Manufacturers who previously focused on producing big geostationary satellites have successfully broadened their product lines to attract new customers.

At the Satellite 2023 conference, Cyrus Dhalla, the senior vice president and general manager of Northrop Grumman Tactical Space Systems Division, stated that the satellite industry has transformed entirely instead of being on the brink of change. The era of ordering 20 geostationary communication satellites yearly has gone. Claude Rousseau, the moderator of the panel and NSR research director, said that nowadays, there are around 10 to 14 annual orders.

Thus, satellite manufacturers have shifted to offer small and medium-size satellites to both commercial and government clients. Furthermore, many nations now demand their independent space capability, and as a result, satellite companies have extended their services to government clients. Jonathan Caldwell, the Lockheed Martin military space vice president and general manager, made this observation.

Radically Reduced Price

According to Jonathan Caldwell, Lockheed Martin now produces more small satellites than large ones. He also mentioned that the commonality factor is crucial in small satellite manufacturers.

Caldwell also pointed out that Terran Orbital, a Florida-based company that won a $2.4 billion contract to provide satellites for Rivada Space Networks, is among the firms that Lockheed Martin is supporting. Caldwell expressed confidence in Terran Orbital’s capacity to manufacture 300 Rivada satellites quickly and efficiently, saying that they would deliver on the contract.

Caldwell also stated that Terran Orbital’s ability to expand its small satellite manufacturers capabilities would enable Lockheed Martin to provide customers with satellites at a “radically reduced price point.”

Risky Business

Jean-Marc Nasr, the executive vice president of space systems at Airbus Defence and Space, mentioned that small satellites are proving to be profitable for Airbus because of standardization, even though larger satellites are more expensive.

Airbus is selling its Arrow 450, which is produced by Airbus OneWeb Satellites, to various customers, including Northrop Grumman. Nasr forecasts potential sales of 500 to 1,000 units in the next five years. Building large satellites for specific customer requirements is more hazardous than mass-producing small satellites, Nasr said.

He advises companies to master their supply chain and continuously scrutinize their make-or-buy decisions. If other firms can produce parts or components more efficiently, it’s best to enter into long-term agreements with them to keep costs in line, according to Nasr.

GEO Remains Important

Thales Alenia Space supplies small satellites through its partnership with BlackSky, with a market driven by both telecommunications and Earth observation, according to Hervé Derrey, the CEO of Thales Alenia Space.

Despite the growth in small satellite demand, Derrey emphasized the continuing importance of large geostationary satellites. He also mentioned that specific telecommunication missions would be challenging and expensive to accomplish with satellites in low or medium-Earth orbit.

More Smallsat Orders

U.S. government customers have clearly expressed their desire to rely less on large satellites.

“They’re going to continue buying some capabilities in GEO,” Dhalla said. “We are seeing orders for much smaller satellites.”

Even satellites once considered mid-size, like Northrop Grumman’s GEOStar platform, looked big to a recent factory visitor.

“Time has really changed hasn’t it, when you look at something that was considered small five to 10 years ago” and someone comments on how big it is, Dhalla said.

Going Faster

In the face of myriad market opportunities, Maxar Technologies will “leverage the commercial go-fast mentality” to meet customer demands for speedy satellite manufacturing, said Chris Johnson, Maxar Space senior vice president and general manager.  

In terms of software-defined satellites, Maxar is taking a different approach from some of its competitors.

“There’s another place that we can go to add value to a certain portion of the market, just like we had value proposition in the GEO market before,” Johnson said. “We are going to leverage a different price point.”