Sizing up the 2023 GEO manufacturing battleground

Competition among builders of the world’s largest communications satellites is intensifying in a shrinking market.

After a C-band clearing shopping spree that saw Intelsat and SES order a combined 13 of the 18 geostationary satellites ordered in 2020, satcom operators worldwide bought just 11 GEOs in 2022 — down from 12 in 2021.

And the competition this year is off to a slow start.

Just three contracts for commercial GEO communications satellites had been announced as of late April, including two to be built by Californian startup Astranis that are part of a new breed of smaller, more regionally focused geostationary spacecraft.

Industry veteran Maxar Technologies secured the other contract with an order from its long-term client Dish Network. Maxar is basing the TV broadcaster’s next satellite on its 1300 series platform, which with a mass of up to 6,800 kilograms, is about 17 times heavier than an Astranis satellite.

One manufacturer hoping for a larger pool of orders for more conventionally large satellites this year is Airbus.

According to Euroconsult research, Airbus’ strong performance in recent years culminated in 2019 when it won 40% of the 10 GEOs ordered; however, it left the arena empty-handed in 2022.

Didier Radola, head of satcom programs at Airbus Defence and Space, told SpaceNewsin February that it hoped to get back on track this year by capturing as many as six of the 15 or so GEOs he expects to be tendered in 2023.

Standing in its way is Thales Alenia Space, Airbus’ main competitor in Europe. The joint venture of French multinational Thales Group and Italian aerospace contractor Leonardo shows no signs of letting up in the increasingly competitive GEO market after winning seven of last year’s 11 orders.

Maxar and Boeing, which are both based in the U.S. and picked up one and two GEO orders in 2022, respectively, are also hungry for more contracts this year.

Fierce Battleground

Competition wasn’t always as brutal. GEO builders used to vie for 15 to 20 large orders annually.

But amid the uncertainty caused by the rise of non-geostationary constellations and, more recently, the disruption caused by the COVID-19 pandemic, manufacturers have been competing for a smaller pool of contracts for half a decade now — ignoring the one-time bonanza of government-stimulated C-band satellites in 2020.

The Federal Communications Commission is covering all the costs of those satellites, which operators need to clear part of their C-band in the United States for Verizon, AT&T, T-Mobile, and other 5G telcos that won the frequencies in an auction that raised more than $80 million.

Geo Challenges

Last year’s GEO order performance shows “signs of market recovery that began in previous years appear to be more cautious than hoped,” Euroconsult principal adviser Maxime Puteaux warned.

Orders placed in 2022 were mainly made to replace aging satellites that are reaching the end of their typical 15-year design lives, he said, rather than for a significant expansion strategy.

Astranis and other new players offering much smaller GEO satellites that are cheaper and more flexible, albeit with less capacity than their larger cousins, are also distorting the market for legacy manufacturers.

Intelsat, which has ordered large satellites from Airbus, Thales Alenia Space, and other established manufacturers, last year became 3D printing

Geo Orders

Geo Order Chart 2000 Thru 2022

According to Euroconsult, 334 GEO comsats were ordered worldwide between 2000 and 2022, averaging roughly 15 per year.

sites to monitor and assist with complicated development tasks.

The manufacturer has suffered its share of satellite production delays in recent years, including for Telesat’s LEO constellation, which remains on ice while the Canadian operator attempts to finalize its funding.

In addition to supply chain challenges and scarce GEO demand that is putting “some pressure on prices,” Euroconsult’s Puteaux said Airbus’ and Thales Alenia Space’s growth strategies also face technological risks.

A good portion of their recent contract wins is for newly developed software-defined satellites that can be reprogrammed in orbit.

specialist Swissto12’s first customer for a dishwasher-sized satellite, about a tenth the size of a conventional GEO.

Getting Back On Track

Radola pinned Airbus’ 2022 no-show on aggressive competition from players battling over slim pickings in the GEO market.

While he expects slightly more orders up for grabs this year, he said Airbus has also been busy finding operational efficiencies to increase its competitiveness, including work to get “closer to our suppliers in order to be positioned to better monitor them.”

Manufacturers will need to have more than just the best or cheapest product to be successful this year as supply chain issues stemming from the pandemic continue to delay satellite projects, according to Radola.

“What will be a differentiator in the coming months will be the capacity for the industry to deliver on time,” he said.

“We see how it is today — nobody is able to deliver on time,” he added, “and the delays are significant.”

In November, Echostar said it is being compensated by Maxar following production issues for its Jupiter 3 satellite, which has seen its launch move from 2021 to later this year in one of the industry’s most recent high-profile delays.

And despite Airbus’ lack of fresh GEO contracts, the company said it still “has a significant GEO backlog” and managed to secure orders for nearly 60 low Earth orbit (LEO) platforms last year.

Strengthening The Lead

Marc-Henri Serre, senior vice president of telecoms at Thales Alenia Space, only expects roughly 10 to 12 GEO communications satellites to be ordered in 2023, and annually in the near term.

While he said the market is too unpredictable to give a clear forecast for the number of orders it expects to win 2023, the company stressed it is not under capacity and is continually chasing new contracts.

Thales Alenia Space is also focusing on operational efficiencies this year, and has been sending employees to supplier

“Now both companies need to deliver to customers,” he said, “and one needs to keep in mind the extreme complexity of fully software-defined satellites and” the risks associated with demonstrating first generations.

MULTI-ORBIT COMPETITION

Thales Alenia Space and Airbus are also increasingly bumping heads for satellite manufacturing contracts beyond GEO. Both hope to play a leading role in developing IRIS² — or Infrastructure for Resilience, Interconnectivity and Security by Satellite — Europe’s 6 billion euro ($6.5 billion) multi-orbit sovereign connectivity constellation currently seeking proposals.

And as OneWeb wraps up the deployment of first-generation satellites built via a joint venture the LEO broadband operator shares with Airbus, Thales Alenia Space is getting ready to make a move for follow-on business.

“We all know that OneWeb is preparing its second generation,” Serre said, “so we are [also] positioned for this constellation, and we have other projects in which we are working” on. SN