On this very special winter solstice day ☃️, welcome to the penultimate edition of the TerraWatch Space newsletter for 2021. If I survive my trip to the Arctic Circle, one final edition will go out on the 31st examining the most important, but underrated space trends of this year.
In case you forgot - in each edition of the newsletter, we will dive deep into 7 things in the space industry, especially trends & developments that I found noteworthy / interesting.
Without any further rambling, let’s get to 7-things space!
3 emerging segments in space tech to watch out 🚀
1. Last-Mile Delivery aka In-Space Transportation
This is a segment of the space industry that has always fascinated me, simply because of the parallels with the growing on-demand transportation industry on Earth. Just like how you can take a metro/bus to a neighbourhood in your city and walk to a specific address, or a taxi instead (Uber, these days) taking you directly to that address, satellites now have the options to do something similar - be deployed by a launcher at a fixed point (like a metro/bus) and then use its fuel to get (walk) to its final destination or use space tugs (like Uber) to get to where they want to, but way quicker.
One very interesting company offering this service (among other things) is the Italian startup D-Orbit - I really enjoyed this conversation with its CEO Luca Rossettini and his vision for in-space transportation. Exolaunch, a rideshare enabler is also quietly developing its own space tugs to offer a similar last-mile delivery service. Spaceflight, about to launch its first space tug mission in January and Momentus, still awaiting its first launch, are also about to enter the market. With Northrop Grumman, Astroscale, Turion Space, Starfish Space also developing space tugs, this market is probably ripe for consolidation even before it has fully taken off.
2. Space Traffic Monitoring aka Space Situational Awareness
We briefly discussed the growing importance of space debris management in the last edition. Part of managing the debris involves knowing where they are in orbit i.e. to create a Google Maps of space debris. A plethora of startups are emerging in this market segment - from the pretty well-established LeoLabs to the recently funded Kayhan Space. And then there is Apple co-founder, Steve Wozniak’s Privateer, which wants to launch hundreds of satellites to track space debris (!!!). Few others with similar propositions include Okapi, Share my Space and Vyoma.
Data without action is worthless, but availability of more data can perhaps result in action. Similar to how collecting more & more data will not solve climate change, just monitoring space debris will not solve the problem in the long-term. Just like the climate issue, we would like to see action. And once again, similar to climate, we are not quite on the same page on who should pay for these actions. In any case, this market is just getting started and I hope the commercial case will develop.
3. On Orbit Data Processing aka Edge Computing
Now, this is an area that got me thinking ever since I got to know about the ESA PhiSat-1 mission (the first AI-enabled on-orbit data processing satellite), a few years back. ESA, through a consortium, is now working on PhiSat-2. At the same time, there have also been numerous commercial offerings for on-orbit Earth observation (EO) data processing (aka) Edge Computing - with involvements from big names like Nvidia & Xilinx to many startups like Exo-Space, Exodus Orbitals, Unibap, KP Labs, Ubotica, OrbitsEdge, cosine, among others. There is also this on-orbit processing research mission from KAUST in Saudi Arabia, that I am really looking forward to.
If you are wondering why process EO data or not sold on the concept of edge computing in space, there is one important factor why this development is inevitable in EO: 💰. As much as the technology to access and process satellite imagery on the edge is very much in its infancy, and most of the processing happens on the cloud (terrestrially speaking!), satellite operators do spend hundreds of thousands of dollars downlinking imagery that turns out to be worthless (for instance, because it is covered by clouds). Even a simple cloud-coverage filtering will both help their economics and their customers’. So, I expect this market to grow continuously, as more imagery becomes available - not because it seems impossible, but because it is necessary!
2 interesting developments in Earth observation 🛰️
4. The Various Go-to-market Strategies in Earth Observation
The EO market never ceases to amaze me, not just from the technical/scientific standpoint, but more importantly from a commercial perspective - specifically, the go-to-market strategies (GTM) adopted by companies for EO in order for it to (soon) become the multi-billion market, it promises to be. As EO companies keep getting funded to launch satellites with various sensors, the past month or so saw some developments that included various GTM approaches:
Sell EO data (along with some derived analytics) to a major company, in a selected vertical, like this development from Iceye.
Handholding & training a non-EO company on how to integrate insights from EO data into their product portfolio, like this product launch from QuantCube.
Unusual, but sell your EO satellite to another major EO company, like this partnership between Iceye and MDA.
Partner with a dominant enterprise software company leading to an attractive position in the market, like this partnership of Airbus Intelligence, Orbital Insight, Blackbear.ai, ESRI with Microsoft Azure (nicely done Microsoft!).
Partnering with the most successful geospatial company of all time, to enable your product to be potentially available to millions of users, like this partnership of Orbital Insight with ESRI.
And finally, my favourite kind - an industry leader in a specific sector diversifying to becoming an EO company taking advantage of the attractive economics of space, like this announcement by Exxonmobile to collaborate with Scepter on launching its own methane monitoring satellite constellation, while we have others GHGSat, Planet, Methanesat, Orbital Sidekick, HySpecIQ + ESA’s Sentinel-5P attempting to collect the same data. I know of one other company that decided to vertically integrate and I work for them today!
Frankly, I think we are just getting started with the dynamics in EO, especially on the business side, and I am confident there’s more to come!
5. The Earth Observation Market Dynamics in China
Talking of EO market dynamics, one part of the world we (or at least I) know very little about is China. There is not much information available, but whatever that does come out of China, with respect to EO, is fascinating. Sometimes, I think they go about EO in a totally different way compared to what we have been used to. From a private company working with Satellogic on this first-of-its-kind “satellite-as-a-service” model to this funding announcement👇 from ADA Space, the Chinese EO market outlook somehow seems just very different (more on the thread below).
I will attempt to decode the EO market dynamics in China including the key players, their vision and their go-to-market strategies through a collaboration with DongFang Hour, a Chinese space industry specialist. So, stay tuned for that - hope to have the piece out, sometime in Q1 of 2022.
2 things related to space and climate 🌍
6. The Evolving Narrative of Climate Tech Investing in Space
Switching subjects a bit, is it just me or have you started to notice a lot more focus on climate from the space industry? Part of it is probably attributed to the industry’s association with billionaires and its critique for space tourism activities, but perhaps, part of it is also because there is a lot of capital flowing into any business that is linking itself to climate. In any case, even if a technology is only indirectly contributing to addressing the climate crisis, I guess we should take it. Couple of interesting developments related to space and climate that caught my attention:
Yet another launch company, Stoke Space, got funded, but with a twist including investment from Breakthrough Energy Ventures (BEV), a VC firm that typically invests in technologies lead to net-zero. Their narrative for climate is about how a fully reusable vehicle is good for the environment, and how, in general, space tech is essential for climate change. But, probably the more important part of the narrative is where they are based - Washington, US, where BEV’s founder Bill Gates is from!
More recently, the in-space manufacturing start-up SpaceForge closed a significant round of funding from many investors including World Fund, a climate-tech fund. I actually like the climate narrative and I hadn’t given much thought about the potential of in-space manufacturing to reduce emissions on Earth, by moving lot of carbon intensive activities to space. Kudos to the VC for believing in this vision!
These two are clearly not the only ones, EO startups like Overstory had been backed by Pale Blue Dot (another climate-tech fund), and I am sure there is more to come. But, as much as I am happy to see this narrative evolving, I hope there will be strong due diligence by the VC community in trying to understand the nuances of the space industry, and not just believe the pitch decks because - space may be hard, but my experience in the industry has taught me that commercialising space is harder!
7. Busy Year Ahead for Climate Science Missions
Let’s close out with climate science, particularly the institutional missions, and what to look forward to, in 2022. NASA announced that four important missions will launch in 2022 - TROPICS, EMIT, JPSS and SWOT. We will also have NOAA launching GOES-T weather satellite and EUMETSAT launching Meteosat Third Generation weather satellite, both of which are going to enable further improvements in short-term weather forecasting and long-term climate science studies.
I am learning so much about weather and climate science, thanks to my new job at Tomorrow.io, and I cannot emphasise how underrated this is (and how overrated rocket science is!). The sheer number of variables to observe off the Earth, the amount of processing complexity needed to fuse the collected data together and then, the level of skill needed to finally make sense of all of this is truly mind boggling. I certainly think that we don’t talk about this domain of space enough.
To wrap up, if you are looking for some geeky holiday reading, let me refer you to the most incredible Earth observation report I have ever read - the decadal strategy for EO from space. If you have ever wondered what variables we are trying to observe from space (through the missions planned for 2022, for example), what kind of gaps exist in our understanding of the Earth, its atmosphere, the weather and the climate, this report is the holy grail - I am confident many entrepreneurial ventures, scientific & technological advancements and commercial value will come out of this.
You can find more holiday reading suggestions, on the topic of climate change (probably with lesser focus on space) here.
Merry Christmas, to everyone celebrating 🎄 (personally, I will be spending the next week or so meeting Santa 🎅 and Aurora hunting at the Arctic Circle in Finland ❄️ )
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