by John Stone
Near Earth LLC
At this writing, firefighters continue work to contain the last of the recent bout of California wildfires. While the property losses from this one incident are indeed staggering, the loss of life has been mercifully small. When we consider why this is the case, its also a good time to consider the role satellite technology plays in preparing, responding and recovering from natural and man made disasters and helping to minimize these losses. Given Near Earths position in the capital markets, we also consider the ramifications this technology can have for investors.
Even before disaster strikes, in many cases satellites help us by predicting the onset of the disaster itself. Consider that before floods, hurricanes or Santa Ana wind storms happen, meteorological satellites help us forecast the disaster itself, providing critical time to prepare and, when needed, evacuate. While todays techniques have already reduced loss of life from weather related disasters, new satellites like the NPOES series now in development promise to improve the quality of these forecasts further. Companies such as ITT, Ball, Lockheed Martin, and others, help make this happen.
New techniques like GPS occultation (GPS occultation combines purpose built meteorological satellites with the Global Positioning Satellites already in service to measure atmospheric properties) will soon magnify to an even greater extent our ability to measure and predict our global climate. This new technology was sponsored and tested by NASA and the Jet Propulsion Lab and is now being explored by NOAA and commercialized by GeoOptics and Broad Reach.
After the onset of a disaster, satellites swing into action in a variety of ways. One of the main consequences of many disasters is failure of the terrestrial communications infrastructure due to destruction, damage or loss of power. For example, flooding and wind damage from hurricane Katrina not only destroyed broadcast, microwave and cell towers, subsequent failure of the power grid silenced much of the equipment that did survive the storm.
Likewise, when the tsunamis ravaged the Indian Ocean, many of the locations devastated by the waves had little communications infrastructure to begin with. Consequently, when first responders arrive, in many instances there are no local communications capabilities. However, thanks to portable satellite terminals from providers like Globalstar, Inmarsat, MSV, Thuraya, and Iridium (soon to be joined by ICO, Terrestar and others), they can bring their communications with them.
Improved mapping and navigation from imaging and GPS satellites are used for fighting fires, tracking assets, and planning responses. Firms including GeoEye, Digital Globe, ORBCOMM, ESRI, Garmin, and Trimble lead here. Within hours of a disaster, thanks to the rapid deployment capability and independence from terrestrial infrastructure that satellite communications provide, broadband communications can be in place. Combined with deployable Wi-Fi mesh networks, VoIP and other technologies, satellites can provide full communications capabilities to speed and optimize recovery efforts. Companies like Freedom For Wireless, Agiosat, Spacenet, Artel, Datapath, Americom Government Services, and Globecomm fill this need.
Finally, through monitoring land use, resources, and the environment itself, satellites can play an important role in planning for the next disaster. Most of the applications above are in an early stage of adoption and the industry landscapes have yet to evolve. Given the increasing success satellite equipment and services have brought to disaster planning, management and response, we expect this area to enjoy growth well above the industry average.
In turn, we expect the capital markets to allocate capital to finance this The next time your government is facing fires, floods, storms, earthquakes, terrorists or tidal waves, make sure the answer to Got Satellites? is YES.
As a testament to the value of ATC spectrum, SkyTerra, the parent of MSV, was able to sell $150 million of senior unsecured notes due 2013 to the hedge fund Harbinger Capital Partners. This is encouraging news for the MSS sector, as significant capital will be needed in 2008 to make up for the sectors difficulties attracting strategic partners. In satellite broadband, Hughes took possession of Spaceway 3 from Boeing, assuring it significant new Ka-band capacity to market to residential and enterprise customers. Meanwhile, WildBlue, Hughes major competitor in the U.S. market, inked a deal with Google to be its partner for web servicesDan Ramsden, Managing Director, Near Earth LLC
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