Global Satellite Manufacturing and Launch Market 2015-2019 (1)

Global Satellite Manufacturing and Launch

Market 2015-2019

technavio insights

EMISPDF in-glim01 from 220.227.137.92 on 2015-10-11 10:05:08 BST. DownloadPDF.Downloaded by in-glim01 from 220.227.137.92 at 2015-10-11 10:05:08 BST. EMIS. Unauthorized Distribution Prohibited.


Market 2015-2019

technavio insights

01. Executive Summary ........................................ 1

02. List of Abbreviations ........................................ 2

03. Scope of the Report ........................................ 4

03.1 Market Overview .................................................... 4

03.2 Product and Service Offerings .............................. 4

04. Market Research Methodology ..................... 5

04.1 Market Research Process ...................................... 5

04.2 Research Methodology ......................................... 5

05. Introduction ..................................................... 7

06. Market Landscape ....................................... 11

06.1 Market Size and Forecast .................................... 11

06.2 Five Forces Analysis ............................................. 17

07. Geographical Segmentation ....................... 19

07.1 Satellite Manufacturing and Launch Market in

Americas ............................................................... 20

07.1.1 Market Size and Forecast......................................................... 20


EMEA ...................................................................... 21


Table of Contents



Market 2015-2019

technavio insights


APAC ..................................................................... 23


08. Buying Criteria ............................................... 25

09. Market Growth Drivers .................................. 26

10. Drivers and Their Impact .............................. 29

11. Market Challenges ....................................... 31

12. Impact of Drivers and Challenges .............. 33

13. Market Trends ................................................ 34

14. Trends and Their Impact ............................... 36

15. Vendor Landscape ....................................... 37

15.1 Competitive Scenario .......................................... 37

15.2 Other prominent vendors .................................... 38

16. Key Vendor Analysis..................................... 41

16.1 Airbus Defence and Space ................................. 41

16.1.1 Key Facts ..................................................................................... 41

16.1.2 Business Overview...................................................................... 41

16.1.3 Recent Developments ............................................................. 42

16.1.4 SWOT Analysis ............................................................................. 43

16.2 Boeing Defense, Space, and Security ............... 44

16.2.1 Key Facts ..................................................................................... 44


16.2.3 Product Segmentation ............................................................. 45

16.2.4 Business Strategy ........................................................................ 45




Market 2015-2019

technavio insights

16.2.6 SWOT Analysis ............................................................................. 47

16.3 Orbital ATK ............................................................ 48

16.3.1 Key Facts ..................................................................................... 48


16.3.3 Business Segmentation by Revenue 2014 ............................ 50

16.3.4 Market Segmentation by Revenue 2014 .............................. 50

16.3.5 Business Strategy ........................................................................ 51


16.3.7 SWOT Analysis ............................................................................. 52

16.4 SSL .......................................................................... 53

16.4.1 Key Facts ..................................................................................... 53



16.4.4 SWOT Analysis ............................................................................. 55

17. Other Reports in this Series ........................... 56



Market 2015-2019

technavio insights

Exhibit 1: Market Research Methodology.................................. 5

Exhibit 2: Satellite Industry Segments .......................................... 8

Exhibit 3: Applications of Satellites .............................................. 9

Exhibit 4: Satellite-based Services ............................................. 10

Exhibit 5: Global Satellite Manufacturing and Launch Market

2014-2019 ($ billions) ............................................................ 11


2014 and 2019 ...................................................................... 13


2014-2019 ($ billions) ............................................................ 14

Exhibit 8: Global Satellite Manufacturing Market 2014-2019 ($

billions) .................................................................................. 14

Exhibit 9: Global Satellite Launch Market 2014-2019 ($

billions) .................................................................................. 15

Exhibit 10: Segmentation of Market by Geography 2014 and

2019 ..................................................................................... 19

Exhibit 11: Satellite Manufacturing and Launch Market in

Americas 2014-2019 ($ billions) .......................................... 20


EMEA 2014-2019 ($ billions) ................................................. 21


APAC 2014-2019 ($ billions) ................................................ 23

List of Exhibits



Market 2015-2019

technavio insights

Exhibit 14: Key Vendors ............................................................... 38

Exhibit 15: Boeing Defense, Space, and Security: Product

Segmentation 2013 ............................................................. 45

Exhibit 16: Orbital ATK: Business Segmentation by Revenue

2014 .................................................................................... 50

Exhibit 17: Orbital ATK: Market Segmentation by Revenue

2014 .................................................................................... 50


1

Global Satellite Manufacturing and Launch Market 2015-2019


01. Executive Summary

Market Size 2014: $21.81 billion

2019: $28.02 billion

Market Growth Rate 2014: 6.64%

2019: 17.97%

CAGR 5.14%

Key Geographies

Americas: 35.72%

EMEA: 34.87%

APAC: 29.41%

Key Customer Segments

Civil/Government Bodies

Commercial Organizations

Military and Defense Industry

Key Market Drivers

Growing Utilization for Military and Defense Applications

Increased Application in Telemetry

Increased Demand in Commercial Applications

Low-cost Solutions through Nano and Microsatellites

Technological Innovation in Electronics

Key Market Challenges

Defense Budget Cuts

Design and Manufacturing Difficulties

Growing Issues of Space Debris

Launch Delays

Satellite Deorbiting Issues

Key Market Trends

All-electric Propulsion System for Satellites

Development of Reusable Space Launch Vehicles

Progression toward Low-cost Satellite-based Internet Services

Use of 3D Printing Technology

Key Buying Criteria

Capabilities as per Mission Requirement

Low Cost to Build and Operate

Reliability

Size and Weight

Key Vendors

Airbus Defence and Space

Boeing Defense, Space, and Security

Orbital ATK

Space Systems Loral (SSL)


2



02. List of Abbreviations

AIS - Automatic Identification System

C4ISR - Command, Control, Communications, Computers, Intelligence,

Surveillance, and Reconnaissance

CAD - Computer-aided design

CDR - Critical design review

CST - Crew Space Transportation

DoD - Department of Defense

EDRS C - European Data Relay Satellite C

ELV - Expendable launch vehicle

ESA - European Space Agency

EU - European Union

FAA - Federal Aviation Administration

FCC - Federal Communications Commission

GEO - Geostationary Earth orbit

GLONASS - Global Navigation Satellite System

GPS - Global Positioning System

GSO - Geosynchronous Orbit

IADC - Inter-Agency Space Debris Coordination Committee

IFF - Identification Friend-or-foe

ISR - Intelligence, Surveillance, and Reconnaissance

ISRO - Indian Space Research Organization


3



JMR TD - Joint Multi-role Technology Demonstrator

LEO - Low Earth orbit

M2M - Machine to machine

MEMS - Microelectromechanical systems

MRTT - Multi Role Tanker Transport

NASA - National Aeronautics and Space Administration

NAVSTAR - Navigation Satellite Timing and Ranging System

SBIRS - Space-based Infrared System

SLS - Space launch systems

UAS - Unmanned aerial systems

UAV - Unmanned aerial vehicle

UN - United Nations

USAF - US Air Force


4



03. Scope of the Report

03.1 Market Overview

In this report, Technavio covers the present scenario and the growth prospects of the global

satellite manufacturing and launch market for the period 2015-2019. We provide a global

overview as well as growth prospects by region (the Americas, APAC, and EMEA). We also

present the market landscape and a corresponding detailed analysis of the prominent vendors.

In addition, the report discusses the major drivers influencing market growth, outlines the

challenges faced by vendors and the market as a whole, and identifies the key trends in the

market.

03.2 Product and Service Offerings

Company Products and Services Offered

Airbus Defense and Space Access and management of geodata

Base maps

Geo-intelligence platforms and software

Monitoring services

Satellite imagery

Boeing Defense, Space,

and Security

GPS

Satellite systems

Satellite launch systems

Orbital ATK Communication satellites

Hosted payloads

Science and environmental satellites

SLS

Space systems

SSL Digital audio radio satellites

Direct broadcast satellites

Fixed satellite services

Mobile satellite services


5



04. Market Research Methodology

04.1 Market Research Process

Technavio has collected and analyzed key data related to the global satellite manufacturing

and launch market using a variety of methods. The market dynamics have been determined

following a detailed study of the microeconomic, mesoeconomic, and macroeconomic

indicators of the market.

04.2 Research Methodology

This report is based on in-depth qualitative and quantitative analyses of the global satellite

manufacturing and launch market. The qualitative analysis involved primary interviews, surveys,

and vendor briefings. The quantitative analysis involved the application of various projection

and sampling techniques. The data gathered as a result of these processes were validated by

experts.

Exhibit 1: Market Research Methodology

Source: Technavio Research

Global Satellite

Manufacturing and

Launch Market 2015-

2019


6



Based on the research results and technical insights gathered, Technavio has provided a

comprehensive analysis of the varied aspects of the market. The impact of global economic

conditions and other macroeconomic indicators were also considered when assessing the

market.


7



05. Introduction

Satellites are launched into space to provide services such as communications, telemetry,

remote sensing, surveillance, and so on. They are designed according to their intended

applications. They may be classified as communications satellites, navigation satellites,

reconnaissance satellites, or remote sensing satellites. According to the orbit that they are in,

they are also classified as LEO satellites, sun-synchronous orbit satellites, and geosynchronous

satellites. Based on size, satellites are categorized as large, medium-sized, mini, micro, nano,

pico, and femto.

We expect the global satellite manufacturing and launch market to grow at a CAGR of 5.14%

during the forecast period. In 2014, the Americas led the market with a share of 35.72%, followed

by EMEA with a share of 34.87% and APAC with a share of 29.41%.

The growing utilization of satellites for military surveillance and other defense applications has

been pushing market growth. Along with the growing use of UAVs and modern equipment, the

military also needs more data bandwidth and reliable communication infrastructure. The

demand for these satellites for commercial applications such as GPS services and the Internet

has also increased. Increased demand for satellite-based telemetry applications also

contributes to market growth.

However, there are many design and manufacturing complexities associated with satellites.

They need to be reliable and capable of withstanding the harsh conditions of their launch and

the extreme environments of outer space while also considering the prohibitive cost, safety, and

certification requirements for the design and build. Budget cuts in the military and defense

sector, which is one of the primary end users of satellites, especially in Europe and the US, also

hamper market growth. The increase of space debris is another hindrance in the market.

The development of all-electric propulsion systems for satellites and reusable space launch

vehicles will contribute significantly to market growth. The use of nano and microsatellites in the

development of low-cost satellite-based Internet services will also open up opportunities for the

market. 3D printing technology is expected to give market growth considerable traction. Its use

in the building of satellite parts and components will reduce costs significantly and even enable

the construction of miniaturized satellite components in space, eliminating the need to launch

from Earth.


8



Exhibit 2: Satellite Industry Segments


Satellite Industry

Ground Equipment

Satellite Launch Industry

Satellite Manufacturing

Industry

Satellite Services


9



Exhibit 3: Applications of Satellites


Commercial Communications

Government Communications

Meteorology

Military Surveillance

Navigation

R&D and Space Sciences

Remote Sensing


10



Exhibit 4: Satellite-based Services


In terms of market size, consumer satellite services is the largest segment, and is followed by the

fixed-satellite services, mobile satellite services, and remote-sensing services segment,

respectively. Increased demand for satellite TV services, driven by growth in emerging markets,

has contributed considerably to demand in the market.

Mobile Data

Mobile Voice

Imaging Services

Remote Sensing Applications

Spaceflight Management Services

Transponder Agreements

Satellite Television

Satellite Radio

Satellite Internet

Consumer Satellite Services

Fixed-Satellite Services

Mobile Satellite Services

Remote-sensing Services


11



06. Market Landscape

06.1 Market Size and Forecast

The global satellite manufacturing and launch market was valued at $21.81 billion in 2014 and

will likely reach $28.02 billion by 2019, growing at a CAGR of 5.14%.

Exhibit 5: Global Satellite Manufacturing and Launch Market 2014-2019 ($ billions)


There is increased demand for satellites from the civil/government, commercial, and military

sectors. Europe and North America have been at the forefront of the market in terms of

development and launch of satellites. However, the growing demand for satellite-based

infrastructure in emerging countries such as China and India has contributed to the

development of the market in APAC.

Advances in the technology of nano and microsatellites have not only enabled markets in

developing countries to enhance their satellite infrastructure but have also opened up new

opportunities in those markets. CubeSat, for instance, has revolutionized the satellite industry. The

low cost of manufacturing such satellite systems has made it possible for universities and

research institutes to build and test satellite systems that use off-the-shelf electronic components.


12



The emergence of nano and microsatellites has helped the market grow in terms of number of

satellites. However, they currently constitute only a small portion of the market in terms of

revenue.


13



Exhibit 6: Global Satellite Manufacturing and Launch Market 2014 and 2019


In 2014, revenue from satellite manufacturing constituted 74.96% of the market while satellite

launch constituted the remaining 25.04%. Currently, the US, Russia, China, Japan and a few

European countries have a stronghold in satellite manufacturing.

However, with the demand for nano and microsatellites on the rise, the manufacturing base of

satellites is likely to expand to more regions. Many developing countries have shown interest in

the development and utilization of satellites such as CubeSat.

The satellite launch market will likely grow to 28.98% by 2019. The entry of private players in the

lucrative space launch business (most notably in the US) and new technological developments

in this field are expected to boost market growth.


14



Exhibit 7: Global Satellite Manufacturing and Launch Market 2014-2019 ($ billions)


Exhibit 8: Global Satellite Manufacturing Market 2014-2019 ($ billions)



15



In terms of revenue, satellites for military surveillance, commercial communications, and

civil/military communications constituted a major portion of the overall market. The emergence

of nano and microsatellites has also contributed to market growth. These small satellites

constitute a major portion in terms of number of units. However, it represented only 4.5% of the

satellite manufacturing market in terms of revenue in 2014.

The US is the single largest manufacturer of satellites worldwide and constitutes 70% of the global

satellite manufacturing market. Most of the satellite manufacturing revenue in the US is

generated from government contracts. Europe, China, Russia, and Japan are the other major

satellite manufacturers.

Exhibit 9: Global Satellite Launch Market 2014-2019 ($ billions)


Russia, the US, and China are the three major markets for space launch activities worldwide. In

2015, 173 launches are expected, as per the data available on space launch schedule for the

year. There were 92 space launches worldwide in 2014: Russia accounted for 36, the US for 23,

and China for 16. In 2013, there were 81 space launches worldwide.

However, the space launch industry is affected by regional/global economic conditions; as a

result, there have been fluctuations in the total number of space launches in the past. Technical

issues and weather conditions also affect the number of launches.


16



As per historical space launch events, current market insights, and future space launch

schedules, the share of the space launch market will likely decline in 2016 and 2017. However,

the market is expected to rebound in 2018 and 2019, especially because of the increased

number of space launch activities in Kazakhstan, the US, and French Guiana. China is also

planning the launch of several satellites by 2019, primarily for maritime surveillance missions.

These satellites are intended for use in the monitoring of ships, drilling platforms, coastal

resources, and assessing and analyzing natural disasters.


17



Threat of Rivalry

(High)

There is strong competition among existing satellite

manufacturers in terms of cost of products and

advances in technology.

Bargaining Power of Suppliers

(High)

The availability of technologically advanced solutions and the need for

regulatory compliance enhances the bargaining power of leading vendors

that possess patented technologies and meet

specific aerospace application requirements.

Bargaining Power of Buyers

(Moderate)

There are many vendors that provide satellite systems,

materials, and parts. However, buyers do not have

control over product costs.

Threat of new entrants

(Moderately high)

New players, especially from APAC, are increasingly

entering the market.

Threat of Substitutes

(Low)

Along with advances in technology, the use of

satellites has also grown among users ranging from

communications to telemetry. The market has

been growing, which decreases the threat of

substitutes (such as ground based systems, e.g., GBAS).

06.2 Five Forces Analysis


18



Key

The impact of the five forces is graded on the basis of the intensity and duration of their

influence on the current market landscape. The magnitude of the impact has been categorized

as described below:

Low: Negligible or no impact on market growth

Moderate: Medium-level impact on market growth

Moderately High: Significant impact on growth of market

High: Very high impact, with radical influence on growth of market


19



07. Geographical Segmentation

Exhibit 10: Segmentation of Market by Geography 2014 and 2019



20



07.1 Satellite Manufacturing and Launch Market in Americas

07.1.1 Market Size and Forecast

The market was valued at $7.79 billion in 2014 and will likely reach $9.34 billion by 2019, growing

at a CAGR of 3.70%.

Exhibit 11: Satellite Manufacturing and Launch Market in Americas 2014-2019 ($

billions)


The US and Canada are the major markets in the Americas for space-based programs. Both

countries have advanced infrastructures and are involved in various space programs. NASA and

SpaceX in the US are developing new systems that are expected to meet the growing demand

for satellites in the future. For example, SpaceX is planning to launch a series of experimental

communication satellites. Furthermore, its fully reusable launch systems are expected to reduce

the cost of space access. In the US, the demand from the military and defense sector has been

increasing, mainly for navigation, communications, and spy satellites.

SpaceX has been working on the development of reusable space launch vehicles that can be

used for multiple satellite launch missions. This will further reduce the costs associated with the

launch of satellites and open up new opportunities to provide low-cost satellite-based services.

The markets in Brazil and Argentina also contribute to the growth of the market in the Americas.


21



07.2 Satellite Manufacturing and Launch Market in EMEA



at a CAGR of 3.87%.

Exhibit 12: Satellite Manufacturing and Launch Market in EMEA 2014-2019 ($ billions)


The market in Europe has high technological capabilities and has the needed infrastructure for

space launch missions. Russia, Ukraine, Italy, France, Germany, Spain, the UK, and Norway are

the leading markets in this region. The ESA contributes to the development of satellite-based

infrastructure and space launch missions.

Russia is the leader in commercial space launches in the region and operates many spaceports.

It also pays around $115 million per year to Kazakhstan to use the country's Soviet-era satellite

launch sites. However, along with the emergence of countries with satellite launch capabilities in

other parts of Europe, Russia has now expanded its collaboration with the EU for new market

opportunities. Russia has been collaborating with the EU to launch satellites on Soyuz rockets

from a Russian-built site located in French Guiana.

The Guiana Space Center is based in French Guiana and is a primary space launch site for the

ESA. It is ideal for space launch missions because it provides access to an ocean buffer zone


22



(ocean buffer zone reduces risks related to launching over populated areas). Many Russian and

European rockets have been launched from this site.

Israel, Saudi Arabia, and UAE are some of the major markets in the Middle East. Africa is currently

a small market and lacks adequate technological capabilities and infrastructure. However, it is

likely that Africa will become one of the important markets for low-cost satellite-based Internet

services in the near future. An increase in demand for communication and other satellite-based

services will also drive the potential of the market.


23



07.3 Satellite Manufacturing and Launch Market in APAC



at a CAGR of 8.14%.

Exhibit 13: Satellite Manufacturing and Launch Market in APAC 2014-2019 ($ billions)


The market in APAC is the fastest growing worldwide. China, India, Japan, Australia, Taiwan, and

South Korea are the major markets in the region that have the necessary satellite manufacturing

and launch capabilities. Emerging countries are also investing in the development of

technology and to improve satellite-based infrastructure capabilities. Also, the growing military in

these countries demand reliable satellite-based infrastructure for communications and data

bandwidth for ground-based military operations, and also for UAVs.

China, in particular, has emerged as one of the leading commercial space launch providers in

the region. China Aerospace Science and Technology Corporation is key to the Chinese space

program. The company is involved in research, design and development of space launch

vehicles and satellites among others. There are four space launch centers in China: Jiuquan,

Taiyuan, Wenchang, and Xichang Satellite Launch Center. Xichang Satellite Launch Center is

the major site for commercial satellite launches from China. However, along with the growing

market and the government's future space plan, the country is expanding the Wenchang


24



Satellite Launch Center for future commercial satellite launches. Along with the strengthening

economy, China has also made efforts to develop its space capabilities. The country's Long

March 5 and Long March 7 rockets are capable of launching payloads of up to 25 tons and 13.5

tons, respectively, and are expected to make the first flight in 2016.

India has also been pushing extensively for the development of its space capabilities. Satish

Dhawan Space Center of ISRO is the major satellite launch station in India. The country is also

allowing an increasing number of private players to enter the satellite manufacturing market.

This has paved the way for the rise of companies such as Dhruva Space, which is the first private

company in India to manufacture satellites. The company focuses on the development,

assembly, testing, and operation of small indigenous satellite platforms. This move is expected to

further open the market for new entrants, and increase the competition, innovation, and

development of the industry. India has mainly been targeting the communications satellite

business, as there is huge demand for such satellite services.


25



08. Buying Criteria

Parameters Details Customer

Segments Significance Attached

Capabilities

Satellites should meet the

specific mission requirements

of the end users.

Civil/Government

Bodies

Commercial

Organizations

Military and

Defense Industry

Low Cost to

Build and

Operate

Larger satellites as well as

nano and microsatellites

should provide cost-effective

solutions.

Civil/Government

Bodies

Commercial

Organizations

Military and

Defense Industry

Reliability

Satellite systems should be of

high quality and able to

handle mission-specific

objectives.

Civil/Government

Bodies

Commercial

Organizations

Military and

Defense Industry

Size and

Weight

Size and weight should be

optimized at the design stage

to reduce manufacturing and

launch costs.

Civil/Government

Bodies

Commercial

Organizations

Military and

Defense Industry

Key

The impact of the buying criteria is graded on the basis of the intensity and duration of their

influence on the current market landscape. The magnitude of the impact has been categorized

as described below:




Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5


26



09. Market Growth Drivers

Some of the drivers of the global satellite manufacturing and launch market are discussed

below.







Military and defense forces worldwide require satellite capabilities to meet the demand for more

operationally responsive forces, especially in terms of communication and positioning. Sufficient

satellite-based infrastructure can provide access to near-real-time information and imagery,

such as in aerial reconnaissance operations. The use of real-time flight and surveillance data via

satellite in UAVs and other military vehicles and equipment has increased; this means increased

data transfer and bandwidth requirements. To cater to these requirements, military and defense

forces are now utilizing commercial satellite infrastructure in addition to their own satellites. They

are also using more nano and microsatellites, as large constellations of such satellites can be

launched at low costs while providing the required services. For instance, in 2013, the US

Department of Defence launched 29 CubeSats to explore their potential in military operations.


Satellite telemetry is used for civil, commercial, government, and military applications. For

example, researchers use satellite telemetry to track the movement of specific targets, such as

animals or birds when studying their migration. An orbiting satellite receives radio signals from

transmitters attached to the target and transmits these to ground stations. Based on the

transmitted signal, researchers can calculate the distance between the transmitter and the

satellite, and geometrically determine the location of the transmitter. Sensors fitted to the

transmitter allow researchers to obtain additional information such as temperature, depth, and

light in the target's environment.

Satellite telemetry is also being widely used for military and defense applications. For example,

the US uses satellite telemetry to provide satellite tracking and communicate with military

personnel or vehicles through ground-based antennas. The US also uses SBIRS reconnaissance

satellites, which provide strategic ballistic missile warning capabilities. These systems are being

upgraded with dual-band telemetry and tracking and communications capabilities.


27




The demand for satellite networks and services in commercial applications has increased with

the growing use of broadband digital communications, direct-broadcast services (such as

satellite radio and television), and mobile device communications. Moreover, the increased

utilization of commercial satellite platforms for dual (military and civil) purposes has also boosted

the need for satellites.

Global navigational services such as GPS are supported by only a few satellite systems such as

the US NAVSTAR GPS and the Russian GLONASS system. To meet the growing demand for

commercial applications of navigation services, new satellites need to be launched. A

relaxation of regulations pertaining to the sale of high-resolution satellite images for commercial

purposes, after DigitalGlobe's acquisition of GeoEye, has provided opportunities for the growth

of the market. Companies can now enter the market and provide diverse on-demand services

(such as commercial satellite imagery based services) based on the utilization of large as well as

smaller satellites. This is likely to further open the door for new applications, products, and

services.


One of the advantages of nano and microsatellites over conventional large satellites is that they

cost less to build and to launch. These smaller satellites also take considerably less time to build

than their larger counterparts. In addition, they can be constructed using existing hardware and

software. The emergence of low-cost launch services for nano and microsatellites has further

helped to lower costs.

Rocket Lab has created a rocket called Electron, which is expected to significantly cut the cost

and time required to launch satellites into space. It will reduce launch costs by 95% and the time

to launch a satellite from years to weeks (for example, development and launch of a large LEO

satellite can take up to 3 years or more). Such developments in this field will allow nano and

microsatellites to provide low-cost solutions for applications ranging from weather forecasting to

Internet services.


28




There has been rapid development in the field of electronics in recent years. This has boded well

for the satellite industry. Miniaturization of electronic components and the development of

MEMS technologies have enabled the creation of satellites that are lightweight and affordable

but also have advanced technological capabilities. For example, CubeSat satellites have

revolutionized the miniaturized satellite market. They have now made it possible even for small

institutes and universities to build and test their own CubeSat satellite systems.

The low cost of nano and microsatellites is also beneficial for scientific and technological

demonstration missions as it enables researchers to take higher risks in their studies, which may

not have been feasible (or financially sensible) with multimillion dollar satellites.


29



10. Drivers and Their Impact

Drivers

Impact on Key Customer Segments

Civil/Government Bodies Commercial

Organizations

Military and Defense

Industry

Growing Utilization for


Applications

Increased Application in

Telemetry

Increased Demand in

Commercial Applications

Low-cost Solutions

Through Nano and

Microsatellites

Technological Innovation

in Electronics

Drivers Impact on Geography

Americas EMEA APAC

Growing Utilization for


Applications

Increased Application in

Telemetry

Increased Demand in

Commercial Applications

Low-cost Solutions

Through Nano and

Microsatellites

Technological Innovation

in Electronics

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5

Low High 1 2 3 4 5


30



Key

The impact of the drivers is graded on the basis of the intensity and duration of their influence on

the current market landscape. The magnitude of the impact has been categorized as

described below:





31



11. Market Challenges

Some of the challenges faced by the global satellite manufacturing and launch market are

discussed below.

Defense Budget Cuts


Growing Problem of Space Debris

Launch Delays

Satellite Deorbiting Challenges

Defense Budget Cuts

There have been significant defense budget cuts in many countries (e.g., US and NATO member

countries). For instance, the US has announced a budget cut of $178 billion for the period 2011-

2015. The US Budget Control Act 2011 mandated a $487 billion reduction in defense spending

over a 10-year period. Moreover, as the US military withdraws from conflict regions such as

Afghanistan, additional automatic budget cuts known as sequestration come into play. Budget

sequestration is the automatic spending cuts procedure implemented in the US to put cap on

government spending for various categories. Similarly, during the 2008-2009 economic crisis,

countries in Europe also implemented significant controls in their military budgets. Such budget

cuts adversely affect the satellite market.


Prohibitive cost is the prime hindrance to the development and manufacture of satellites.

Satellites should be designed to withstand the harsh conditions of launch and the conditions of

outer space. The industry also has to adhere to stringent safety regulations and certification

requirements.

Nano and microsatellites are required to be lightweight and compact without compromising on

performance and reliability. Many of the current microsatellites in the market have been

designed for short mission lives and use off-the-shelf electronics to lower costs. The antennas

used in these satellites have to be miniaturized to fit into the satellite system, which reduces

signal strength. Current microsatellites are low-power and low-mass, and cannot meet the

growing demand for long operational missions. Therefore, there is dire need for significant

advances in miniaturized electronics and components.


32



Growing Problem of Space Debris

There have been more than 4,800 satellite launches since the launch of Sputnik in 1957. These

launches have placed more than 6,000 satellites into orbit. Less than a thousand of the satellites

in orbit are still operational as most satellites are decommissioned after the mission is completed.

Many of these decommissioned satellites, however, continue to remain in orbit as space debris.

This poses a major risk to space missions as any impact from debris (even debris as small as an

inch) can potentially damage or destroy the satellite.

The advent of nano and microsatellites has enabled even small institutes and universities to

launch their own satellites, and has further increased the possibility of thousands of satellite

launches in the next decade. This is a serious concern as most of these miniaturized satellites lack

deorbiting systems and may be left in orbit after they are decommissioned.

Launch Delays

As per historical data, the actual number of satellite launches has always been lower than the

projected estimate due to launch delays. Launch delays result in increased overall program

costs for satellite missions. Launch delays can be caused by uncertainties in the schedule of

launch vehicles, delays in the development of launch vehicles, and lack of coordination

between the satellite developer and the launch provider. Launch schedules may also be

affected by technical challenges, lack of funding, non-availability of components from suppliers,

and government approvals, among others.

Satellite Deorbiting Challenges

One way to dispose of a satellite in LEO after its mission is complete is to deorbit it. In most cases,

the ballistic coefficient and altitude of the satellite will cause it to naturally deorbit after a certain

period of time. In many cases, however, the satellite needs to be deorbited using a dedicated

deorbiting system. However, because of mass and volume constraints, most nano and

microsatellites lack such systems. As well, currently available deorbiting approaches cannot be

used reliably for nano and microsatellites.

Many agencies such as the IADC, the FCC, and the UN have proposed space debris mitigation

guidelines to tackle the growing issue of space debris. One of the recommendations is to deorbit

the satellite after decommissioning and to perform necessary deactivation measures. The

implementation of these deorbit guidelines by agencies worldwide will hinder the growth of the

miniaturized satellite industry.


33



12. Impact of Drivers and Challenges

Key

The impact of the drivers and challenges is graded on the basis of the intensity and duration of

their influence on the current market landscape. The magnitude of the impact has been

categorized as described below:



Moderately High: Significant impact on growth of market



34



13. Market Trends

Some of the trends in the global satellite manufacturing and launch market are discussed

below.



Progression toward Low-cost Satellite-based Internet Services



Chemical propulsion systems (like the ones in solid-fuel rocket engines) carry a substantial

amount of fuel for the mission. It is not feasible to use these systems for nano and microsatellites

as they are required to be lightweight. Also, the propellant used in solid-propellant systems

cannot be stopped or restarted once it has been started, and multistage rocket have to be

used if more than one burn is desired, which further increases the weight.

The advent of miniaturized electronics and MEMS has enabled the design of micro-electric

propulsion technologies such as micro-thrusters. Micro-thrusters can be used for the propulsion of

nano and microsatellites. Micro-thrusters are an all-electric propulsion system. They minimize the

launch mass by eliminating the need for large amounts of fuel, enabling the maximum utilization

of available payload. An MEMS-based thruster is minuscule but can accommodate highly

sophisticated propulsion systems. Such propulsion systems consist of nozzles, heaters, valves, filters

and controls, all put together into compact units.


Satellite launches are mostly conducted using ELVs that carry a payload to the orbit and can be

used only once. Most of the costs involved in satellite launches come from building the rocket,

which is used for only a single mission.

The use of reusable space launch vehicles can substantially reduce costs in the market, if these

rockets can be effectively used for multiple missions. Companies such as SpaceX have been

working to develop such reusable space launch vehicles that can re-enter the Earth's

atmosphere without burning and return to the launch pad for a vertical landing.


35



Progression Toward Low-cost Satellite-based Internet Services

At present, satellite-based Internet services use satellites in GSO, which is 22,000 miles or more

from the surface of the Earth. This distance results in high latency and makes satellite Internet a

poor option for applications such as gaming, video conferencing, and live streaming. In

addition, the manufacture of traditional large-sized satellites and their launch to GSO is

expensive, thus increasing the cost of Internet services based on these systems.

In comparison, nano and microsatellites can be put in LEO, which is at a distance of

approximately 680 miles from the Earth's surface. The latency of the Internet service at this height

would be 20 milliseconds to 30 milliseconds, which is comparable to or even better than existing

broadband Internet solutions that use fiber-optic cable networks. For developing nations,

establishing a network of optical fibers for Internet services can be very expensive. Nano and

microsatellite-based infrastructure is, therefore, a good alternative for the provision of low-cost

satellite-based Internet access with broad coverage. Companies such as OneWeb and SpaceX

are working in this direction and are planning the launch of a constellation of 648 microsatellites

in the next few years.


Additive manufacturing (3D printing technology) is a development that has the potential to

revolutionize current manufacturing processes. 3D printing allows a final product to be created

directly from the CAD design. In place of expensive molds for different product designs, 3D

printing uses a single additive manufacturing system that can create multiple parts and

components just by varying the CAD design as per requirement. As the manufacturing process is

conducted in layers, utilizing only the raw materials needed to build the part, there is substantial

reduction in raw material consumption and weight of the component.

Companies such as Aerojet Rocketdyne have been working in cooperation with research

institutes to develop a way to manufacture microsatellites from metal and composites using 3D

printing technology. In 2014, the company successfully demonstrated the 3D printed rocket

propulsion system for CubeSat. One of the future objectives is to build such satellites in space

using 3D printing technology, which has the potential to eliminate the need for and the costs

involved in the launch of satellites from the Earth.


36



14. Trends and Their Impact

Key

The impact of the trends is graded on the basis of the intensity and duration of their influence on

the current market landscape. The magnitude of the impact has been categorized as

described below:





37



15. Vendor Landscape

15.1 Competitive Scenario

The market is highly competitive, and vendors compete on the basis of the cost of satellites,

advances in technology, lightweight platforms, reliability, and market share. To survive and

succeed in such an intensely competitive environment, it is crucial for vendors to optimize their

product development processes to provide cost-effective and high-quality products and

solutions.

For satellite manufacturers, it is also important to work closely with satellite operators in order to

provide spacecraft suitable for a broad range of services. The satellite platform should also be

highly efficient and reliable and suit the application requirements in areas such as radio and

television services, broadband Internet, and mobile communications. Satellite platforms should

also provide high flexibility and modular design approaches considering technological

advances and upgrade requirements in the future.

Vendors should also cooperate and work collaboratively with space launch system developers

and service providers. It will help to integrate the entire space launch process and tackle issues

of space launch delays. There is also growing concern regarding space debris and the

mitigation measures that might be implemented, including the requirement for deorbiting

systems in miniaturized satellites. The respective authorities in the industry should also work

toward solving such issues to avoid hindrances to the growth of the satellite industry.

The satellite launch market has been growing rapidly and has, in recent years, not only paved

the way for private companies to enter the market and provide innovative solutions for space

exploration, but also helped in creation of jobs and fostered innovation in technology and

market competitiveness. Countries such as the US are planning the development of new

spaceports, which will support the growth of the satellite launch industry.


38



Exhibit 14: Key Vendors


15.2 Other prominent vendors

Company Description

Arianespace

A commercial satellite launch company that provides

launch services to commercial satellite operators and

government space agencies

Axelspace Develops microsatellite-based systems and provides

other space-based solutions

Clyde Space

Supplies small and micro spacecraft systems; also

provides high-performance power subsystems, DC-DC

converters, lithium polymer batteries and high-

efficiency solar panels for small satellite missions

Dauria Aerospace

Offers a range of products such as geostationary

platforms and microsatellite platform such as Auriga,

DX, and Perseus

Deep Space Industries

Provides nano and microsatellites, propulsion systems,

space mission design services, and spacecraft

manufacturing

Dynetics

Provides cost-effective engineering, scientific, and IT

solutions to the cyber security, satellite, launch and

critical infrastructure sectors

Airbus Defence and Space

Boeing Defense, Space, and Security

Orbital ATK

SSL


39



Company Description

GeoOptics

Develops small satellites primarily used for Earth

observation applications, and launched in the LEO; it

also provides data and information about the Earth to

public and private users worldwide

GomSpace

Develops systems and components for nanosatellites,

including power systems, Spacelink, control systems,

and satellite platforms

Innovative Solutions in Space Offers CubeSat satellites, ground systems, spacecraft

platforms, launch services, and payload integration

Lockheed Martin

Provides space-based solutions to military, civil

government and commercial customers; its satellites

are mainly used for remote sensing, navigation,

meteorological and communications purposes

Mitsubishi Electric

Provides space-based solutions to governments and

commercial clients including satellites, satellite

components, and ground systems

Novanano

Offers products such as launch adapters, satellite

platforms, and subsystems; also provides launch

services, nanosat missions, and insurances

Planet Labs

Provides satellite systems, satellite-based services

mainly for monitoring applications and satellite

imagery solutions

Raytheon

Develops and builds small satellites mainly for military

and defense applications; also makes various other

civilian and military-based space products and

systems

Ruag Space

Provides space launcher structures and separation

systems; also provides satellite structures, mechanisms,

and mechanical equipment. The range of products

also includes solar array drive mechanisms,

deployment mechanisms, pointing mechanisms and

satellite mechanical ground support equipment

Sierra Nevada

It is a major developer of space systems and

technologies that offers propulsion systems, space

exploration systems, spacecraft systems and other

space technologies


40



Company Description

Skybox Imaging

Develops satellites and also provides space-related

solutions and provides satellite antenna and

equipment as well as satellite-based analytics services

SpaceQuest

Provides antenna systems, Earth station equipment,

electrical power, microsatellite systems, satellite and

ground components, radios, modems, M2M

communications and global AIS data

SpaceX

The company designs, manufactures and launches

rockets and spacecraft, provides launch services, and

has been providing regular cargo supply missions for

NASA, to and from space station

Spire

Develops satellites primarily for remote sensing

applications; these satellites provide data and

information back to the Earth

Surrey Satellite Technology

Develops satellite systems and subsystems including

the satellites SSTL GMP-T, SSTL NovaSAR, SSTL 300-S1,

Nano-X, and Cube-X and subsystems subsystems such

as actuators and sensors, on-board data handling,

propulsion systems, and power management

Thales Alenia Space

Designs, integrates, tests and operates space systems;

provides satellites and payloads for communications,

navigation, monitoring, and scientific research

applications among others

Tyvak Nano-Satellite Systems

It develops nanosatellite and CubeSat satellite

systems; it also provides services such as R&D and

consulting to governments and commercial

customers

United Launch Alliance

The company mainly provides space launch services

for the US government agencies such as DoD, NASA,

the National Reconnaissance Office and other

organizations


41



16. Key Vendor Analysis

16.1 Airbus Defence and Space

16.1.1 Key Facts

16.1.2 Business Overview

Airbus Defence and Space was founded in 2014 and is headquartered in Germany. The

company designs, manufactures, and delivers transport and surveillance, multi-role/wing-role

combat, unmanned, and military trainer aircraft.

The key business offerings of the company are:

Military aircraft: Comprises the A400M Airlifter, Eurofighter, A330 MRTT, UAS, light and medium

transport aircraft (C295 and CN235), CISR aircraft, and mission systems. It also includes full


42



fleet support solutions, air services, maintenance, repairs, upgrades, logistics and engineering

services, training, and flight operations services.

Space systems: Comprises Ariane 5; orbital systems; Earth observation, navigation and

science satellites; spacecraft; probes and rovers; telecom satellites; defense systems; and

space propulsion systems

Communications, intelligence, and security systems: Comprises satellite communications

solutions, border security systems, and C4ISR. It also offers secure land communications, geo-

information services, and consulting and training services.

Electronics: Comprises radars and IFF systems, electronic warfare systems and sensors, space

platform electronics, space payload electronics, and avionics

The company serves customers in APAC, EMEA, and the Americas. For FY2014, it generated

revenue of $17.31 billion. It spent $457.0 million and $478.4 million on R&D for FY2013 and FY2014,

respectively.

16.1.3 Recent Developments

Company Details Description

Key Highlights

March 26, 2015: Selects Arianespace to launch

PeruSat-1, the Peruvian Earth observation satellite

March 23, 2015: Sells its subsidiary Rostock System

Technik to Ferchau Engineering in Gummersbach

March 19, 2015: Selects Arianespace to launch EDRS-C

satellite, the second geostationary satellite of the

SpaceDataHighway system

March 16, 2015: Signs a strategic partnership

agreement with SES (global satellite owner and

operator) to deliver managed Satcom services to

corporate customers in Africa and globally

January 20, 2015: Receives a contract from the Ministry

of Interior of Lebanon for a Terrestrial Trunked Radio

(Tetra) communication system


43



16.1.4 SWOT Analysis


44



16.2 Boeing Defense, Space, and Security

16.2.1 Key Facts


Boeing Defense, Space, and Security, formerly called Boeing Integrated Defense Systems, was

founded in 1939 and is headquartered in Berkeley, Missouri, US. The company develops

intelligence and security systems, manned and unmanned airborne services, and integrated

systems.

It is a subsidiary of Boeing and is a $33 billion business. The company's product portfolio

comprises four major segments:


45



Military aircraft: This segment offers strike aircraft, surveillance aircraft, unmanned systems,

weapons, and mobility crafts

Satellites and space: It offers satellite systems and services, space transportation solutions,

human space flight, heavy lift launch vehicles, and military space and security services

C4ISR and cyber: It is engaged in the development of integrated missile systems, ISR systems,

and secure communications solutions

Support and services: It provides multiple services such as integrated logistics, modification

and maintenance solutions, and training systems

The company has a workforce of 56,000 employees.

16.2.3 Product Segmentation

Exhibit 15: Boeing Defense, Space, and Security: Product Segmentation 2013


16.2.4 Business Strategy

Operational Strategy

The company focuses on the continuous improvement of its product line by incorporating new

and innovative technologies to its existing products. The company can serve a wider range of

customers and strengthen its market position with the introduction of new products.


46





Key Highlights

August 2014: Completes the Phase Two Spacecraft

Safety Review of CST-100 spacecraft and CDR of its

integrated systems

August 2014: The company along with Sikorsky Aircraft

is selected for the US Army's JMR TD Phase 1 program

August 2014: Its Tactical Surveillance Aircraft receives

FAA certification

August 2014: Delivers a training center for C-17

Globemaster III airlifter to the Memphis Air National

Guard base in Tennessee

Key Partnerships July 2014: Signs a contract with NASA to develop the

core stage of SLS


47





48



16.3 Orbital ATK

16.3.1 Key Facts


Stock Listing New York Stock Exchange

Ticker Symbol OA


49




Orbital ATK is headquartered in Virginia, US. It designs, develops, and markets a wide range of

aerospace, defense, and commercial products to the US government, commercial, and other

foreign customers. Orbital ATK was formed as a result of the merger between Orbital Sciences

Corp. and the aerospace and defense groups of ATK in April 2014. ATK has spun off its sporting

group segment to its shareholders.

The company operates through three business segments:

Flight systems groups: Designs and manufactures products for the space launch, strategic

missile and missile defense, and aerospace structures markets. Some of its key products are

space launch vehicles (Antares, Minotaur, and Pegasus), propulsion systems (booster

separation motors, Castor 30-A multi-use motors, GEM strap-on booster systems, rocket motor

testing systems, and switchblades), missile defense systems (ballistic missiles, interceptors,

anti-ship cruise missiles, and Minuteman III intercontinental ballistic missiles), and aerospace

structures (military aircraft structures, launch structures, and commercial aircraft structures)

Defense systems groups: Manufactures and markets a wide range of precision weapons;

tactical rocket motors used in air-, sea-, and land-based systems; missile warning products;

and ammunition and gun systems

Space systems groups: Designs, manufactures, and markets small- to medium-class satellites

for communications, imaging, science, and national security space applications. It offers

commercial satellites (GEOStar satellites), scientific and national security satellites (LEOStar),

human space and advanced systems, and space components


50



16.3.3 Business Segmentation by Revenue 2014

Exhibit 16: Orbital ATK: Business Segmentation by Revenue 2014


16.3.4 Market Segmentation by Revenue 2014

Exhibit 17: Orbital ATK: Market Segmentation by Revenue 2014



51



16.3.5 Business Strategy

Operational Strategy

The company focuses on the following strategic areas:

Retaining its key officers and personnel

Retaining its old customers and attracting new customers by developing innovative products

and technologies

Restructuring its recent mergers and acquisitions



Key Highlights

March 12, 2015: Receives a contract for additional

armed caravan work from the US DoD Foreign Military

March 9, 2015: Receives a $120 million contract from

the US Army for additional production of the precision

guidance kit for 155mm artillery

February 20, 2015: Receives a $30 million production

contract from the US Navy for manufacturing AAR-47

missile warning system

February 18, 2015: Begins the production of Boeing 787

Dreamliner composite frames


52





53



16.4 SSL

16.4.1 Key Facts


SSL was established in 1957 and is headquartered in Palo Alto, California, US. The company

designs, manufactures, and integrates satellites and satellite systems for commercial and

government customers. Its products are used by various customers to deliver services such as

broadcast video distribution, broadband digital multimedia communications, direct-to-home

video and data broadcast, mobile radio and data broadcast, mobile voice and data services,

defense communications, and air traffic control.

SSL's products comprise of space proven products (satellites and satellite systems), 1,300 series

platform (space-proven platform for a wide range of satellite services), satellite applications,

and hosted payloads. It offers a wide range of satellites, including direct broadcast satellites,


54



digital audio radio satellites, mobile satellite services, fixed satellite services, and broadband for

government and commercial purposes.

SSL has manufactured over 250 satellites and delivered more than 2,000 years of on-orbit service

since its inception. In addition, the company is building next generation satellites that provide

more than 100

Global Satellite Manufacturing and Launch Market 2015-2019 (1)

Documents

launch market

market size

market challenges

market overview

market landscape

market trends

market research methodology

market growth drivers