Data Downlink: The Shining Star of Satellite-Based Cloud Services

Obtaining data from space remains a massive bottleneck yet to be resolved. The increasing resolution of space-based sensors, data collected at higher revisit rates and the lack of onboard memory or relay systems for massive amounts of information from scientific missions all contribute to the current downlink bottleneck experienced by many operators and scientists.

Due to this rising demand, established and new space players launching satellites with improved sensor capabilities are signing up more partnerships with cloud service providers to process ever growing volumes of data and transform the way it is brought back to users.

As a result, the ‘little known’ data downlink market is heating up very nicely compared to other applications such as Satcom or analytics. Indeed, NSR’s Cloud Computing via Satellite, 3^rd Edition report forecasts more than $21 billion in cloud service revenues generated from data downlink through the next ten years, well ahead of the more established satcom-based cloud applications. A number of factors and contributions from a range of actors support this lead, despite the low-key profile of this segment of the satellite industry.

Data Downlink via the Cloud on Multiple Fronts

Public cloud service providers are enabling a shift from CAPEX to OPEX for satellite operators and downstream analytics service providers, leading to increased adoption of cloud services in the satellite data downlink sector. In addition, the entry of major CSPs (AWS GS and Microsoft Azure, among others), the virtualization of ground station services and the emergence of new space players with solid investor backing, such as Satellogic, Synspective, and Pixxel are all contributing to the movement. Furthermore, these newer entrants are cloud-ready from the beginning as demand for fast data delivery increases.

NSR forecasts approximately 1.4 EB of data volume from EO, Science, and Situational Awareness (SA) applications delivered via cloud servers by 2031. The commercial segment drives a majority of revenues, taking up about 54% of the cumulative opportunity from 2021 to 2031, with significant demand from the 'heavyweight' 100-500 Kg satellite mass category.



One thing to consider however is, despite being lower on the demand side than satcom applications, data that is downlinked has a price; i.e., it is more expensive on a per GB when compared to other verticals. The bottleneck explains this partly, as existing solutions do not offer the higher data rates for increasing volumes and lower latency, which the cloud helps to alleviate for a portion of the whole transport, store, and process equation. Added to this, ground station operators and service providers are experiencing huge price pressures that are shifting their pricing models from pay-per-pass towards pay-as-you-go or price per minute.

The data downlink segment is mainly derived from EO applications with 64% of cumulative cloud revenues. Commercial EO players have begun to outsource their ground service requirements either fully or partially, generating cloud data traffic and revenues for third-party GSaaS providers as well. Operators such as Satellogic, Spire, and Capella Space leverage AWS services to automate their data flows. Moreover, the demand for EO data downlink is growing with the increasing number of planned constellations with a higher the total data volume downlinked per satellite per day. The commercial segment contributes to more than half of the cloud services revenues. The adoption of cloud services for EO is growing due to the need for a reliable, secure, scalable solutions for storage and computing to ensure faster data delivery, data processing and customer centric analytics solutions.



Situational awareness applications, still very small today, are forecasted to reach $2.6 Billion in cumulative revenues in the next decade, with the Gov/Mil segment contributing to higher revenues in the short term while commercial operators will take a greater share in the medium and long term. As the use-cases in this application are time sensitive such as asset and threat monitoring, low latency will be critical for this application. Scalability, security, and lower CAPEX values will push the adoption of cloud in this application. The demand is also expected to proliferate with increased reliance on analytics-driven decision-making and monitoring and the rising need for situational awareness.

Science applications are Gov/Mil-focused throughout the decade due to inherent expensive nature of the missions. The market opportunity for this application stands at $537 Million up to 2031. Higher mass range satellites (1,000+ Kg) lead the demand for science applications with data volumes generated and downlinks projected to increase with improving sensor capabilities and system complexities. A surge in the no. of exploration missions, increased collaboration among nations, and improved interplanetary communications with higher data rates will drive the market for this application. The Gov/Mil segment will continue to drive the demand throughout the decade; however, demand from commercial operators is expected to rise towards 2031.

Cloud to Enable Customer-Centric EO Products

As the number of EO constellations keeps growing due to more backing from investors, their key value proposition focuses more on higher resolution and revisit frequency, and many for hyperspectral/multispectral/SAR images at lower prices. Currently, EO players are upstream-focused as opposed to a more downstream play, leading to a gap between customer requirements and products offered as new use-cases arise. Thus, a customer-centric approach will enable EO operators and data analytics providers to address emerging customer needs.

There is an emerging trend in the industry with downstream providers who are software-focused to provide products tailored to customer requirements across verticals such as agriculture, energy, industrial, and services. Such tailored and niche products will be key differentiators and a winning proposition for EO service providers in the long term. As a result, many platforms and marketplaces exist, with geospatial intelligence tools becoming a key component of existing big data applications. The cloud will also enable faster data delivery and scalability to offer such tailored solutions, and as a result, it will be an essential foundation for each layer in the EO demand stack. 

Cloud: Key to Better Ground Network Management

Partnerships between EO ground stations and cloud service providers are also on the rise, leading to faster and easier data dissemination and data delivery to customers. Additionally, major cloud service providers such as Amazon and Microsoft have adopted Ground Station as a Service (GSaaS) business models to enable end-to-end solutions for data downlink and delivery, allowing for seamless integration with their existing cloud infrastructure.

Existing price pressures in the market for a high volume of data downlink at lower costs by satellite operators are driving investments into automated tasking and higher frequency band antenna infrastructure. Virtualization of ground segment infrastructure will enable improved cloud integration to offer scalable, resilient, and flexible solutions in standardized digital environments. The cloud will play an essential role in EO ground network management for a smoother experience through APIs and automated scheduling.

The exponential growth in data generated offers a compelling case to bring computing capabilities closer to the sensor to ease the data downlink bottleneck. For this, there is an interest in edge solutions in space from players such as Ramon Space, Orbits Edge, and UNIBAP, who are working on hardware that can support compute-intensive ML/AI models onboard satellites for processing data, which can minimize the overall data volume downloaded. The testing of such edge processing solutions has expanded and will impact the overall data downlinked volumes per day in the medium and long term. Moreover, software companies are leveraging their existing capabilities and developing edge compute solutions to be deployed onboard the ISS and on-orbit platforms.

Bottom Line

The data downlink cloud services market is on the cusp of accelerated growth with the rise in satellite data traffic. Additionally, cloud adoption for data downlink will continue to rise due to the need for scalability, reliability, and faster data delivery. As the space market continues to invest in and team up for downlink solutions, the data downlink will shine like a star in the satellite cloud services market.