Quietly, without any fuss, and largely unnoticed by managers and engineers alike, the satellite communications industry is sliding toward potential catastrophe. It may be facing its greatest competitive threat since the global expansion of undersea fiber optic cable. Earth observation satellites, and even nascent suborbital tourism, also are at risk.
Google’s purchase of Titan Aerospace, a developer of solar-powered stratospheric unmanned aerial vehicles (UAVs), for an undisclosed price, is not an obvious strategic move for a developer of search engines and other Internet services. Likewise, Facebook’s $20 million purchase of the British company Ascenta, which also makes high-altitude drones, seems to make little sense for a social networking company.
Google and Facebook are interested in lowering the cost of Internet access in major cities, and in extending the Internet’s reach to remote rural communities. To date, the latter services have largely been provided by satellite.
In today’s world, for today’s companies, “Internet” effectively means “communications.” It is a much broader market than e-mail and Web access, and can include telephony, teleconferencing, data networking, audio and video distribution, and many other services. The risk to high-bandwidth communications satellites is correspondingly broad.
The impending rise of the drones appears largely unnoticed within the satellite community, even though it is not new and is partially generated within the industry’s own ranks. Google has been discussing the use of ultra-high-altitude balloons to provide Internet access for some time, and has invested substantial funds in Project Loon, which appears to be the furthest along.
Looking like a startlingly beautiful jellyfish, Google’s balloon is able to stay on station for about 100 days by raising or lowering its altitude, searching for a naturally occurring air current to push it in the desired direction. That eliminates the need for propulsion, lowering costs and extending the time on station.
In its “Loon for All” campaign, Google began testing balloon-provided Internet services in New Zealand in June 2013, and it plans to extend the test this year to the entire 40th southern parallel. Rather than take on the cost and risk of marketing the service itself, Google says it intends to provide bandwidth to telephone companies for resale.
Ironically, a European satellite builder, Thales Alenia Space, is developing a solar-powered dirigible to provide services currently offered by its own satellites. Called Stratobus, in a conscious echo of the Airbus brand, the European vehicle includes active propulsion and is more complex and ambitious than Google’s. Facebook’s Ascenta is reusing solar-powered drone technology originally deployed by the British defense research and development company QinetiQ.
Efforts to lower the cost of Internet access with “near-space” technologies are obvious risks for the likes of Inmarsat, ViaSat, Hughes and KVH, which provide Internet access and other Internet Protocol-based services from orbit. Generally, these companies deploy or rent large and expensive high-throughput satellites.
UAVs are more immediate hazards to high-resolution Earth observation satellites, provided by companies such as DigitalGlobe, MDA Corp. and Airbus Defence and Space. (A company called World View is even trying to use a balloon to take on fledgling suborbital tourism ventures.)
Since these industries, collectively, generate most commercial space profits, they keep ever-more-capable and lower-cost launch vehicles in business. Thus, balloons and UAVs represent a direct threat to any near-term spacefaring future humanity may have.
Military markets will keep high-end rocket companies like United Launch Alliance in business, but the Delta 4 and Atlas 5 are too expensive for commerce or for many scientific missions. Take the profits out of spaceflight, and what happens to the lower-cost end of launch vehicle and satellite manufacturing and operations?
To be sure, significant parts of the satellite communications industry are not at immediate risk. Global or regional services, like wide-area television or radio broadcasts, are best supplied from orbit, and that is unlikely to change in the near term. However, these are mature industries. They are large and extremely profitable, but there is relatively little potential for future growth. The Internet is where the industry has been investing and growing.
Despite their obvious potential, most UAVs remain far from deploying operationally useful vehicles — especially those safe enough to operate day in and day out over major population centers. Google’s Loon appears closest to deployment.
The greatest long-term issue for near-space vehicles is likely to be getting access to global bandwidth not already claimed by wireless, satellite and other industries. The lack of obvious solutions to this problem may limit balloons and UAVs to regional systems, at least in the short term. That would give the satellite industry time to develop a response — and help to push Google and Facebook toward other options.
Google does appear to be hedging its bets. On June 10, the company spent $500 million buying Skybox Imaging, one of several small-satellite specialists based in the San Francisco Bay Area. Skybox is developing Earth observation satellites, but the company said its technology also is applicable to Internet access and disaster relief. Google reportedly is in talks with Virgin Galactic about investing in that company’s technology to cheaply launch small satellites.
More suggestively, Google, along with Brian Holtz, a founder of O3b Networks, has invested in WorldVu Satellites, a company in Britain’s Channel Islands, according to a report by Peter B. de Selding [“Google-backed Global Broadband Venture Secures Spectrum for Sat Network,” June 2, page 1]. WorldVu has reserved Ku-band spectrum for what looks remarkably like a global version of O3b, a satellite network being deployed now over equatorial nations. O3b provides Internet connectivity to the “Other 3 billion” people who have little or no access to modern communications. A global version would require an enormous number of spacecraft — WorldVu has mentioned 360 small satellites — an obviously expensive undertaking.
While these developments would be very good news for the space industry, they do not remove the potential threat posed by cheaper near-space technologies. Satellite and launch vehicle suppliers will be making a big mistake if they remain complacent. It’s easier to prevent a competing industry from becoming established than it will be to restore competitiveness against a dug-in alternative.
To compete, the space industry must dramatically reduce costs, especially for launch vehicles. By offering substantially lower prices, Space Exploration Technologies Corp. has forced the entire launch industry to take a hard look at structural costs and inefficiencies. Over time, this will help the industry compete against new, potentially lower-cost options, but more must be done.
SpaceX is working hard to lower costs further by introducing reusability to the Falcon 9’s first stage, and eventually to its upper stage. Other launch vehicle providers should follow suit.
MDA Corp., Orbital ATK, NASA and others are working on satellite life extension and repair technologies.
Boeing’s introduction of all-electric satellites, quickly being copied throughout the industry, cuts the fuel required to get a satellite from transfer orbit, where its launcher leaves it, to geostationary orbit. In theory, this breakthrough could as much as halve a geostationary spacecraft’s weight. It allows two or more satellites to be launched at once, even on relatively small launch vehicles that heretofore have been able to launch single satellites alone.
Reaction Engines of Britain seems to have come closer than anyone to the ultimate dream of a fully reusable, air-breathing launcher with an airliner-like vehicle, the Skylon. After years of private development, the Skylon’s Synergetic Air-Breathing Rocket Engine, or SABRE, now has financial support — and increased credibility — from both the British government and the European Space Agency.
The satellite communications industry as a whole, beyond simply being a passive customer, needs to get behind SpaceX, Reaction Engines and other efforts to lower launch costs. Satellite builders and ground system manufacturers should provide financing and technical support to promising new technologies.
More importantly, satellite operators need to purchase spacecraft and services incorporating the new technologies. It is unconscionable that MDA and, until recently, ATK have found it difficult to sell satellite servicing to the industry, and that it took so long for Boeing to sell additional all-electric spacecraft.
The stakes could not be higher. If it is to survive — and continue to finance humanity’s economic expansion into cislunar space — the satellite communications industry must invest in new technologies and take greater risks. While enjoying profits that are the envy of most industries, it may all too soon find itself lost in the past, and humanity’s future with it.
Donald F. Robertson is a freelance space industry journalist based in San Francisco. He is a small shareholder in most of the space companies mentioned in this article.
For further examples of his work, see www.DonaldFRobertson.com.