A new report of the global Earth observation (EO) market predicts a $7.5 billion USD industry by 2029 based on projected demand for data and services.
An extract of the roughly 150-page Euroconsult report provided to SpaceQ says that the text is focused on assessing the demand for imagery and “value-added products” in satellites, and also includes aerial survey and field survey products to estimate how quickly the Earth observation (EO) market will grow.
Euroconsult highlighted the importance of EO products and satellites in terms of their diversifying wavelengths, and their ability to combat climate change effects such as wildfire, in a short statement accompanying the report. The report is available for purchase here.
“Brand new to the 2021 edition, the report also highlights the growing influence that the development of new types of data,” Euroconsult said in the statement, highlighting sensors in wavelengths including Multispectral-VNIR, Hyperspectral & Multispectral-SWIR/MWIR/LWIR and SAR.
“Indeed, more affordable satellite constellations have created an opportunity for specialized sensors to meet the requirements of a growing user base,” the statement added. “These new sensors are expected to leverage open-source data from [the] Copernicus and Landsat programs to bring a higher revisit, and thus unlocking new markets with new services ranging from vegetation water stress detection to wildfire anticipation.”
The 2019 global market for commercial EO data is estimated at $1.6 billion and it is anticipated to grow to $2.5 billion by 2029, the report stated. Maxar Technologies and Airbus are expected to make up 55 percent of the total revenue by the end of the decade, with overall industry growth “expected to be driven by a mix of defense and new commercial markets, supported by the arrival of new constellation operators with low-cost solutions,” Euroconsult said.
Euroconsult has found more than 50 companies planning to build satellite constellations, and noted that 2019 was a record year for fundraising with more than $800 million raised – more than 40 percent more compared to 2018. With their arrival and increases in resolution, product demand will gradually shift more into the 50 cm resolution and below range, with less demand gradually coming in the 1 m range.
Value-added services to EO stand at $3 billion in 2019 and are expected to close at $5.6 billion by 2029. This field is more “highly fragmented”, but expected to become more integrated as operators seek to consolidate knowledge and build “specific vertical markets”, Euroconsult stated. Artificial intelligence products and data analytics are a key driver in this segment.
While the pandemic had some effect upon launch timelines and procurement for existing companies, Euroconsult said the rise of secure cloud services has allowed industry growth to continue with little effect, even in U.S. Department of Defense-driven procurements. That said, the difficult economic environment has been more difficult upon startups and may lead to a consolidation effect down the road, the report noted.
The prime drivers for EO data and services are environment (26 percent), defense (23 percent), natural resources (13 percent) and infrastructure (13 percent). Security-driven applications are expected to keep growing rapidly, especially as change detection analytics and satellite revisit times improve, Euroconsult stated.
The largest data procurer is the National Reconnaissance Office, with Maxar the main solution provider in the United States. (Planet and BlackSky could become major players in procurement in the future, Euroconsult said, as contracts are already in place with these two providers.) Global trends show little change in the share of commercial data and services worldwide between 2014 and 2028, although all global areas are seeing an increase; North America, Europe and Asia (outside of southeast Asia) are the largest drivers worldwide.
Some of the major international uses of commercial EO data include defense (particularly in Latin America, due to a lack of government data in very high resolution), infrastructure (particularly in Mexico, Columbia, Chile and Brazil) and natural resources (particularly in heavily forested regions fighting illegal deforestation, such as in Costa Rica.)
Other trends of note include:
- A slow-down in EO fundraisings due to COVID, which pivoted offerings to Series B and C financings and away from the earlier-stage Series A.
- The rise of special-purpose acquisition companies (SPAC), which led to billions of dollars raised in 2021 and is expected to lead to several mergers and acquisitions in 2021-2022.
- Rideshares producing a record number of EO satellites launched, particularly on SpaceX.
- Constellations beginning to reach full operational capabilities, along with “strong diversification” of miniature payloads in these constellations that can image with hyperspectral and infrared capabilities fo the commercial market.