In this article, I propose a conceptual framework to assess the information content of some important national and global statistics on the space economy (SPE), widely used by public and private agencies and institutions, firms, researchers, and others. The framework is sketched in part 1 and is based on (1) a precise definition of the space sector as an aggregate of a sector producing space products (SPI, space industry) and a sector using them to produce nonspace products (SPE); (2) an explicit identification of the input–output relationships within the space sector; and (3) a special attention to the relationships between space capital goods and their services. In part 2 taking those statistics at their face value, I reclassify them and find results that are quite informative about the “specializations” of different national space sectors, although the figures should be taken as tentative in view of the inevitable approximations of our reclassifications. I also attempt a simultaneous reclassification of the two major global space statistics—those of the Satellite Industry Association and Space Foundation—although their totals are only broadly consistent, to obtain an evaluation in terms of revenues of our upstream SPI, the core the global space sector, on which those two sources give different and only partial information.
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References
1.
In the terminology of the UN System of National Accounts (2008), a product is a good or a service.
2.
Notice that an I–O network by its nature disregards the institutional organization in which production is embedded, whereby an I–O link may concern an internal transaction between two divisions of a firm or a market transaction between two independent firms and so forth.
3.
Obviously, one could include in a general concept of space transportation any launch vehicle flight to position a payload in space, as is actually done in the FAA-AST publications. However, here, we prefer to restrict the notion of space transportation to the moving point to point of humans and cargos because (1) it is more similar to what happens with transportation on Earth and (2) the input–output network behind a space transportation service is rather different from that behind the other FISS, as explained below in the text.
4.
But microgravity and other types of experimental equipment used for those activities are space products.
5.
In what follows, we shall abbreviate “spacecraft on the ground” into “spacecraft”.
6.
GOS are conceptually related to space capitals services in the same way as the operation of a lathe by a worker is related to the lathe's work. This point may be clarified further by recalling that different goods have different prices and considering the price of a satellite TV broadcasting. That price covers both the amortization of the price of the transponder, that is, the cost of the “pure” capital service (the electromagnetic wave with its specific frequency range) and the costs of the transmission of the TV signal, that is, the cost of the required GOS.
7.
The condition of specificity for an input to be regarded as a space product is explicitly required for the inclusion of the EGSE/MEGSE equipment in the Eurospace survey of the European space industry (see ASD-Eurospace, p.18).
8.
In SIA, one finds impressive lists of goods (intermediate services and the services of capital goods are left aside) used in the production of a satellite, going back from Tier 1 (Design or integration of final system or service) to Tier 2 (Subsystems), Tier 3 (Assemblies), Tier 4 (Components and parts), and Tier 5 (Hardware and materials). These lists do not distinguish specifically spatial inputs from those nonspatial but show that there is a problem in drawing a dividing line between the two types of inputs.
9.
Merely by way of illustration, one sees from the Profit and Loss Statement of Sky Italia Group, a pure satellite TV-broadcaster, that in 2016, the cost of satellite leasing was only a 6% of its total costs of €2,449M, whereas the percentage of costs for TV rights was 61%.
10.
Note that in common parlance the downstream sector includes both our SPI downstream sector and most of the activities that constitute our SPE as defined below.
11.
It is well known that, in practice, the production chain of intermediate goods is organized partly within large prime contractors and partly through market relationships in which firms in lower tiers supply subsystems, parts and components, to those in higher tiers.
12.
We use the term “collective consumption product” instead of “public product” because the former points to the nonexcludability of the consumption. This property is not usually required for a public product, defined simply as a product nonrival in the consumption.
13.
Let us call final consumption the aggregate of private consumption (PC) and government's general consumption (Fig. 3). PC includes also consumption financed by governments for health, education, and so on (e.g., satellite telemedicine, satellite broadband for educations), and the general consumption of governments includes both current goods, as smartphones with satellite functionality and capital goods as civilian satellite TLC networks, and so on. Notice that both the final consumption and the government's consumption of FSP, aimed at specific CC products, are components of the GDP.
14.
From the table in Basu, one sees that Defense and intelligence market demand for EO data is around 60% of the global EO data market in 2014 and that this percentage remains essentially in their yearly forecasts up to 2024.
15.
This point was made in an economic evaluation of the spatial information (digitalized spatial information and communication system combined with satellite positioning) sector, in ACIL (p.10): “A good way of conceptualizing the impact of the spatial information sector therefore recognizes that the output of the sector is rarely targeted at ‘final’ households consumers, but usually enables other production processes.”
16.
In COMSYS, broadcast receivers are isolated by the generality of VSATs because counting the former in addition to the latter “would simply distort the numbers in the market place.”
17.
Many of these operators in the United States are, however, members of the Satellite Broadcasting & Communications Association (SBCA).
18.
See, for example, EARSC with “Consultancy” to End-users (figure at p.7); SPACE REP with “Insurance Premiums” and “Independent Research and Development (R&D)” (Exhibit 2d, p.14); and the “Specialized support services” in UKSA (p.4).
19.
As an illustration, consider that, in the Profit and Loss Statement of Sky Italia SrL (2016), a pure satellite TV broadcaster, the cost of satellite leasing is only a 6% of total costs (2,449 MLN €), whereas the cost of TV rights is 61%.
20.
Box 1.5 in OECD seems to suggest, beyond the perimeter of the “space sector,” or the aggregate of an “Upstream space sector” and a “Downstream space sector,” the existence of a sector of “Space-related or derived activities in other sectors [other than the space sector].”
21.
The Downstream Segment of the CSA/ASC report is roughly equivalent to the “Downstream space sector,” defined in the recent OECD, box 1.5.
22.
For a detailed discussion of this sample and a presentation of its data for 2010–2012, see Graz et al.
23.
The representativeness of our sample in terms of production value is much higher than in terms of the number of the space units, because it includes virtually all the large and medium space units. [The list of the firms with space units for the aggregate of SPI and Private SPE is available on request].
24.
These sectors are further detailed in 18 segments (table 1, p.5).
25.
In UKSA, p.4, the word “income” is introduced instead of the previously used word of “turnover,” because the former is thought more appropriate than the latter when one has to take into account non-commercial as well as commercial organizations. But because in national accounting the word “income” is synonymous of “value added”; and in business accounting it denotes the capital's share of value added, its use as an alternative to “turnover” is definitely confusing.
26.
This is done in UKSA. It may be recalled also that Space News, in its annual compilation of the list of the top world FSS providers, did not include “direct-broadcast satellite operators using their own spacecraft” (see De Selding) in the FSS sector. A fortiori direct-broadcast operators leasing the spacecraft should be left out of this sector.
27.
In 2014, this industry was made of an aggregate of more than 200 firms from: Austria, Belgium, Czech Republic, Denmark, Estonia, Finland, France, Germany, Hungary, Ireland, Italy, Kazakhstan, Luxemburg, Netherlands, Norway, Portugal, Romania, Russian Federation, Spain, Sweden, Switzerland, and United Kingdom.
28.
The final or consolidated sales of the firms in a sector are their total sales, net of sales among those firms. Final sales are obviously the correct metrics if one want to assess what that sector supplies to other sectors or final consumers.
29.
In particular government launch activities are excluded: “Launch industry data include launch services provided by private companies for both commercially-owned and government-owned payloads … [and] do not include government launches, such as Shuttle launches or ISS missions” (SIA, p.4).
30.
In 2010–2015, the size of the nonsatellite industry has been around 38% of the space industry.
31.
The European GNSS Agency (GSA) draws indeed a distinction, different from that of SIA, between “Devices and augmentation services” and “value-added services.” In 2015, the revenues for the former were slightly lower than those for the latter and their total for the global market was €94.8B or about $105.0B (see GSA, p.6 tables and p.11 figure). Note that this figure is definitely higher than the figure of $78.1B for “GNSS Consumer Equipment” reported in SIA, p.30 (here in table 2.7); and the figure of $83.3B reported in Space Report, p.23. The Space Report figure makes up the largest portion (75.4%) of their “Ground stations and Equipment” segment, whose revenues amounted in 2015 to $110.523B (here in table 2.8).
32.
The data on these revenues are obtained from influential statistical sources such as SIA, ASD-Eurospace, Northern Sky Research, GSA, and others.
33.
Already in Space Report (p.21), the first issue of the Space Report, it was recognized that “there is the formidable challenge of separating government and commercial revenues. The majority of government space spending is on contractors, so industry revenues and government budgets are not simply additive.”
34.
This is certainly true for the EO subsegment, because of its small size. Also the upward distortion for Satellite Communications could not be severe, if the outsourcing to private providers of satellite communications from government entities like Defense Ministries (e.g., UK MoD to Ptarmigan) were not widely used in the world. The revenues of the “Ground Stations and Equipment” subsegment, after netting them of the revenues from the sales of GNSS consumer devices and value-adding services to essentially private buyers, amount to $27.2B, as explained in the text. The share of governments in these revenues could be significant but probably not to so far as to cause an excessive upward distortion of the value of the global Space Economy.
35.
This is not entirely correct because part of these ground stations or equipment is a component of our GCC, which is part of our upstream SPI.
36.
Average of (Procurement obligations/Total NASA obligations) for fiscal years 2011–2015 (see NASA, p.1).
37.
Average of (Procurement/Total Air Force budget) for fiscal year 2000–2018 (see Defense Estimates, table 6.1).
38.
Average of (Purchases/ESA Budget) for years 2012–2015. Data on purchases are from “Statement of Financial Performance” in ESA Annual Reports.
39.
This value has been chosen because one obtains from it a value of $39.943B for the upstream SPI revenues (Table 8), consistent with that of $43.52B for the world Spacecraft and Launch Services Market in 2015 [see SPACE REP (2016), exhibits 2e and 2f]. This choice is an instance of using the principle of statistical consistency when real data are missing!
40.
These correspond roughly to what NASA calls “Space Operations” (ISS, Space Transportation, etc.) whose costs amounted in 2014 to $4.626 (see NASA, BUD-1).
41.
ACIL Tasman. The Value of Spatial Information, March2008.
42.
ASD-Eurospace. The European Space Industry in 2014, Facts and Figures, 19th Edition. Paris: ASD Group, June2015.
43.
BasuP.EO—The New Playground for UAS and SmallSats, October 1, 2015, downloaded 12/14/15 from NSR, News and resources.
44.
BeatsonM, BulliS, Galindo-RuedaF, StockdaleB, The Space Economy in the UK: An economic analysis of the sector and the role of policy. BIS Economic Papers No. 3, 2010.
CSA/ASC (Canadian Space Agency/Agence spatiale canadienne). State of the Canadian Space Sector Report 2015, 2017.
47.
De SeldingP.Top Fixed Satellite Service Operators. The List, Space News, July8, 2013.
48.
EARSC (European Association of Remote Sensing Companies). A Survey into the State and Health of the European EO Services Industry. 2017.
49.
EARSC (European Association of Remote Sensing Companies). A Survey into the State and Health of the European EO Services Industry, 2015.
50.
FAA (Federal Aviation Administration). The Annual Compendium of Commercial Space Transportation: 2017, January2017.
51.
GraziolaG, CristiniA, SciortinoG.The Italian space industry in 2010–2012. Structure, performance and returns from a high tech sector. L'Industria, XXXVII, 1, gennaio-marzo 2016.
52.
GSA (European Global Navigation Satellite Systems Agency). GNSS Market Report. Issue 5, 2017.
