AnalysisCivilEquitiesExplainerMilitary

Exclusive: Euroconsult Values 2022 Space Economy at $464B

Euroconsult space economy and market graph
Image: Euroconsult

In its flagship Space Economy Report published this morning, Paris-based Euroconsult finds that the space market grew 8% in 2022. This report is the gold standard for market intelligence on the end-to-end space economy, from upstream manufacturers to downstream service providers and end users across civil, military, and commercial space. 

The space value chain

…as Euroconsult see is, consists of: 

  1. Government agencies, which fund R&D and operate space assets 
  2. The space industry, which builds space subsystems, satellites, and rockets
  3. The ground segment, who operates hardware and software to send commands to satellites, downlink data, and more 
  4. Satellite operators, who serve satcom, navigation, or geospatial data to end users in “packaged solutions”
  5. And finally, service providers use these solutions along with other value-added services

For methodological purposes, Euroconsult describes #2 and #3 as upstream players, while #4 and #5 are downstream. And #5—service providers—includes satellite user terminal suppliers. 

Space market + economy $$$ values

Euroconsult values the 2022 space market at $424B, an 8% year-over-year jump. The space economy—which encompasses industry contracts across civil, military, and commercial space + non-contracted government activity—sat at $464B last year, according to Euroconsult. 

Euroconsult space economy and market data visualization
Inage: Euroconsult

Breaking out the data…

  • The vast majority of the space market’s value—83%—is captured by downstream players like Uber, smartphone makers, or telcos, which use space-collected data to provide services in some way, shape, or form. 
  • Euroconsult assesses the “core” space sector—ie, companies that make or own space assets—at $70B in 2022. That’s expected to grow to $100B in 2031.
  • The market research firm valued the manufacturing segment in 2022 at $29B, with satellite operators at $16B, launch services at $10B, and ground at $5B. Those sectors are projected to grow to $30B, $30B, $11B, and $5B, respectively, by 2031.
  • And 2022 government space spend totaled $103B, according to Euroconsult. That’s expected to grow to $124B in 2031.

Macro trends

Supply bottlenecks and inflationary pressures extended into 2022 and continued to negatively impact the space industry throughout the year, with Russia’s invasion of Ukraine adding new pressures and uncertainties for space operators. But the war in eastern Europe also shed new light on the value of space internet and EO services.

From the investor’s POV, Euroconsult writes that “cash is king” now. We saw tons of major M&A deals announced or completed last year, with various satellite sub-industries continuing to consolidate. Investors are looking more favorably on capital-efficient, revenue-generating companies, while rotating “away from uncertain business models and capex-intensive businesses.” And the SPAC boom, of course, became the SPAC bust.  

Government space spending

86 nations invested some $103B in space last year (+9% YoY). That’s a new record and an especially notable jump, but Euroconsult expects government space expenditures to stabilize at 1%–2% annual growth starting in 2024.

Government space spend remains top-heavy, with the top five countries spending 84% of the world total. But relatively speaking, it’s not as top-heavy as it once was: In 2000, the top five government space spenders accounted for 93% of the world total.

What to watch for

Euroconsult smallsat deployment
Image: Euroconsult

As Euroconsult first projected in mid-2022, the smallsat sector is in the midst of a hockey stick-like ramp in deployments. The next decade will see an average of 1,704 satellites launched each year from 2022 to 2031. For comparison, an average of 382 was launched annually over the previous decade). 

Considering just <500kg satellites, Euroconsult’s analysts say that we’ll lift roughly one ton a day into LEO over the next decade. Let that sink in. But revenue may not scale neatly with satellite deployments or upmass, given increases in the cost of capital and a coming decade that will see intense competition between constellation operators.

Related Stories
Civil

The GAO Calls on the FAA to Improve its Mishap Investigation Process

The US Government Accountability Office (GAO) says the FAA should be taking the lead more often when things go awry in spaceflight.

ExplainerPolicy

The Space Industry’s Climate Impact: Part 1

Space technology benefits humanity every day, from scientific understanding to the nuts and bolts of supporting the systems that enable life as we know it, but some advocates worry regulators are not paying enough attention to the potential downsides of a bustling space economy.   With more launches going up and more satellites raining back down […]

BusinessMilitaryPolaris

Report Considers Commercial Reinforcements For DoD

What would it look like for the Defense Department to be able to lean on the commercial space community in times of need? That’s the question examined by a new report from the RAND Corporation released last week.

InternationalMilitary

Korea Tensions Move to Space

North and South Korea are using space as a vantage point to keep an eye on one another. On Nov. 21, North Korea successfully launched a military spy satellite to orbit on its third try, sparking international concern and escalating tension in the region. Now officials say that the satellite is up and running, collecting […]