Defense and security requirements will continue to drive the commercial EO data market for the next decade, but the growing commercialization of the industry and the data needs of emerging EO nations and private enterprise will also fuel revenue growth in the sector, according to Euroconsult, an international research and consulting firm specialized in the satellite sector.
According to the company’s new report, “Satellite-Based Earth Observation, Market Prospects to 2019,” now in its 3rd edition, 230 EO satellites will be launched in the next decade for a manufacturing market value expected to reach $19.9 B from 2010-2019. This compares to only 107 satellites in the previous ten years. (These figures do not include 50 and 28 meteorology satellites, respectively.) At the same time, EO commercial data sales are expected to rise at a compound annual growth rate (CAGR) of 15 percent reaching $4 B annually by 2019.
“On a global scale, there is real demand ahead for EO satellite manufacturing, data and services,” said Adam Keith, Director of Earth Observation at Euroconsult and primary author of the report. “Actors at each level of the value chain will need to adapt their business models to best leverage these opportunities, which could lead to interesting developments and integration in the future.”
Emerging and in-development space programs will account for 75 satellites, a four-fold increase over the previous decade. A total of 41 nations are expected to have an EO satellite in operation by 2019, versus only 26 today. In addition to serving local needs, an EO satellite is also a relatively low-cost first step into a government space program.
In-development and emerging programs will account for 21 percent of the total $19.9 B EO satellite manufacturing revenues, according to Euroconsult. But because these same countries often lack an established satellite manufacturing infrastructure, the growth could translate into significant export opportunities for manufacturing host nations, either in the form of direct procurement or technology transfer. In addition, new manufacturers could emerge by taking advantage of technology transfer initiatives and training offered by leading satellite and equipment manufacturers.
Euroconsult also forecasts that optical data will dominate the $4 B data market throughout the decade, representing 79 percent of the overall sales, with radar capturing the balance. In addition to defense applications, demand for optical data will come from growing location-based services and natural-resources applications. Demand for high-resolution commercial radar is expected to remain predominantly government defense, with usage growing in sectors such as energy and engineering.
The report also indicates that as the demand for high-resolution data grows, competition will intensify among both pure commercial companies providing data and governments offering their own data on the commercial market. At the end of 2009, 24 high-resolution satellites offering commercial data (including from government operators) were in operation. This number is expected to more than double in the coming years with new satellites coming from a number of sources: existing commercial operators expanding their fleets, new commercial actors, and civil governments and dual-use programs commercializing data.