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The global satellite data services market, valued at US $6 billion in 2020, is projected to skyrocket to $45 billion by 2030.1 Dominated for decades by a few public and private entities with limited and costly entry points, the space sector is rapidly expanding. And this maturation of space infrastructure is creating new opportunities for many companies to capitalize on the value of space data.
It’s a similar evolution to the transformation of railways, airlines and telephone networks, where, over time, value shifted from the infrastructure itself to widespread applications for newly available data. As space-oriented networks multiply and satellite data becomes more affordable, the time is now for non-space companies to consider developing their own space strategy.
What does that look like? In agriculture, satellite imagery and remote sensing can help farmers monitor crop health, predict yields and improve irrigation and fertilization practices. In the energy sector, satellite data can be used for resource exploration, monitoring power grids and improving energy production. In the logistics industry, space data helps monitor traffic patterns, manage fleet operations and improve overall efficiency. New business models and space data consumption will influence the future of global commerce and trade as the space sector moves beyond exploration, to unlock the potential of data and value-added content. Here’s what companies need to know today to develop their space data strategy for tomorrow.
The advent of space as a node
Space has become an integral node in a network of systems that are indispensable for security, operations, scientific research and commerce.
The advent of space as a node opens up vast, even revolutionary, potential for both newcomers and veterans in the sector to contribute to the creation of a new paradigm for value and growth. As space becomes a more fundamental part of the global infrastructure, satellite nodes will offer information, access points, data generation and transfer, application development, and the birth of new business models and services. Going forward, we are likely to see deepening integration of the space sector in the global economy, making space attractive for increased investment and innovation.
This development holds significant implications for our clients at PwC. As government and commercial systems diversify, it creates opportunities on both the supply side and the demand/consumption side of the equation. On the supply side, space companies need to ramp up to support these evolving architectures, while pioneering new technologies and backing new business models. On the demand/consumption side, space and non-space companies need to explore how to value and transport data across multiple architectures. They must also understand how new value streams and capabilities can be offered through space integration.
Looking ahead: developing nodes in the network
The evolution in government and commercial infrastructure since the dawn of the US-Soviet space race more than seven decades ago has helped pave the way for a new breed of players — nontraditional actors, small companies and startups — to make their mark. This shift is not just a change in players, but a harbinger of new business models and untapped value within the space sector and its adjacent industries.
Many factors (including groundbreaking advances in sensor hardware technology) have led to this pivotal moment, where the focus is shifting from traditional, hardware-centric satellite acquisition requirements to commercial data architectures. The economics of launch continue to shift, allowing new ways to increase technology maturation and move the technical readiness levels of vital technology. Ground stations and applications are also increasing the use of space and unlocking further value in the domain.
The integration of space capabilities into the terrestrial commercial economy is progressing via multiple access points to networks, including transcontinental terrestrial, undersea cable and satellite-based systems. Viewed holistically, this exciting development could create a new hub in the world’s industrial, technological and economic infrastructure.
Refining the space sector’s data value chain: the data paradigm shift
As the space sector embraces its role in the global economic landscape, it’s essential to develop a clear view of the data value chain’s significance. This chain represents the life cycle of data from its initial capture to its final use, a path that reflects the industry’s own evolution.
What’s next: converging near-term priorities
The space ecosystem used to depend on proprietary architectures, both state- and privately owned. Now, however, the launch of more satellites provides a wider range of interconnected capabilities and commercial use cases across multiple orbital planes. This transition is leading to the adoption of an open global architecture. And public-sector space networks are ever more intricately linked to, and reliant upon, a rapidly diversifying private space sector, leading to additional new paradigms of operations.
The transition now underway is likely to have significant consequences for dual-use applications. Governments are seeking commercial collaborations to spur innovation and help reduce costs as they look to disaggregated capabilities within a growing and diverse threat environment. US policy is also prioritizing programs that are “allied by design” in terms of collaboration with national partners and allies, including NATO, the Five Eyes alliance and others. Space-as-a-node will continue to evolve in the domain, with greater reliance on the data passing through the network — and creating value versus infrastructure as the source of economic creation.
We see the market moving away from traditional large-scale systems and toward lower-cost options with faster rates of technology insertion, and proactive outreach to startups and other players outside the traditional orbit of contracting. At the same time, we’re witnessing space-focused commercial procurements placing emphasis on data rather than satellites, as well as on the movement of space-derived data independent of satellite architectures. For example, in one space acquisition the proposal calls for data requirements without specifying any satellite hardware requirements and calls for hardware-agnostic options instead.
This isn’t only in communication architectures. Industry leaders are also keen to use commercial Earth observation and satellite data analytics services for various purposes. This shift in priorities promises to further enhance the value of data.
1. Allied Market Research, “Satellite Data Services Market Statistics 2021–2030,” 2023.
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