulation, making sure it supports the commercial market to be competitive.
Mark Roberts, Defence and Security Director, RHEA Group
How do you see the market evolving around the concept of ‘space as a service’?
Pascal: As individuals, we are completely agnostic about the technology that is used to provide a service we receive on the ground – we are just focussed on receiving the information. Now, for the upstream side as well, people investing in space are also looking for a service approach. Previously there was a lot of capex investment needed, but people want to access space as a service or buying a satellite as a service, without having to think about how it is operated. That is a completely different approach which is creating opportunities for new initiatives.
Andy: In terms of investment, most investors are looking for a return, but there are some who are willing to take a longer term risk and consider different types of return – as we get into a climate aware future, for example, they may consider impact as an acceptable form of return. We will see some interesting models of government and private sector investing where risk is higher. I also think that as elements such as the ground segment are provided ‘as a service’, sharing liability and risk with your service provider is an excellent model.
Eduardo: Our customers are looking at both reliability of data and competitive price points, so that the overall cost of ownership of the data is based on the entire value chain. An ‘as a service’ model helps to provide the customer with more guarantee over what they are paying for, providing a different way of looking into space as an enabler of an industry.
Space as a service is creating a weakness in terms of security. The more the space segment becomes commercially orientated and visibly generates money, the more it will attract cyberattacks and become vulnerable. The European Space Agency recognizes this and has become a focus of cybersecurity activity, but we must pay attention collectively and collaborate to address this risk.
Pascal Rogiest, RHEA Group Chief European Institutions Officer
How do you see the future of the commercial market outside the EO domain?
Pascal: Space exploration used to be mainly managed by governments with a large amount of national investment. Now we see a lot of commercial players moving into that area.
Luxembourg anticipated this 5 years ago with its national programme for space resources, stimulating exploration and exploitation and putting in place all the means to stimulate commercial players to enter this area. This has given the country an advanced position in the European landscape. There are other areas to that Luxembourg has planned for that are relevant for future space, such as space situational awareness and the management of clean space, which is going to be a big issue in future.
One area where you will see new markets grow is climate change, where EO data is key to informing long-term decisions. Related to that, space finance will not be purely commercial but instead will be blended, because the issues of resilience and adaptation to climate change are both a public and a private responsibility.
Andy Shaw, Director at Assimila
Are there specific areas where you would like to see more investment?
Andy: The future decentralized energy sector would benefit from a range of solutions – not just EO but also satcoms and positioning, navigation and timing. I am excited about what we could do to support the transition to a net zero energy economy.
Mark: There is a fantastic opportunity for us right now to start collaborating throughout the space value chain as opposed to the transactional approach that we see at the moment.
Pascal: One other area that is important is the management of the spectrum as it is a limited resource. We need to foster collaboration and promote wise use of the spectrum between the terrestrial and space solutions so we use it in an efficient way.
When you are managing multiple satellites for multiple customers, things like AI and machine learning come into play, because you need large scale data to feed those models. We are not only looking to provide end-to-end solutions to customers but also to optimize the technologies and the entire space value chain.
Eduardo Cruz, GOMSpace Luxembourg Country Manager
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