The market for data and services derived from Earth observation (EO) satellites is expected to grow by 9.4% each year for the next ten years for a total upside market value of $12.1bn by 2028, according to a survey titled, “Satellite-Based Earth Observation Market Prospects to 2028” from space and satellite-based application markets analyst Euroconsult.
“We expect that growth in demand for Earth imagery will be driven by a mix of defence and new commercial organizations,” said Alexis Conte, report editor and Senior Consultant at Euroconsult. “This will be supported by the arrival of new constellation operators with lower-cost solutions, attracting new customers to the one-meter resolution market. At the same time, some revenue from this segment is expected to move to the 50-centimetre and below resolution market, dominated by traditional satellites.”
Governments are expected to continue to be key in driving growth over the next decade. The research shows that the total civil government investment in EO programmes, including meteorology, in 2018, was $9.8bn, reflecting 5% growth over 2017. This is the 12th year of continuous investment growth from governments and the trajectory is likely to continue with more than $10bn of investment in 2019. According to the forecast, 52 countries will have launched at least one EO satellite by 2028.
A growing focus on multi-satellite constellations is significantly changing the market landscape. Constellations increase the frequency of data collection for better global coverage and faster change detection. Euroconsult identified more than 20 companies that intend to develop low-cost smallsat constellations for Earth observation, including satellites designed to collect optical, radar and hyperspectral imaging. The report provides detail on each of these proposed constellations and the applications they are pursuing.
Analytics derived from vast quantities of multi-sourced data are driving the shift in revenue generation from imagery to services.
“According to our findings, business-to-business opportunities for value-added services that rely on EO data is growing,” said Pacôme Révillon, Chief Executive Officer at Euroconsult. “If changes can be detected over a given area and relayed with low latency at a competitive price, demand for EO-based solutions will grow. Location-based services and financial services are likely to be the first industries to benefit from faster access to this low-cost data in a market previously dominated by government customers.”
Market pull for these analytics is also coming from the business intelligence and insurance sectors, as well as from infrastructure site monitoring and precision agriculture. For these types of services, subscriptions and recurring sales to multiple users are expected to keep pricing affordable. New services will also benefit from cloud computing and AI technologies, which will enable even higher data consumption and faster analysis.
In the report, Euroconsult quantifies the number of EO satellites launched and revenue generated from 2009-2018 and compares those numbers to projections for 2019-2028. The report also examines the impact of this growth on downstream businesses such as commercial data and value-added services and discusses nine sectors including nascent markets and emerging business models in eight regions.