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Monday, March 13, 2017

STRATFOR: The Marketplace in Space, November 18, 2016

I've been meaning to post this for the last few months. It's amazing what imagery is available now. In years past, getting a few pictures of large formations of troops or ships was a major effort. Now we apps for it. God knows we could not mount another Operation Overlord again. An interesting look at how satellite imagey has moved from the domain of governments to the commodity of the free market.

A satellite image shows an oil field burning near Iraq's Qayyarah
air base on Sept. 4. (DigitalGloba/AllSource Analysis)


Though commercial satellite imagery is now available to every corner of the economy, the industry will largely stay focused on its original customers: government intelligence agencies.

Thanks to a number of novel concepts and technologies, imagery collection satellites will continue to evolve and proliferate at a faster and faster pace.

As companies try to keep up with the ever-expanding volume of imagery available, they will have to find better ways to store, analyze and manage it.


DigitalGlobe, one of the largest commercial providers of satellite imagery, launched its WorldView-4 satellite into orbit last week, adding to the growing constellation of satellites circling the Earth. Thanks to these satellites, we have gotten accustomed to having vast amounts of imagery at our fingertips. From online mapping services like Google Maps to browsable databases like Microsoft's TerraServer, the widespread availability of aerial photographs has become the new norm.

But commercial satellite imagery was never intended to serve media outlets or households alone. Instead, the industry was largely built with one set of customers in mind: government intelligence agencies. Even now, the imagery that frequently makes its way to consumers in the private sector is still gathered with an eye toward intelligence requirements. In all likelihood this emphasis will not change much in the coming years, even as states' own collection capabilities continue to improve....

...Complete and Detailed Coverage

Since 1960, when the United States took its first photograph from space, nearly a dozen other countries have launched their own reconnaissance satellites. Over time, the capabilities of those satellites have evolved. At first, early models such as the Corona KH-1 took images with an equivalent resolution of 12 meters (39 feet). (In other words, the surface represented by a single pixel measured about 12 meters by 12 meters.) At this resolution, analysts could make out only large infrastructure, such as runways. But after a series of rapid innovations, satellites were able to take pictures at an equivalent resolution of 1.5 meters. By 1967, analysts could detect individual aircraft, ships and buildings from the images satellites produced. Of course, they still paled in comparison to today's photographs, whose 30-centimeter resolution allows analysts to identify specific weapons systems or even locate human silhouettes.

Modern satellites can deliver images more quickly now, too. The satellites belonging to the United States' initial Corona program carried film cassettes that were then dropped and recovered as they fell toward the Earth. Unsurprisingly, this method led to substantial delays in the photographs' arrival on the desks of analysts and policymakers. It wasn't until 1976, when Washington launched the first KH-11 Kennan spy satellite, equipped with a digital sensor, that images could be immediately transmitted to bases on the ground. Now the United States has 15 of these satellites — which are believed to be able to achieve resolutions as high as 15 centimeters — in orbit. Though much of Washington's satellite program since the KH-11's development remains classified, many believe the newer KH-13 series is operational as well. Regardless, the spread of cutting-edge satellites in space has dramatically increased the ability of the world's great powers to observe one another's actions — a change some have even credited with stabilizing the world by making it more difficult for countries to hide wrongdoing or secretly amass military power.

In Search of New Markets

Governments have not been the only ones pursuing better satellite abilities, either. In 1993, the first private satellite imagery company — WorldView Inc., which later became DigitalGlobe — burst onto the scene when it secured a U.S. license to sell its photographs. Since then, the market has grown exponentially as other giants such as Airbus and myriad smaller competitors followed in DigitalGlobe's footsteps. Thanks in part to increasing internet access and bandwidth worldwide, the industry has taken off, reaching corporations and publishing companies around the globe.

Nevertheless, the bulk of commercial satellite firms still receive most of their revenue from governments. The burgeoning businesses have given countries that are unable or unwilling to field their own satellites access to imagery they otherwise would not have had. Selling photographs to multiple clients has also made imagery far more affordable for consumers, and prices on most products are still falling. The cost of sending satellites into space is dropping quickly as well, reducing the amount of upfront investment required to develop private satellite fleets.

Plunging costs and rising demand have encouraged the sector to seek out new customers. Nongovernmental organizations have been of particular interest to commercial satellite companies, though beyond a small segment that cover conflict zones, nuclear proliferation and humanitarian crises, they have proved a difficult market to break into. The industry has had more success selling its goods to media outlets, but even then it faces tight restrictions on the sale of photographs that contain information on certain government activities, including the movement of troops....

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