Benchmarking the Global Space Economy

Interest in space is exploding, with the industry seeing growth and opportunities that weren’t just dormant, they simply didn’t exist 5-10 years ago. Over the next decade, according to NSR’s Global Space Economy, 2nd Edition, cumulative revenue is expected to hit USD $1.25T. Video, the use-case that built most of the satellite industry and continues to be a core market opportunity for most satellite operators, remains one of the top 10 space economy markets - forecasted to hold 6% of that $1.25T; however, it is no longer the revenue driver of the past. Mobility, EO Information Products, and Crew & Cargo Markets currently lead the way.

Using video revenues as the ‘yard stick’ for benchmarking, each of the major ‘slices’ of the Global Space Economy (Infrastructure, Applications, and Communications) yields a ‘leading segment’ (green boxes), which drives revenues over the next decade. We will explore each slice of the Global Space Economy, and then cross-compare the ‘top market’ against the Video Satellite Communications markets (red box).

Mobility to Lead SATCOM

Mobility markets - “Maritime”, “Aero”, “Land Mobile”, and “Direct Satellite to Device” – are a huge market force within the overall space economy. “Direct to Device” (another use-case that didn’t exist even 2 years ago) will be a key growth driver by 2030. More “Traditional” maritime or aeronautical end-user markets are the next building blocks for the satellite communications market. Then, there is the ‘infamous’ connected car opportunity, which my colleague Alan Crisp discussed in-depth. Combined, all of these ‘legacy mobility’ and emerging opportunities account for 12% of the cumulative global space economy. 5G

Comparing the flashier “Mobility markets” to the more traditional video market, a significant difference will be seen from the mid-2020s as Mobility overtakes Video. This is the ‘revolution’ that satellite operators are planning for today – a shift from the point to multi-point economics of broadcast video to the ‘point to point’ design requirements of IP-centric mobility. Video will decline in YoY growth to -1% by the end of 2030, whereas the Mobility market grows from 2024 onwards. By 2030, mobility shows a strong YoY growth rate of +20%.

EO Information Products Drive Applications

Before Russia’s invasion of Ukraine in early 2022, which is being captured ‘in living color’ from a network of commercial Earth Observation satellites, NSR projected EO Information Products (aka the ‘analytics’ of EO data) will account for 2% of the Global Space Economy. While NSR continues to assess the overall impact of current events on the imagery vs. insights side of the Earth Observation market, EO Information Products was another ‘top 3’ opportunity by cumulative revenues from 2020 to 2030. Within the EO Information Products market, “Public Authorities” (23%), and “Weather” (25%) accounted for the largest use-cases. But with the current events happening between Ukraine and Russia, this will likely cause a shift in the market towards “Defence & Intelligence”, currently making 14% of the EO Information Products segment.

Currently EO Information Products make up 2% of the global space economy, but again this will increase in times of war, due to the technical and tactical advantage this area of the space economy gives to governments. When it comes to the EO images seen on TV they are using visible, near infrared, and short-wave infrared sensors, but the defence and intelligence agencies are using the Synthetic Aperture Radar (SAR), which gives strategic advantage as it gives the capabilities to penetrate cloud cover to see what critical moves governments can make. While NSR has yet to fully assess the full impacts from a revenue perspective, Earth Observation in general, and EO Information Products specifically is ‘the application.’

Benchmarking against video, EO Information Products is a smaller opportunity – roughly a $60B smaller opportunity. However, the YoY growth for EO IP will exceed 12% by 2030 (and likely to be much higher once Russia and Ukraine conflict is included in NSR’s dataset). Video, meanwhile, is -2%. Growth in EO IP at a time when video opportunities are on the downswing.

Crew & Cargo as the Infrastructure Opportunity

At 12% of the total Global Space Economy Opportunity, Crew & Cargo is the leading infrastructure play by revenues from 2020 to 2030. Comprised of Government Missions, Commercial Crew Programs, Orbital Space Tourism, ISS Delivery, Lunar Delivery, and Interplanetary Cargo Missions, this market is a mix of commercial and government, ‘service’-based models such as Commercial Crew to traditional hardware-centric acquisition programs.

As with the EO Information Products, the Infrastructure market is another of the ‘most visibly impacted’ Space markets from the Russia and Ukrainian conflict. From Russia removing the Soyuz rocket from the launch pad at Baikonur Cosmodrome in Kazakhstan containing 36 OneWeb internet satellites to on-going uncertainty around Russia’s participation in the ISS. In short, it highlights and emphasizes the outsized role commercial providers will have in the next decade – a trend already established.

Long-tailed government procurement programs will be a key component of the market, however, the rise of commercial players looking to develop commercial space stations over the next decade will dramatically change the market dynamics. As the next wave of commercial opportunities enter the market, with a subsequent ‘boom and bust’ YoY growth pattern, the future looks like to be mostly commercial dependant with priority given to government missions.

Crew & cargo is one of the most exciting markets within the global space economy – most of us dream at some point in our lives of ‘going into space.’ Compared against our traditional video market benchmark, we can see YoY growth is very much ‘feast and famine’ pattern. While Video is on the slow-train to decline, early growth is offset by a longer-term run rate between $5B to $15B. It is only that the per-mission revenues are huge that Crew & Cargo is not only the largest ‘infrastructure’ opportunity, but a leading revenue generating segment over the next decade. Overall, the commercialization of space via Crew & Cargo is a ‘must-watch’ opportunity for the Global Space Economy.

Bottom Line

From exciting space faring industries contained within Crew & Cargo, current affairs having an impact within the EO information products, and “direct to handheld” leading growth within the mobility market, we still have markets such as video still holding their own within the industry. While video is on the decline, it remains a key benchmark and revenue source within the Space & Satellite markets - making up 6% of the total revenue opportunity within the Global Space Economy.