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Space


Space Green Paper

1.1.4. The commercial market and the institutional demand

The open commercial market represents around 30% of the total world space activities. The remainder is made up of an institutional demand, the main part of which (American) is until now not accessible to European players. The latter have concentrated their investment mainly on the commercial segment.

Fig.4 Commercial satellites: European versus American orders since 1995 (Numbers of satellites) [Source: Euroconsult, AIA]
Fig.4 Commercial satellites: European versus American orders since 1995
(Numbers of satellites)
[Source: Euroconsult, AIA]

N.B.: in 2000, the increased requirements of communication satellite operators, coupled with more severe export controls by the American administration, were particularly beneficial to European industry.

The breakdown of the commercial space market (particularly certain price practices, overcapacity and government restrictions) make this market difficult.

European industries are more vulnerable since the relevant part of their activities taken up with this type of market is greater than for their American counterparts. Analyses agree however that certain niche markets, mainly applications, have a favourable commercial potential.

To create a better long-term equilibrium, industry is calling for the creation of a true institutional market in Europe, based in particular on the environmental, security and defence elements, and at the same time posing the question of European preference.

The United States in particular protect their industry from external commercial pressures thanks to support from a large national security and defence market which is closed to foreign suppliers. Application to commercial civil satellites of export control laws – notably the application of clauses related to dual use technologies – reinforces this support.

The world space market: comparison between public and commercial expenditure [Source : ESA]

  • The world space market, including commercial revenue generated by space applications (telecommunication, navigation, earth observation), is estimated to total €167 billion in 2001.
  • Budgets for institutional space programmes world-wide in 2001 totalled €42 billion (civil activities: 26 billion; defence activities: 16 billion). The world commercial market – satellites, launch services and operations – in 2001 is estimated at €49 billion.·
  • For 2002, US public expenditure in the space sector is €31.8 billion (5% up from 2001) and is essentially equally shared between civil and military expenditure.
  • In 2002, European public expenditure in the space sector is €6 billion (slightly down from 2001), 90% of which is attributed to civil programmes.

Q 3: What is the outlook for growth in the European institutional market? In parallel, is it necessary to seek agreement with key international partners (United States, Russia) to establish more balanced market conditions?

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