Profile: Transparency and Simplicity

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  Space News Business

Profile: Transparency and Simplicity

By MISSY FREDERICK
Space News Staff Writer
posted: 29 August 2006
11:45 am ET


Profile: Antoine de Chassy

CEO of Spot Image Corp.

“Opening up the black box” is a phrase that Antoine de Chassy, the new chief executive officer of Spot Image Corp., the U.S. operations of Toulouse, France-based Spot Image, uses frequently. It is his way of describing the company’s philosophy for keeping its business as simple and as transparent as possible.

Spot distinguishes itself as an imagery company, de Chassy says , by making its customers a part of the data acquisition process in a way that allows them to see exactly how Spot collects its imagery and dictate the satellite’s collection plan and other aspects of its programming.

Since February, Spot has tried to simplify its way of doing business with the U.S. government by selling directly to the government, rather than through partners, which is something de Chassy said his customers were looking for.

In the year ahead one of Spot’s big challenges will be making many of the early decisions associated with the development of its two 0.7-meter resolution Pleiades satellites, which are expected to launch in 2009 and 2010, respectively. De Chassy’s U.S. operation also will be working on a plan to better distribute its data via the Internet.

De Chassy spoke about these and other issues Aug. 22 with Space News staff writer Missy Frederick.


How has Spot 5 changed things for the company?

If you go back about five years, the success of Spot 5 has had a great impact on our business. We’ve had a steady income; all companies and subsidiaries, including ours, are profitable, and that’s pretty reassuring, and helped us gather financial capacity to invest for the future.

Spot 5 imagery generated 20 to 30 percent more revenue than we had projected.

What are some of the challenges you face in the U.S. market?

Clients have very different needs in the United States than they do in France or Europe or China. We’ve been trying to address the markets in different ways, pricing according to regions and according to amounts of data, and trying to get the best value possible out of our amazing archives.

About 70 percent of the data Spot Image sells globally is Spot 5 data that is less than six months old. We’re going to keep Spot 2 for at least another year and there’s a steady demand and need for Spot 4 imagery.

H ow much government business do you have, and what percentage of that is from the U.S. Department of Defense?

More than 80 percent of the business is government money, and that is not only for our subsidiary or for our company, but across the industry. About 70 percent of government business is defense business.

Is the commercial market for imagery growing?

There is a commercial market — our commercial clients are in the oil and gas industry, in forestry, in security and in insurance, which is a new market, as well as the agricultural market. We have to pay particular attention to that market because even if it makes up only about 20 percent of our business, there will be less and less government money.

There will be a new public demand, with new Web actors such as Google Earth and Microsoft Virtual Earth , and we are going to have to pay particular attention to how those service affect the market’s perception of the value of imagery. People see Virtual Earth and in their minds, the data is free. That is what industry calls “the commodity trap.” It means we need to develop our applications in a way that the client understands the quality and the timeliness of the data we sell.

It represents a new way to address the client and i t will force our industry to simplify access for our customers. Our clients now expect that. The Web actors represent probably where our industry wants to be in a year, in terms of data access.

What markets does Spot’s imagery appeal to most given that your imagery is lower resolution than the offerings of DigitalGlobe or GeoEye?

We are not very high resolution now, though we will be when we have the Pleiades satellites. We sell to clients who have a larger territory to cover. The collection capacity of our three satellites is unparalleled by now. We can cover 70 percent of Canada in one year, or 60 percent of Brazil.

Commercially speaking, everyone was expecting that very high resolution was going to take over, and have a big influence on prices and everything else. The opposite has happened. We’ve had a growing business with Spot 5 and 2.5-meter resolution imagery. We’ve seen a growing activity for the entire Spot group and for us in particular.

How does the U.S. subsidiary fit into Spot’s overall business?

We’re about 10 percent, though it ranges between 10 and 20 percent. That is going to grow. Technically, it is in the United States where the standards of the industry are set, and we want to be a part of that. While the U.S. government has already invested in the industry with programs like [The National Geospatial-Intelligence Agency’s] Clearview contracts, they want to use other sources of information and data. There has been a very strong signal in the end of 2005, beginning of 2006, that they want us to be a part of that.

Do you see a market in the Landsat program?

We want to help fill the gap for the Landsat program. We have recently resumed discussions, and it has been very interesting. T he U.S. Geological Survey has been extremely receptive and open to new models and new ways of exploring things together. There is no set solution but we have looked at ways we can invest in this together.

This could include new pricing models, revenue sharing, investing together in technology research or a fixed-fee arrangement, regardless of the amount of data. All of these are being explored right now, and we hope to come to a conclusion in the next few months or years. We haven’t done this in the past, and we’re ready to explore this market, but we need a long-term strategy for this.

What key milestones do you see in 2006?

In 2006, all the planning for 2009 and 2010 will take place. We will make all the main decisions for distribution of the Pleiades data: how we will sell it, and which distribution network we will use. Most of the key decisions will be made in the fourth quarter of this year.

Another key decision will involve the distribution of data on the Web. We also will look at partnerships with the W eb actors; if we can get distribution of our data over Microsoft software or Google software, that’s great, and that’s what we’ll do. We want to make sure to use all the existing tools and adapt our technology to these tools.

How has your business changed since Sept. 11, 2001?

There is a greater need for commercial imagery and a greater importance placed on having a truly global business with access to data around the world. We have the means to supply that. There are no more local markets; interests are worldwide.

And despite all the political speeches that are made, there is great cooperation between the U.S. and French governments, at whatever level in the defense department. We make sure data is shared properly and that information flows freely between governments. We have a role there.

We have also seen a growing overlap between commercial and government work. All commercial companies are involved in homeland security programs, and things flow far easier, say, between the government and a university. We saw that during Hurricane Katrina.

In general, since 9/ 11 we need to make sure information is accessed more quickly, not only collecting data but managing and distributing it, mostly on the Web. These are new business models and we have to adapt to them.