Upcoming Wave of Demand and Customer Requirements Push Changes in the Launch Landscape

New ideas, a new focus on the consumer, and new technologies are driving growth and change in the launch segment of the space industry, speakers from leading launch providers said Thursday at SATELLITE 2021.

A new type of space logistics is coming with the expansion of space exploration, said Tory Bruno, CEO of United Launch Alliance (ULA). “When they put twice as many people in the [International] Space Station and around the Moon, and then on the surface of the Moon, there will be a logistics train constantly going back and forth with consumables,” Bruno said. “That will be very interesting.”

These new ideas are attracting more and more investors. There has been massive growth in investments, said Josh Brost, vice president of Business Development for Relativity Space, including billions of dollars for constellations. “On the launch side, an investor community is looking for something more capable. And there are more rockets today than at any time in history.”

The growth that the satellite industry is experiencing is not about bigger satellites, but a greater volume of satellites, said Jim Simpson, chief strategy officer for Virgin Orbit. “The capabilities we’re seeing now we weren’t even seeing two years ago,” he said. “Now we are seeing satellites the size of a grilled cheese sandwich.”

Tiphaine Louradour, president of International Launch Services, said customers have a greater variety of mission requirements now than in the past.

“There is a combination of mainstream providers and then new entrants driving funding that space launch companies have seen,” Louradour said. “We are seeing an increase in the variety of mission requirements and mission orbits, which means requiring flexibility and reliability in launch services as keys to good customer service.”

Price Adjustments Make Inroads

Clay Mowry, vice president of Global Sales for Blue Origin forecast a wave of launch demand coming in 2024 to 20208 with constellations being launched to Low-Earth Orbit (LEO). “There is another wave of constellation deployment coming where we will see a huge rush in launch capacity,” he said. “Launch prices have come down by order of two to three, and that launch price has engendered a lot of new businesses in the satellite business. That is really important for the future of the business.”

Yet half of the cost of constellation deployment is driven by launch, Mowry said, and the barrier needs to be lowered. Reusability will play a role in making launch more accessible. “Reusability is going to play a huge role in that,” Mowry said. “We need to be able to turn around and launch again and again and again.”

Looking at the big picture, Bruno said, launch prices have come down to half of what they were a decade ago, and spacecraft in orbit have doubled in the last year and half.

“To the casual observer, you would say those two things are connected,” he said. “You would be wrong. It is not about the launch prices. It’s about the technology advances in small craft. It’s allowing specialty missions and other missions that certain countries need. There is also an expansion of small launch vehicles in many countries that did not previously have access to space at all.”

The shift in high launch rates and lower launch prices is the sign of a healthy competitive market, Brost said, after a period of time in which governments set launch prices. “You see both big and small launch markets getting better,” he said. “The fact you can buy a small launch vehicle to take your satellite where you want it when you want is amazing.”

Drivers of Launch Demand

Demand is about flexibility and performance, Louradour said, giving more levers that customers have at their disposal to help them generate revenue. She gave the example of a space tug, which can take a customer to a more precise orbital location after launch.

Customers really want launch on demand, Brost said, echoing the comments on flexibility. “They know that their businesses are changing rapidly. They know the design is changing rapidly,” he said. “And flexibility is a big part of their decision.”

In terms of market size, Bruno believes there is only room for three large launch providers, two small launch providers, and one air-launch. “That’s it. The traditional market is flat. Our growth is in LEO constellations. And we have a few specialty and flexibility markets that are available to us. That is the market.”

Constellations “really haven’t generated revenue yet,” he said. “We are looking at the Internet of Things, with $4 trillion of activity, and talking about IoT constellations. But nobody has put a dollar into that yet.”

The Future of Launch

The future of launch is global, where countries will have dedicated access to space, Simpson forecasted.

This is just the start of innovation, Louradour said. “We are seeing opportunities that involve both launch and space. My hope is that the international collaboration, as it has existed for decades, will continue.”

Stephane Israel, CEO of Arianespace, also sees a booming future. “The dream is the capability to bring back space resources to Earth,” Israel said. “It’s a long, long journey. I think that is far more helpful for our future.”

There is an unimaginable wealth of resources in space, Bruno said. “We will tap into that and take our species to its future.” VS