Industry growth is projected to continue as firms bring additional satellites online
Los Angeles, CA (PRWEB) April 23, 2012
The Satellite Imaging Services industry has launched into the commercial market and is benefiting from increasing income from government contracts. The two companies in this industry, DigitalGlobe Inc. and GeoEye Inc., produce high-resolution satellite and aerial images, tools and corresponding analysis. The industry's primary customer is the US government, in particular, the National Geospatial-Intelligence Agency (NGA), which supplements proprietary satellite images with higher-quality industry products. “Thanks to restructured contracts and increasing demand for industry products, revenue from commercial clients and other government agencies is also rising,” says IBISWorld industry analyst Agata Kaczanowska. As such, IBISWorld expects industry revenue to reach $735.5 million in 2012, representing 15.2% annualized growth since 2007.
Satellite Imaging Services industry growth is projected to continue in the next five years as it brings additional satellites online. This growth will stimulate higher revenue from the NGA, according to contracts that are already in place. For example, GeoEye Inc. expects increased revenue once it launches its next satellite, scheduled in 2013. Says Kaczanowska, “Additional revenue from commercial clients is also forecast as more companies invest in technologies that can use satellite images.” Still, The high degree of industry market share concentration is not forecast to change during the next five years. Although DigitalGlobe and GeoEye compete fiercely for new business, they share a number of the same customers, like the NGA. There are very high barriers to entry in this business, and their relationship with NGA is essential to the development and launch of these two companies' satellites.
This industry consists of only two companies because operators use advanced technologies, make significant upfront investments and depend on long-term government contracts. Strict satellite regulation also limits the ability of new companies to enter the industry as well as commercial industry applications. For example, companies must resize images to a fraction of the resolution that they provide to the government. Likewise, all distribution agreements must first be approved by the US government, which expands the amount of time and money that clients must spend to obtain industry products and services. As a result, the number of firms in the industry is expected to remain unchanged during the next five years. As they invest in new technologies and marketing to attract clients, their profit is expected to slide. For more information, visit IBISWorld’s Satellite Imaging Services in the US industry report page.
Follow IBISWorld on Twitter: https://twitter.com/#!/IBISWorld
Friend IBISWorld on Facebook: http://www.facebook.com/pages/IBISWorld/121347533189
IBISWorld industry Report Key Topics
Firms in this industry primarily provide geospatial services, such as aerial and space imaging. Companies may also provide related geospatial services, such as analysis of image data. Resellers of such information, companies that primarily analyze such data, and satellites primarily used for GPS or other navigational systems are excluded from the industry. Likewise, land and water surveying or mapping services are not included in this industry.
Key External Drivers
Industry Life Cycle
Products & Markets
Products & Services
Globalization & Trade
Market Share Concentration
Key Success Factors
Cost Structure Benchmarks
Barriers to Entry
About IBISWorld Inc.
Recognized as the nation’s most trusted independent source of industry and market research, IBISWorld offers a comprehensive database of unique information and analysis on every US industry. With an extensive online portfolio, valued for its depth and scope, the company equips clients with the insight necessary to make better business decisions. Headquartered in Los Angeles, IBISWorld serves a range of business, professional service and government organizations through more than 10 locations worldwide. For more information, visit http://www.ibisworld.com or call 1-800-330-3772.