Making a Difference | Silicon Valley

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This past June brought confirmation of a months-old rumor that Silicon Valley technology giant Google would purchase satellite imaging startup Skybox for what turned out be a surprisingly high price: $500 million.

The acquisition, which came as a Google-backed venture called WorldVu secured spectrum rights for a 360-satellite broadband constellation, officially marks Silicon Valley’s arrival as an engine for innovation and growth in the entrepreneurial space industry.

The nexus of space and the tech community is nothing new, of course. In the late 1980s and early 1990s, the driver was the emerging cellular industry, whose technology, cash and ideas helped fuel concepts for low Earth orbiting telecommunications constellations including Globalstar, Iridium and the most audacious of the bunch, the Teledesic broadband venture featuring hundreds of satellites that, despite the backing of cellular pioneer Craig McCaw, ultimately never got off the ground. More recently, some of those who got rich in the broader tech sector — Elon Musk, Paul Allen and Jeff Bezos, to name three — began looking to space, and more specifically space launch, as their next big challenge.

Nowadays, in its relentless quest for more-efficient ways to collect, package and disseminate information, the tech sector is looking to leverage advances in electronics that are enabling the tiniest of satellites to perform functions that once required much larger — and often prohibitively expensive — spacecraft. This has opened up a world of commercial possibilities, spawning a new breed of venture capital-backed space startups.

Skybox, created by Stanford University MBA students and backed by Silicon Valley venture capital funds, is perhaps the highest-profile example. Others include Planet Labs and Spire, both of which are deploying Earth observation constellations for change-detection applications. 

This, in turn, has attracted existing small-satellite manufacturers like Millennium Space Systems, which recently launched its so-called Bootstrap initiative designed to help entrepreneurial space ventures get off the ground, and relative newcomers like Dauria Aerospace. New launch companies, some backed by Silicon Valley venture capital, also have begun to appear on the scene with ambitious plans to break the stubborn cycle of failure in efforts to further energize the small-satellite industry by providing dedicated, low-cost access to orbit.

The current gold rush has an unsettling precedent in the form of the aforementioned low Earth orbit telecommunications industry, whose economic promise was quickly usurped by the expansion of the cellular companies that help fuel its creation in the first place. Iridium, Globalstar and others went bankrupt soon after — and, in at least one case, during — initial deployment, taking with them several aspiring low-cost launch providers and making “satellite” a four-letter word on Wall Street.

Whether or not this new wave of Silicon Valley-fueled space investment ultimately pays off, there can be little question that it is already breaking many of the old conventions that limited space technology to a very-well-heeled few.