Commercial satellite services accounted for more than half of the $251 billion worldwide space-related revenue in 2007, contributing to the global space industry’s 11 percent growth over 2006, according to the Space Foundation’s “Space Report 2008.”
Direct-to-home television captured the largest share of the commercial market, followed closely by GPS
equipment and chipsets and U.S. government contracts, according to the 116-page report.
The report is intended to highlight the benefits of space exploration and science amid tight budgets and space industry concerns about a lack of enthusiasm among many Americans.
“There are all these integrated uses and that’s what the book is all about, to help people understand what the space industry allows them to do today or what the growth and resources allow them to do,” said the report’s program manager, Marty Hauser, vice president of the Space Foundation’s Washington operations, research and analysis. “It lays out how it’s integrated. It’s in clothing, it’s in shoes, it’s in satellite TV, satellite radio, and the technology is used in the medical field and the battle field.”
Direct-to-home television accounted for $64.4 billion of the $138.8 billion commercial satellite services market, up from $55 billion in 2006 and $46 billion in 2005. Similarly, GPS
equipment and chipsets sales earned almost $56.2 billion, an increase of almost $20 billion since 2005. Satellite radio and mobile satellite services each generated revenue of
in 2007, and total revenue for fixed satellite services reached $12.8 billion, according to the report.
Satellite infrastructure experienced some growth over the past two years, with revenue from ground stations and equipment increasing from $25.2 billion in 2005 to almost $30.7 billion in 2007. The commercial launch industry saw only a slight increase to $1.44 billion, while
satellite manufacturing dropped to a two-year low of $2.23 billion.
U.S. and international space budgets rose slightly over the two previous years, but NASA’s budget dropped from $16.6 billion in 2006 to $16.25 in 2007 – not quite decreasing to the 2005 funding level of $16.1 billion. Based on government estimates, the report said the U.S. Department of Defense space budget remained flat between 2006 and 2007 at $22.5 billion. On the international front, most nations in 2007 increased their budgets slightly or kept them at 2006 levels, with the exception of the largest spender, the European Space Agency, which raised its budget by $500 million to $4 billion in 2007, the report said. The report produced some surprises, Hauser said.
“I was not surprised by the increase in revenue, but when so much of the globe is experiencing difficulty financially, it was maybe a little bit more than I expected,” he said.
The Space Foundation’s Space Index shows 8.4 percent growth in 2007 – double the growth of the S&P 500 but lagging Nasdaq’s 9.8 percent. The index is a good tool for investors interested in the space business and provides a yardstick for measuring the industry, Hauser said.
Kevin Leclaire, managing director of ISDR Consulting in Reston, Va., said the Space Foundation Index shows the industry’s strength. “Over its history it has performed better than the S&P and has been right in line with Nasdaq,” he said.
The aerospace industry, concerned that the next generation of scientists and engineers are gravitating toward other high-tech professions such as software programming, has invested in salaries, the report said. In his first study of how much aerospace workers are paid in comparison with other workers, Hauser and his report team found that U.S. aerospace workers earn on average $88,200 – twice as much as the average $42,400 earned by other private sector employees. The highest paid sector of the space industry is the guided missile and space manufacturing arena that paid $97,891 per year in 2006. Space vehicle propulsion and parts manufacturing jobs paid the lowest – at $70,054 in 2006.
“In order to successfully compete in the labor market, the space industry must be able to continue to pay its employees well and offer them interesting tasks in order to attract the individuals who drive the process of innovation,” the report said.
The space industry, as defined by the Space Report is comp
sed of companies that manufacture products such as radar systems, guided missiles,
, as well as firms that provide satellite telecommunications services. Overall, the space sector employed 266,725 employees in 2006. That number represents a 6.7 percent increase over 2003, compared with a 5.3 percent increase in the private sector during the same period, the report said. The majority of those jobs – 157,245 in 2006 – were tied to search, detection and navigation instruments. The only decrease was in satellite communications, in which the number of employees dropped from 17,190 in 2003 to
16,384 in 2006, the report said.
Included in the work-force section is a breakdown of the top five states with the highest annual space industry wages, which produced unexpected findings, Hauser said. Washington D.C.
topped the list, with an average space industry wage of
$118,435, followed by Colorado, Maryland and Massachusetts. California placed fifth with an average space industry wage of $96,412. The wage differential between the private sector averages in those states versus the space industry average was at least 80 percent in every state, and rose to 134 percent in Colorado.
The report looks to the future and projects almost unlimited opportunities to integrate space technology with information systems such as Google Earth and Microsoft’s Virtual Earth, furthering the growth of the commercial space sector. It warns, however, that a worldwide increase in defense and commercial programs could create an overcapacity in the open market.
The United States and Europe, the report notes, already have begun to address this potential problem by consolidating programs or businesses, such as the merger of XM Satellite Radio and Sirius Satellite Radio. That deal still has not been completed, pending
final approval by
the U.S. Federal Communications Commission.
With the growing use of satellites, pressure may grow to develop international regulation and governance of space activity, including information gathering, space debris, traffic management, allocation of rights to orbits and locations, the report said.
The opportunities for commercial space ventures “seems boundless,” the reports states, but it also notes there are risks due to the uncertainties surrounding
potential use of space for aggressive actions, such as the recent in-orbit destruction of satellites by China and the United States.
One of the report’s primary objectives, however, was to show that space is more than just launching satellites and NASA activities, said Leclaire, who was a peer review panelist for the report.
“I think that everyone who has a dish on their roof knows their signal is coming from a satellite, but they don’t have to care about the fact that there’s a satellite up there when they watch TV,” he said. “I think this type of transparency is good for the commercial prospects, but in a way it’s a bad thing for space awareness because people don’t realize how much of their everyday life depends on space assets.”