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Aerospace and satellite comms: The next growth frontier for cloud service providers?

Space projects of the near future are less sci-fi and more about driving efficiencies through business intelligence, edge analytics and cloud technologies

Following the news of Amazon Web Services’ (AWS) aerospace and satellite communications division, cloud services providers might be wondering if they are missing a trick by not targeting this market too.

Paul Kostek, IEEE senior member and an advisory systems engineer at Seattle consultancy Base2 Solutions, says the broader cloud provider opportunity is real. The biggest mistake is to underestimate it, thinking of aerospace as one-off or public research projects, when the reality is often one of commercial expansion.

“A lot of people are thinking of the cloud as basically a ground-based system,” he says. “But one of the big issues in the aerospace and satellite world is all the data being collected and what you do with it. Ground station development is way behind, because it’s not sexy or cool like building a SpaceX rocket.”

Ground stations typically require massive processing power to collect and manage all the data, whether it is navigation data or communications to and from weather balloons, planes, satellites or rockets.

It is typically about internet of things (IoT) capabilities, edge-powered applications, and how to manage all of that – and it is becoming “a really big deal”, says Kostek.

“Most people don’t even realise that SpaceX is already heavily engaged in sending up many satellites,” he says. “This is really one of these things that’s about to catch up on people. The cloud industry will suddenly realise there’s a huge opportunity.”

Amazon alone has been approved by the US Federal Communications Commission to launch 3,236 satellites as part of its $10bn Project Kuiper satellite project. Project Kuiper, entailing a “tremendous amount of data flying around, to and from satellites and on the ground”, will boost internet coverage to rural and developing areas.

In military communications, demand is expanding for unmanned aircraft from drones to flying “aircraft carriers” or even “wingmen” for fighter support. Meanwhile, countries from the US to China plan to return to the Moon.

Even space tourism might be only a couple of years away. Beyond collecting, monitoring and managing data on the space vehicles themselves, passengers will doubtless want to record and transmit live blogs, pictures and videos. And there are “probably a hundred” companies around the world, such as Uber Elevate, that are developing air taxi services, says Kostek.

“Companies will start to look at all that and say ‘I should be in space, doing something’,” he adds.

UK aerospace industry

In the UK, the aerospace industry as a whole generated £35bn in GDP in 2017, stoked by assorted government initiatives. The UK has the second-largest aerospace industry in Europe, with 2,500 companies, 2,300 of which have fewer than 10 employees. Government documents suggest that gross value added (GVA) for aerospace has grown by 30% since 2010, compared with 4% for manufacturing as a whole. The global market for aircraft, spacecraft and parts imports, excluding the UK, was worth about £142bn in 2016.

A steady stream of satellites and related services have seen lift-off across the UK. Airbus UK recently signed another contract with the Ministry of Defence, to develop its Skynet 6A military communications satellite for a 2025 launch.

The contract includes manufacture, cyber protection, assembly, integration, test and launch. Related programmes include new secure telemetry, tracking and command systems, launch, in-orbit testing and ground segment updates to the current Skynet 5 system.

Market research company IBISWorld estimates that the UK satellite communications industry expanded by 8.7% from 2014-2019, with key players including Airbus Defence and Space, SES and Arqiva.  The largest share is broadcasting, with the rest spread across data, phone/mobile communications and Earth observation.

IBISWorld analysts expect the sector to fare better than the wider economy in the wake of the Covid-19 pandemic.

Chris Roberts, head of datacentre and cloud at Goonhilly Earth Station, agrees. In a sense, Goonhilly has been a sort of proof of concept for building datacentres on-site to manage communications, incorporating direct access to the satellite providers. The main driver is definitely around data on the cloud platform and “making all that a bit easier”, he suggests.

Making a use case for aerospace investment

Satellite-derived Earth observation data and images are increasingly needed for industries ranging from agriculture – such as monitoring and managing crop yields – and surveying to shipping. This goes beyond transmitting data over a satellite link to processing, storing and managing it on the ground, with the market for real-time predictive analytics based on machine learning, and satellite-gathered data is likely to be especially promising.

“An example might be calculating the most efficient way of moving cargo and freight around the planet at any one time – a bit like Ocado online has been trying to do,” says Roberts. “The big leviathans, like the major telcos, may not be as successful at cloud computing. Managed services providers could partner up to take advantage.”

A team at the University of Hertfordshire has been using Goonhilly’s supercomputer to develop a clear view of the UK without interference from typical cloud cover, using radar imaging from the European Space Agency’s Sentinel satellites as part of the Copernicus Earth Observation programme.

The Herts team’s new commercial entity, DeepEO, with agritech provider Agrimetics will monitor some 2.8 million British fields every week to map crop yields and health.

One goal is a continuously updated observation database combining land, ocean and atmospheric data for a range of commercial opportunities. Target customers for algorithm-fuelled conclusions include insurance firms, commodity traders, hedge funds, supermarkets and the agriculture sector. Obviously, such projects offer an array of possibilities in the wraparound services space.

“There are so many applications and so much innovation in the sector,” says Roberts. “We are seeing a lot of academics in the artificial intelligence space, with more people coming to Goonhilly, using radioastronomy data for AI-based practical applications.”

“The big leviathans, like the major telcos, may not be as successful at cloud computing. Managed services providers could partner up to take advantage”
Chris Roberts, Goonhilly Earth Station

It is true that a UK 5G roll-out could be delayed by the mandated removal of Huawei kit. Hopefully, however, other players will fill the gap, says Roberts, and the disruption itself might offer an “in” to service providers looking to partner up and meet the growing demand.

Decide what the use case is, for instance for Earth observation data, and then move ahead to engineer the appropriate system, he says.

That is as true for aerospace as it is for satellite communications. Alex McMullan, chief technology officer - international at hardware supplier Pure Storage, says aerospace has many of the same challenges around data and applications as any other business customer – from email to human resources (HR) and enterprise resource planning (ERP). This might be for hundreds of planes each month, over an average 30-year lifespan.

Aircraft are profitable only when flying. A key way to improve the bottom line today is by generating and harnessing data collected across multiple time zones or countries. This means that edge computing, data processing, filtering and streaming services are in demand, says McMullan.

“All the devices we sell to customers have a virtual private network [VPN] back to the public cloud for the airport telemetry, for [aircraft] health status,” he says. “We’re not on the same scale as Boeing or Airbus, clearly, but each of those devices is an IoT problem that generates a data set that we want to analyse and look at in real time to make sure it’s all functioning correctly, exactly the same as airplane manufacturers do.

“Think of all the components that go into that – the engines, the APU [auxiliary power unit], the fuselage for stress and crack testing, the avionics, and even the more prosaic stuff, like the tyres.”

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But McMullan points out that airlines will need to reinvent themselves and their supporting tech post-Covid-19. For example, British Airways announced in mid-July that it will retire all its Boeing 747 airliners. Customers in general are currently unwilling to make big hardware purchases or long-term investments, says McMullan.

Luckily, sub-sectors from planes to satellites to submarines and defence often use the same software and toolsets, enabling manufacturers to pivot as required.

“It’s great for the cloud consumption model: service provider or SaaS [software as a service] or simply public cloud hosting,” says McMullan. “Customers just want to buy on a drip, to flex up and flex down or even stop that investment.”

Key services opportunities could be directed towards security and cost efficiencies, despite a grey area in space tech, which is still partly covered by International Traffic in Arms Regulations (ITAR), he says.

Pure Storage offerings to aerospace include enforced encryption that runs in the public cloud, covering links between cloud applications as well as on-premise. Snapshots of data can be transmitted, encrypted, to the public cloud.

“If all the aerospace companies went to the cloud tomorrow, I don’t think there would be a clear winner”
Alex McMullan, Pure Storage

McMullan says more customers are looking at public cloud as a disaster recovery bunker or a site of last resort, for exactly that reason.

“With Google more tailored to analytics, AWS for software development and development-friendly containers, and [Microsoft] Azure for enterprise-grade porting and production services, if all the aerospace companies went to the cloud tomorrow, I don’t think there would be a clear winner,” he says. “They all have their use cases, and no one wants to be locked into one provider anyway.”

Companies that can handle the process-driven challenges of the public sector should be able to manage aerospace, says McMullan, as sealing deals is not quite as tricky. However, the technology tends to be partly outsourced, so suppliers can end up in a three-way discussion.

That said, those that move today should do well as the sector returns to growth, he says.

In late June 2020, AWS unveiled its new aerospace and satellite communications division, aiming to sell AWS services and solutions into the sector, working with customers and partners globally to innovate around system architectures and data-driven services on Earth and in orbit, as well as supporting space missions in both the public and private sectors.

The cloud giant has been building its chops in the sector for years, inking deals and developing ventures with big names from Nasa’s Jet Propulsion Lab to Lockheed Martin, to lesser-known specialists including geospatial intelligence provider Geollect, satellite intelligence company Maxar, Earth observation satellite firm Capella Space, data provider Spire Global and engineering services provider TLG Aerospace. AWS declined to be interviewed directly for this article.

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