Low-cost constellations to foster development of new service areas
Paris, Washington D.C., Montreal, Yokohama, October 19, 2018 – According to the 11th edition of Euroconsult’s report, Satellite-Based Earth Observation: Market Prospects to 2027, the commercial Earth observation (EO) data market could reach $2.4 billion in 2027, driven by a mixture of defense and new commercial markets and supported by the arrival of new constellation operators. The EO market for value-added services (VAS) should reach over $5.7 billion by 2027; potential new service areas with entrants focusing on developing constellations to support high-frequency change detection could even see the VAS market reaching $9 billion in our upside scenarios.
For this new edition, we have revisited our market estimates and forecast methodologies in this fast-changing environment, deepening our bottom-up analysis.
Euroconsult has identified approximately 15 companies that have announced intentions to develop low-cost constellations based on smallsat technologies. This has been aided by the advancement in several areas such as miniaturization of components, enabling the development of more capable satellites at a lower mass. We anticipate the launch of nearly 1,500 smallsats (most of them below 50kg) to serve EO applications and see the years 2020-2022 as a major transition period. While new constellations being put forward are predominantly optical, SAR solutions and even hyperspectral or video are also now emerging.
The advent of new cost-efficient solutions collecting data at a higher frequency rate should transform services generation and delivery. Optimized analytics and increasing use of artificial intelligence, being pushed by both start-ups and established players, should contribute to an increase in the value proposition, and to the enlargement of use cases for satellite-based data.
“Under this approach, location-based services (LBS) and finance are relatively new markets with a large potential – the two combined could represent a revenue opportunity of more than $2 billion in 2027,” said Pacôme Révillon, CEO of Euroconsult. “LBS markets are built around the monitoring of specific point targets; the finance sector is similar in the change detection analytics being built, but with a clear focus on financial institution end-users.”
Selected performance indicators include:
- The commercial satellite data market exceeded $1.3 billion in 2017, of which over $850 million was generated with the intelligence and defense community. Cumulative manufacturing revenues of EO satellites should total approximately $35 billion over the next ten years.
- From a government perspective almost 50 countries will launch satellites over the next ten years. Morocco and Pakistan were the latest new countries to launch Earth observation satellites; developing EO programs should represent $3.8 billion in market value over the next decade.
The fast-evolving capabilities and the challenges attached to the development of business opportunities should favor a transformation of the ecosystem. While government and private end-users will be eager to leverage new capabilities, strategic partnerships and/or different forms of consolidation and vertical integration should contribute to reshaping the industry in the next three to five years.
About the Report
Satellite-Based Earth Observation, Market Prospects to 2027 provides an assessment of the current EO value-chain, with forecasts as to how this may evolve leading to 2027. Each aspect of the value-chain is taken in turn from government and private investment down to value-added services, providing a full 360° view of the opportunities and issues related to the Earth observation sector and how these trends will progress over the coming 10 years.
Euroconsult is the leading global consulting firm specialized in high technology industries, with expertise in the space industry, satellite-based applications and aero connectivity. As a privately-owned, fully independent firm, we provide first-class strategic consulting, develop comprehensive research and organize executive-level annual summits and training programs for the industry. With more than 30 years of experience, Euroconsult is trusted by over 600 clients in more than 50 countries. Euroconsult is headquartered in Paris, France, and has offices in Washington D.C. and Montreal, as well as representatives in Singapore and Tokyo.
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