THE SPACE INDUSTRY: HIGH TECH AT LAST? A MARKET BASED INTERPRETATION

Transcription

1 THE SPACE INDUSTRY: HIGH TECH AT LAST? A MARKET BASED INTERPRETATION 3 April 2017, Space Symposium Tech Track Carolyn Belle, Senior Analyst, NSR 1

2 Global in Reach, Local in Knowledge Extensive Client Research, Consulting and Advisory Services Multi-Client Market Research Reports In 9 Major International Hubs of business and government United States Canada Argentina Spain France India Tokyo Hong Kong Philippines 2

3 Relevant Reports Satellite Manufacturing and Launch Services Global Satellite Capacity Supply and Demand Satellite Operator Financial Analysis 3

4 Historic Market Stability Robust industry with growing subscribers counts and revenues TV Broadcast profitable & predictable over the lifetime of the satellite High CAPEX Risk-Averse Operator Mentality 4

5 USD Millions Growth in R&D Spending ViaSat R&D Expenditures ViaSat-3 Procurement ViaSat-2 Procurement ViaSat-1 Procurement R&D spending has increased among both manufacturers and operators: SSL: 5x increase since 2014 Thales Alenia Space: 2x increase since 2014 R&D is more important now than it was 15 years ago Airbus, Orbital ATK, SSL, Boeing, TAS, March Source: ViaSat Annual Reports, NSR Rising focus on technological innovation 5

6 Commercial Satcom High Tech Conversion Process New Market Environment Today's Operator Drivers Greater Adoption of Technological Solutions Data Demand Capacity Availability Pricing Declines New Applications Optimize CAPEX Optimize Addressable Market HTS EP Flexibility New Launch Systems 6

7 FSS Capacity, 36 MHz TPEs US$ Billions Data Driving Demand HTS reduced scarcity of satellite capacity opening the door to more data applications. $20 Historic and Forecast Global Satellite Capacity Revenue Historic and Forecast Global Satellite Capacity Demand % FSS Video FSS Data HTS Video HTS Data Non-GEO HTS Data +10% Source: NSR HTS Capacity, Gbps $15 $10 $5 $0 FSS Revenues HTS (GEO & Non-GEO) Revenues Source: NSR Majority of revenue and capacity growth will come from HTS +$7B -$1.5B 7

8 Average Price per 36 MHz TPE per Year Pricing Continues Downward Trend Global FSS Ku-band Pricing Declines 2010 vs 2017 Video applications command a premium over Data applications $2.0 $1.5 $1.0 $0.5 FSS market pricing declines beginning to accelerate as more GEO-HTS capacity is launched. GEO-HTS market continues to develop quickly, with operators trying out new business models and new ways to sell capacity. $- Global Ku-band Video Pricing Global Ku-band Data Pricing Spot Market pricing declines impact FSS Video, FSS Data, and HTS Data markets Source: NSR Bottom Line: Pricing expected to decrease further in the next decade. 8

9 Challenging Operator Business Plans Future growth will come from increasing volumes of data at a lower cost per bit, rather than from rising prices for services Increasingly Volatile Market New verticals needed with demand that is highly elastic Can no longer launch a satellite fully pre-sold 9

10 Prompting Today s Operator Drivers: Optimize CAPEX Optimize Addressable Market $ $ 10

11 Share of Satellites Launched Going HTS 100% 75% 50% 25% Commercial GEO Satcom Launches, by Payload Type* Significant departure in capabilities Massive increase in capacity & CAPEX efficiency ViaSat-1: ~$400 million for ~140 Gbps, ⅟ 20 the cost per Gbps to orbit of satellites with comparable power/mass profiles Tripling of HTS & FSS/HTS hybrid launch rates between 2014 and % < 20% of satellites launched 41% FSS Hybrid HTS New system architectures, such as the Tbpssatellite ViaSat-3 system, advance the HTS concept to address an even broader market and serve ballooning end-user capacity demand. *excluding MSS, DARS, & DBS Source: NSR 11

12 Adopting Flexible Payloads Adoption rates for payload flexibility on FSS satellites have remained low versus : 2x orders for flexible satellites 30% market share increase Alter frequency, coverage patterns, and power allocation Change coverage, optimize available capacity, counteract jamming, offer customized customer solutions SES-12 JCSAT-17 Eutelsat Quantum Image: Airbus Defence & Space Image: Lockheed Martin Image: Airbus Defence & Space 12

13 # Satellite Orders Share of Total Orders Opting for Electric Propulsion EP offers a higher dry:wet mass ratio: 1. Keep original payload parameters and launch a lighter satellite reduce launch costs 2. Improve payload increase capabilities Increase payload fraction, increase capability:cost ratio Application of Electric Propulsion 100% 75% 50% 25% Commercial GEO Satcom Order Share, by Propulsion Type # Satellite Orders 0% Electric Orbit Raising Electric Orbit Topping Chemical Orbit Raising & Direct Injection Source: NSR Larger Payload Lighter Satellite Source: NSR EP on ABS-3A contributed to ~$0.4M per TPE savings compared to ABS-2 13

14 Launching on Reusable Vehicles Incremental reduction in launch cost with vehicle/process re-tooling, but significant cost reduction requires new approach. 10%-30% price reduction? 2016 SES-10 launch contract ~$6-20M CAPEX reduction valued above risk posture 5 more reused boosters to fly in 2017 Image: SpaceX 14

15 What Next? Continue to advance flexible solutions Change coverage in orbit, including frequency, power, regional coverage, and beam shape Shorten order launch timelines Modular designs? Full software definition? Eliminate the fixed 15+ year satellite investment Shorter lifetimes? Full software definition? Editing payloads on-orbit? Optimize deployables In-space manufacturing? Larger fairings? 15

16 The Bottom Line I am super interested in new technology of every type. Mark Dankberg, CEO, ViaSat No single technological solution Stronger operator support for innovation encourages a faster pace of R&D for the industry Competitive factors themselves will diversify Long term challenge and the long term opportunity for commercial GEO satcom is the transition in technology that has already begun 16

17 Questions & Discussion Questions 17

18 Contact Us Address: Northern Sky Research, LLC One Mifflin Place, Suite 400 Cambridge, MA By Phone: +1 (617) #NSRinsights #AskNSR Northern Sky Research, NSR HTS - High Throughput Satellites LI Group 18