Companies Choosing 'Satellites' Over Majors... How Do They Make Money? [Reading Science]

Increasing Use of Service Satellite Data in the US and Europe, Domestic Stage Still in Early Phase

[Asia Economy Reporter Kim Bong-su] Recently, Hancom Group, famous for 'Hangul Word Processor,' announced that it will enter the satellite industry by launching a micro-satellite early next year. Hanwha Group, whose main businesses are petrochemicals and defense, is also making a full-scale entry into the satellite industry after acquiring Setrec Eye, a domestically developed satellite company recognized globally for its capabilities. These are cases where companies have chosen the satellite industry as their future growth engine instead of their traditional specialties.

Why have these companies, which were previously distant from the general public except for broadcasting communication services or GPS, decided to regard the satellite industry as a 'future growth engine' and jumped in? When thinking of satellites, the scene from the 1998 movie 'Enemy of the State' comes to mind, where the protagonist was tracked in real-time by security authorities via satellite after being framed as a terrorist. I remember thinking, 'Because it's America,' and 'Is that really possible?' However, 20 years later, Korean companies are now stepping forward to build such real-time satellite information systems.

According to the Ministry of Science and ICT on the 26th, the use of satellite information in various service areas is increasing both domestically and internationally. Satellite information has established itself as an essential infrastructure providing earth observation data to solve various social issues such as environment, energy, resources, food security, and disaster response. The United States has already built a system that supports public decision-making by utilizing satellite information in fields such as security, agriculture, disaster, and marine sectors based on world-class satellite infrastructure. The European Union (EU), under the leadership of the European Space Agency (ESA), is promoting large-scale satellite utilization projects and encouraging private sector participation, creating an independent satellite information utilization model. Japan is also promoting large-scale satellite utilization projects to enhance public services.

The private sector is no different. New industries based on satellite data are being created, such as DigitalGlobe’s earth observation imagery provision and education, and Google’s digital map services. Cutting-edge services that efficiently analyze and utilize vast satellite information by integrating technologies like artificial intelligence (AI) and big data have begun to be offered. Recently, instead of expensive large satellites, clusters of small satellites are being operated to shorten the acquisition cycle of satellite images for specific areas and expand coverage, creating various service areas. The small satellite that Hancom plans to launch follows the same concept. By deploying multiple small satellites over the Korean Peninsula, near real-time image information acquisition becomes possible when specific situations occur.

Moreover, startups providing customized satellite information services using AI are emerging. Orbital Insight offers services that estimate crude oil storage to predict international oil prices. Sentinel Hub provides land management services through vegetation analysis, Spacenow analyzes regional economic growth rates based on swimming pool sizes, and E-GEOS conducts flood and damage scale services. Advanced analysis services using micro-satellites are also emerging; Spacenow monitors construction processes through near real-time observation, and Planet merges satellite information with economic indicators to predict financial markets. There are also providers improving the quality of Automatic Identification System (AIS) services for ships and offering satellite-based radio frequency monitoring services.

In response to diverse public and private service demands, the number of earth observation satellites worldwide has surged from 596 as of September 2017 to 801 as of August last year. Technological innovations are also underway, including the construction of global satellite communication systems to meet global communication demands, development of high-throughput satellites (HTS), establishment of independent satellite navigation systems, innovations in satellite manufacturing technologies such as 3D printing, and technological convergence with IoT, new materials, renewable energy, AI, etc. (such as space solar power generation and quantum communication satellites).

What about domestically? The public sector still dominates, and satellite information utilization is still at a rudimentary level. However, more companies are stepping forward to make profits by utilizing satellite information beyond existing satellite broadcasting communication and satellite navigation services. Although currently at the level of providing video sales, processing, technology development, and analysis services using public satellite information provided by the government, the private sector’s role in satellite manufacturing is growing. The government has actively transferred the know-how and technology developed through the production of multipurpose practical satellites and Cheollian satellites to the private sector. Currently, Hanwha Aerospace holds technology related to satellite propulsion systems, Korea Aerospace Industries (KAI) for power systems, Doowon Heavy Industries for thermal control systems, and AP Satellite and LIG Nex1 possess payload technologies and participate in public satellite development.

The global satellite information service market size is expected to grow nearly fourfold from $2.5 billion in 2013 to $9.75 billion in 2028. In the near future, not only large fires or traffic accidents but also the tracking and capture of fleeing criminals via satellites, as depicted in the movie Enemy of the State, will become possible. Of course, excessive privacy invasion in a Big Brother style would be problematic. The 'satellite,' which once belonged only to imagination and the public domain, will soon appear in our daily lives.