What is the New Space Economy?
The new space economy is the rising commercialization of space exploration. Private investors, companies, and start-ups are investing and contributing to space exploration. The difference between traditional space exploration and the current one—sometimes referred to as NewSpace— is that the government no longer has to intervene entirely.
“We expect that the global space economy will rapidly expand in the coming decade and beyond. Investments in the space sector have been made since the 1950s, but what’s changing is who these investors are and what form those investments really take.”
Professor Olivier de Weck – Professor of Astronautics and Engineering Systems at MIT
It’s becoming increasingly accessible to launch products into space. Today, private launch companies can send small 10x10x10-sized satellites to space for research and business. They wouldn’t send just one, of course. Launch companies gather satellites from different companies to send them together, sometimes with more than 49 satellites in a single launch. The number of satellites can quadruple in the next decade (Pultarova & Howell, 2022). With over 2,000 up in space now, this number will increase exponentially.
5 Ways the New Space Economy can Improve Human Life
Outer space and humans interconnect today more than ever. GPS systems guide you each time you look for that new delicious restaurant in your city. Satellites answer your weather concerns before leaving the house. The invisible-to-the-human-eye devices orbiting our planet could pave the way to many life and Earth improvements.
1. Imaginative and Innovative Business Models
Private investment in space start-ups increased in 2019 and reached $5.7b. Therefore, current evidence indicates unprecedented investments from angel and venture capital funds in start-up companies and recently formed businesses in the space industry. At the same time, the sums remain pale compared to state funding.
Particularly in the last 15 years, the strong profitability of commercial satellite telecommunications has cleared the path for private funding by enabling operators to benefit from traditional financial schemes to expand their operations. Therefore, most satellite operators in OECD nations have converted to publicly traded firms and turned to project financing, whereby a group of banks provides loans. Similar outcomes have been achieved in other domains thanks to this lucrative trend in telecommunications (Parrella et al., 2022). Types of space economy investors today include:
- Angel investors
- Venture capital firms
- Private equity firms
- Larger investment firms
- Public private partnership (PPP)
2. New Space Economy: A More Sustainable Future on Earth
Professor Olivier de Weck, the Apollo Program Professor of astronautics and engineering systems, and Dr. Afreen Siddiqi, a research scientist in MIT’s Department of Aeronautics and Astronautics (AeroAstro), work on closed life-support systems. The system is used in the International Space Station and proposed habitats on Mars, which need to provide clean air and water and recycle all waste. They are applying similar models here on Earth.
Hundreds of small farms line the Paraná River in Brazil. The river feeds the Itaipu Dam, which causes problems since animal feces that enter rivers substantially deteriorate water quality and encourage algae blooms, which can obstruct effective energy production.
The MIT team is approaching this challenge from a “systems perspective,” which allows them to evaluate how the numerous factors involved—water, energy, agriculture, transportation, and the environment—are interdependent and what tradeoffs might need to be taken into account (Nadis, 2022).
This approach is similar to the one they use in their space research.
3. Innovative Technology Opportunities for Businesses
How does space exploration help the economy and businesses? The new space economy will benefit just about every industry imaginable. Precision agriculture, contemporary agriculture, and agricultural innovation can all benefit from space technologies. Farmers, agronomists, food producers, and agricultural officials that want to increase productivity and profitability can benefit from space-based technology.
Remote-sensing satellites provide essential information for tracking crop development, drought, snow cover, and soil conditions. For instance, farmers can plan the timing and volume of irrigation needed for crops with satellite rainfall assessments. Accurate data and analysis can be crucial for forecasting and minimizing the effects of food shortages and famines and predicting a region’s agricultural output well in advance (United Nations Conference on Trade and Development, 2021).
4. More Products to Improve Human Life on Earth
We now have a plethora of product knowledge thanks to space exploration. This knowledge has enabled us to develop products and technology that make life easier while advancing our understanding and ability to explore the cosmos. Here are some products that have come into existence thanks to space exploration:
- Phone cameras
- Scratch-resistant lenses
- Foil blankets
- Water purification systems
- Home insulation
- Wireless headsets
- Memory foam
- Freeze-dried foods
- Portable computers
These products have undoubtedly changed how humans live today (California Institute of Technology, 2016). Imagine a world with centuries of space exploration. Technology will surely evolve significantly.
The products in our pockets also use space technology. The GPS feature in smartphones is almost indispensable to completing most application functions. With it, we can find directions and locate dependent family members.
5. Services that Could End World Problems
There are still many remote areas without internet access. Installing terrestrial networks in underserved or rural locations is either challenging or expensive. Beyond simple inconveniences, a lack of connectivity might affect the delivery of essential services, such as online medical consultations or remote schooling.
Satellite connectivity could help public health and education by bringing internet access to these remote locations. For instance, the recently launched Bangladeshi communications satellite Bangabandhu-1 also transmits television and radio shows and will soon offer Internet, telemedicine, and distance learning services for individuals in rural areas (United Nations Conference on Trade and Development, 2021).
Space exploration goes beyond discovering space and other planets and galaxies. Throughout the process, humans learn and create products and models that innovate and find solutions here on Earth.
New Space Economy Course from MIT Professional Education
MIT Professional Education offers the opportunity to learn about NSE with the New Space Economy: Technologies, Products, Services, and Business Models 8-week online course. The course draws on industry case studies and an engineering approach to structure an understanding of New Space products and services.
Professors Olivier de Weck and Alessandro Golkar, professors in space technology, lead the course where you’ll learn:
- Proficiency in the application of New Space technologies and ventures in commercial domains
- Types of investment opportunities
- The history and evolution of the space sector
- Development of new business opportunities related to the development and use of New Space technologies
- Impact of New Space in non-space application verticals
- Opportunities for innovation in space activities
Learn more about MIT Professional Education’s courses and how you can boost your career.
California Institute of Technology. (2016, May 20). 20 Inventions We Wouldn’t Have Without Space Travel. Retrieved December 20, 2022, from https://www.jpl.nasa.gov/infographics/20-inventions-we-wouldnt-have-without-space-travel
Nadis, S. (2022). At MIT, Lessons from Space for Handling Waste. Spectrum. Retrieved December 20, 2022, from https://spectrum.mit.edu/spring-2022/at-mit-lessons-from-space-for-handling-waste/.
Parrella, R. M., Spirito, G., Cirina, C., & Falvella, M. C. (2022). The New Space Economy and new business models. New Space, 10(4), 291-297. https://doi.org/10.1089/space.2021.0020
Pultarova, T., & Howell, E. (2022, April 14). Starlink Satellites: Everything you need to know about the controversial internet megaconstellation. Space.com. Retrieved December 16, 2022, from https://www.space.com/spacex-starlink-satellites.html
United Nations Trade on Trade and Development. (2021). Exploring space technologies for sustainable development – UNCTAD. Retrieved December 20, 2022, from https://unctad.org/system/files/official-document/dtlstict2021d1_en.pdf