Optical Satcom Equipment a US$3.7 Bil. Opportunity by 2028, but Market Must Establish Ecosystem to Drive Development

Cambridge, Mass., April 16, 2019 — NSR’s Optical Satellite Communications report, released today, forecasts nearly US$4 Billion in cumulative revenue over the 2018-2028 period for laser communication equipment in space. Largely driven by the impending wave of mega-constellations with inter-satellite links, the volume of production and subsequent deployment of Non-GEO satellites will drive revenue growth for equipment manufacturers.

“The market growth for laser communication terminals (LCTs) rests strongly on the successful deployment of Non-GEO HTS mega-constellations,” states Shivaprakash Muruganandham, NSR Analyst and report author. Constellations such as SpaceX’ Starlink and Telesat’s LEO that propose to incorporate inter-satellite laser links are expected to drive demand for Space-Space terminals beyond 10,000 units by 2028.

Free space optical communications has long been a niche alternative to today’s radio frequency-based satcom ecosystem, used primarily in technology demonstration missions by governments and research organizations either in near-earth orbits or on deep space platforms. However, technology advances in recent years and increasing demand for data downlink have captured industry interest in optical as a commercially viable satcom alternative.

Another niche market in the making is satellite data downlink capabilities, where optical satcom is expected to play a key role in the networks of the future. “NSR recognizes this need for optical downlink capabilities in the long-term, but the communications infrastructure on the ground segment will first need to catch up before real returns can be observed,” Muruganandham adds.

Many optical equipment manufacturers are racing to address this market with a variety of products aimed at Space-Space or Space-Ground optical connectivity solutions. NSR believes that the progress of key players, along with the growing maturity and partnerships seen in the industry value chain, will be highly beneficial to fulfill the promise of Optical Communications. These dynamics are expected to drive cost and performance improvements that will eventually enable the wider adoption of laser terminals in the satcom industry.