Satellites: Driving A Burgeoning Space Economy

By Steve Isakowitz and Robbie Schingler|March 2020

One of the biggest opportunities for economic growth on the planet actually begins 250 miles above it, where a developing space economy is building at speed. It’s empowered by new business models, burgeoning partnerships, and technological advancements that are welcoming new entrants and fresh thinking to the space enterprise.

Space has long been home to thousands of satellites that provide crucial services for society. Most of this investment in space has been driven by national and military utility, such as communications; position, navigation and timing (PNT) systems; weather; and early warning systems. However, nearly all of these assets have dual use, and data and services have been made publicly or commercially available to help farmers maximize their crops, financial institutions process transactions, fishermen increase their haul, utility companies manage power grids, and more. The economic impact of these satellites cannot be understated.

Since the 1980s, GPS satellites have helped generate nearly $1.4 trillion in economic benefits. With roughly 8,950 satellites placed in orbit and more than 16,000 small satellites expected to launch by 2030, the importance of satellites in the economy will only increase. The majority of these activities have been funded by or in close collaboration with governments. With a new decade upon us, we see the space economy, led by innovative companies, new technologies, and novel business models, becoming commercialized and governments transitioning into enterprise customers.

A lot of progress has been made by innovators in the space industry who are building businesses with commercial business models. Leveraging investments from major technology companies in cloud computing, computer vision, and machine learning, space-enabled businesses are using these commoditized and open source technologies to build cost-effective products that deliver business value quickly. Applying these technologies and processes to remote sensing further decreases the barrier to entry for a non-remote sensing expert to extract insights within geospatial data.

By reducing the cost to reach space by a factor of 10 and developing satellites at 1,000x lower mass per unit performance and cost than 10 years ago, new commercial space companies—such as Planet, Spire and HawkEye 360—have made data that was once only accessible by government entities available to the masses. And it is being utilized daily across industries to achieve great things that were never imagined.

Meanwhile, the U.S. government is focused on advancing the capabilities of the space sector and relies on organizations such as The Aerospace Corporation to solve the hardest problems in space for both industry and government. This includes working to accelerate the speed of innovation and product development through an agile aerospace enterprise aimed at rapidly replacing space assets at speeds previously unprecedented, as well as developing new technologies, informing space policy, and aiding new entries into space.

These initiatives are already working. There has been an increase in medium-lift and heavy-lift launch vehicles offering piggyback launch opportunities for small satellites. The Indian PSLV and Russian Soyuz are much too expensive for most small satellite companies to purchase the full capacity of the rocket, but there’s usually several hundred spare kilograms available on each flight—and Planet has already launched over 200 of its satellites as hitchhikers on bigger rockets. The launch side of the equation is also picking up with Rocket Lab launching six dedicated small satellites last year and SpaceX’s announcement of a smallsat rideshare program, offering launch capacity as low as $5,000 per kilogram, an approximately 75 percent reduction in price from most options.

The growing support of government entities for the commercial enterprise sector has been particularly notable. Some governments and agencies are becoming enterprise customers and buying commercial subscription products, thereby incentivizing industry to build and deliver upgradable products. That means rethinking the way spacecraft are designed, built, and operated.

Satellites of the past were large, costly, and took a long time to test and build; they were also often in space for so many years that their technology became outdated. Small satellites are much less expensive and business models can incorporate rapid iteration of hardware and software. There’s been continued support for companies that inspire evolution and growth following a classic market dynamics for disruptive innovation. Conferences such as the new ASCEND event, powered by AIAA, 16–18 November, as well as Satellite 2020, Space Symposium, and GEOINT 2020, are critical to the development of these ideas and advancements.

Many individuals are in the space community because of the effect it has on the future of humanity. They have a desire to understand the cosmos, become a multiplanetary species, and devise ways to live more sustainable lifestyles. It is exciting to be a part of the Space Renaissance and the 21st century’s rapidly-evolving aerospace ecosystem. ★

Steve Isakowitz is Chief Executive Officer, The Aerospace Corporation, and Robbie Schingler is Co-Founder & Chief Strategy Officer, Planet.