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March 31, 2013 8:43 pm
Britain’s space industry is on an upward trajectory. With annual growth averaging 7 per cent throughout the downturn, UK space companies have set their sights on grabbing a 10 per cent slice of a predicted £400bn global market for satellite applications by 2030.
One of those pushing into new frontiers is Surrey Satellite Technology Ltd (SSTL), part of a cluster of businesses running along the so-called “space corridor” from Portsmouth to Oxford via Guildford in the southeast.
SSTL, owned by European aerospace group EADS, has expanded from 250 to 550 employees in the past 5 years, driven by growth in a relatively new sub-sector: the market for small, inexpensive earth observation satellites used for weather tracking, precision agriculture, environmental monitoring and a host of other emerging functions.
The Guildford-based company launches about two satellites a year, each weighing anything from 50kg-300kg – considerably smaller than the 4 ton-6 ton instruments used for broadcasting or communications uses. Steve Young, head of business development and sales, said this greatly reduces launch costs. “If you double the weight, you’re probably quadrupling the launch costs. The smaller you can build it, the easier everything becomes.”
“A mobile phone is basically a satellite without an engine attached,” says Steve Young, head of business development and sales at Surrey Satellite Technology Ltd, a company that takes a resolutely pragmatic approach to space technology.
Instead of spending six-figure sums on so-called “space-qualified” components, SSTL might use parts from consumer goods, such as the hard disk from a laptop or a high-end camera component. Many such parts are perfectly able to withstand the harsh physical environment of space - including temperatures that swing from -100 C to 20 C and intense solar radiation.
SSTL is now pushing this ethos to the limit with an eye-catching experiment to replicate all the functions of a conventional earth observation satellite using a shop-bought Android Google mobile phone.
The core functions required by a satellite - GPS positioning, memory, a computer, communications, an accelerometer - are present on the average phone, Mr Young says. “Someone has already done the work of integrating those functions. Why do it again?”
Recently launched into orbit, the phone sits alongside a more conventional satellite on-board computer, whose functions will steadily be transferred to it and tested over the next few months.
For SSTL’s workers, the project was a way of proving successes in space technology do not have to blow the budget - or take years to get off the ground. “They did it in their lunch break,” said Mr Young.
With 41 successful missions behind it since it was founded in the 1980s, SSTL also keeps costs down by eschewing the system of exhaustive international space standards followed by agencies such as Nasa. “We test to our own standard, which is ‘Does it work in space?’,” Mr Young said.
The company, which makes £100m in annual revenues, is riding a wave of emerging commercial uses for observation satellites. At its headquarters, Mr Young points to an image of a vast construction site in China, where each building is clearly visible. “The Chinese use the images for project management. The developer might look at it, phone up the building contractor and say ‘Why isn’t the roof on that building yet?’,” Mr Young said, adding 99 per cent of its business was for export.
Satellite images can even be used to predict human behaviour. The Brazilian government receives daily pictures of the Amazon rainforest from an SSTL satellite. Careful analysis of the results shows the most likely future routes of illegal loggers, and have been used by the police to catch them in the act.
Further down the A3 in Portsmouth is Astrium, another EADS-owned business and the largest European space company. With roots going back to the very beginnings of the UK space industry in the late 1960s, it is now focused mainly on the largest communications satellites used by broadcasters such as BSkyB.
One such satellite might cost $120m-$150m - not including launch fees of around $60m. But while customers such as Intelsat and Eutelsat provide steady business for Astrium, it also won part of a PFI contract to build the Ministry of Defence’s Skynet military communications satellite. Annual revenues in the UK are around £1bn.
Richard Peckham, strategy and business development director for Astrium in the UK, said that unlike many other countries, the UK’s approach to space is “user-driven”. “The UK didn’t get involved in the international space station, for instance, because it regarded its scientific value as limited. It is not interested in the prestige of space.”
But it is interested in its economic benefits. The government has put money into the £9.1bn UK industry, last year announcing an extra £60m funding for Britain’s contribution to the European Space Agency and investment in the Harwell-based Satellite Applications Catapult, one of seven UK technology and innovation centres set up to bring industry together with academia.
The centre, which opens its doors on Thursday, will have a core staff of 70, with another 50 brought in on secondment from industry. Government is providing £10m annual funding for five years but the centre is aiming to win matched industry funding of £20m a year.
One task will be to work up a range of financing models, from grant funding and angel investment to bank loans.
Stuart Martin, chief executive of the Satellite Applications Catapult, said: “There’s a huge amount of latent capital resting in the economy that we need to excite people into putting into the sector. Britain is taking space into new markets.”
But while UK space companies predict rising growth, the foreign ownership of science companies was identified as a source of concern by MPs in a report last month. The cross-party Commons science and technology committee said lack of financing often led start-ups to sell out to private equity or larger foreign buyers to get ambitious ideas off the ground.
“British entrepreneurs are being badly let down by a lack of access to financial support,” said Andrew Miller, chair of the committee.
For Mr Martin, the future flow of the highly skilled graduates essential to the industry is a potential worry. He said: “I’m concerned the pipeline is drying up over a five-to-10-year timeframe.”
He describes leafing through a prestigious academic journal in which – 10 years ago – all authors would have been British. “In the most recent issue there wasn’t one.”
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