LEO Satellite Market

[315 Pages Report] The LEO Satellite Market was valued at $9.6 billion in 2021 and is estimated to grow from $12.6 billion by 2023 to $19.8 billion by 2026 at a CAGR (Compound Annual Growth Rate) of 15.5%, during the forecast period. LEO satellite systems hold a huge potential for satellite data service providers, small sat service providers, remote sensing service providers, technical service providers, and investors. The market is one of the most lucrative verticals of the space industry. Factors such as versatility, low cost, advanced mechanics, ease of assembly and launch, mass production, and short lifecycles have driven investments in the LEO satellite market. The amount of satellite data and the range of applications for that data will continue to grow in the future as new technologies develop and more satellites come online.

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COVID-19 Impact on the LEO satellite Market

The COVID-19 pandemic has caused significant damage to the economic activities of countries across the world. The manufacturing of LEO satellite systems, subsystems, and components has also been impacted. Although satellite systems are critically important, disruptions in the supply chain have halted their manufacturing processes for the time being. Resuming manufacturing activities depends on the level of COVID-19 exposure, the level at which manufacturing operations are running, and import-export regulations, among other factors. While companies may still be taking in orders, delivery schedules may not be fixed.

LEO satellite Market Dynamics

Driver: Increase in demand for LEO-based services

Demand for low-cost, high-speed broadband with increased capacity for enterprise data (retail, banking), energy sector (oil, gas, mining), and governments in industrialized countries is growing. Thus, there is an increase in demand for low-cost broadband among individual consumers in less developed countries and rural areas, which may not have access to the internet. These market expectations are driving investments in LEO constellations. Also, there is a high demand for low-cost, high-speed broadband in industrialized countries, and if all planned LEO constellations succeed, the supply could be higher than the expected demand, which would drive the price per megabit down.

According to the Science and Technology Policy Institute, satellite broadband capacity demand (served by both small and larger satellites in GEO, MEO, and LEO will grow at a CAGR of 29% by 2024, reaching more than 3 terabits of bandwidth 12; however, proposed LEO constellations can collectively deliver almost 10 times as much, if operational.

Restrains: Government policies

Government policies at both the nation-state and international levels directly or indirectly influence the evolution of the LEO satellite ecosystem and market. Currently, there is no comprehensive global or domestic on-orbit regulation regime. There are regulations related to the launch and re-entry of satellites in the spectrum and remote sensing in the US; for example, there are no regulations related to on-orbit activities, such as rendezvous and proximity operations, space-based Space Situational Awareness (SSA), or RF mapping. Internationally. with more than 70 countries engaged in LEO satellite activities, a consensus has not been reached, and there are a few indicators that depict that there will be a comprehensive global regime beyond the high-level dictates in the Outer Space Treaty. Although operators have expressed interest in developing regulations that would provide certainty to investors, there are concerns over burdensome regulations that could drive companies to move from country to country. Given that the timeline in which operator and policymaker functions do not always align and the significant efforts involved in creating international community agreements, developing policies and regulations for the quickly evolving commercial space industry will be a challenge for the next 10 years.

Opportunities: Potential applications of space optical communications using laser beams

Recent developments in laser beam pointing technology have increased the scope of LEO satellites in space optical communications. Using this technology, communication is possible from earth-to-earth orbit and into deep space such as mars and moon and is used in missions such as Artemis Program. Due to the increase in the number of LEO constellations, this technology helps in communication between the satellites in a constellation.

The recent developments in alternate power-sharing technologies (using wireless optical technology) that can provide the power demands of high data rate communication have increased the opportunity for the expansion of the LEO satellite market.

Challenges: Concerns over space debris

LEO satellites may pose a threat to the space environment as they are often launched in densely populated orbits. This is because LEO satellites are subsidiary payloads that are piggybacked on launches dedicated to larger and more expensive satellites. They are generally deployed near or with other large satellites. These large satellites are positioned in sun-synchronous orbits or geostationary transfer orbits, which have space debris. Nanosatellites and microsatellites lack the maneuverability required to move around in such orbits. Native radar signatures of these satellites are typically small and often below the threshold of perception for space surveillance sensors. Furthermore, space debris may prove to be a hazard for LEO satellites, which, in turn, increase the number of debris due to collision or system failure. This is a significant challenge in this field and is under research by various space agencies.

Based on satellite type, the small satellite segment is expected to lead the LEO satellite market from 2021 to 2026.

A small satellite is a type of low mass and compact satellite primarily employed for remote sensing, Earth observation, and communication purposes. These satellites usually weigh less than 500 kg. Small satellites are used for in-orbit inspection purposes of larger satellites. These are also used as test carriers for newly developed components that are to be installed on a much critical satellite. However, small satellites are prone to operational challenges that include lack of power storage and propulsion system, owing to their small dimensions. In January 2022, satellite communications provider, Starlink launched a part of constellation of small satellites in LEO.

Based on application, the communication segment is expected to lead the LEO satellite market from 2021 to 2026.

LEO satellites are increasingly being adopted in modern communication technologies. The introduction of wireless satellite internet and development of miniature hardware systems are exploiting numerous opportunities in the field of satellite-enabled communication. A rise in R&D activities for communication-related missions is expected to offer enhanced quality communication systems with the help of highly sophisticated miniaturized onboard nano, micro, and mini subsystems, coupled with advanced mission-compatible ground-station technology.

Based on region, North America is expected to lead the LEO satellite market from 2021 to 2026.

The US is a lucrative market for LEO satellite systems in the North American region. The US government is increasingly investing in advanced LEO satellite technologies to enhance the quality and effectiveness of satellite communication. The increasing investment on satellite equipment to enhance defense and surveillance capabilities of the armed forces, modernization of existing communication in military platforms, critical infrastructure and law enforcement agencies using satellite systems, are key factors expected to drive the LEO satellite market in North America. In 2021, Swarm Technologies launched 28, 0.25U CubeSat SpaceBEE. The CubeSat is the world’s smallest two-way communications satellites for IoT.

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Key Market Players

The LEO satellite market is dominated by a few globally established players such as L3Harris Technologies (US), Honeywell International Inc. (US), Airbus Space and defense (Germany), SpaceX (US), Northrop Grumman (US), among others.

Contracts were the main strategy adopted by leading players to sustain their position in the LEO satellite market, followed by new product developments with advanced technologies. Many companies also collaborated to set up special centers for the research & development of advanced satellite systems.

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Scope of the Report

The study categorizes the LEO satellite market based on Application, End user, Satellite type, Frequency, Sub-system, and region.

By Satellite type

• Small satellite
• Cube satellite
• Medium satellite
• Large satellite

By Sub-system

• Satellite Bus
• Payloads
• Solar Panels
• Satellite Antenna
• Others

By End use

• Commercial
• Government & Military
• Dual Use

By Frequency

• L- Band
• S-Band
• C-Band
• X-Band
• Ku-Band
• Ka-Band
• Q/V- Band
• HF/VHF/UHF-Band
• Laser/Optical

By Application

• Communication
• Earth Observation & Remote Sensing
• Scientific
• Technology
• Others

By Region

• North America
• Europe
• Asia Pacific
• Middle East & Africa
• Latin America

Recent Developments

• In February 2022, SpaceX launched 49 Starlink spacecraft from NASA's Kennedy Space Center (KSC) in Florida. These satellites add to the existing 1700+ LEO satellite constellation in aim to provide faster satellite internet.
• In December 2021, Surrey Satellite Technology Ltd (SSTL) had been selected to lead a UK Space Agency study to define the mission requirements for a complex mission to de-orbit two non-operational space debris targets.
• In December 2021, Surrey Satellite Technology Ltd (SSTL) had signed a contract with Satellite Vu for a Mid Wave Infra-Red (MWIR) thermal imaging satellite which will pave the way for a planned constellation of seven MWIR spacecraft. Satellite Vu’s MWIR satellite is based on SSTL’s DarkCarb product, a 100kg class small satellite in SSTL’s Carbonite range.
• In March 2021, SKY Perfect JSAT Corporation, the main satellite operator in Japan and the world leading Fixed Satellite Service provider, had selected Airbus to build Superbird-9, a fully digital in-orbit reconfigurable telecommunications satellite.
• In February 2021, Lockheed Martin contracted ABL Space Systems, of California, a developer of low-cost launch vehicles and launch systems for the small satellite industry, to supply a rocket and associated launch services for the company’s first UK vertical satellite launch.
• In September 2020, The Space Development Agency (SDA) awarded a Tranche 0 contract of the Space Transport Layer to Lockheed Martin to demonstrate a mesh network of 10 small satellites that links terrestrial warfighting domains to space sensors – all launching in just two years.
• In July 2020, L3Harris Technologies launched the demonstration series of end-to-end small satellites as part of a U.S. Air Force constellation, the company is responsible for developing.
• In September 2020, Northrop Grumman received a USD 253.5 million contract by the US Space Force to develop a cyber-secure communications payload that could be deployed on military or commercial satellite.
• In July 2020, Airbus Defence and Space had won a contract for a fully reconfigurable telecommunications satellite from Australia’s second-largest telecommunications company and leading satellite operator Optus. The satellite will be based on Airbus’ new standard OneSat product line and is Airbus’ first contract from the Australian operator.
• In June 2020, Iridium Communications signed a contract with Relativity Space to deliver satellites to the LEO. The contract included flexible timing for up to 6 dedicated launches to deploy Iridium’s ground spare satellites.

Frequently Asked Questions (FAQs) Addressed by the Report

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