BY NICK SCHULZ
38 | B U S I N E S S H O R I Z O N Q U A R T E R L Y // S U M M E R
T
he United States military keeps the nation
where they can access a treasure trove of high-
safe and protects American interests around
resolution photos taken from the sky.
the world. It also plays an important role
driving technological innovation, with enormously
The ubiquity and increasing utility of all this imagery
beneficial spillover effects for American consumers.
is easy to take for granted, just another example of
Perhaps the best illustration of this dynamic is the
images come from two private sector companies,
Internet. What started as a research project funded
GeoEye of Virginia and DigitalGlobe of Colorado.
by the Defense Advanced Research Projects Agency
These companies were made possible in part thanks to
(DARPA), the Advanced Research Projects Agency
American military research and development needs.
Network (ARPANET) was the world’s first fully functioning packet
the wonders of the modern age. Yet many of these
The companies are the two designated providers of commercial satellite
switching network. Its advent laid the foundation for the World Wide Web and the commercial Internet that is revolutionizing commerce, media, business, and social life. Nevertheless, other examples are worth studying
imagery to the United States
The microchip revolution that makes the iPhone and other mobile marvels possible can trace its roots to the U.S. space program and other military endeavors in the 1950s and 1960s.
for the serendipitous and advantageous innovations they enable and create. Consider the growing market for satellite imagery. Images of the Earth taken from high in the sky are now widely available on the Internet. For example, when a tsunami strikes the Pacific Ocean coastline, media outlets can now publish “before” and “after” images of a devastated region to let people grasp the extent of the damage and to let aid agencies know
government. Yet, it wasn’t always this way. Indeed, the history of U.S. government reliance on satellite imagery has evolved in interesting and surprising ways. In the late 1950s and early 1960s, the federal government elected to create an agency that
would both develop and operate space reconnaissance systems. The systems under the National Reconnaissance Office (NRO) would include satellites to collect imagery and for other intelligence purposes. In the 1990s, Congress permitted private companies to get in on the satellite imaging business. This included big players such as Boeing and smaller companies such
where they should concentrate their relief efforts.
as Orbital Sciences Corporation.
Or consider how different it is for house hunters
In the 2000s, the playing field shifted as President
to look for a home today. They can check out neighborhoods via Bing or Google map platforms
George W. Bush issued Presidential Directive 27, a measure that pushed intelligence agencies to rely
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on commercial enterprises as much as possible, as
study current and potential installations in the Gulf of
opposed to heavy reliance on expensive government
Mexico. The images help them to see the conditions
satellites. Additonally in 2009, President Obama
surrounding installations and how those conditions
proposed a plan to procure satellite imagery from
evolve over time.
the private sector, with GeoEye and DigitalGlobe providing the bulk of commercial imagery for U.S.
Major insurance companies are also using satellite
intelligence services.
imagery in productive ways. The pictures give them
In addition to providing images to satisfy America’s
potential natural disasters, such as earthquakes or
military and intelligence needs, the companies are able
hurricanes. Transnational shipping enterprises use the
to create or satisfy new markets and emerging needs in
images in a similar way as they analyze global shipping
the private sector.
routes for potential trouble.
For example, big energy companies are increasingly
It’s not just the for-profit sector that is increasingly
using commercial satellite images and analysis to
finding value added in the use of commercial satellite
40 | B U S I N E S S H O R I Z O N Q U A R T E R L Y // S U M M E R
a wide lens to help evaluate risks associated with
pictures. Non-governmental organizations (NGOs)
Even the touchscreen technology that is the
that promote human rights procure pictures as a
hallmark of the iPhone experience was made
way of understanding refugee activity in the world’s
possible by University of Delaware researchers
hot spots. The images help them determine what
who were provided support from the CIA and the
governments and militant groups are doing that
National Science Foundation.
influences the migration patterns of people over broad regions.
To be sure, it took remarkable entrepreneurial genius
The commercial satellite industry is still in its relative
GPS, develop the business model that would support
infancy. New uses of images are being thought of every
the iPhone, and cultivate the marketing wizardry and
day. In this way, it tracks a pattern we’ve seen in other
supply chain marvels that can turn a product into
private sector industries that were birthed by American
a global phenomenon. Yet, it’s clear that American
military demands.
military needs and spending priorities were key drivers
Scholars at the Breakthrough Institute recently
in the private sector to commercialize the Internet and
of the early catalysts to innovation.
published a report titled Where Good Technologies Come
American innovation is the result of a complex
From: Case Studies in American Innovation. They found
ecosystem, one that comprises many great American
that “the history of American innovation shows that
institutions. These include our enviable research
an active partnership between the public and private
universities, strong military, cultural celebration of
sectors has been key to developing breakthrough
risk and entrepreneurship, advanced financial markets,
technologies, which have driven generations of
marketing savvy, embrace of globalization and trade,
economic prosperity.”
and productive and highly adaptive workforce.
Consider the über innovation of the 21st century – the
All of these institutions combine to make America’s
Apple iPhone. While Steve Jobs was rightly lionized
free enterprise system the most remarkable and
for his role in revolutionizing mobile computing and
awe-inspiring force for material advance and wealth
telephony, the U.S. military deserves some credit.
creation in the history of the world. Q
The microchip revolution that makes the iPhone and other mobile marvels possible can trace its roots to the U.S. space program and other military endeavors in the 1950s and 1960s. The GPS embedded in the
Nick Schulz is a National Chamber Foundation Scholar and a frequent contributor to the Business Horizons Quarterly. He is the co-
phone was made possible thanks to the military’s
author of From Poverty to Prosperity and
NAVSTAR satellite program.
the DeWitt Wallace Fellow at the American Enterprise Institute.
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