LEO satellite market to see double digit growth
According to the new research report by MarketsandMarkets™, the LEO satellite market is projected to grow from USD 9.6 billion in 2021 to USD 19.8 billion by 2026, at a CAGR of 15.5 percent. LEO satellite systems hold a huge potential for satellite data service providers, small sat service providers, remote sensing service providers, technical service providers, and investors. The market is one of the most lucrative verticals of the space industry. Factors such as versatility, low cost, advanced mechanics, ease of assembly and launch, mass production, and short lifecycles have driven investments in the LEO satellite market. The amount of satellite data and the range of applications for that data will continue to grow in the future as new technologies develop and more satellites come online.
Growing investments by several governments particularly in developed and developing economies such as the US, India, and China, among others. COVID-19 has affected the LEO satellite market growth to some extent, and this varies from country to country. Industry experts believe that the pandemic has not affected the demand for satellite equipment.
Based on satellite type, the small satellite segment is expected to lead the LEO market from 2021 to 2026. A small satellite is a type of low mass and compact satellite primarily employed for remote sensing, Earth observation, and communication purposes. These satellites usually weigh less than 500 kg. Small satellites are used for in-orbit inspection purposes of larger satellites. These are also used as test carriers for newly developed components that are to be installed on a much critical satellite. However, small satellites are prone to operational challenges that include lack of power storage and propulsion system, owing to their small dimensions. In January 2022, satellite communications provider, Starlink launched a part of constellation of small satellites in LEO.
Based on application, the communication segment is expected to lead the LEO satellite market from 2021 to 2026. LEO satellites are increasingly being adopted in modern communication technologies. The introduction of wireless satellite internet and development of miniature hardware systems are exploiting numerous opportunities in the field of satellite-enabled communication. A rise in R&D activities for communication-related missions is expected to offer enhanced quality communication systems with the help of highly sophisticated miniaturized onboard nano, micro, and mini subsystems, coupled with advanced mission-compatible ground-station technology.
Based on region, North America is expected to lead the LEO satellite market from 2021 to 2026. The US is a lucrative market for LEO satellite systems in the North American region. The US government is increasingly investing in advanced LEO satellite technologies to enhance the quality and effectiveness of satellite communication. The increasing investment on satellite equipment to enhance defense and surveillance capabilities of the armed forces, modernization of existing communication in military platforms, critical infrastructure and law enforcement agencies using satellite systems, are key factors expected to drive the LEO satellite market in North America.
Contracts were the main strategy adopted by leading players to sustain their position in the LEO market, followed by new product developments with advanced technologies. Many companies also collaborated to set up special centers for the research and development of advanced satellite systems.
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