Outer Space - The Emerging Market

Prospects and implications on the world economy - Analysis of the market potential

Diplomarbeit , 2008 , 163 Seiten , Note: 2

BWL - Wirtschaftspolitik

Public interest for outer space ventures was huge in the beginning of space flight as spectacular successes were achieved in the space race between the Soviet Union and the United States. The enthusiasm culminated in the moon landing of 1969. Since then only spectacular events in space travel were covered by the media and noticed by the public. However in reality often the non-exciting developments were those which changed life on Earth most significantly. Many developments for space travel and the usage of outer space made and still make our civilisation totally dependent on outer space activities. This includes the development of satellites for
communication, television, Earth observation, weather forecasting and navigation to name just a few. All this happened widely unnoticed by the broad public. What is even more overlooked by the public but changed life at least as significantly are “spin off technologies” with the Personal Computer being the most prominent one. Despite the huge growth during the 1990s, only a few studies on the future potential of the space market were conducted on a comprehensive basis. This thesis therefore draws a complete overview of all aspects and sectors of the space market and analyses its future potential as well as the potential of possible future applications. Additionally the legal and institutional framework of outer space activities and its implications on business activities, institutional space ventures, military space applications, and commercial companies is discussed in this work. The results show that outer space is a market with a huge potential, not only due to the growth potential in already existing applications like navigation and communication, but also due to a large potential in emerging applications like spacetourism
and in future applications like mining on the moon. In addition not only
commercial applications are growing but also military and governmental spending for space ventures is on the rise due to increasing commitment of emerging countries like India and China, and the drive of industrialised nations to keep their leading position. Based on the extensive analysis the thesis suggests that the outer space sector as a whole is emerging and will become increasingly important in the future.

TABLE OF CONTENTS

ACKNOWLEDGEMENTS

STATUTORY DECLARATION

ZUSAMMENFASSUNG

ABSTRACT

LIST OF FIGURE

LIST OF TABLES

LIST OF ABBREVIATIONS

1. INTRODUCTION
1.1. Purpose
1.2. Overview
1.3. Methodology
1.4. Background
1.4.1. Orbits
1.4.1.1. Low Earth Orbit (LEO)
1.4.1.2. Medium Earth Orbit (MEO)
1.4.1.3. Highly Elliptical Orbit (HEO)
1.4.1.4. Geostationary Earth Orbit (GEO)
1.4.2. Benefits of Space exploration and space research for everyone

2. INTERNATIONAL LEGAL, AND INSTITUTIONAL FRAMEWORK
2.1. United Nations
2.1.1. COPUOS
2.1.2. UNOOSA
2.1.3. International Telecommunications Union
2.1.4. Other UN Organisations
2.1.4.1. The International Atomic Energy Agency
2.1.4.2. Food and Agriculture Organization
2.1.4.3. International Civil Aviation Organisation
2.1.4.4. World Health Organization
2.1.4.5. World Meteorological Organisation, WMO
2.2. Space Law
2.2.1. Treaties
2.2.1.1. The outer space treaty
2.2.1.2. The Rescue Agreement, 1968
2.2.1.3. The Liability Convention, 1972
2.2.1.4. The Registration Convention, 1976
2.2.1.5. The Moon Treaty, 1979
2.2.2. Resolutions
2.2.3. Criticism

3. INSTITUTIONAL AND SCIENTIFIC USE OF OUTER SPACE
3.1. Intergovernmental Organisations
3.1.1. INTELSAT
3.1.2. EUMETSAT
3.1.3. INTERSPUTNIK
3.1.4. EUTELSAT
3.1.5. INMARSAT
3.1.6. ARABSAT
3.2. Space Faring Nations / National Organisations
3.2.1. The United States of America
3.2.2. The European Union (EU)
3.2.3. Russia
3.2.4. Japan
3.2.5. India
3.2.6. China
3.2.7. International Cooperation
3.2.7.1. International Space Station (ISS)

4. MILITARISATION OF SPACE
4.1. United States of America
4.2. Russia
4.3. Europe
4.3.1. Germany
4.3.2. France
4.3.3. Great Britain.
4.3.4. Italy
4.4. China
4.5. Israel
4.6. India
4.7. Japan
4.8. South Korea
4.9. Rest of the World
4.10. Summary and Outlook

5. SPACE INDUSTRY AND COMMERCIAL USE OF OUTER SPACE
5.1. Institutional Market vs. Commercial Market
5.2. The Satellite Industry
5.2.1. Satellite Manufacturing
5.2.2. Launch Industry
5.2.2.1. Cheaper launches
5.2.3. Downstream / Satellite Services
5.2.3.1. Telecommunications & Direct Broadcast Services (DBS)
5.2.3.2. Location and Navigation
5.2.3.3. Earth Observation (EO)
5.2.4. Prospects of the satellite market
5.2.4.1. Microsatellites
5.2.5. Ground Equipment
5.3. Space Tourism
5.4. Prospects / Future Space Applications
5.4.1. Private Investors and Trusts
5.4.2. Space Cargo
5.4.3. Space Advertising and Sponsorship
5.4.4. Asteroid Mining
5.4.5. Commercial Satellite Servicing in Space
5.4.6. Space Lift
5.4.7. Mining on the moon

6. CONCLUSION

LIST OF REFERENCES

ACKNOWLEDGEMENTS

First of all I want to thank Mr Schwand, my supervisor for this thesis, who guided me in writing this thesis, and who always found time for me no matter how short the notice, and who was very helpful during the whole process of writing this thesis.

At the end of my studies I would like to also express my particular gratitude to my parents who not only financed my education but also supported me in every other respect throughout these years.

ZUSAMMENFASSUNG

Das öffentliche Interesse für Weltraumunternehmungen war am Beginn der Raumfahrt, als sich die USA und die UdSSR einen Wettlauf um die Vorherrschaft im All lieferten, enorm. Dieses gipfelte in der Mondlandung von 1969. Seitdem wurden nur noch spektakuläre Ereignisse in der Raumfahrt von der Bevölkerung wahrgenommen. In Wahrheit sind es aber oftmals gerade die weniger spektakulären Entwicklungen, die unser Leben auf der Erde am stärksten beinflussen. Viele Entwicklungen für die Raumfahrt und die Nutzung des Weltraums haben unsere Zivilisation grundlegend verändert und uns von ihnen abhängig gemacht. Dies sind zum Beispiel Satelliten für Telekommunikation, Fernsehen, Erdbeobachtung, Wettervorhersage und Navigation, um nur ein paar zu nennen. All dies ist geschah nahezu unbemerkt von der breiten Öffentlichkeit. Was von der Bevölkerung ebenfalls kaum wahrgenommen wurde, sind die Nebenprodukte der Weltraumtechnologie, die unser Leben nicht minder verändert haben, beispielsweise der PC.

Trotz des großen Wachstums des Weltraumsektors während der 1990er Jahre wurden nur wenige umfassende Marktpotential-Analysen erstellt. Diese Diplomarbeit versucht daher einen kompletten Überblick über die wichtigsten Aspekte und Sektoren der Raumfahrt zu geben und das Zukunftspotential bestehender sowie möglicher zukünftiger Anwendungen zu analysieren. Zusätzlich befasst sich die Arbeit mit dem gesetzlichen und institutionellen Rahmen für die Raumfahrt und ihren Auswirkungen auf Wissenschaft, Militär, Wirtschaft und Unternehmen.

Die Ergebnisse zeigen, dass der Weltraum ein Markt mit ungeheurem Potential ist, nicht nur durch das Wachstumspotential in bereits bestehenden Anwendungen wie Navigation und Kommunikation, sondern auch durch ein gewaltiges Potential von aufstrebenden Wirtschaftszweigen wie des Weltraumtourismus und zukünftigen Wirtschaftszweigen wie der Rohstoffgewinnung am Mond.

Desweiteren wächst nicht nur die private Weltraumwirtschaft, sondern auch militärische und öffentliche Ausgaben für die Raumfahrt steigen stetig aufgrund des

Engagements von Schwellenländern wie China und Indien und dem Drang der etablierten Weltraummächte ihre Vorrangstellung zu behalten.

Basierend auf der eingehenden Analyse kommt diese Arbeit zu dem Schluss, dass der Weltraumsektor weiterhin wachsen wird und in Zukunft immer wichtiger wird.

ABSTRACT

Public interest for outer space ventures was huge in the beginning of space flight as spectacular successes were achieved in the space race between the Soviet Union and the United States. The enthusiasm culminated in the moon landing of 1969. Since then only spectacular events in space travel were covered by the media and noticed by the public. However in reality often the non-exciting developments were those which changed life on Earth most significantly. Many developments for space travel and the usage of outer space made and still make our civilisation totally dependent on outer space activities. This includes the development of satellites for communication, television, Earth observation, weather forecasting and navigation to name just a few. All this happened widely unnoticed by the broad public. What is even more overlooked by the public but changed life at least as significantly are “spin off technologies” with the Personal Computer being the most prominent one.

Despite the huge growth during the 1990s, only a few studies on the future potential of the space market were conducted on a comprehensive basis.

This thesis therefore draws a complete overview of all aspects and sectors of the space market and analyses its future potential as well as the potential of possible future applications. Additionally the legal and institutional framework of outer space activities and its implications on business activities, institutional space ventures, military space applications, and commercial companies is discussed in this work.

The results show that outer space is a market with a huge potential, not only due to the growth potential in already existing applications like navigation and communication, but also due to a large potential in emerging applications like spacetourism and in future applications like mining on the moon. In addition not only commercial applications are growing but also military and governmental spending for space ventures is on the rise due to increasing commitment of emerging countries like India and China, and the drive of industrialised nations to keep their leading position.

Based on the extensive analysis the thesis suggests that the outer space sector as a whole is emerging and will become increasingly important in the future.

LIST OF FIGURES

Figure 1: LEO MEO HEO GEO

Figure 2: Preliminary Design Concept of ExoMars

Figure 3: Ariane V at lift off

Figure 4: India's PSLV

Figure 5: Arianespace ad demonstrating EU-Russian cooperation

Figure 6: The International Space Station

Figure 7: Geopolitical Distribution of Military Satellites

Figure 8: Military Satellites by Task

Figure 9: The satellite business value chain

Figure 10: World revenues by sector from 1996 to 2004

Figure 11: World revenues by sector in 2004

Figure 12: Civil Satellites by Task

Figure 13: Satellite Manufacturing Revenues in Billion Dollars

Figure 14: Revenues of launch providers in billion dollars

Figure 15: World ground equipment revenues

Figure 16: Rocketplane Kistler’s concept of a suborbital space plane

Figure 17: SpaceShipTwo linked to WhiteKnightTwo

Figure 18: Passenger demand forecast for suborbital space tourism

Figure 19: Demand Forecast Using Different Market Maturation Periods

Figure 20: Revenue Forecast for Space Tourism

Figure 21: The SS/L-CSI intermodal COTS approach

Figure 22: An artist’s impression of the space lift

Figure 23: Russian plans for a permanent Moon base to mine helium-3

LIST OF TABLES

Table 1: Spin Offs from Space Research

Table 2: United Nations resolutions concerning space activities

Table 3: National Space Agencies

Table 4: Fields of application for military satellites

Table 5: Overview over United States military space applications

Table 6: Public Private Partnership projects in space

Table 7: Worldwide commercial launch services

Table 8: List of 25 biggest satellite operators

LIST OF ABBREVIATIONS

Abbildung in dieser Leseprobe nicht enthalten

1. INTRODUCTION

The usage of Outer Space and Space Travel are topics that in the last forty years became more real than fiction. When Yuri Gagarin orbited Earth in his small Vostok 1 space ship the human species entered a new age, which then was spectacularly affirmed and brought to the minds of all peoples with the dramatically staged Moon landing of America’s Apollo 11 crew. In the space race American and Soviet science missions increased our knowledge about space and Earth extensively, spy satellites changed the way wars were fought, meteorological satellites enabled us to predict the weather and telecommunication satellites changed our way of living and together with the internet led us into the “Information Age”. Spin off technologies did not change our life less significantly; from thermal clothing to the personal computer: these technologies changed many aspects of our economy and even our civilization as a whole.

Military use and motivations always were the main drivers for developing rockets and satellites, and military use also was the main field of application in space flight until the end of the cold war and beyond it. In the 1980s the commercialization of space began when satellite operators, mainly for television, emerged. Astonishing growth rates and turnovers of these operators led to substantial private investments in the 1990s, the “technology bubble” or “dot com bubble” at the turn of the millennium though also hit the space industry hard, leading to the collapse of the growth rates. Today the market has recovered and we are we are on the cusp of entering a new era, where commercial companies are penetrating all established fields of space flight and even open new markets. Various new technologies and new players will change the picture in space completely in the coming years. These new developments did not and will most likely not receive the media coverage of the first moon landing in 1969, but they are not less important milestones in humanity’s progress. The first space tourist in the first privately financed and developed space ship in late 2008 or early 2009 will be a significant milestone and will be a monumental signpost on our way in the future, and demonstrate the entrance of private companies into all established fields of space flight and beyond.

The commercial usage of space is an important step in the future that will revolutionize our culture and open a huge new market, but the role of institutional use of space will not decline in its importance as countries still represent the only entities to be able to finance large-scale projects like the International Space Station (ISS), which enable humanity to achieve significant scientific progress. Michael Griffin, administrator of America’s National Aeronautics and Space Administration (NASA) accurately explained why institutional scientific usage of outer space keeps essential for our evolution:

"Every aspect of human knowledge will be tested and advanced: physics, chemistry, biology and their practical applications in engineering, medicine, materials science, computer science, robotics, artificial intelligence, power, and many other fields - and we haven't even mentioned rocket science ," Michael Griffin, NASA Administrator (Morring (2007))

That a new space age is arising not only in the commercial field, but also “resurrects” increased efforts in the institutional field was correctly examined recently by China’s policy makers:

“Space activities around the world have been flourishing in the first few years of the 21st century. Leading countries in the area of spaceflight have formulated or readjusted their development strategies, plans and goals in this sphere. The role of space activities in a country's overall development strategy is becoming increasingly salient, and their influence on human civilization and social progress is increasing.” White Paper of the Peoples Republic of China (Han, 2006)

The importance of outer space though is not only limited to the two mentioned fields but also stretches to an again increasing military use of outer space in recent years that is very likely to also boom significantly in the near future.

1.1. Purpose

Given the above stated trends and current developments this thesis aims to prove the re-emergence of the significance of space in international politics and for the military, and the increasing importance for the world economy, and tries to analyse the potential of this gigantic new market, as well as to identify possible applications and their potential.

Following research questions are to be answered by this paper:

- Are there any new technologies or developments in the market that have the potential to revolutionise the space sector, lower the threshold for space ventures or even turn it into a mass market?
- America and Russia have dominated outer space since the late 1950s. Is a shift of power possible or even to be expected?
- Space research and satellite technology brought substantial benefits for humankind and changed our society completely. Is there any new space application or development that has the potential of bringing benefits equal to those that were already achieved?
- Is the space sector indeed an emerging market? What is its potential, how fast can the market grow, how big can it get?

1.2. Overview

This thesis is structured the following way: the Introduction states the purpose of this work, the methodology used to fulfil this purpose and finally provides a reader who is not too proficient with the topic with information necessary to understand the thesis. This is a short overview of the history of human use of outer space, a short introduction into the benefits of space exploration and space science and a description of the orbits satellites can strike around planet Earth.

The second part focuses on the legal and institutional framework for space flight. It first describes the United Nations (UN) Institutions that are important as law makers for outer space and then elaborates on Space Law.

The third part describes the “traditional” users of outer space: Institutions. The part first lists intergovernmental organisations, then lists space faring nations and their space programmes and international cooperation and the importance for private (space) companies.

The fourth part describes the already mentioned again arising militarization of outer space, and national military space programmes, and the importance of these programmes for the private (defence) industry.

The fifth part is the main part of the thesis and describes all sectors of the space industry, Earth-bound and in space and analyses their market and growth potential. Afterwards the prospects and possible future applications are discussed in detail.

The sixth part concludes the work and aims to provide explicit answers to the research questions.

1.3. Methodology

In order to solve the research questions the author worked through the major pertinent publications (i.e. Aviation Week & Space Technology, Space News, etc.), in the time between August 2007 and May 2008, space related reports of intergovernmental organisations as well as recent pertinent reports of all major space agencies. Furthermore all space related articles of the last eight years available in the comprehensive online Database Business Source Premier were examined thoroughly and space related websites were consulted frequently. Finally two very competent experts were interviewed two hours each about the topic, which gave the author first hand information of the industry that could not be found in articles.

1.4. Background

This chapter is intended to provide the reader with knowledge needed to understand geopolitical and technical and historical coherences in order to appreciate all aspects discussed in this thesis.

1.4.1. Orbits

Satellites operate in four different orbits, Low Earth, Medium Earth, Geostationary, or Highly Elliptical. Since these terms will be mentioned frequently in this work the author will explain what they stand for and for which applications they are used.

As it will be mentioned in the chapter “Legal framework” there is no universally accepted definition of a borderline between Earth’s atmosphere and outer space. The most widely accepted borderline though is the Kármán line, at an altitude of 100km and named after the famous Hungarian pioneer of modern aerodynamics aeronautics and astronautics Theodore von Kármán. The NASA and other United States governmental organizations are using an 80km borderline. The Kármán line was not drawn because of its round numeric but is the altitude from which a satellite can stay in orbit with relatively low technical effort.

The possible orbits of satellites are classified four different category groups.

1.4.1.1. Low Earth Orbit(LEO)

The Low Earth Orbit is a circular or elliptical orbit at an altitude of up to 2000 km. Due to the proximity to Earth and the subsequent pull attributable to gravity objects in LEO must travel at a speed of around 7000m/s which leads to a time of circulation of 90 minutes to two hours. Since it requires less energy to place a satellite into a LEO then any other orbit, and LEO satellites need less powerful amplifiers for successful transmission, LEO is used for many applications. Because these LEO orbits are not geostationary, communication satellites require a network (or "constellation") of satellites to provide continuous coverage. Remote sensing satellites normally use lower orbits because of the added detail that can be gained. Therefore most military surveillance satellites and civil Earth observation satellites like weather satellites are launched to LEO.

The most famous artificial object in the LEO is the International Space Station (ISS).

1.4.1.2. Medium Earth Orbit (MEO)

Satellites in Medium Earth Orbit (MEO) have circular orbit at an altitude of between 2,000 km and 35,800 km and an approximate time of time of circulation of about 12 hours. The most common use for satellites in this region is for navigation purposes, such as the Russian GLONASS (at 19,100 kilometres), the United States NAVSTAR GPS -System (at 20,200 kilometres), and the European Galileo -System (at 23,222 kilometres).

1.4.1.3. Highly Elliptical Orbit(HEO)

Highly-elliptical, highly-inclined orbits, are referred to as HEO or, more traditionally, “Molniya” orbits after the early Soviet Union satellites that pioneered this path around the Earth. A HEO must have a point where it is further away from Earth than 35.800 km. These highly elliptical orbits are useful for communications satellites for regions near the North Pole.

1.4.1.4. Geostationary Earth Orbit (GEO)

A Geostationary Orbit is a Geosynchronous Orbit directly above the Earth's equator (0° latitude), with an orbital eccentricity of zero. Geostationary Satellites have a circular orbit at an altitude of approximately 35,800 km and a field of vision of approximately one third of the Earth’s surface. From the ground, a geostationary object appears motionless in the sky and therefore Earth antennas can be mounted at a fixed angle. The Geostationary Earth Orbit is the commercially most important one especially for communication and television satellites. Early warning satellites are also placed in GEO.

Satellites in GEO are the biggest money-makers in space, generating billions of dollars in revenue annually by providing communications between fixed sites, directto-home TV, digital satellite radio, Internet access, and mobile telephone services. (Turner (2007))

The following picture shall support the understanding of the different Earth Orbits used by satellites:

Figure 1: LEO MEO HEO GEO

Abbildung in dieser Leseprobe nicht enthalten

Source: Yang (n.d.a)

1.4.2. Benefits of Space exploration and space research for everyone

In order to understand why space exploration and space science bring such substantial benefits for humankind and to comprehend why an increasing use of outer space is to be seen so positively, one has to look back at the benefits that space faring already provided us with.

Our modern societies depend on space applications, satellites and space research. Basically there are two reasons why, or major advantages that humankind receives from outer space. First, applications that require satellite data, like modern times communication, television, maps, navigation, weather forecasts, and so on.

Second, space research and developments for space missions brought major technological breakthroughs and new technologies. Today life without these “spin off technologies” from space research would be unthinkable.

“The point is that unlike in previous decades, astronautics has turned from something extraordinary and celestial into a down-to-Earth aspect of everyday life. Present-day defense doctrines and an ordinary telephone call both depend on the degree of development of national astronautics or on the ability to hire space services.“(Kislyakov (2006c)) .

Some R&D results directly influenced by or even achieved for space travel and space research are listed in the following table:

Table 1:Spin Offs from Space Research

Abbildung in dieser Leseprobe nicht enthalten

Source: Martinez (n.d.) p.9; Frischauf (2007)

2. INTERNATIONAL LEGAL, AND INSTITUTIONAL FRAMEWORK FOR OUTER SPACE ACTIVITIES

There is not one space law, or one organisation that deals with the subject. Instead a network of national, multinational and international treaties and laws exist. “Since the beginning of the space age, some progress has been made in developing a legal framework for space activities. At international level a public law regime has been set up within the context of the United Nations, and multilateral and bilateral agreements have been established to govern co-operative efforts among space faring nations. Moreover, some nations have developed and implemented national space laws (OECD (2005) p.172) .”

Most people will not know how many international organisations are concerned with outer space activities. Sometimes it is the organisation’s main assignment or sometimes parts of the subject that the organisation cares for needs outer space (for example ITO) or just because the organisation needs Satellites for some of their projects. In general all following international organisations create rules for the use of space, spend money for space applications or deal with and create space law or foster international cooperation in outer space.

2.1. United Nations

All progress that has been made in developing a legal framework and a public law regime for space activities at an international level has been set up within the context of the United Nations (OECD (2005) p.172) . The United Nations even set up two legal bodies to deal with outer space affairs: the UN Committee on the Peaceful Uses of Outer Space (COPUOS) and the United Nations Office for Outer Space Affairs (UNOOSA).

From the earliest days of space exploration, the United Nations recognised the important role that space-related technologies can play in improving the human condition all over the globe. To this end, the United Nations and it specialised agencies conduct a coordinated programme of activities utilising these technologies to their fullest (UNCOSA: Home (2007)) . The United Nations annually convenes an Inter-Agency Meeting on Outer Space Activities to discuss current and future activities, emergent technologies of interest and other related matters. The meeting issues a report on its deliberations for the consideration of the United Nations Committee on the Peaceful Uses of Outer Space . The meeting also produces, on behalf of the Secretary-General, a report on the coordinated space-related activities of the UN system¹. (UNCOSA: Home (2007))

2.1.1. COPUOS

The most important legal body regarding outer space law is the UN Committee on the Peaceful Uses of Outer Space (COPUOS), which was established shortly after the launch of sputnik in 1958 as an ad hoc committee and formally created in 1959 by United Nations resolution 1472 (XIV) to “review the scope of international cooperation in peaceful uses of outer space, to devise programs in this field to be undertaken under United Nations auspices” and “to encourage continued research and the dissemination of information on outer space matters, and to study legal problems arising from the exploration of outer space.” (Office of Outer Space Affairs, (2007)).

COPUOS is one of the largest committees in the United Nations with 67 member nations.

The Committee has two standing Subcommittees which meet annually to consider questions put before them by the General Assembly, reports submitted to them and issues raised by the Member States.:

- the Scientific and Technical Subcommittee; and
- the Legal Subcommittee.

COPUOS and its two Subcommittees, work on the basis of consensus and make recommendations to the General Assembly. (Office of Outer Space Affairs, (2007))

2.1.2. UNOOSA

The United Nations Office for Outer Space Affairs (UNOOSA) was initially created as a small expert unit within the Secretariat to service the ad hoc Committee on the Peaceful Uses of Outer Space in 1958. It became a unit within the Department of Political and Security Council Affairs in 1962, when the permanent Committee on the Peaceful Uses of Outer Space met for the first time, and was transformed into the Outer Space Affairs Division of that Department in 1968. In 1992, the Division was transformed into the Office for Outer Space Affairs within the Department for Political Affairs. In 1993, the Office was relocated to the United Nations Office at Vienna. At that time, the Office also assumed responsibility for substantive secretariat services to the Legal Subcommittee, which had previously been provided by the Office of Legal Affairs in New York. Questions relating to the militarization of outer space are dealt by the Conference on Disarmament, based in Geneva.

The Office for Outer Space Affairs implements the decisions of the General Assembly and of the Committee on the Peaceful Uses of Outer Space. The office has the dual objective of supporting the intergovernmental discussions in the Committee and its Scientific and Technical Subcommittee and Legal Subcommittee , and of assisting developing countries in using space technology for development. In addition, it follows legal, scientific and technical developments relating to space activities, technology and applications in order to provide technical information and advice to Member States, international organizations and other United Nations offices. (strongly adopted from Office for Outer Space Affairs. (2006)).

2.1.3. International Telecommunications Union

After UNOOSA and COPUOS the International Telecommunications Union (ITU) is the most important international organisation for Outer Space. Besides undertaking standardisation activities relating to e.g. mobile telephony and mobile internet, the ITU also manages the radio-frequency spectrum and – this is why it is so important for outer space – coordinates satellites. This coordination includes the allocation of spectrum and register frequency assignments, orbital positions and other parameters of satellites (ITU: About us (2008)) . These tasks are performed by the ITU Radiocommunication Sector (ITU-R), which is one of four sectors of the ITU. ITU-R also develops and manages space-related assignment or allotment plans and provides mechanisms for the development of new satellite services by locating suitable orbital slots. ITU-R has a permanent secretariat, the Radiocommunication Bureau , based at the ITU Headquarters in Geneva, Switzerland. (ITU: ITU-R (2008)) An interesting feature of the ITU is that not only countries but also private organisations and companies (like carriers, equipment manufacturers, funding bodies, research and development organizations and international and regional telecommunication organisations), can join as Sector Members . (ITU: Membership (2008)) The elected Director of the Bureau is Mr. Valery Timofeev of Russia who was re-elected for a second four year term in November 2006 (ITU: ITU-R (2008)).

2.1.4. Other UN Organisations

UNOOSA and COPUOS are the only two bodies that exclusively deal with outer space matters, the ITU does not only deal with outer space but is still indispensable in the satellite sector as it is the coordinating agency for satellites, but there is number of other United Nations affiliates and related organisations that also deal with questions of outer space and make their contribution to the organizational framework. Many specialized UN organizations are also heavily dependent on the use of satellites for their programs. The Committee on the Peaceful Uses of Outer Space in 2006

published a 67 pages long list² of space-related initiatives and programmes that respond to specific recommendations contained in the Johannesburg Plan of Implementation of the World Summit on Sustainable Development (WSSD) of 2002 (or also referred to as Earth Summit 2002 ) (A/CONF.199/20. (2002)) . The website United Nations Coordination of Outer Space Activities of the UNOOSA lists 26 Organisations and Agencies of the UN framework, that take part in the Inter-Agency Meetings on Outer Space Activities (UNCOSA: Directory of Organizations (2007)).

UN Agencies do in general not have their own satellites, but rely on satellite date of member countries and member organizations. In the course of this chapter some diverse example of organisations will be given as well as specifications how these organisations are related to outer space activities, to show how important space applications are for organisations where one would not expect it. The chapter does though only explain the organisations’ relevance for outer space and not their mission, history and residuary tasks. If the reader is interested in this information, they are referred to the organisations’ web presences which are cited in “Sources”.

2.1.4.1. The International Atomic Energy Agency

The International Atomic Energy Agency (IAEA) follows the work of COPUOS and particularly provides its technical expertise in COPUOS’ Scientific and Technical Subcommittee. It deals among others with safety devices for nuclear power supplies in outer space, especially in the case of unanticipated and uncontrolled re-entry, the exposure of astronauts to radiation as a potential health concern, for the implementation of most possible up to date safety measures. (Pleninger, (2005) p.38)

2.1.4.2. Food and Agriculture Organization

The Food and Agriculture Organization of the United Nations (FAO) already started using remote sensing technologies in the 1970s focusing on renewable natural resources establishing, ten years later, a Remote Sensing Unit which later became the Environment and Natural Resources Services . This contains the organisation’s

remote sensing, geographic information system , agro-meteorology, environment and energy activities. It seeks to optimise related technology transfer and to integrate the use of the before mentioned activities in its member states. The overall aim of satellite usage at the FAO is to achieve timely and cost-effective data collection relevant for monitoring and management of environment and natural resources for e.g. early warning for food security or natural disaster mitigation. (Bjorgo (2002) ; Pleninger (2005) pp.32-3)

2.1.4.3. International Civil Aviation Organisation

The International Civil Aviation Organisation (ICAO) utilises satellite technology for its Navigation Surveillance/Air Traffic Management, Civil Navigation/ Air Traffic Management, systems. Satellites are also used to support communications in remote and oceanic air spaces. ICAO distributes meteorological data via satellites. Satellite technologies are also used for support of search and rescue services, and global navigation coverage for all phases of flight. (UNCOSA: Directory of Organizations: ICAO (2007))

2.1.4.4. World Health Organization

Many of the World Health Organization’s (WHO) programmes are affected or even heavily dependant on developments in space research and the use of satellite data. This includes for example early detection of environmental changes relevant to the outbreak of new diseases or determining the habitats of vectors for malaria, Ebola and other epidemics and naturally research on these diseases (BBC (2003)) . Furthermore the WHO uses satellites for studies of air and water pollution and just started to apply satellite communication in health and medical education (ESA, WHO (2006) pp.1-2) . Another field of application is the use of satellite maps to help WHO to plan better medical responses or the use of satellite data to track down nomadic peoples, in order to provide them with medical help. (BBC (2003))

2.1.4.5. World Meteorological Organisation,WMO

Most World Meteorological Organisation’s programmes and especially WMO’s core programme “World Weather Watch” (WWW) rely heavily on the use of weather satellites to make available meteorological and related environmental information needed to provide efficient services in all countries. (WMO (2007))

After having covered the international institutions creating the international framework for astronautics, another important aspect is to look on the laws created by these institutions.

2.2. Space Law

Space law is formed by national legislation, bilateral and multilateral treaties and most importantly by a public law regime set up within the context of the United Nations. International space law is based upon five international space treaties and five resolutions that were drafted at COPUOS, governing the relations among nations regarding space. The main purpose of this regime is to preserve the freedom of exploration and use of outer space. Furthermore it should foster peace and international co-operation, and declare rights and obligations of states.

2.2.1. Treaties

There are five international space treaties passed by COPUOS. All five treaties were drafted during the times of the cold war. They will be discussed in the following section. The meaning of these treaties for private operations is discussed in the section thereafter.

2.2.1.1. The outerspace treaty

Drafted in 1966 entering into force on October 10, 1967 the outer space treaty , or Treaty on Principles Governing the Activities of States in the Exploration and Use of Outer Space, including the Moon and Other Celestial Bodies as it is formally known,provides the basic framework on international space law. It is based on the Declaration of Legal Principles Governing the Activities of States in the Exploration and Use of Outer Space but expanded by a few provisions. As of January 2007, 98 countries have ratified the treaty and another 27 countries have signed but not yet ratified it, whereby all countries having national space agencies or space programs have ratified it. (UNOOSA: Outer Space Treaty (2007))

The most important principle of this treaty is, that no country can, by any means, claim a celestial resource such as the Moon or a planet or any other object in outer space. Furthermore it forbids countries to place or test nuclear weapons or other weapons of mass destruction in orbit or on celestial bodies or station those in outer space in any other manner; the Moon and other celestial bodies shall be used exclusively for peaceful purposes. Also, the treaty declares states responsible for national space activities, whether carried out by governmental or non-governmental activities, and liable for damage caused by their space objects. (UNOOSA: Outer Space Treaty (2007) ; Cheng (1997))

2.2.1.2.The Rescue Agreement, 1968

The Agreement on the Rescue of Astronauts, the Return of Astronauts and the Return of Objects Launched into Outer Space finally entered into force in 1968 after five years of negotiations. The agreement provides that “States shall take all possible steps to rescue and assist astronauts in distress and promptly return them to the launching State”, and that “States shall, upon request, provide assistance to launching States in recovering space objects that return to Earth outside the territory of the Launching State” (UNOOSA (2007)) As of January 2007 88 countries have ratified and 25 have signed but not yet ratified the agreement. Furthermore two international intergovernmental organizations, namely the European Space Agency and the European Organisation for the Exploitation of Meteorological Satellites have declared its acceptance of the rights and obligations of this Agreement. (UNOOSA: Rescue Agreement (2007))

2.2.1.3. The Liability Convention,1972

The “Convention on International Liability for Damage Caused by Space Objects” was discussed and negotiated even longer than the rescue agreement, namely 9 years in the legal subcommittee of UNOOSA. Coming into force in 1972, and as of January 2007 ratified by 84 countries, signed by 24 countries and accepted by three intergovernmental organisations (European Space Agency, the European Organisation for the Exploitation of Meteorological Satellites, and the European Telecommunications Satellite Organization), the Liability Convention expands on the liability rules created in the Outer Space Treaty of 1967. Basically the treaty declares a state fully liable for all damages that their space object caused in any way. (UNOOSA: Liability Convention (2007))

2.2.1.4. The Registration Convention,1976

In 1976 the Convention on Registration of Objects Launched into Outer Space entered into force. It provides that the launching State has to inform the United Nations, as soon as possible about, the registration number of a space object, the date and territory or location of launch; the basic orbital parameters, and the general function of the space object. The convention was as of January 2007 ratified by 49 States signed by four and accepted by two international intergovernmental organisations (European Space Agency and European Organisation for the Exploitation of Meteorological Satellites). Today even an online searchable index of objects launched into outer space is available³. (UNOOSA: Registration Convention (²⁰⁰⁷ )

2.2.1.5. The Moon Treaty,1979

The Agreement Governing the Activities of States on the Moon and Other Celestial Bodies was intended by the legal subcommittee to serve as a new comprehensive treaty to supersede the Outer Space Treaty, most notably by elaborating upon the

Outer Space Treaty's provisions regarding resource appropriation and prohibition of territorial sovereignty. It was elaborated from 1972 to 1979, but it was not until June 1984, however, that the fifth country, Austria, ratified the Agreement, allowing it to finally come into force. The treaty did not meet the expectations of UNOOSA and is only ratified by 13 states as of January 2007, not including any nation which engages in manned space exploration, it has a negligible effect on actual spaceflight. (UNOOSA: Moon Treaty (2007) ; Cheng (1997))

2.2.2. Resolutions

The five UN resolutions concerning outer space, drafted in the legal committee of COPUOS and adopted by the UN General Assembly encourage international cooperation and exchange of information via direct satellite broadcast and remote satellite observation of Earth. In addition the resolutions set general standards regarding nuclear power sources used in outer space. (OECD (2005) pp.172-4)

Since UN resolutions do not have a legally binding status the five outer space resolutions will just be named in chronological order but not be described in detail.

Table 2: United Nations resolutions concerning space activities

Abbildung in dieser Leseprobe nicht enthalten

Source: OECD (2005) p.174

Although an international regime is very important and should govern outer space activities, it must not be forgotten, that states have ultimate authority to define the legal environment for their national space activities. (OECD (2005) pp.172-4)

2.2.3. Criticism

Experts state that the international legal regime space law is not supportive of commercial undertakings in space, since it basically is a public law regime which deals with rules and obligations of sovereign states and not of business activities. ( i.e. insurance and liability, environmental, financing, patent law and other intellectual property rights, export controls, transport law, dispute settlement). (OECD (2005) p.176) One must not forget, that the last international treaty concerning space law was passed nearly thirty years ago, at a time were commercial space flight was hardly an issue.

In addition to that, many space-faring countries do not have national space laws or have laws that cover only some space activities and thereby create a legal vacuum. (OECD (2005) pp.12,175-6)

Another point often criticized by experts is vague formulation of the space treaties, which leave a lot of room for interpretation and create flaws. Many terms are not defined, even the term “outer space” itself is not defined in international treaties and leaves room for opinions and interpretations. In 1997 Bin Cheng wrote, that in general practice, air space is interpreted as in which navigation by conventional aircrafts is possible and outer space is where artificial satellites are able to orbit, what brings the frontier at approximately 80 kilometres. (Chen (1997)) This borderline is though only used by United States agencies; most other space agencies use the Kármán line, at an altitude of 100km. (Windholz, Frischauf, Bohaumilitzky (2007), p.3)

A clear definition would be very important to clarify whether space law or air law is applicable. Other important terms that need clarification are “launching state” or “space object” (OECD (2005) pp.176-7) or “Astronaut” (e.g. is a space tourist also an Astronaut and do the same legal provisions count for him?).

Another major difficulty that could arise in the near future is the fact that “Outer space, including the Moon and other celestial bodies, is not subject to national appropriation by claims of sovereignty, by means of use or occupation, or by any other means” (Outer Space Treaty (1967) Article II) . This can lead to legal problems of planned commercial or state activities like Helium 3 mining on the moon or asteroid mining (see chapter 5 “Commercial use of outer space”). Some entrepreneurs are nevertheless convinced that the provision of being allowed to use outer space for the benefit of mankind is interpretable enough to allow for commercial space ventures and that a new space treaty is not needed (Frischauf (2007)) .

Until now, no dispute arose out of an unclear definition, provision or the lack of the same. But with an increasing commercialization of space, an increasing traffic in space and more and more countries participating in space ventures the necessity of a new comprehensive space treaty rises.

3. INSTITUTIONAL AND SCIENTIFIC USE OF OUTER SPACE AND SPENDING

Commercial spending is an important factor for the space industry and has grown in importance over the years. Nevertheless governmental spending still represents a major part of income in the upstream sector especially for satellite builders. Since the downturn of commercial activities in space in the late 1990s governmental spending represents approximately half of the income of space businesses. In fact, public spending is constantly increasing. In 2001 world public budgets for space activities amounted to about $38 billion, rising to $43 billion in 2003 and are expected to exceed $50 billion by 2010. (OECD (2005), p.95)

In 2003, the part of public space resources devoted to civil applications made up 57% of total spending ($24.3 billion), with the remaining $18.5 billion allocated to military space programmes. The following Chapter will explain the international and national public sector and its future.

3.1. Intergovernmental Organisations

Many intergovernmental satellite operators were transformed into private companies mostly in the late 1990s. Nevertheless most of those organizations still have intergovernmental control organs or non-profit duties to fulfil. Therefore they are all listed in this chapter in order to deliver a complete picture. The European Space Agency (ESA) is an intergovernmental organisation as well but rather has the characteristics of a national space agency as it is involved in the exploration of space not only in the operation of satellites, and will therefore be discussed in the chapter “space faring nations”.

3.1.1. INTELSAT

In 1961 the United Nations General Assembly adopted Resolution 1721, stating that global satellite communications should be made available on a non-discriminatory basis. Three years later on August, 20th 1964 the International Telecommunications Satellite Consortium (INTELSAT) was established on the basis of agreements signed by eleven countries. Another five years later 500,000,000 television viewers worldwide were able to watch Neil Armstrong’s first steps on the moon live via INTELSAT. Another five years later INTELSAT already had 86 member countries.

In the late 1990s first steps to a commercialization of the organisation were taken, as working capital, five in-orbit satellites, one in-construction satellite and their associated orbital roles were transferred to the newly created company, New Skies Satellites N.V. 37 Years after the creation of INTELSAT as an intergovernmental organisation, it was privatized on July, 18th 2001. (Intelsat: About Us: Our history (2007))

In 2005 INTELSAT was bought by a conglomerate of four private equity firms: Madison Dearborn Partners, Apax Partners, Permira and Apollo Management. In 2007 UK private equity firm BC Partners prevailed in a bidding war for Intelsat agreeing to pay $4.6 billion (plus $11.4 billion in debt) for a 76% stake in the company. Today INTELSAT is the biggest satellite operator, owning a fleet of 52 satellites and a large, complementary terrestrial infrastructure. In 2006 INTELSAT had 1,217 employees and a yearly revenue of $1.7 billion. (Yahoo! Finance (2007))

3.1.2. EUMETSAT

Founded in 1986 the European Organisation for the Exploitation of Meteorological Satellites (EUMETSAT) operates a fleet of four Satellites and delivers weather and climate-related satellite data, images and products to National Meteorological Services of the organisation's 21 Member and 9 Cooperating States in Europe, as well as other users world-wide. (EUMETSAT: Who we are (2008)) The Organisation is funded by contributions of its member states (EUMETSAT: Who we are: Structure: Funding (2008)) .

3.1.3. INTERSPUTNIK

Founded as response to INTELSAT in 1971 by nine countries of the eastern block Intersputnik International Organization of Space Communications ’ function was (and continues to be) to design, manufacture, operate and develop an international satellite communications system in the interests of its member countries (Satnews (2008)) . In 2007 INTERSPUTNIK had 25 member states and was still an IGO but commercially aligned and operated 11 satellites. (INTERSPUTNIK (2005))

3.1.4. EUTELSAT

Set up as an intergovernmental organisation in 1977 the European Telecommunications Satellite Organisation (EUTELSAT) had the aim of developing, constructing, operating and maintaining the space segment of the European telecommunications satellites systems for international telecommunications services within Europe. With the general liberalisation of the telecommunications sector in Europe, EUTELSAT was transformed into a private company called Eutelsat S.A. in July 2001, but still supervised and controlled by an intergovernmental organisation with supervising function ( Eutelsat IGO ). Today EUTELSAT operates a fleet of 23 satellites in GEO and has five more in construction and broadcasts over 2,500 television and 1,000 radio stations to more than 164 million cable and satellite homes and offers many other services. (EUTELSAT a (2007))

EUTELSAT had 515 employees and consolidated revenue of €829 million in the financial year 2006/2007 and is therewith the third biggest satellite operator worldwide. (EUTELSAT a (2007))

In the first half of the financial year 2007/2008 EUTELSAT obtained a revenue growth: 3.4% and an 18.5% increase in net income. (EUTELSAT b (2008) p.1)

3.1.5. INMARSAT

The International Maritime Satellite Organization (IMSO) as INMARSAT was earlier known was created as a self financing non profit international organisation in 1979 at the behest of the UN International Maritime Organization to establish a maritime satellite communication network to improve safety at sea. As the organization began to provide service to aircraft and portable users the name was changed to International Mobile Satellite Organization. Contrary to other satellite providers, INMARSAT operates satellites in a geosynchronous orbit and not in a geostationary orbit. In 1999 INMARSAT became the first intergovernmental organisation to transform into a private company. (INMARSAT a (2007)) For that reason, the organization was split into the commercial company Inmarsat plc, and regulatory body IMSO. As of December 2006 INMARSAT operated 11 mobile satellites, had around 400 employees and revenues of $500 million and a profit of $174.9 million.

(INMARSAT (2006b) pp.5,32)

3.1.6. ARABSAT

The Arab Satellite Communications Organization (ARABSAT or ASCO) was founded by the Arab League in 1976 as Intergovernmental Organization (IGO), governed by the General Assembly, the Board of Directors and the Management Committee. ARABSAT was not transformed into a profit oriented enterprise. The organisation is a relatively small satellite operator, with a fleet of four satellites and ranked number ten internationally. Nevertheless it is – fulfilling its purpose – by far the leading satellite services provider in the Arab world. (ARABSAT (2007))

3.2. Space Faring Nations / National Organisations

The following table lists all countries that have national space organisations or administrations and names them.

Table 3: National Space Agencies

Abbildung in dieser Leseprobe nicht enthalten

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¹ For further information see UNOOSA: Space Solutions (2006)

² For viewing the document see http://www.uncosa.unvienna.org/iamos/2006/wssd_2006.doc

³ This searchable index is provided on http://www.unoosa.org/oosa/showSearch.do by UNOOSA (n.d.)

• Hochschule: FH Krems
• Note: 2
• Autor: Mag.(FH) Florian Albin Gerl (Autor:in)
• Erscheinungsjahr: 2008
• Seiten: 163
• Katalognummer: V116794
• ISBN (eBook): 9783640196470
• ISBN (Buch): 9783640196555
• Sprache: Englisch
• Schlagworte: Outer, Space, Emerging, Market, spaceindustry