IQT Explains: The Future of Space Technology

Transcript

[Music] for years outer space has been a source of intrigue inspiration and imagination for many here at iqt we harnessed our intellectual curiosity and perspectives on the commercial space industry years ago and continue to be interested and invested in how space ecosystem develops in the future while it may seem like the stuff of science fiction it is not too far-fetched to imagine robots mining the moon for resources and raw materials or a lunar economy based on out-of-this-world manufacturing or even a family vacation among the stars maybe even one day we might be able to see what spring is like on jupiter and mars welcome to the iqt podcast today's episode concludes our three-part intro series where we explore how iqt's space investments and insights have helped advise and shape the technology to help enhance national security and beyond on our previous two episodes we covered the origins of itt space efforts and current initiatives and focuses and on today's episode we'll focus on what we predict the future will look like for this ever evolving domain i'm your host vishal santosara and i'd like to welcome back christy bradford and tom gillespie who we heard from our previous two space podcasts christy is a senior technology architect on incutel's field technologies team she's a space technology strategist with experience working across the civil commercial national security and international space communities in areas as diverse as technology development program management space innovation policy and the global space investment landscape tom gillespie serves as managing partner on inqtel's investment team and as investment lead for inquitel's field technologies practice he has led a significant number of iqt's investments in commercial space ventures over the past seven years including launch vehicles small satellite constellations space situational awareness and satellite componentry and new to the iqt podcast today is clayton williams a managing director at our iqt australia office headquartered in sydney prior to incutel clayton developed innovative signal processing approaches in support of the nro nga and u.s navy to address space domain challenges spanning product quality automation processing and distribution christy tom clayton welcome to the show thanks for being here today so let's get started today we're talking about the future might be worth discussing what we really mean when we talk about the future are we talking about a year a few months weeks a decade a millennium where is it that we're going to focus our discussion and scope our our topics of interest today open question to uh to all of you let's start with clayton yeah i think uh it's kind of a dangerous topic especially for a 20-minute podcast because you can get you know anywhere from from star trek to uh you know just trying to get the nuts and bolts of manufacturing down but i think for this conversation uh scoping it i think we can probably give uh uh an interesting story in the next 10 years or so of what might be coming down the pipe in space great focus on it so we'll set the scope to 10 years from now so it's 2021 right now 2031 between now and 2031 for those of you listening we're looking over the next decade uh let's start by talking about business models tom we've discussed a lot in the previous podcast about the existing business models and you know historical business models what do you see in the in the landscape for the next 10 years in terms of things that will stay the same things that will evolve what should be looking out for yeah it's interesting yeah and just in terms of the time horizon i might actually i'm coming at it really from the investment standpoint so from a venture capital time horizon you know funds are typically about in that 10-year range really making investments though over the next five or so so that's almost kind of more how i'm thinking about it in terms of the future as an investor you know what's going to change the next few years i think i think we'll see a migration to business models with more commercial baked into them when we first saw commercial space a few years ago there was some lip service around that but really the reality has been the last few years more of a focus on government markets i think that'll start changing the next couple of years i think we'll see a lot more investors spill into this sector um some will come in and come out uh but i think it's gonna be a much broader set of investors and i think uh you know we'll we'll see interesting funding mechanisms along the way too i've seen things like um uh you know interesting uses of markets to to fund alternative strategies so i think we'll see some innovative financing strategies as well along the way here excellent thanks to question to clayton or christie so tom mentions this shift from a focus from uh government funding to commercial funding interesting interesting developments and capabilities uh leaning that in that way as well where do both of you see dr requirements coming from who's going to be driving the requirements specifically what will this look like uh how will we see uh commercial industries sort of take a leading role in developing capabilities uh in this space unintended yeah so i think it's going to be very much a combination well i think we will see a shift uh to more commercial as tom said i think that government's still going to be a really critical component to the ecosystem and so but i think we're going to get a better balance um especially as a lot of these companies begin to deploy uh their full constellations and uh start to explore product offerings um that are more commercially oriented whereas the government side there's already proven demand there because the government has been leveraging similar technologies for for so long uh but it's hard to uh really understand what the demand is on the commercial side until those capabilities are on orbit and can actually be uh proven out and products developed around them and i think we're going to see that product development really happening in in the next five years yeah yeah i think to again emphasize what christie was saying is you know the number one customer for remote sensing certainly i'm sure it's a significant split of comms as well is is the government customer our government's customer um and and the long-term justification of all these uh competing uh commercial endeavors uh it'll be interesting to see you know who who these governments are able to support and and which which companies are able to pivot enough of their business to sustain it commercially and and when we say commercially it's interesting right because we actually just saw an article yesterday uh from cnn uh that's basically watching the build of the launch site in the arctic from the russians so so these kind these kind of missions that were uh fully in the government domain are kind of shifting over into news articles ngos and different folks that have kind of these worldwide regulatory policy or news type of missions and then i think the the next phase to that is is you know big agriculture big business all these kinds of oil and gas all these big industries that really can benefit from remote sensing and tracking large areas and large systems um as as the cost of space comes down and as these analytics companies kind of actually flesh out their products and make them reliable and useful all right if i could join in i think synthetic aperture radar is an interesting example of it's pretty illustrative of the the government versus commercial you know when we first saw these companies you know probably five plus years ago they were ostensibly going to be commercially uh commercially focused um they weren't really able to do that early on and so i think they pivoted back to government markets for a while um what we're seeing is that i think over the next few years you know sar data is really tough to work with there aren't a lot of commercial applications for that but there probably will be at some point and it really is a case of you know getting that data out there um helping the commercial market understand it work with it and see the use cases for it and the market's going to develop from that so does the commercial market exist in any form today not really but i think as we start learning how to use that data and the different applications um it's really going to take off it's just not yet so i would add to that that i think that uh there's a a semi-good analogy that we can look to when it comes to this remote sensing data um and that is how uh gps applications evolved over time is that when uh gps which obviously was you know it was and still is a government program uh once it was made available uh to uh the civilian communities and people could start using it for commercial applications then it took many many years for it to develop into the ecosystem we see that today where use of gps is ubiquitous and is uh in basically every industry that you can think of but it's sort of hidden behind the scenes is that i think over time we may see a similar thing develop in uh from remote sensing data where it becomes uh used in so many different ways that we often don't even realize that we're using space data in our everyday lives but it's important to remember it took a very very long time for gps data to be used in the ways we see today and it's going to take a similarly long time for it to mature on the remote sensing side and chris you just provide a sense of scale and comparison well in your in your gps example it's safe to say that uh perhaps the timeline and gps begins sometime in the 90s uh and roughly from then until now 20 plus years or so till to massive massachusetts ubiquitous adoption and availability uh first of all is that accurate in relation to gps and secondly would you suggest that we're looking at something similar uh in in this regard yeah i i think your your timing is uh is accurate is that we're looking at about a 20-year time period from when the capabilities started to come online uh to when we see this ubiquitous use and so i think we're right now at the stage where we're really starting to see a variety of sensing modalities come online at the um you know level of fidelity and revisit time uh that um you know these companies have been talking about for for some time and so i think we're sort of looking 20 years out from now which i get is 10 years longer than we said we were gonna address um but uh i do think that we're gonna slowly see over the next 20 years um new new applications emerge uh that are going to proliferate the the use of remote sensing data a quick moment for our audience uh clayton tom you both mentioned sar data synthetic aperture radar for our for our listeners could you define just what that is and perhaps what it looks like and and what kinds of uh what kind of information star data conveys yeah i'll take a shot at it it's basically you send a an rs signal down to the earth you get the reflected signal back at the system and you do that over time and what you're able to do is construct a short video or image of that data as it reflects off of different objects and so that difference in reflectance can tell you different information about uh not just the size and shape but the the material properties of the objects you're looking at um and what's interesting about it is uh uh you know that that doesn't rely on the sun in any way so you can get the same image uh day night or during storms there's an interesting article i think from from eyesight that we can probably share that uh that shows you know this application while monitoring a volcano and that's been one of the uh largest challenge remote sensing even from airborne platforms because you don't want to be anywhere near it and so synthetic after radar is able to provide you that consistent imagery through the smoke through the cloud day night to kind of track these kind of natural disasters as they occur i see interesting one thing that we mentioned that it's a that that is interesting to me is this idea of we use we took gps's analogous example to sort of what we're talking about in terms of the future of the the space ecosystem this concept of dual use so you know we discussed uh the shift from government to commercial both in terms of funding and and where you know uh demand will be coming from and where capabilities will be shaped to cater to can can one of you describe just what dual use means on behalf of our listeners again this concept of you know something being perhaps invented in one uh domain and then becoming useful or pertinent to another domain a little bit more detail that would be great sure i can jump in on that one so um dual used you know you could define it as simply a technology that has more than one use but usually when the term dual use is used it has a specific connotation which means that uh in addition to having a military or national security use it also has some sort of civilian or commercial use um and so that's that's basically the idea of dual use is it's some sort of technology uh that could be used um for both national security as well as for non-national security applications oh very good thank you so let's talk about challenges we're this is a podcast about the future something that's really interesting to think about and make predictions on our challenges uh obstacles things that will have to be overcome or hurdles that will need to be uh crossed when dealing with uh this industry as it grows what do you see as some of the toughest or enduring challenges that need to be addressed overcome as we enter the future uh we'll start with uh clayton and then uh christian and tom yeah i think uh uh you know the cliche is space is hard and i think that you know a lot of a lot of the lessons learned from governments over the last you know 30 40 years in space may not be fully realized by some of the companies that are that are entering into this space and that's from you know the challenges of the manufacturing the challenges of launch the challenges of having a system in space that functions and doesn't break and then providing you know reliable software updates to those systems uh it's it's really you know i think i'm describing like five startups when i talk about all the challenges that that entails um so being able to do that effectively and efficiently uh when you have you know uh uh uh investors who are looking for return on investment is an extremely challenging thing i think there are a lot of programs in the government that got cancelled due to funding overruns and you can only imagine the pressure is exceedingly higher for these companies yeah i would uh add to that that i think uh sort of the umbrella term of space sustainability encapsulates a lot of the challenges moving forward um which is that as more and more activity is happening in space it presents a lot more challenges although it also does present more opportunities and does open new types of markets and that is an area that we at iqt look into uh we refer to it as space auxiliary services um and i know i've talked about that on a previous podcast so but to dive into it a little bit more than i i did previously um we we see four pillars of space auxiliary services um the most near-term is space traffic management which i think is a cornerstone to space sustainability issues which is how do we understand the space environment how do we track everything that's going on in that environment how do we characterize what's going on um be able to detect changes in in that environment how do we make sure that uh different satellite operators are communicating with each other how do we minimize the amount of debris creating events that are occurring how do we uh deal with debris that is already up there how do we prevent more debris from being created in the future and so that's an area that i think is going to be really critical and is an area that is incredibly complex because you're dealing with such a diversity of actors in space is that you're not just dealing with u.s companies and the us government you're dealing with non-state actors you're dealing with state actors you're dealing with a huge array of different players in space and that diversity of players is continuing to grow over time as more and more countries begin to place strategic priorities on space and as commercial space becomes more and more international interesting tom any perspectives from you on challenges maybe from the the business front funding finances yeah exactly it's um so i think from a funding standpoint it's going to be interesting if you look back over the past few years i think one of the things that sort of held the sector back for a little bit is it was the lack of um financial exits you know ipos acquisitions um there were very few that could be cited one was skybox which is probably 20 12 or 13. i can't remember um that was you know 500 million dollar exit to google which sounds like a lot but really in the venture context isn't that much that was really the only one with site for a long time in the present we've now got all of a sudden the special purpose acquisition companies that are um you know exit vehicles for a lot of space companies i think we've got 10 or 12 now that have gone out past uh year and a half or so that's great my question is is that sustainable and you know how long does that last um you know a lot of these companies need a lot of money um the spac vehicle is one way to do that uh but i don't know if we look forward a few years if that's going to continue to be kind of the way things go so i think you know that's really an obstacle is is where do you get the money to fund these things and um you know how available is it not not just now but uh looking at a few years um but one thing i'll say i i do think there will be funding you know available over the course of time i just don't think it's going to be a straight line path of progress i think we're going to you know have have uh you know moments when we have a lot of fun available and it's going to fall back a little bit and it's going to recover but i don't think it's going to be a straight-line path in the next 10 years i think i think i think it's interesting too that there's probably going to be some consolidation i think you saw it you know there's a ton of innovation that happened in aerospace in the 50s and 60s and then you know we all kind of ended up uh with with the stan the same you know jet body type 747 type plane uh that we use for uh you know nearly all of our at least uh human human movement across earth and so i think you're going to see the same thing where you see some really innovative space things happening but are they the most efficient way uh to do business in space and uh is this you know really bespoke sensor that's super expensive uh bringing you enough value to justify its cost versus something off the shelf so there's all these kinds of questions that are going to play out and it'll be interesting to see how those companies combined go under or get acquired by large players in this space clayton you're reminding me of something uh in relatively recent history in my life and that's the dot com here the internet.com era and tom i think you never had you and i have had conversations about this it's open open commentary and thoughts on and perspectives on how uh how similar or different uh is what we anticipate in the future to occur in the space realm when it comes to companies uh starting up getting funded maybe consolidating defragmenting uh and then operating versus you know not being able to operate how similar is that trajectory looking in the space realm as compared to the internet.com era i'll tell you very simply uh looking back at it now of course uh i everything was an internet company back then i recall literally everything i saw uh that that and everything anyone talked about was like oh this is it's my dot-com company this is my new internet company uh are we gonna hear the same thing this is my space company i'm doing space um and if so what are what is it that's gonna be meaningful for for something to be a quote space company versus might not be so meaningful well i'll jump in on that one just on the question of what is a space company is i think uh already it's really hard to define what a space company is because you could argue that uber and lyft are space companies because their business model is dependent upon gps now no one really categorizes them as space companies but that shows how uh ubiquitous space already is is that things that we don't even think of as space companies are dependent upon space infrastructure and in fact you know going back to your previous question i would say that's almost one of the challenges over the next five years is or even longer is getting people to better understand just how dependent we are as a society on space so that they understand why there is so much investment going into space and i think that's um that that's just something that we need to uh grapple with uh because there is this disconnect between sort of those who understand space and understand how ubiquitous it is and the average person that thinks the space simply as space exploration that's a good point i think it's also there's like a double uh uh challenge there one is these companies that uh are launching building and operating space systems those are those are full-time jobs so you you used to hear a lot of companies saying we're actually just an ai company and step one is is you know build and launch a satellite um and i think you're getting less of that and and to christie's point that that secondary uh market or those those companies are waiting for uh the right time the right price point to develop analytical products on that data uh uh as a space company a space services company here on the ground just doing software so there's kind of this cascading uh chicken or the egg problem on the timing of when those constellations will be sufficient enough to build reliable ground businesses off of that data tom your thoughts on the internet.com comparison the boom and the bus cycle there and how it may relate to the topic at hand today yeah it's interesting for saul so i i um speak to you as somebody who actually started an internet accelerator in 1999 which if you know the timeline of this was a terrible time it was right right at the peak so um what what i uh um a little bit of what i see you know has some um some of the same markings that we saw in the in the dot com economy it feels a little bit in some ways like it's 1997 or so and uh you know in the space economy so we're starting to see a little bit of froth uh we're starting to see some things get funded that maybe shouldn't um but i don't think we're kind of in full frenzy yet like like we were in the dot com a couple years later um i think there are a couple ways that's different though um and one is um you know space has a lot of national security implications obviously um consumer internet really didn't have that and so i think it's um to some degree you know that's always going to play a role in how we think about space whereas whereas the you know the consumer internet of the 90s did not um i also think if you look at the history there once we came out of the bust there are a lot of good companies that got formed that were based on the internet and did interesting things but um you know ultimately we're just good businesses period and i think we'll see some of that too as we work through some of the bumps here i would also add to that that um uh hype cycles are something that we see all the time in new technologies uh as they're coming online and being adopted and so the dot com uh boom and bust is a perfect example of a hype cycle and so i think we are in a hype cycle right now around space and i think we are going to eventually um you know hit the the trough of disillusionment as it is called uh but i don't think that you know when that happens that means that you know commercial space is dead and we need to go back to government only space um i it's it's sort of a natural part of the process that this this hype occurs ahead of the time that it takes for technology to mature and and uh proliferate through your population and so i expect as tom said that we are going to see a dip in the uh future exactly when that will be hard to say uh but when that dip happens i think you're gonna have some people sort of trying to abandon commercial space and i don't think that's the right move i think you know there's a longer tale here that we need to watch play out predictions worth tracking certainly even with the hype cycle i'm going to assume that it's important for the us and the private sector to continue to care about developing space capabilities uh i think you tell of course we have believed this for quite some time and in case you haven't listened to the previous two podcasts associated with this topic please do so you can find those on our podcast page my question to all three of you uh is that do we continue to care going to the future we as in the us and the private sector do we continue to care about this industry uh for the same reasons that we've talked about uh in in previous uh recordings and historical uh discussions or do you presume that there would be other reasons and other uh perhaps profitable lucrative or strategically important reasons for the us and the private sector to continue to develop space capabilities in other words is is what we care about this industry going to remain the same or will there be other things that we care about going to the future i think maybe i'll touch on the government side and maybe let tom talk about the commercial side or the expansion of what the government cares about that kind of tends on the commercial side um you know the government's been in the business of picking winners for the past uh uh well since the inception of space and so now it's a different game where they really need to develop a common set of standards and endpoints and uh and processing mechanisms to generally accept this data to really have uh the maximum value from commercial space so if you you know if you if you decide to pick a winner then you have one out of you know the 10 competition uh very competitive companies in that space but two if you if you build a common interface and pay a small amount of money to those companies develop that interface now you have 10 times that capability and you're really a best customer and then the things that i think were talked about in the earlier the passive space is kind of that revisit rate is really important the ability to have time series data over time so leveraging as many sources as possible is kind of a new game a new mindset for uh certainly the us government and how to contract to that and how to sustain these businesses uh but not be the sole sustainer of these businesses is the inflection point i just want to foot stomp that in that i think it really is important uh that the the government start to take a sort of uh agnostic technological view of their engagement with commercial so that it isn't just we've picked the winners and we've been dependent on those companies but it is this uh we can have any commercial company plug in to our workflows um so that if a company fails uh that the the government's not you know out of luck because now they don't have a capability they're reliant upon but instead they have a portfolio uh approach to how they're thinking about commercial and yourself in the um the commercial side um i guess first i'll answer something that's not commercial which is we're going to continue to care as a nation uh because our adversaries do so they're up there they're creating capabilities in space so united states is going to care on an ongoing basis about the space sector on the commercial side you know we're going to continue to find new ways to do things in space new new opportunities as christie pointed out where they're coming about space auxiliary services uh the more satellites they get up get up there the more activity that happens up there the more opportunities they're going to be commercially to support that um in addition you know we'll be able to find new things to do with remote sensing will go further out than just kind of low earth orbit and nearby earth it's going to be a cislunar economy and beyond so you know it's going to take time to get there but but absolutely you know the commercial markets are going to develop alongside them yeah i think you know touching on that it's increasingly complex and so all the systems to make that happen need to be in place so it's not just about you know having computer vision algorithms on your optical systems but now that whole computer vision architecture needs to be built for we talked about synthetic aperture radar or hyperspectral or are all the rf companies that are that are being formed and doing interesting things in space and and i think uh really innovative companies like spire are trying to maximize the capabilities of their constellations so now you're seeing one satellite that can do 10 different things simultaneously or near simultaneously and so trying to understand how to fuse that data how to get it to the ground how to process it and how to customers in a in a timeline that's reasonable it's all a lot of hard work that needs to be figured out yeah i would add to that that um i think one of the biggest changes we're going to see is a fundamental change in the space data ecosystem is is right now it is fairly siloed and you know it's each sort of company trying to to figure things out themselves um i think especially with the the entry of companies like amazon and microsoft coming in uh with you know cloud computing for space as we see a different way of thinking about how we're doing onboard processing uh how satellites are communicating with each other in space i think that the the entire data ecosystem is going to to evolve to something that i'm not sure anyone can fully even imagine right now tom christie clayton our time is almost up but before we drop off a fun question for all of you to consider would you go to space in the next two five or 10 years we've been talking today about the 10-year time horizon when considering the future uh space tourism certainly is something that is interesting currently as we've sort of heard about the billionaires in space barring cost concerns if you were all faced with the opportunity to go into low earth orbit uh within the next 10 years would you or would you not go why or why not and we'll start with we'll start with clayton i guess i'm maybe the pessimist or uh it doesn't the answer is no not two not five not ten i'd rather be on a sailboat very good christy um i guess i would say i i don't think it's fair to say barring any financial concerns because in my opinion that's actually one of the challenges that the space sector has had for so long is that it's all been about well what can we do rather than well what can we do within the cost constraints that exist and the economic constraints that exist and so i think once you put that into the equation which is a really important part of the equation uh then you know maybe i i would be able to afford to probably go into space but maybe a suborbital or not go into leo but maybe a suborbital flight within 10 years but to be honest i don't know that iqt pays me enough tom you want to be a star man so i'm the opposite yeah i i watched the uh you know the first uh spacex man dragon capsule launched what i guess a year ago or so um and when i when i saw that i've seen in my kids man i'd love to do that they looked at me like i was nuts but uh you know so absolutely uh it probably depends on the company i think if spacex is offering a ride i'd probably do it sooner than maybe some of the others um but uh you know i i'd go i okay so we've got a a no we've got a maybe and we've got a yes i'll i'll throw my hat in the ring i'm uh i'm a yes after a certain amount of time i have a hard rule uh after i got burned by the great cd-rom wars of uh 1995 i bought a 2x cd-rom reader and then like a week later a 4x came out and then like a month later a 48x came out and i was stuck with this 2x for like seven years it was the worst uh so for that reason i follow the following rule which simply is whenever something newfangled comes out wait five years because it's going to be way better way faster way cheaper my prediction is that we'll see something similar when it comes to space tourism tom chrissy clayton thank you so much for your time today i've had a great time discussing the next 10 years of what the future looks like in the space industry in the space ecosystem uh to our listeners in case you want to learn more about what we've talked about today i can point you to uh the other two podcasts in this series you can find those at the iqt homepage in addition we've got a handful of blogs about our space efforts you can check those out at the iqt blog at iqt.org front slash blog thank you all for listening thank you to our guests for being here and we look forward to talking to you at the next iqt podcast take care now [Music] you