Race to Space

How well were the Covid-19 lock­downs in the spring of 2020 actu­al­ly fol­lowed? Views from space pro­vid­ed an answer to this ques­tion. Launched in 2017, Europe’s Sen­tinel 5P Earth obser­va­tion satel­lite showed sub­stan­tial reduc­tions in nitro­gen oxide con­cen­tra­tions over major cities like Paris, Madrid, and Rome—corresponding to the slow­ing down of pub­lic life in the EU. Less traf­fic meant fewer emis­sions and there­fore less air pol­lu­tion. The pre­ci­sion of the data is lit­tle short of mirac­u­lous. From an alti­tude of more than 800 kilo­me­ters, Sen­tinel 5P mea­sures light across a 2,600-kilometer swath of the Earth­’s sur­face in one sec­ond. It also mea­sures seven kilo­me­ters ahead in the direc­tion of flight, for it moves at a speed of near­ly 28,000 km/h—or 7.8 km/s. As it turns out, it has also pro­vid­ed Earth-bound pol­i­cy mak­ers with infor­ma­tion about the effec­tive­ness of their anti-Covid measures.

But arti­fi­cial satel­lites are not only use­ful for ana­lyz­ing pol­i­cy deci­sions. They and their data have become a part of every­day life, with an appar­ent­ly lim­it­less range of appli­ca­tions. “There would­n’t be any con­nec­tiv­i­ty on Earth with­out space,” says Elodie Viau, Direc­tor of Telecom­mu­ni­ca­tions and Inte­grat­ed Appli­ca­tions at the Euro­pean Space Agency (ESA). “There would­n’t be any nav­i­ga­tion, secu­ri­ty, or traf­fic safe­ty sys­tems. Space is the heart of all our con­nec­tiv­i­ty and mobil­i­ty systems—and the engine for quan­tum leaps in inno­va­tion toward what will become seam­less­ly inte­grat­ed, super-intel­li­gent, and high-per­for­mance hybrid infra­struc­tures.” Ms. Viau is one of eleven top experts from lead­ing Euro­pean avi­a­tion and aero­space enter­pris­es whom Porsche Con­sult­ing queried about the future of the indus­try in Europe.

Around the world, estab­lished com­pa­nies and start-ups alike are work­ing on new appli­ca­tions and devel­op­ing inno­v­a­tive busi­ness mod­els. “The race to space is under­way, with dif­fer­ent man­u­fac­tur­ers and oper­a­tors launch­ing ever more satel­lites every year,” says Joachim Kirsch, Senior Part­ner for Avi­a­tion and Aero­space at Porsche Con­sult­ing. That was hard­ly con­ceiv­able until just a few years ago. The satel­lite busi­ness and access to space were con­sid­ered the realm of gov­ern­ments and their space agen­cies. But this has changed, for a num­ber of rea­sons. As Kirsch explains, “Cost-effi­cient small-scale satel­lites, some of which have a mass of well under 100 kilo­grams, are enabling rel­a­tive­ly eco­nom­i­cal access to space.”

They are joined by new launch sys­tems that carry pay­loads for a frac­tion of pre­vi­ous costs. “Small launchers—just like small satellites—will become an inte­gral part of the space econ­o­my,” pre­dicts Chris­t­ian Schmier­er, Co-CEO of the Ger­man start-up HyIm­pulse, in con­ver­sa­tion with Porsche Con­sult­ing. “They’ll func­tion like taxis by send­ing indi­vid­ual satel­lites quick­ly, direct­ly, and com­par­a­tive­ly cheap­ly into the desired orbits. That will enable rapid replace­ment of sin­gle satel­lites in larg­er constellations.”

Small satel­lites and launch­ers have trig­gered ever greater dynamism and dis­rup­tion in the indus­try. Hun­dreds of start-ups, along with com­pa­nies from other indus­tries, are crowd­ing into the mar­ket and set­ting up shop in niche areas along the entire value chain with new busi­ness mod­els, tech­nolo­gies, and appli­ca­tions. In July 2021 alone, two companies—Astra Space and Plan­et Labs—were list­ed on the stock mar­ket with val­ues of over a bil­lion dol­lars. The poten­tial for prof­it is high, with indus­try sales expect­ed to reach 1.4 tril­lion dol­lars in 2030, up from 400 bil­lion in 2019. Among other things, the new­com­ers promise an unprece­dent­ed pace in mov­ing into space. “Speed and sim­plic­i­ty are key,” says Pierre-Damien Vau­jour, CEO of the Loft Orbital Solu­tions satel­lite ser­vice provider, in con­ver­sa­tion with Porsche Con­sult­ing. “There will always be projects for very sophis­ti­cat­ed end users that run for five years under strict super­vi­sion and cost half a bil­lion euros. But there are ever more users in the defense, research, and com­mer­cial sec­tors who view space sim­ply as a source of ser­vices and want to be there in nine months.”

The most lucra­tive seg­ment of the satel­lite mar­ket is what is called “space data as a ser­vice,” or the sale of data to end cus­tomers. “My top mega­trend is real-time Earth obser­va­tion, because it gen­er­ates con­tent that sets entire value chains into motion instead of sim­ply trans­port­ing other people’s data,” says Marco Fuchs, CEO of the north­ern Ger­man aero­space sys­tems provider OHB SE and its sub­sidiary OHB Sys­tem AG. OHB’s Dig­i­tal busi­ness unit is active in space data as a ser­vice, offer­ing its cus­tomers the abil­i­ty to track ship move­ments in close to real time, for exam­ple, or the lat­est cli­mate and envi­ron­men­tal data.

The break­through in the satel­lite indus­try is still in its early stages. All play­ers have the chance to posi­tion them­selves favor­ably in this growth mar­ket. Porsche Con­sult­ing has been advis­ing clients for more than ten years in the avi­a­tion and aero­space sec­tor, and sup­port­ing them in the race to space. Its spe­cial­ties include choos­ing the right busi­ness mod­els and basic mar­ket posi­tion­ing such as ver­ti­cal inte­gra­tion along the value chain. Its experts also guide end-to-end indus­tri­al­iza­tion. “On the one hand there are con­sid­er­ably more satel­lites, yet on the other hand they have to be pro­duced in short­er devel­op­ment cycles and show con­sid­er­ably greater flex­i­bil­i­ty,” notes Kirsch. “This requires an indus­tri­al­iza­tion process along the entire prod­uct life cycle,” he adds, “from prod­uct engi­neer­ing to after-sales services.”

The con­sul­tants can also work with space com­pa­nies to check the eco­nom­ic via­bil­i­ty of pos­si­ble appli­ca­tions for space data as a ser­vice, in order to iden­ti­fy promis­ing strate­gic use cases. Thanks to their broad client base, the experts have a sound grasp of the poten­tial added value of space data in dif­fer­ent indus­tries. “It’s cru­cial not to be mis­led by hype,” notes Kirsch. “The busi­ness model has to be right—that’s the only way to be suc­cess­ful in the race to space.”