Satellite Commercial-Off-the-Shelf Components Market

Market Overview

The global satellite commercial-off-the-shelf components market size was worth USD 1,950 million in 2022. It is anticipated to reach an expected value of USD 2,170 billion by 2031 at a CAGR of 1.2% during the forecast period (2023-2031).

As the need for smaller satellites has grown, the electronic technologies used in satellites have evolved at a rapid pace to keep up. New worldwide information networks and electronic information management systems have been the subject of extensive study in order to lower the satellite's operating costs and increase its efficiency. The space sector has widely adopted COTS (Commercial Off-The-Shelf) components because they offer effective radiation shielding without sacrificing quality. Using commercial off-the-shelf (COTS) components helps keep space electronics budget- and time-friendly. The global space economy has been rapidly growing owing to the increasing demand for satellite-based connectivity services across different applications such as communication, navigation, Earth observation, and many others.

According to the Satellite Industry Association (SIA), the global space economy, as of 2020, was worth USD 371 billion, consisting of satellite manufacturing, launches, associated services, and ground equipment. However, this is anticipated to grow in the upcoming years due to several developments, such as a rise in small satellite launches, an increase in satellite internet and broadband services, and technological innovations. Additionally, the role of commercial-off-the-shelf components in the space industry holds immense importance and requires verification and testing to ensure their functionality. This is mainly due to the high degree of radiation in the space environment. Space contains a high level of radiation that can cause anomalies in the space electronics components' operability.

Highlights

• Large Satellites (1,001Kg and above) dominate the mass class segment.
• The Electrical and Power Subsystem dominates the subsystems/components segment.
• Asia Pacific is the most significant shareholder in the global market. 

Market Dynamics

Global Satellite Commercial-Off-the-Shelf Components Market Drivers

Technological Expansion in Electronic Components and Associated Devices for IoT Enabling Services

Over the last few years, due to increasing investments in IoT-based satellites, there have been continual advancements in electronic components and associated devices such as antennas, routers, sensors, and modems. Globally, companies are developing relatively scalable and hybrid features, which facilitate capabilities equivalent to the components utilized in conventional big satellites. Satellite communication requires specific needs in antennae, such as gain, size, weight, sidelobe level, and mobility, to boost the tracking speed of the satellite. Therefore, there is a trend of utilizing new lightweight composite materials to manufacture low-cost antennas. For instance, satellite operators have invested in flat panel antennas based on meta-material that can provide adequate mobility, backhaul, and content delivery while reducing the overall size of the antenna. Similar technological development is also witnessed in IoT-enabling modems. It is well-known that IoT network powered by terrestrial connectivity is currently highly dominating.

End-users must invest heavily in creating the infrastructure to switch their IoT connectivity from terrestrial to satellite. Therefore, satellite operators are developing IoT-associated devices to switch between terrestrial and satellite networks. Such devices operate in a terrestrial setup and jump onto satellite connectivity as the asset moves out of the terrestrial coverage. This is expected to emerge as a massive driver for adopting satellite commercial-off-the-shelf components creating a bridge between supply chain stakeholders.

Increasing Usage of Commercial-off-the-Shelf (COTS) Components

COTS components offer high performance, power, and reliability and are cheaper than QML-certified radiation-hardened components. COTS components can quickly fulfill the demands of new space satellites for low costs and fast services. COTS components can be easily modified as per the requirement at an affordable rate. Modified COTS (MCOTS) members have a simple manufacturing process and can be quickly delivered using various technologies and techniques. COTS or MCOTS components have no flight heritage information, no radiation support, no traceability, and homogeneity due to their low cost and quick manufacturing options, resulting in a high cost of ownership in case of problems.

The use of COTS components provides radiation shielding without compromising the quality. They reduce the cost and development time of the satellites and have lower components and higher ownership costs. The cost associated with COTS components is approximately 60% less than radiation-hardened components. This is because COTS components require a lower level of qualification and screening, making them suitable for effective incorporation in the space launch industry, leading to more frequent missions and faster returns. Commercial technologies primarily drive the emerging private spaceflight industry. It includes open-system architectures, design approaches, standards-driven approaches, and COTS electronic technologies. Companies are acquiring and implementing COTS products in the healthcare industry rather than designing customized solutions. COTS components are an integral part of the IT industry, and its product testing in the healthcare industry can optimize costs and decrease implementation risks. Moreover, COTS components are extensively used in space industries and show the scope and opportunity for use in other sectors.

Global Satellite Commercial-Off-the-Shelf Components Market Restraint

Evolution of Standardized Satellite and Subsystem Platform

Historically, satellite manufacturing involved dedicated assembly lines focused on manufacturing one satellite at a time. However, the need for many satellites is growing, with commercial constellation operators entering the space industry. This has resulted in satellite manufacturers installing serial production facilities and developing standardized satellite platforms that could be customized for multiple mission requirements. This evolution of standardized satellite platforms for serial production has resulted in specific subsystems and components being qualified for consideration.

While the overall demand for satellites indicates high demand for components, using standardized platforms has resulted in a small number of subsystems and components being qualified for integration on those platforms. Such industry-wide practice of qualifying subsystems and components for standardized platforms will result in many COTS components needing to be taken up for satellite manufacturing. This will also result in customized subsystems and components being developed for standardized platforms reducing the need for considering existing COTS components.

Global Satellite Commercial-Off-the-Shelf Components Market Opportunities

Rising Demand for Reconfigurable Satellite Payloads

Reconfigurability is an evolving aspect of the satellite industry. While security concerns drive it across missions, deploying complex/versatile payload solutions has started imposing the need for enhanced onboard payload tasking, data storage, and associated processing. This results in integrating relevant space hardware (electronics associated with data handling and onboard computing) and existing hardware (the default design). As the need for onboard processing grows, satellites will be equipped with more command and data-handling hardware components that have been commoditized.

Many organizations, such as Xilinx and Harris Corporation, provide reconfigurable satellite components. For instance, Xilinx provides SIRF FPGAs, consolidating reconfigurable digital interconnects and interfaces. FPGAs offer a prominent advantage over microprocessors for space and are in demand because of their reliability, high performance, and reprogrammable feature for single processing tasks. Similarly, Harris Corporation developed a reconfigurable multimission software-defined architecture platform for hosted payloads. It is expected to add new capabilities to the satellite to adjust according to the changing missions even when placed in orbit. These payloads have been used in the Iridium NEXT satellite constellations. The satellites are equipped with SEAKR's onboard processor, which utilizes reconfigurable computing in place of application-specific integrated circuits (ASICs).

Regional Analysis

Based on region, the global satellite commercial-off-the-shelf components market is segmented into North America, Europe, Asia-Pacific, and Rest-of-the-World.

North America Dominates the Global Market

North America dominated the global electrical contact cleaner market and is anticipated to register a CAGR of 2.9% during the forecast period. The North American region comprises the regional markets of the U.S. and Canada. The North American region dominates the global market for satellite commercial-off-the-shelf components, with huge investments and revenue expected to be generated from the U.S. market. The demand for satellite commercial-off-the-shelf components will likely rise in the coming years. The companies are already developing products and solutions to meet market needs. Furthermore, the growth of the technology and miniaturization in components is anticipated to create new markets to expand its operations and develop innovative, cost-effective solutions. The region captured a significant market share of 70.63% in value in 2021 and is expected to grow by 0.13% over the forecast timeframe. With substantial industry players such as Cobham Advanced Electronics Solutions, Analog Devices, Inc., and Texas Instruments, government and military players are modernizing their existing systems to cater to market opportunities.

Europe is the second largest region. It is estimated to register a CAGR of 6.6% during the forecast period. The areas covered include France, Germany, Russia, the U.K., and Rest-of-Europe. The U.K., Russia, Germany, France, and Germany have many manufacturing, research, and development hubs to develop innovative solutions for market needs. Europe has several vital companies that provide electronic component products to satellite companies worldwide. Europe will account for 20.98% of the satellite commercial-off-the-shelf components market in 2021. Europe is the second-largest region for the satellite commercial-off-the-shelf components market growth. The European Space Agency (ESA) has been engaged with numerous semiconductor manufacturing companies and partnered with other government bodies to demonstrate the capabilities of the emerging technology. The government in the region maintains a balance between the civil and commercial space program aiming to facilitate the growth of satellite commercial-off-the-shelf components in the area.

Asia Pacific is the third largest region. The Asia-Pacific (APAC) region comprises the regional markets of China, Japan, India, and the Rest-of-Asia-Pacific. China dominates this region's satellite commercial-off-the-shelf components market in product innovations and strategic partnerships with market leaders. Countries such as Laos, Bangladesh, and Myanmar have been buying and launching telecommunication satellites, increasing the market for commercial-off-the-shelf electronics components. The Asia satellite commercial-off-the-shelf components industry is increasingly becoming a significant part of the global industry, with new players and governments developing new space systems concurrently. Furthermore, the increasing investments by industry players to establish comprehensive satellite commercial-off-the-shelf components are augmenting market growth.

Segmental Analysis

The global satellite commercial-off-the-shelf components market is bifurcated by application, product, functionality, and region.

By mass class, the global market is bifurcated into small satellites (0-500Kg), medium satellites (501-1,000kg), and large satellites (1,001Kg and above).

The large satellites (1,001Kg and above) segment dominated the global electrical contact cleaner market and is estimated to grow at a CAGR of 0.2% during the forecast period. The satellites that weigh 1,001kg and above are classified as large satellites. These are expected to grow significantly in the satellite commercial-off-the-shelf components market over the coming years, driven by its increasing capability to provide communication applications with broader coverage. The applications of large-sized satellites include tracking and monitoring mobile terminals in real-time, and these satellites find extensive applications in the IoT and M2M and broadband communication applications. Moreover, large satellites are capable of operating in narrow and broad-spectrum applications. Therefore, this can help the operators cater to lucrative business opportunities. In addition, the cost of manufacturing a medium satellite is low compared to large satellites. It can cater to niche applications such as IoT and M2M, which require real-time monitoring in government, defense, and commercial sectors. Large satellites started using commercial-off-the-shelf components for decades and are expected to continue the usage of conventional electronics during the forecast period.

By subsystems/components, the global market is bifurcated into the payload, electrical and power subsystem (Battery, Field-Programmable Gate Array, Application Specific Integrated Circuit (ASIC), Power Convertor), command and data handling system, communication subsystem, thermal control subsystem, attitude determination and control subsystem, propulsion subsystem, mechanism, and actuator.

The electrical and power subsystem segment dominated the global electrical contact cleaner market and is estimated to grow at a CAGR of 4.3% during the forecast period. Within the electrical and power subsystem, Application-specific integrated circuit (ASIC) dominated the global electrical contact cleaner market and is estimated to grow at a CAGR of 0.4% during the forecast period. Application-specific integrated circuit (ASIC) is a non-standard integrated circuit designed and built for a specific purpose or application. The application-specific integrated circuit is almost found in all electronic devices and contains a considerable part of the electronics in a single circuit. It is a crucial technology for performing the avionics control and data processing of all types of satellites. The use of application-specific integrated circuits has increased significantly in the last few years. Unlike other integrated circuits or programmable boards, an ASIC improves the speed because it is specially designed to perform a particular task. Though the ASIC is customed-made, it is more expensive to design and manufacture. Commercial off-the-shelf ASICs are used in various applications such as defense, space, intelligence, research, and commercial missions. Companies such as STMicroelectronics, Microchip Technologies, and BAE Systems are producing ASICs in the space market.

Recent Developments

• February 2023 -To help radio designers lower risk and accelerate time to market, Analog Devices, Inc. announced the release of a fully integrated open radio unit (O-RU) reference design platform. The platform enables hardware and software customization for macro and small cell radio units and is a complete solution from the optical fronthaul to RF (RUs).s
• February 2023 - Analog Devices, Inc., a global semiconductor leader that bridges the physical and digital worlds to enable breakthroughs at the Intelligent Edge, and Marvell Technology, Inc., a leader in data infrastructure semiconductor solutions, announced their next-generation 5G massive MIMO (mMIMO) reference design platform with support for Open RAN.