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Unlocking the Potential of Space Investment Beyond Galactic Tourism

Space Investment Beyond Galactic Tourism

When it comes to space-based investments, galactic tourism may spring to mind. But there are other exciting prospects ahead, underpinned by an evolving satellite network. 

Investment has been pouring into the space sector since the start of 2020: public and private markets put $10bn of fresh capital into space companies in 2021 alone. Some of these were start-ups and others were more established operators, but all represent a new wave of dynamism that’s happening high above. Indeed, Morgan Stanley estimates that the global space industry could generate revenue of more than $1tn by 2040, up from $350bn as of 2023. 

The ‘new space’ has become fertile ground for innovation, ideas and business, with those companies creating proprietary or unique tech often being the most attractive to investors. 

“It’s really about the democratization of space,” says Mollie Martin, Senior Investment Associate at Deloitte Ventures and co-author of a recent space investment report for the consultancy. “Making space easier and cheaper to access; opening it up to more customers and market entrants.” 

Historically, space has been the preserve of national governments with multi-billion-dollar budgets, but an increase in open-tender opportunities from national space agencies has brought  

new players to the market. “And now space tech start-ups are increasingly sitting in investment portfolios alongside consumer brands and fintech’s,” says Martin. 

Solving Earth’s challenges 

Some liken it to the California Gold Rush – a particularly apt comparison when you consider the companies looking for off-Earth mining or billionaires’ dreams of colonization opportunities. But for many, the most exciting aspect is what space-focused companies bring to terrestrial challenges. 

Blane Boynton, VP Product Development at Intelsat, points out that satellite technology, for example, has helped with Earth-based issues, too, from improving battery storage to chip miniaturization, to extending the range and reach of cellular networks, and more. “Improved satellite tech and coverage connects the unconnected, ensures that critical sectors from government to farming have access to continuous and uninterrupted connectivity, helps us monitor the planet and enables our growing wave of IoT devices to talk to each other,” he says. 

The commercial potential of space is increasingly being recognized, agrees Deloitte’s Martin. “More organizations are using satellite data to create ‘downstream’ products and services – using space-enabled technology for applications on Earth, rather than in space,” she says. 

In industries such as agriculture and automotive manufacturing, leading companies are capitalizing on new satellite-enabled applications, connected equipment and services to enhance operations. In the farming sector, Boynton explains that smart farming applications are using satellite connectivity to monitor field, livestock and equipment in real time, allowing farmers to pre-empt issues and plant and harvest with greater efficiency. In other industries like logistics, construction, energy and mining, applications using space-based technology are still emerging. In all industries, satellite networks have the potential to change and inform everything from weather monitoring and greenhouse gas emissions to infrastructure planning and land management analysis. 

Chris Johnson, Senior Vice President and General Manager of Space at Maxar, a space infrastructure builder, outlines how innovation in the sector is helping. “We’re working with industry partners on multiple technologies including digital payloads that provide flexible beam coverage and the ability to re-allocate bandwidth and power in-orbit,” he says. “That means if demands on the ground change, satellite operators can send a command to reconfigure the coverage in orbit. That kind of capability helps customers deliver coverage where it is needed and can extend the life of a satellite as it adapts.” 

Flexible, in-space computers 

As space gets busier, it’s not just ground-to-satellite comms that will be required. There will be a significantly increased need for space-to-space connectivity as well. Most people might assume this means that space tourists, on a Branson or Bezos-enabled mission perhaps, can communicate while on board. But a more useful requirement will be to route data between space objects, from a satellite to the International Space Station, for example. 

Ken Takagi, Director of Innovation Strategy at Intelsat, explains: “With the new generation of software-defined satellites, you can flexibly change the mission of a satellite after it’s been launched. Essentially, it’s a computer and you just send new software commands. In the future, satellites could also assume the role of a network cloud in space. So, one day it could be routing data between space objects and the next day it could be processing data, because somebody’s run out of compute capability on a LEO satellite or on a space station. New space technology has much more flexibility.” 

However, like prospectors in the Gold Rush, many new participants are piling into the sector, and it’s crucial that industry standards reflect and protect the ‘new space’. For their part, investors should think carefully about the unique nature of the sector. 

Intelsat’s Boynton suggests that those investing in a space-based approach need to ensure that it’s either the best – or the only – way to solve the problem for which it’s intended. “Make sure you can live through the longer development cycle and the product launch timeline associated with working in space,” he cautions. “And understand what it is that you’re signing up for in terms of CapEx and OpEx over the lifecycle of the investment. There are lots of opportunities out there but go in with your eyes open.” 

Invariably, as with all businesses, there will be winners and losers in this new space race. However, says Boynton, companies already operating a modern and digitized satellite network – like Intelsat – can deploy at a much lower risk than a new market entrant requiring massive funding. 

What is clear, though, is that thanks to reusable rockets and smarter, more adaptable satellite technology, the space sector will continue to soar, bringing benefits not just to billionaire space tourists, but for all humankind. 

This content was paid for and produced by Intelsat in partnership with the Commercial Department of the Financial Times. 

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