The small satellite market is expected to reach US$ 11,778.83 million by 2028; it is estimated to grow at a CAGR of 24.7% from 2022 to 2028.
Internet access, machine-to-machine communication (M2M), and the Internet of Things (IoT) are among the most important applications of a small satellite. Space has become an ideal solution to improve the efficiency of current terrestrial communication networks. According to Al?n Space, by 2025, more than 25.2 billion IoT connections are predicted to exist worldwide, and the IoT market will reach US$ 1,072.08 billion (? 950 billion). Also, small satellite constellations can play an important role in various environmental conditions, especially in remote or hard-to-reach places, where real-time data is received from all types of sensors and linked devices for IoT-based business models. Thus, a small satellite helps receive, store, and transmit real-time information to any point.
A small satellite can also be effective for remote management. Sensors can help control all devices, receive real-time information, and send commands for configurations remotely across the world. Satellite communications support land-based communications in Amazon basin, Antarctica, offshore platforms, critical infrastructure such as nuclear power plants and other hard-to-reach areas. Also, small satellites guarantee communication in any circumstances in virtually uncommunicated areas such as large rural areas, desert territories, frozen areas, jungle areas, and high seas.
For high internet access, several projects are being launched in various developed and developing regions where small satellites play a major role. According to Oberlo, in 2022, there are ~62.6% active internet users across the world. The growing internet access worldwide will propel the demand for small satellites during the forecast period. Thus, the rising demand for small satellites to provide internet access, M2M communication, and IoT will create a lucrative opportunity for small satellite market growth during the forecast period.
The major small satellite market players include companies such as Thales Group, Airbus, L3Harris Technologies Inc., SpaceX, and Swarm Technologies. These companies have a well-established customer base, and they are already engaged in the development of small satellites for the future small satellite major projects globally. Also, the small satellite market players have been collaboratively working with different end users such as government, commercial, and military customers to cater to their growing needs for nanosatellites, microsatellites, and picosatellites. Further, these companies have a good market share in terms of subsidiary companies. Most of the small satellite market leaders also focus on implementing merger and acquisition strategies that lead to the expansion of their existing business lines along with strong expansion.
Companies with low profit margin includes vendors such as Aerospace Corporation, Millennium Space System, AAC Clyde Space, Microsats Systems, and Zephyr. These companies are majorly focusing on providing innovative solutions to their respective customers to retain their positions in their respective product segments. Such vendors have a less product differentiation of small satellites along with limited customer base, which is one of the major factors behind their lower small satellite market share and lower profit margins.
Based on country, the small satellite market in Europe is segmented into Germany, France, Italy, the UK, Russia, and the Rest of Europe. Over the years, satellite research & development programs and production facilities have increased in Europe. The region is also highly dependent on space services for applications such as earth observation, communication, and navigation. According to European Parliamentary Research Service (EPRS), 10% of Europe’s GDP is supported by satellite navigation signals. For instance, according to EPRS, in 2021, the global navigation satellite systems (GNSS) recorded a total revenue of US$ 174.27 billion, in which Europe accounted for 25% of the total revenue. Thus, the growing demand for nano and micro satellites for communication and navigation applications across the country is constantly increasing across the region.
SES, Eutelsat, Arqiva, Hispasat, Globecast, and other World Teleport Association (WTA) companies are utilizing small satellite networks to offer communication services. These companies offer cloud services and other connectivity solutions for video and data management to video service providers, broadcasters, telecom operators, Internet Service Providers (ISPs), and government agencies. Thus, the rising adoption of satellite communication is directly propelling the demand for small satellites across Europe, contributing to the growth of the small satellite market in the region.
The European Space Agency (ESA) is actively engaged in several projects to develop nanosatellites. For instance, in April 2019, the ESA set up a dedicated unit for designing nanosatellite. The agency partnered with numerous local organizations to design nano satellites for atmospheric reentry measurements and ozone monitoring. Also, in 2019, ESA started the development of Miniaturized – Asteroid Remote Geophysical Observer (M-ARGO) nanosatellite for the assessment of asteroids. Another nano satellite that the agency is developing includes Rendezvous Autonomous CubeSats Experiment (RACE) for the testing of autonomous rendezvous and docking capabilities. These factors are further expected to contribute to the rapid growth of the small satellite market in Europe in the coming years. The region also homes several small satellite market players, further boosting the growth of the region. Some of the players to be mentioned are Infineon Technologies AG, Tyvak International, AAC Clyde Space, Leonardo S.p.A, SPUTNIX LLC, and Al?n Space.
The overall small satellite market size has been derived using both primary and secondary sources. To begin the research process, exhaustive secondary research has been conducted using internal and external sources to obtain qualitative and quantitative information related to the small satellite market size. The process also serves the purpose of obtaining an overview and forecast of the small satellite market growth with respect to all small satellite market segments. Also, multiple primary interviews have been conducted with industry participants and commentators to validate the data and gain more analytical insights into the topic. Participants of this process include VPs, business development managers, intelligence managers, and national sales managers, along with external consultants such as valuation experts, research analysts, and key opinion leaders, specializing in the global small satellite market analysis.