Although the space industry has begun to take small satellites more seriously, a panel of experts at the SATELLITE 2018 Conference & Exhibition agreed that this niche of the business is still in its beginning stages. In order for smallsat players to continue their growth trajectories and stay relevant to the broader industry, the focus must remain on “execution, execution, execution,” emphasized Tyvak Nanosatellite Systems Chief Operating Officer (COO) Marco Villa.
“We have to not fool ourselves that we’ve accomplished anything. We just achieved the possibility to be at the table and speak as grown adults,” Villa said during a discussion on improving the power and performance of smallsats. “[The opportunity] is now in our hands to stay for a long time and be disruptive by executing the missions the customers are now entrusting us with.”
According to Elizabeth Driscoll, Chief Operating Officer (COO) of GomSpace North America, the attitude toward smallsats has changed largely due to the significant improvements in technology the industry has seen over the last few years. “Fifteen years ago, [smallsats] were toys, and you couldn’t build a business case against those capabilities. Now we can do really useful things — we can take pictures of the whole globe in a couple of hours … you can track signals from aircraft [traveling] across the ocean in a way that’s much more pervasive,” she said. These new capabilities are allowing smallsats the opportunity to engage with “industries that haven’t thought about using space before.”
Additionally, as satellite technology has evolved, so too have mission demands from both a government and commercial perspective. Governments are looking to reformulate traditional space architectures as military threats evolve, while commercial players are looking to crack markets Geostationary Earth Orbit (GEO) satellites have historically been too expensive to access — such as bringing connectivity to underserved areas. “A lower capability at a lower price may be more interesting to some of those emerging communities,” Driscoll said.
“You have to have the right technology and timing. The market fit has to be there. And the business model has to be scalable. We feel that all of those things are finally happening,” added Shey Sabripour, Chief Executive Officer (CEO) of CesiumAstro, a manufacturer of active phased array communications systems.
For a while, Earth Observation (EO) was “the hottest thing in town” for smallsat operators, Villa said. Now, companies have begun to diversify — or are forced to — due to the crowded landscape. “Personally, [Tyvak] stayed as far away as we could from that domain for the longest time because everyone was doing it. There was a very clear signal of market saturation without an understanding of what the customer was really looking for,” Villa said.
However, that is changing as smallsat operators begin to hone in on more sophisticated applications, such as “tactical capabilities, as in the ability to move the satellites or take extremely high quality pictures,” Villa suggested as an example. “We think that’s a great complement to what bigger assets can do.” As a whole, EO is migrating from a very fragmented paradigm — where one company focuses exclusively on infrared imaging or Synthetic Aperture Radar (SAR) — to “more cohesive and autonomous dedicated solutions that has different slices coming together,” Vila said.
The panelists agreed too that there are opportunities for smallsats to generate revenue beyond Earth orbit, although Driscoll hedged that such business cases are still somewhat difficult to evolve right now. The profitability of these missions, which are mostly scientific in nature, will come into clearer focus over the next few years, especially as NASA returns to an emphasis on cislunar missions, noted Robert Hoyt, Tethers Unlimited CEO.
Driscroll pointed out that 2018 will be a significant year for smallsats due to the bevy of dedicated launchers on the verge of their commercial debuts. “There are many companies who are looking at cheaper, smaller launches to service the smallsat industry. If even one of those companies is successful, that’s a game changer for satellites,” she said. “Cost is one thing — that’s manageable — the issue tends to be predictability and control.” VS