Photographer: Kenzo Tribouillard/AFP/Getty Images

Airbus Wants a Slice of the Space Business

  • Ariane rocket builder is venturing into new space business
  • Companies are racing to tap future mini-satellite mass market

Airbus is working on developing a launcher to send mini satellites into orbit, people familiar with the project said, a move that would pit it against the likes of Virgin Galactic and Rocket Lab.

The Toulouse, France-based company is working on a project to build a commercial launcher for satellites ranging from less than one kilo to a few dozen kilos -- the so-called CubeSats and nano satellites -- used for earth exploration, defense and security, weather forecasts and Internet connections, the people said, asking not to be named because the project is not public.

The plan comes as NASA unveiled in October contracts worth $17 million with three companies, including billionaire’s Richard Branson’s Virgin Galactic, to help develop launchers for small satellites. Airbus’s project would give a European company a piece of the emerging mass market, the people said. Airbus officials declined to comment on any mini-satellite launcher plans.

“The market for CubeSats is going to expand, and France and Europe must be part of it, including with launchers,” Genevieve Fioraso, the French government’s point person for space matters, said in an interview. “A wise company must keep all options open and CubeSat launchers are an option.”

Elon Musk

With developments like Elon Musk’s re-usable rocket and plans for manned missions to Mars by his Space Exploration Technologies, or Space X, capturing the imagination, the space business is in the midst of a new innovative wave after the breakthroughs of the 1960s. 

The U.S., Europe and emerging nations such a China and India are pushing their industries, scientists and politicians to rev up their space sectors. The Chinese are seeking to explore the dark side of the moon, while the European Space Agency, or ESA, wants to measure gravitational waves through lasers in space.

Airbus is developing its own technology for re-usable rockets as well as a much cheaper rocket called Ariane 6 in a joint venture with Safran, called ASL.

The mini-satellite launchers would let Airbus and its U.S. competitors give companies, universities and defense contractors, an independent, low-cost access to orbits. They would also help develop constellations, or a web of satellites sitting in low-earth orbits, to allow them to beam the Internet down at speeds rivaling fiber optic cables.

Chicken and Egg

The business has yet to prove itself.

“It’s a little chicken-and-egg thing that will determine the future of the market,” said Stephane Israel, chief executive officer of Arianespace, which launches large telecommunications and defense satellites. “Without an ultra-competitive, ultra-accessible launching solution, it won’t have the scale needed. It may not replace our current market, but it may stimulate major innovations in launching solutions that we could offer over the next decade.”

The business of sending of small satellites into space is potentially big. According to Arianespace, 600 very small satellites could be sent annually by 2030 from 400 expected this year and up from the 200 in 2014. So far, CubeSats have flown into orbit as auxiliary payloads on rockets such as Space X’s Falcon 9 or Ariane 5. They are released after the booster has achieved the primary mission, making them dependent on these launches.

Real Demand

Airbus isn’t the only company in Europe to work on launchers. Italy’s Avio Spa is currently developing a new and cheaper version of Vega, designed for small payloads. It would be able to develop one for mini satellites, industry observers say. Norway’s state owned Nammo Raufoss AS is also looking into a launcher to send tiny satellites to a polar orbit by 2020.

Rocket Lab, a company that was created in New Zealand, got a $6.9 million NASA contract for launches, and is planning to send its first Electron rocket in June. Sending small satellites in space could also mean a large downstream business, including replacement and maintenance.

“New services means new needs, with a whole new pricing,” said Francois Chopard, the founder of Starburst Accelerator, specializing in space ventures. “There will soon be real demand for such launchers. We have seen enthusiasm in the U.S. for it. I am curious to see what Europe will come up with.”

Before it's here, it's on the Bloomberg Terminal.