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UPLINK: State of the Art
by Hartley Lesser, Editorial Director

Whenever I attend the National Space Symposium in Colorado Springs, I leave the conference with what feels like a brain 2x larger than when I arrived. There is so much information imparted to attendees that one’s brain cells are flooded with new data, new contacts, new technologies — in this case, having a headache is a good thing, as such means a ton of information has been absorbed for current and future synapse processing.

Elliot Pulham offered some thoughts regarding the state of the space industry and its related business environs. Elliot happens to be the CEO of the Space Foundation, the organization that plans and hosts the National Space Symposium.

Mr. Pulham believes there may be lag before the full impact of the current economic doldrums are felt, with most business advancement to be seen in the public sector. He definitely feels there will be an increase in collaborations of the international kind, as well as increased integration within the business sector. There is definitely great capacity, not necessarily with transponders, but for growth and advancement in this industry.

From a personal perspective, when economies are recalcitrant, forging forward with already committed projects, as well as activating aggressive marketing and public relations efforts, makes a great deal of sense. Due to any number of actors withdrawing from such activities, such is an opportunity for those with foresight to cement themselves into place as subject-matter experts. Their voices remain heard — their messages are more easily recognized due to a lack of competitive voices, not a bad thing when attempting to promote your product or message.

As economies improve, those who have weathered the storm and remain in place have no need to start from scratch, and seem to have “always been there,” doing what is necessary to instill confidence with prospective customers, and assuring their well-established client base they are in the industry for the long term proving they can accomplish the job. This is also a good time for a new company to launch as more attention is paid to their announcements and products due to less clamor from an over-messaged industry.

I would now like to present excerpts from both the Executive Summary and the pages of this magnificently produced annual, The Space Report 2009: The Authoritative Guide to Global Space Activity. For those who are interested in obtaining this publication, the annual is available at this direct link.

In 2008, a year when the world’s economy was more tumultuous than any other in decades, the space industry experienced a remarkable time of success and inspiration. It weathered the economic crisis while reaching new levels of technical, scientific, and business achievement. Folded within the pages of this annual space story are historic accomplishments by governments, corporations, and entrepreneurs and their ambitious plans for continuing the use and exploration of space. These success stories, detailed throughout The Space Report 2009: The Authoritative Guide to Global Space Activity, demonstrate the resilience and determination of countries eager to reach out into space, and the people and companies desiring to take part in the exploration and expansion of the highest frontier.

The Space Report 2009 presents an innovative and energetic chronicle of the previous year in space as well as an outlook on what lies ahead. Space activity spans a vast arena, ranging from locating the family pet with a global positioning system (GPS) collar to discovering the origins of our universe. In 2009, the space industries that envision, design, build, and operate the systems for space exploration and space-borne commerce, and the governments that direct, and underwrite, sizable portions of global space activity, will confront down-to-earth challenges brought on by a tightening global economy.

Amid these substantial economic reverberations, the breadth of worldwide space activity in the past year is all the more remarkable. Significant space-related developments in 2008 included some potential “game changers” with a collection of scientific, government, commercial, and entrepreneurial firsts. They include the first-ever observation of a supernova at the moment of its explosion and a NASA lander discovering ice on Mars, a sign of the possibility of life on that planet. The United States shot down one of its own satellites to prevent an uncontrolled fall from orbit. Taikonauts performed a spacewalk and made China the third nation ever to accomplish this feat. The U.S. Air Force and its steadfast support contractors achieved a record of 59 consecutive successful launches while the first commercially funded and built space booster was successfully launched, propelling its payload into orbit.

Entrepreneurs took steps toward making private spaceflight more affordable, while commercial enterprises made advancements in delivering satellite-borne media services to airplane passengers. Demand grew for satellite transmission of high-definition television signals, and high-tech swimsuits based on space-related technology enabled world records to be broken during the Summer Olympics — all of this made 2008 another banner year for space.

Beyond these stories of space success, The Space Report 2009 presents vital economic data about the $257 billion space industry, ranging from the launch industry to space-dependent consumer services. The Space Foundation Index, the industry’s premier public equity market tracking tool, declined significantly, as did most other market indexes around the world. This year, The Space Report 2009 also includes two new indexes, the Space Foundation Infrastructure Index and the Space Foundation Services Index. These additions provide more detailed historical financial analysis, tracking, and clarity about two critical segments of the space industry.

The report updates developments in the use and application of space products and services and includes new information about space infrastructure, with greater detail on the global space workforce and the economic impact of the space industry. In addition to updated information on salaries, workforce numbers, and leading space states and metro areas, The Space Report 2009 addresses concerns about scientific and technical education and the future of the U.S. space industry’s labor pool. This year’s report includes a new subsection analyzing U.S. science, technology, and math performance from kindergarten through the 12th grade, and compares undergraduate and graduate technical degree programs in the United States with those in several other leading space countries.

The Space Report 2009 closely examines, perhaps the single most important factor in the success of the space industry, its people. Education trends may present a recruiting problem for the U.S. space industry in years to come as interest in science, technology, engineering, and mathematics declines in U.S. schools, along with academic performance in those areas. In the technology arena, the hold on the popular imagination enjoyed by the space industry in the early years of the space age has slipped, and young people with a technical interest appear more inclined to focus on computer and software engineering career tracks.

The positive side of the workforce picture is that the space industry, despite the economic downturn, appears poised to continue its role as a major jobs producer, and an engine of economic innovation. Regions such as California, Colorado, and the Washington, D.C., area are likely to continue to attract workers due to the important role played by space employment and wages in their regional economies.

The Space Economy
The detailed financial analysis presented in The Space Report 2009 reveals that, in a troubled financial environment, the space industry managed to maintain and increase its revenues in 2008, with estimated budgets and revenues from public and private sources of $257 billion. This represents a growth of more than $6 billion over the previous year. Within that total there was significant growth in individual sectors. At the same time, space industry stock valuations took a severe hit in 2008 according to the Space Foundation Index, and the lean times most likely will continue well into 2009. Nevertheless, investment in space activity and economic output resulting from space activity remained substantial in 2008 and continued to provide thousands of jobs at enviable pay scales.

Total revenue for space products and services in 2008 reached an estimated $91 billion, 10.4 percent more than the $82.4 billion total in 2007. The largest revenue producer within the commercial satellite service sector was direct-to-home (DTH) television, which generated $69.61 billion in 2008. Fixed satellite services constituted the second-largest sector with $16.79 billion in 2008. These industry segments together comprise 95 percent of commercial satellite revenues. Fixed satellite services showed the strongest growth rate, increasing 31 percent in 2008 to a sector with revenue of $16.79 billion from $12.82 billion in 2007.

Revenue in 2008 for commercial space infrastructure, including launch vehicles, satellites, ground stations, in-space platforms, and infrastructure support industries totaled $83.11 billion. The pace of launch industry operations was essentially unchanged in 2008 with 69 orbital launches carrying 106 payloads. Of these 69 launches, 28 carried commercial payloads and 41 carried non-commercial payloads. The level of government spending reflected by those non-commercial launches demonstrates that governments often represent a stabilizing force for the worldwide space industry.

Space Foundation Index
The Space Foundation Index, now in its fourth year, tracks the market performance of 29 public companies selected because they derive a significant portion of their revenue from space-related assets and activities. The index, available online at this direct link, enables industry professionals and market analysts to track the performance of the industry against broad market benchmarks such as the Standard & Poor’s (S&P) 500 and the NASDAQ Composite Index. Following more than three consecutive years of steady gains where it often outpaced other key indexes, the Space Foundation Index fell substantially with the rest of the stock market in 2008. During 2008, the performance of the Space Foundation Index declined from a lifetime gain of approximately 29 percent to a loss of 29 percent by the end of the year. It underperformed both the NASDAQ and the S&P 500 expectations.

This year, the Space Foundation unveils two additional indexes that individually track the two market segments that make up the overall Space Foundation Index. These are space infrastructure, which is directly related to the equipment and software that space systems need to function, and satellite services, which involves the sale of services that depend on space assets.

The Space Foundation Infrastructure Index (SFII) and the Space Foundation Services Index (SFSI) are new market measures that have been tracked back to June 30, 2007. The SFI and its two component parts, the SFII and the SFSI, are updated daily.

Space Products and Services
As the space industry becomes a vital part of the general consumer economy with GPS receivers and satellite television, it becomes more susceptible to general economic downturns. During the years when the U.S. space industry relied almost entirely on U.S. government programs, government spending served as a protective buffer from economic down-cycles. For several years prior to 2008, the expansion of the space industry into consumer spheres was the engine of its rapid growth. Last year brought home the risks inherent in participating in these commercial markets.

Satellite systems provide a host of services ranging from intercontinental communication to in-vehicle navigation, and have become as integral to daily life as cell phone towers.

What is changing, and changing rapidly, is the way this basic information can be used. Sometimes in new combinations, it is used to deliver an ever-expanding variety of services. Demand for satellite communications is increasingly driven by consumer applications, most notably video. Carriage of high-definition television (HDTV) continues to increase in major markets globally. Global positioning services continue to expand in variety, and designers and engineers are coming up with new ways to combine positioning data with other databases as an aide to travelers, tourists, professionals, and soldiers.

A challenge ahead for the expanding global positioning and navigation market lies in the need to develop uniform technical protocols that will eliminate the need for multiple sets of equipment to access the signals provided by satellite constellations deployed by different nations.

How Space Products + Services Are Used
The space industry has surpassed the point where descriptors of space products and services used can be covered in a single publication. The examples in this report represent a small sampling to illustrate the breadth and ingenuity of the space industry in creating new ways to serve governments and the private sector. From private space travel to mobile Internet services to high-tech swimsuits, the space industry is fully engaged in finding new applications for existing technology and in developing new technologies to solve persistent problems.

Common themes around some of these products and services involve making life easier and more interesting. In 2008, ICO Global Communications began testing a mobile TV service using a satellite over the United States, designed to deliver up to 15 television channels for entertainment starting in 2010.

Governments as well as individuals are finding new ways to use space products and services. The Beijing Olympic organizers relied upon remote sensing data from a U.S. satellite to monitor aerosol levels in and around Beijing before the games. The data helped organizers concentrate their pollution reduction efforts to make Beijing a more receptive environment for athletic competition. The same research team was also deployed after the Sichuan earthquake to provide the governments with disaster damage assessments. Satellite communications serve governments around the world for election monitoring, border security, tax collection, distance learning, disaster relief, and national defense.

As satellites are unaffected by the disruption on Earth caused by natural disasters, satellite services are often the only way for first responders to communicate immediately and consistently. New technology being developed jointly by the United States and the United Kingdom is promising marked improvement in border security by offering more accurate means of detecting smuggled nuclear materials. The list goes on and on as the fusion of technologies creates new products and services for space, and its users, nearly every day.

The Space Report 2009 Data
The Space Report 2009 is the result of extensive research by the Space Foundation and an array of independent research organizations and individuals with expertise in space, policy, financial markets, science, education, and technology. This combined effort involves identifying, gathering, analyzing, and synthesizing publicly available sources including government reports, congressional records, and corporate reports, as well as data provided by industry trade associations and private research firms. The report also draws upon articles in business and industry publications.

Illuminating the text of The Space Report 2009 are scores of exhibits tracking industry sector activity, major sources of space industry revenue, trends in education, employment, government investment in space, and market performance of space industries. Additional exhibits that further illustrate the state of the global space industry can be found at the the Space Foundation’s website.

Earth Observation
Broadly defined, the Earth observation market includes revenues from applications as varied as weather forecasting, intelligence-gathering, highway inspections, climate change studies, and commercial uses in agriculture, fishing, mining, construction, and public health.

The primary industries using space-based products and services involve Earth-orbiting satellites used for communication; remote sensing and Earth observation; and position, navigation, and timing.

Based on BCC Research revenue data, the estimated total global expenditure for this overall satellite-based Earth observation market in 2008 was $7.5 billion, a 3 percent increase from $7.3 billion in 2007. Weather forecasting and intelligence-gathering applications experienced the highest growth rates, approximately 5 percent and 7 percent, respectively. The same study projects that revenue will reach $9.9 billion by 2012.

In a different study, Chesapeake Analytics reported that world markets for high-resolution land imaging and related value-added services totaled $3 billion in 2008, and are projected to reach $5.2 billion by 2013. High-resolution satellite imagery is a leading driver for this market with revenues expected to grow from $1.1 billion in 2008 to $2.5 billion in 2013. Chesapeake also estimates that satellite-based synthetic aperture radar will grow from $280 million in 2008 to $780 million in 2013, as providers seek Earth observation capabilities regardless of cloud cover or darkness.

Remote sensing products and services provide a unique perspective of the Earth, its landmasses, nations, and communities. Growing access to these products and services has expanded our understanding of landforms and structures, made it easier to identify change in natural and fabricated formations, and assisted in rural and urban planning.

More than 80 percent of commercial remote sensing data is produced and purchased by governments with national security as the primary application. Commercial companies and governments operate remote sensing satellites, and a wide range of private companies analyze and integrate imagery with other information such as road maps, store locations, pollution maps, census data, and crime statistics. An increasing mix of military, civil government, and consumer interests drives demand for imagery. Current military operations drive continual U.S. government demand for satellite imagery to address national security and intelligence gathering concerns. Global change, including climate change, human impact, and natural disasters such as the 2008 earthquake in China, floods in Asia and North America, and hurricanes and tsunamis, increasingly drive demand for remote sensing and Earth observation.

Innovative services such as Google Earth and Microsoft Virtual Earth, among others, are streamlining and enhancing the use of remote sensing products and services by consumers for such tasks as locating retail stores, gas stations, and restaurants, and getting directions to an office or other destination. The Microsoft and Google services use imagery from various satellites, aerial, and ground-based platforms to provide a variety of perspectives, melding access to space-based views and bird’s-eye views with street-level images.

Environmental monitoring satellites provide decision-makers with critical information on climate change and natural disasters. The loss of a single satellite can cause significant gaps in Earth observation capabilities, as was the case in February 2009 when NASA’s Orbiting Carbon Observatory (OCO) was destroyed in a launch failure. OCO was designed to acquire high-resolution data on the atmosphere, the oceans, and the Earth’s surface. The spacecraft was intended to collect carbon dioxide measurements for research into reducing manmade greenhouse gasses. Missions of this type may influence environmental decisions and policies as scientists and policy makers seek to understand atmospheric processes.

Low Earth Orbit (LEO) spacecraft, in addition to their use for communications services, are also used to provide images of the Earth for civil, scientific, and military applications. In 2008, the U.S. National Oceanic and Atmospheric Administration’s (NOAA) Advisory Committee on Commercial Remote Sensing reported that there were 88 satellites in use, or in development for this purpose, operated by 27 different countries. The U.S. has been the leader in the commercialization of electro-optical remote sensing technology, but recent years have seen other countries begin to excel in the development of synthetic aperture radar (SAR) systems. SAR combines the echoes from multiple radar pulses and overlaps them into a single radar image. This allows imaging of the Earth during inclement weather, heavy cloud coverage, and nighttime, overcoming constraints that limit other remote sensing systems.

In 2008, there were 19 remote sensing satellites launched on behalf of five countries. Of particular note, in August, the German RapidEye constellation of five remote sensing satellites was launched. The five RapidEye satellites travel along the same orbital plane and feature identical sensors, allowing large amounts of imagery to be collected, up to 4 million square kilometers (2.5 million square miles) per day. Five satellites in the same orbital plane allow for a higher number of multiple imaging passes over the same spot and quick revisit times. With these capabilities, the RapidEye constellation is capable of imaging any point on Earth every day.

In addition, in September, the GeoEye-1 satellite was launched. Funded in large part by the National Geospatial-Intelligence Agency (NGA), GeoEye-1 provides 0.4-meter (1.3-foot) high-resolution panchromatic and 1.6-meter (5.2-foot) multicolor images to be marketed to the Department of Defense as well as city and state planners. GeoEye-1 provided imagery of the January 20, 2009, U.S. presidential inauguration on the National Mall in Washington, D.C., to media outlets worldwide.

Thanks to the Space Foundation’s Elliot Pulham and Janet Stevens as well as the editors and writers of the publication: Marty Hauser, Micah Walter-Range and Mariel John, with contributions from: Andrea Maléter, the Technical Director at FutronChristopher Novak, Partner, Content First, LLCCharlies Liu, Ph.D., of the City University of New YorkAnita Antenucci, the Managing Director of Houlihan Lokey — and Kevin W. Leclaire, Managing Partner of ISDR Consulting, LLC. The Editor of the report is John M. Diamond and to brandt ronat + co for the superb design of the report.

All have managed an exceptional job in presenting this annual. Believe me, there’s so much more deep information and analysis within these pages that anyone involved in our various industries owes themselves a copy of The Space Report 2009.

For further information, select the following graphic for the report’s website. All images used in this article are located in the Space Foundation’s book — Hartley G. Lesser, Editorial Director