Non-U.S. firms provide niche imagery products: Imagesat, Spot benefit from growing demand for satellite data, intelligence. (Space Industry Update).

International satellite-imagery providers Imagesat and Spot have emerged as the top non-American commercial suppliers of remote-sensing data to the U.S. military.

Imagesat Corporation is based in Limassol, Cyprus, with its technical offices in Tel Aviv, Israel. Together with Toulouse, France-based Spot Image, they contribute most of the non-U.S. commercial satellite images to the National Imagery and Mapping Agency (NIMA) and other government agencies.

NIMA functions as a clearinghouse that purchases satellite images, not only for the Defense Department, but for other federal agencies, such as the Departments of Homeland Security and Agriculture. NIMA purchases commercial imagery from two U.S. companies-DigitalGlobe and Space Imaging--but also buys images from several non-U.S. firms, when domestic providers are not available, said David Burpee, a NIMA spokesperson.

In 2002, NIMA's purchase of commercial foreign imagery comprised less than 3 percent of the total commercial imagery purchased for that year. "Some foreign capability is not replicated by U.S. commercial companies," said Jean Mears, a NIMA spokesperson.

Imagesat distinguishes itself from its competitors "in that the company sells the exclusive right to directly task the satellite camera and download the imagery data from Eros A (Earth Resources Observation Satellite), with complete autonomy and secrecy, to its satellite operating partner (SOP) customers," said Menashe Broder, chairman and chief executive officer of Imagesat. Eros A, a sun-synchronous, polar-orbiting satellite, was launched in December 2000. It is the first in a constellation of satellites that Imagesat plans to deploy during this decade.

To protect its customer's secrets, Imagesat has no knowledge of the targets the satellite camera seeks, "nor do we see the images that are collected by the SOP customer," he said. "Our customers, in effect, acquire their own reconnaissance satellite in an agreed-upon footprint at a fraction of the cost than it would rake to build their own," Broder said.

"Autonomy and secrecy are very attractive to the intelligence and military customers we support. They particularly are attracted to the notion that the satellite camera is their's over their footprint, at all times. There is no shutter-control with our satellite," Broder said.

"Imagesat's SOP Program allows SOP customers to get intelligence in real time. They do nor have to ask for the satellite imagery from someone else. They do not have to reveal where or when they are imaging, and they do nor have to share the imagery with anyone," he said.

Imagesat is nor focused on the commercial market for high-resolution imagery, said Broder. "Our business generates less than 1 percent of its revenues from the commercial market," said Broder. Like Spot Image, its main customers are governments.

Spot Image operates a constellation of three satellites, with one spare satellite in higher orbit. Seventy percent of its business is to government organizations.

Spot distinguishes itself by its rapid response, said Jean-Marc Nasr, chairman and chief executive officer of Spot Image. "We are able to secure one image on one point on the globe within less than 24 hours," said Nasr. In many cases, that image can be delivered from satellite to user within six hours. If the customer has a mobile imagery receiving station, image delivery can occur in as few as 30 minutes. With the receiving stations, users can have images delivered directly to laptops for immediate use.

Spot 1, Spot Image's first satellite, was launched in 1986. Spot 2 was launched in 1989, Spot 3, in 1992, and Spot 4, in 1998. Spot 5 was launched in 2002. Spot 3 had a major software failure after three years of operation, and is no longer in use.

Spot's images can be scaled to 2.5 meters, and can photograph areas as large as 60 kilometers by 60 kilometers. "When your problem is to scale an entire region," Spot's capabilities are appropriate, Nasr said. "When you don't know where things are happening, this is when you need Spot imagery," he said. For example, one of Spot's current projects is to map all of Western China.

Spot is also partnered with Radarsat International. Radarsat's satellite, Radarsat 1, which was launched by the Canadian Space Agency, is the only satellite currently in space that sells radar images. "We are teaming together. Their imagery is very complementary to ours," said Nasr.

NIMA also has a separate contract with Radarsat, and bought $1.49 million worth of Radarsat images in 2002, said Mears.

Imagesat customers may choose between 1.8 meter standard or sub-meter hyper-sampled image resolution. Spot offers a capability range of 20 meters to two and a half meters in resolution capacity.

Future Plans

Imagesat plans to launch its next satellite during the coming year. "The Eros B1 will have a resolution significantly better than 1 meter, will have multi-spectral capability and a larger on-board recorder," Broder said.

Pleiades is the name of a new Spot constellation of submetric-resolution satellites. Spot plans to launch two satellites into space at same rime to capture higher resolution imagery. Pleiades will achieve resolution of between 0.5 and 1 meter, said Nasr.

Nasr said the future of the satellite imagery business involves public-private partnerships. "Since the (French) government paid the majority of the cost of Spot 5, we have a special contract with the government to sell them images at a very low price. They have a reduced cost, but not unlimited use," he said.

Imagery and data now comprise only 40 percent of Spot's business. "Our product offerings are changing," said Nasr. The customers are asking for not only data, but also services. "Processing, infrastructure and ground stations to provide access to Spot images" are all becoming a significant portion of its business. "Grounds stations, so they can do it directly by themselves, represents 30 percent of the business last year," said Nasr.

Because Imagesat's primary customers are military and intelligence agencies within government, the vast majority of their business is through SOP contracts.

"What sells high-resolution satellite imagery is the keen desire for non-invasive intelligence: to monitor your borders, investigate what your neighbor is researching, or where they have placed their troops, ships, aircraft, ranks and training facilities," Broder said.

Broder explained that his company hopes to make inroads into the American market. "Clearly, our U.S.-based competitors worked for and rightfully received first-in-the-queue status to address the U.S. national security agenda. However, it is our understanding that international suppliers are very much a part of the plan and will be factored in as the process continues. Based on our customers' success in using our imagery for national security purposes, and the uniqueness of our business concept, we are confident that Imagesat will become an active player in the United States," Broder said.

A significant difference between Imagesat and Spot Image is that Spot has multiple partnerships with companies around the world to distribute Spot Images. Spot Image Corporation, based in Chantilly, Va., is Spot Image's U.S. representative, and was created in 1982, at the same time of Spot Image's creation.

The role of the U.S. subsidiary is to manage business agreements with Spot partners. They are "in charge of signing contracts with partners and serving the needs of our distributors, and managing the rest of the business that is not in the hands of our distributors," said Nasr.

Other distributors include Spot Imaging Services, in Australia; Spot Asia, based in Singapore; Beijing Spot Image Co. Ltd., in China; and Tokyo Spot Image, in Japan. Spot also keeps offices in Germany and in the United Arab Emirates.

Eighty percent of Spot Image's business is done outside of France, Nasr said. "Asia represents 50 percent of our sales. China and Japan are the two biggest players," he said,

Spot partnerships include Digitalglobe, which distributes Spot's images to the Defense Department. Resource 21, a subsidiary of Boeing Corp., distributes imagery to the federal civilian marker, including the Department of Homeland Security; Spot signed a partnership contract with Resource 21 in September 2002, Nasr said.

Spot also has a partnership with Iumctus Geomatics, a Canadian company. Imagesat's "corporate nationality" is not a primary issue, "as we have both advantages and disadvantages to our status, which, at times, actually provide us with an edge in the market," said Broder.

Broder explained that the satellite imagery industry is in "an accelerated state of evolution," because of the changes in the needs of the intelligence community after September 11. The terrorist attacks led to a growing demand for satellite-based intelligence, surveillance and reconnaissance capabilities. The location of the country providing the satellite services is less important, said Broder.

One growing market for Spot Image's business involves farming. Spot has a contract with the European Union for crop surveillance. The company is developing relationships with individual farmers as well. "We are selling more and more precision farming products to help with irrigation, That market is growing at the rate of 100 percent per year. It is doubling every year," Nasr said.

Imagesat has a backlog of mote than $300 million. "Our typical SOP contracts are usually 6 to 8 years in duration, and the customer buys the entire satellite imaging capability over its footprint for about $15 million per year," said Broder.

Spot's total sales in 2002 were 50 million euros, compared to 34 million euros in 2001. Spot has had a 40 percent growth in the last year. "The launch of Spot 5 was one of the major triggers to give us that growth," Nasr said.