Space-Based RF Microwave Technology Market

Market Overview

The global space-based RF microwave technology market size was worth USD 7.18 billion in 2022. It is anticipated to reach an expected value of USD 13.63 billion by 2031 at a CAGR of 7.2% during the forecast period (2023-2031).

Space and communication sectors have witnessed numerous developments in the past years to cater to the rising market demand for satellite communication. Technological developments in space-based radio frequency (RF)/microwave components, miniaturization of parts, reducing launch costs, and increasing demand for stable connectivity in remote locations support market opportunities. The rise in research and development efforts and collaborations between space organizations and universities are accelerating innovation in the space industry. Some significant advancements identified within the space-based RF/microwave technology market and the space sector include multispectral communication and 3D-printed electronic components. These technologies are entirely independent of each other; the commercial integration of these technologies has resulted in increased efficiency and a reduction in operational costs.

The rise in the application of satellites for a range of activities like surveillance, real-time imaging, communication, navigation, weather forecasting, broadband and connectivity, research, development, and testing, and IoT integration for various government, commercial, and civil-military domains is leading to the evolution in the space industry. In addition, more than 6,000 satellites are expected to be launched between 2021 to 2031, with rising year-on-year (YoY) launch rates. The rise in satellite launches has generated demand for various satellite connectivity components and other peripheral systems, forcing industry players to explore new market verticals to cater to the growing demand.

Key Highlights

• Space-based platforms dominate the platform segment
• Communication dominates the application segment
• Government and military dominate the end-user segment
• North America is the most significant shareholder in the global market

Market Dynamics

Global Space-Based RF Microwave Technology Market Drivers

Rising Demand for Satellite Communication Systems

Over the past few years, satellite connectivity solutions have gained tremendous importance, and these systems are becoming extremely crucial as the dependency on data transmission and analysis is increasing. Satellite communication systems perform essential operations like aerial satellite communication, navigation, and tracking of naval vessels and earth observations that stand on a critical economic perspective. The rise in land, naval logistics, military activities, and air traffic congestion have generated the demand for uninterrupted satellite connectivity systems. In addition, the continuous business operations performed by government bodies and private players via secure uplink and downlink with the requirement of zero downtime and globalization and virtualization of business operations have spurred the demand for satellite connectivity systems. To cope with the market's rising demand, industry players use LEO constellations capable of providing much higher data transfer rates.

Additionally, the rising business opportunities within the satellite communication market have attracted several private players and start-ups, eventually supporting market competitiveness. Technological development within the segment has also spurred new business opportunities within the vertical. Some common driving factors within the industry are:

• Miniaturization and technological advancements in electronic components led to the development of low-cost satellites.
• Increase in investments by private companies such as Amazon and SpaceX, infusing growth in the satellite industry.
• The emergence of small satellites, which are lightweight and can optimally provide functional capability as large satellites.

Rising Usage of CubeSats

Key players operating in the market are conducting primary research activities to introduce ways to reduce the cost of satellites. However, the high prices of developing and manufacturing satellites are a significant hurdle to the industry's growth. Furthermore, the high complexity in designing and selecting appropriate technology as per the requirement increases the overall development cost. Therefore, reducing the cost of satellites is exceptionally challenging. Over the last few years, the satellite industry has entered an arena of low-cost satellites, namely nano, micro, and Cubesats. Due to this innovation, many companies have embraced the nanosatellite, which facilitates services almost equivalent to the traditional satellites for government agencies or public-sector industries.

Some significant benefits of using CubeSats for constellations are:

• CubeSat constellations reduce the risk of failure. They continue to provide service even when a few units have failed. Furthermore, spare satellites can be launched more quickly and inexpensively.

• Satellite constellations weigh and cost less to launch. CubeSats clusters can significantly reduce the acquisition cost by reducing the requirement of payloads and structures of the satellite.

Global Space-Based RF Microwave Technology Market Restraint

Market Access Restriction and Spectrum Allocation Problems

The World Trade Organisation (WTO) Agreement on Basic Telecommunications (ABT), signed in 1997, has allowed several countries to have considerably reduced cross-border restrictions on market access. Many countries can have ownership and operation of private Earth station equipment, permit multiple entities to obtain service licenses for their own or third-party use, have unrestricted private ownership and operation of transmission/broadcasting facilities, and choice in providers of satellite capacity. There has been an indirect impact of ABT on regulatory decisions of non-signatories, resulting in cross-border investment in satellite communication services and facilities. The statement can be true regarding most of the friendly and developing nations, but the market is confined to a global level. Moreover, it is noted that even in countries that are ABT signatories, opaque national licensing procedures remain a significant obstacle to new investment in satellite infrastructure and the availability of new satellite services. This creates an uncertain environment in which investors and operators must be sure whether they can obtain a license promptly.

The other major challenge faced by the industry is frequency allocation. The demand for operational frequency has increased, and the trend will continue over the past few years. The International Telecommunication Union (ITU), responsible for frequency allocation, is witnessing a backlog of 30 months in the publication of filling, resulting in inefficient operations. The best-case scenario to mitigate the existing problems about frequency allocation can be achieved by improving the frequency allocation process and regulating the market toward commercial space applications.

Global Space-Based RF Microwave Technology Market Opportunities

Growing Demand for Cost-Effective Satellite Solutions

Another major driving factor in reducing the cost of satellite operations is using reusable launch rockets. With the introduction of reusable launch vehicles by SpaceX and Blue Origin, the pre-launch cost has been reduced significantly, approximately by 50%. This has allowed several small industry players with limited financial capabilities to enter the space industry, supporting market competitiveness. In addition, the strategic approach to launching multiple satellites from various countries in a single launch vehicle is also one of the significant factors in reducing the launch cost. The RF/microwave components integrated within the launch vehicles will also witness a notable growth rate. More electronic components will be integrated within launch vehicles to perform complex maneuverability operations.

Regional Analysis

North America Dominates the Global Market

Based on region, the global space-based RF microwave technology market is bifurcated into North America, Europe, Asia-Pacific, and the Rest-of-the-World.

North America is the most significant global space-based RF microwave technology market shareholder and is anticipated to register a CAGR of 7.3% during the forecast period. The growing satellite mega-constellations technologies by various new manufacturers such as SpaceX, OneWeb, and Amazon that are U.S.-based will raise the demand for LEO slots. Once operational, these constellations can provide services that will uplink and downlink the capacity of a few Gbps. Recent investments by major industry players are creating significant global market opportunities.

Europe is estimated to exhibit a CAGR of 6.9% during the forecast period. The European Space Agency's (ESA) presence has created a massive market for the satellite industry in Europe. With increased company investments in developing new technologies, the scope for developing advanced systems is high. In addition, Europe has the second-highest number of operating satellites in space, catering significant market share in the satellite connectivity vertical.

Asia-Pacific is the third largest region. The countries in the Asia-Pacific region have the manpower and resources to develop mass manufacturing capabilities. Increasing satellites planned to be launched from their respective regions and collaborations with other industry players support market growth. In addition, lucrative government initiatives of FDI toward the aviation and space sectors are also significant market accelerators.

Segmental Analysis

The global space-based RF microwave technology market is bifurcated by platform, application, end-user, and frequency. 

By platform, the global space-based RF microwave technology market is bifurcated into space-based platforms (satellites, launch vehicles, and others) and ground-based platforms.

The space-based platform segment accounted for the largest market share and is estimated to exhibit a CAGR of 7.5% during the forecast period. Rising space-borne applications and investments in research and development by major companies like Thales Group, L3Harris Technologies, and General Dynamics Mission Systems have established new business horizons for generating revenue. Selecting market trends to provide a customized solution to the customer's requirements will positively impact market competitiveness. Furthermore, the introduction of software defines components with the ability of reconfiguration, providing a significant business potential to other objects like deep space probes and space exploration rovers.

By application, the global space-based RF microwave technology market is bifurcated into communication, technology development, navigation/GPS, earth observation, and others. 

The communication segment accounted for the largest market share and is estimated to exhibit a CAGR of 7.6% during the forecast period. The communication segment will capture a maximum market share of USD 5,300.8 million in 2031 by witnessing a growth rate of 7.62% CAGR within the forecast period in the global space-based RF/microwave technology market. Increasing digitization and changing trends of remote operations with the rising machine-to-machine operations are some of the primary factors supporting the segment. Most of the market share captured by communication applications is derived from satellites operating in LEO, the primary communication system source. In addition, changing trends in operations where satellites can operate on much higher frequencies to cater to larger bandwidths will also allow the market to witness a positive outcome over the coming years.

By end-user, the global space-based RF microwave technology market is bifurcated into government and military, logistics, media and telemetry, oil and gas, and environment and monitoring. 

The government and military segment accounted for the largest market share and is estimated to exhibit a CAGR of 7.6% during the forecast period. The rising scope of satellite communication in various applications, fuelled by the increasing demand for its usage by different military and government bodies, supports market opportunities. Increasing geopolitical conflicts and discrepancies in multiple nations recently, such as the rising concerns between Israel and Palestine, have allowed the countries to witness the importance of strong government and military satellite networks. Developed nations like the U.S. and the U.K., Russia, and some developing countries like India and China already have their satellite communication network for internal application, generating ample business opportunities.

By component, the global space-based RF microwave technology market is bifurcated into TRM, amplifier, RF Switch, RF Cable, FPGA/IC, and others.

The TRM segment accounted for the largest market share and is estimated to exhibit a CAGR of 9% during the forecast period. The TRM is one of the most crucial components in a satellite communication system. It can receive radio frequency (RF) signals and emit different signals in response. Technological development in frequency multiplexing and modulation are primary factors generating demand for advanced TRM. The 5G network's introduction poses a significant market opportunity as old components need to be replaced with new ones. Increasing the requirement of communication infrastructure and increasing CubeSats constellations will multiply the market requirement of TRM within the forecast timeframe, allowing the segment to witness a growth rate during the forecast period.

By frequency, the global space-based RF microwave technology market is bifurcated into Very High Frequency (VHF) (30MHz-300MHz), Ultra-High Frequency (UHF) (301MHz-3GHz), Super High Frequency (SHF) (4GHz-30GHz), and Extremely High Frequency (EHF) (31GHz-300GHz).

The Super High Frequency (SHF) (4GHz-30GHz) segment accounted for the largest market share and is estimated to exhibit a CAGR of 8.6% during the forecast period. The growth can be witnessed by increasing demand for fixed satellite services, broadcast services, satellite uplinks and downlinks, weather radars, imaging radars, and air traffic control supported by SHF. Gradual increases in air traffic and demand to witness accurate weather forecast are some of the primary factors supporting market opportunities. In addition, major industry players within the vertical invest in research and development to increase operational efficiency and identify new revenue streams of connectivity components that operate on SHF frequency. Increasing market competitiveness and the rising interest of industry players will support market augmentation.

Recent Developments

• March 2023- To enhance the manufacturing of silicon carbide (SiC) power semiconductors, Mitsubishi Electric Company (TOKYO: 6503) said that it will double the investment it had previously planned to make, to almost 260 billion yen over the five years ending in March 2026.
• March 2023 - The Japan Meteorological Agency (JMA) awarded the contract to Mitsubishi Electric Corporation (TOKYO: 6503) to construct the Himawari-10, which will be the fourth consecutive geostationary meteorological satellite built by Mitsubishi Electric dating back to the Himawari-7 some 20 years ago.