The UK Space Scene - an industry perspective

HoustonApril 2012

Stuart MartinVice-Chair UKspace

The “Space Sector”

The Global Space Market 2010

Source The Space report 2011

The Space Foundation

Non U.S. Government Space Budgets, $22.5bn,

8%

Commercial Space Transportation

Services, $0.01bn, <1%

US Government Space Budgets,

$64.6bn23%

Commercial Infrastructure &

Support Industries, $87.4bn

31%

Commercial Space Products and

Services, $102bn, 38%

Global Market: US$277bn

7.7% growth in 2010 (5% in 2008 and 2009)

13% growth in commercial sectors

The Space Value Chain

1.8

1.5

7

30

55

TELECOMMUNICATIONS EARTH OBSERVATION NAVIGATION

0.5

0.4

0.3

0.5

1.5

4.82

Satellite Manufacturing 1

<20 companies

Launch service provision 1

<10 companies

Lease or saleof satellite capacity

User ground equipments and terminals

Satellite based servicesLarge number of

companies, some global

1. Market values at space launch date 2. With meteorological-related funding (not only satellite)

7

21

<50 companies, highly concentrated

Many companies incl. consumer electronics leaders

<10 companies, highly concentrated

Few companies, often “space primes”

No commercial companies

Few companies, usually electronics and aerospace contractors

Source:

Euroconsult 2008

Units: €billions

UK Industry Growth 2000 to 2009

56

5

54

8

62

0

60

3

78

5

80

3

84

0

87

7

99

5

93

0

2,9

24 3,4

64

3,7

90

4,1

10

4,3

74

4,5

41

4,8

39

5,3

07 5,9

62 6,5

81

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

UpstreamDownstream

Real Space Turnover (£m, 2008/09 prices)

Source : Oxford Economics

Turnover rose at an average rate of 8.9% per year in real terms

Downstream has grown at 9.4% per year, upstream by 5.7% per year

UK Space Industry Growth Strategy

• A joined-up industry, government, academia team developed an “Innovation & Growth Strategy”, Feb 2010

• This aims to grow the UK share of the global (growing) space market, creating 100,000 new jobs and achieving a £40bn turnover by 2030

• This requires maintaining the growth seen over the last decade to 2030!

• Financial crisis has impacted government’s ability to respond

• Other “space nations” are also reacting to the high-growth of the sector and increasing investment

• New entrants – China and India extremely active

• UK will not outspend, so we have to be smart

Growing the UK Share of the Global Market

• If we can maintain the current share of the global market then in 2030 we reach £25bn

• If our market share drops to an average relative to our GDP of around 3% then we reach £12bn in 2030

• If we can grow market share to 10% then we reach the goal of £40bn by 2030

• The growth is primarily in the area of applications & services

Growth scenarios

0

5000

10000

15000

20000

25000

30000

35000

40000

45000

£M

UK turnover (static share at 6%)

UK turnover (global share up to 10%)

UK turnover (global share down to 3%)

Growth Markets

0

5,000

10,000

15,000

20,000

25,000

30,000

35,000

40,000

45,000

2006 2008 2010 2012 2014 2016 2018 2020 2022 2024 2026 2028 2030

Year (2010 - 2030)

Turn

over

£m

ns (2

009

pric

es)

Sat Telecoms

Earth Observation & Services

Navigation & Services

Space Transportation

Space Science

Other Services

Sat Broadcasting

The Vision for Catapult

Challenges• The industrial community identified two “valleys of death”

where good ideas fail to become commercial successes:▫ In the technology field “failure to industrialise” where the

high entry barriers make demonstrating and proving the new technology impossible – in particular to demonstrate performance in orbit, but also ground testing (esp. for SMEs)

▫ In the applications field “failure to commercialise” where access to space derived services or data is limited or not understood, to allow service prototyping in front of prospective customers

• And doing this all under one roof where possible to create the innovative dynamic between technologies and applications▫ Applications pull and technology push

• The development of an in-house research capability is also being investigated with our academic partners

Opportunities for growth• Various sources confirm market size and growth, including

the Space IGS, the [US] Space Foundation and OECD• The Industry Delivery Team has used the OECD Space

Economy at a Glance, 2011 report as the basis for planning

  Satcoms EO GNSS

Distance learning and telemedicine 2 2 1

E‐commerce, incl. home and remote working

4 0 0

Entertainment 1 1 0

Location‐based consumer services 0 0 1

Traffic management, incl. fleet management

6 12 10

Natural resources management, incl. energy, farming, food and fisheries

5 21 11

Urban planning 2 6 2

Disaster prevention and management 3 11 1

Meteorology and climate change 1 17 3

Security 3 7 3

Financial services and insurance 0 2 2

• High growth markets have been mapped against traditional space technology sectors

• And UK strengths and opportunities identified

• And underpinning technology requ’s identified

• Response from community reinforces initial delivery team assessments

Capabilities• The two main offerings from the Catapult will be technology and

expertise for proving and demonstrating application / service prototyping▫ Across each of the identified market areas there will be a mix of

needs for both capability offerings:

TechnologyDemonstration

ServicePrototyping

Distance Learning & Telemedicine

E-Commerce

Entertainment

Financial Services & Insurance

• Technology proving / demo includes in-orbit through TDS follow-on missions as well as access to national test facilities (anechoic chamber, thermal-vacuum, RF-test equipment etc)

• Service prototyping includes access to EO and GNSS data and satcom products and services through ISIC facilities (SRU, CEMS, video wall, AIC….)

Conclusions

• The UK space industry is a hidden success story, and continues to grow strongly

• Like other nations, UK is targeting space as high-growth sector, however

• The cooperative model between industry, government and academia is unique, …

• … and vital to bringing the ideas, the skills, the finance, the regulation and public sector customer base together effectively– UK good at doing this and ISIC and Catapult are good

examples of a partnership in action• We will not outspend the other nations so we have to be

smart and make best use of all capabilities• Wider cooperation with like-minded organisations will widen

skill base and market opportunity