The New Age of Space: How Telecom Money Is Shaping the Sector

By Jean-François Morizur

Space carries certain associations. Although in recent years the understanding that space plays a fundamental role in modern life has become more widespread, the most familiar images that come to mind when someone thinks of space are Neil Armstrong setting foot on the moon, or dramatic rocket launches, or perhaps something out of science fiction.

This points to the historical fact that space has largely been inaccessible to everyone except for those with the backing of national governments. It was too costly for anyone else to get near. That in more recent times billionaires have elbowed their way in, eager to plant flags of their own, doesn’t really disprove that point. Those billionaires have more money than many national governments.

The pace of growth in space has, as a consequence of this, been uneven. Dictated by politics on the one hand and the whims of private citizens on the other, the sector has developed in an awkward way. But now, for the first time, that’s beginning to change. Because a new source of money is entering orbit, and ushering in – almost without anyone noticing – a revolution. That source is telecoms.

We all know that telecommunications is big business. We all use the internet all the time, after all. What many don’t is quite how big it is. It’s a genuine financial behemoth. Global revenues regularly exceed $1.1 trillion, which makes the entire global space economy look small by comparison. So when the big players – companies like Orange, Vodafone or AT&T – start to invest their capital in space, the effect is immediate and transformative.

What this means is that consumer payments – monthly bills, essentially – are now fuelling growth in space. That is a decisive shift. The space economy has a predictable, scalable source of revenue. Yes, many domains of space still depend on public money: exploration, defence, climate science. But growth is no longer contingent on political needs or tech billionaires. The engine of growth is now more stable.

Interestingly, we can see how this works at the level of the individual company. Starlink, the satellite broadband network run by SpaceX, doesn’t rely on government contracts or investor hype. It sells a service (internet access) directly to consumers. That revenue pays for its launches, satellite design and construction, and more. It’s a model drawn straight from the telecoms playbook.

One side effect of this happening across space is that the sector’s evolution may tilt to some extent in Europe’s favour. The strength of European industry is in systems engineering, component manufacturing, precision supply chains, and other areas that will come into their own as space begins to transform and resemble a conventional industrial sector built on scale and standards. Europe’s depth of technical expertise, incubated at world-leading research institutions across the continent, will become manifest to a degree that was not previously possible. 

Mature sectors involve complexity, which invites specialisation. Vertical stacks tend to come apart. So although the dominant model in space at the moment is vertical integration (vertical integration is necessary to get started: to arrive at a workable solution from a standing start), that will change. Employees at the big incumbents will leave to join or create niche suppliers. Contract manufacturers will emerge. And what was once an empire will start to look like an ecosystem. This is how aerospace developed, and it’s how space will develop. That’s good news.

Why? Because with the emergence of space-as-an-ecosystem, innovation will accelerate. Costs will plummet. New applications will become possible. Direct-to-vehicle connectivity, for instance, is likely to become a significant driver of growth. Put a flat antenna on the roof of your car and you could be online at the top of a mountain (assuming you could get the car up there) or – more probable – in even the most remote communities. Millions want that. Millions more will want that. The demand that generates will justify still more satellites, more launches, more infrastructure. Telecommunications revenue will fund deployment; deployment will expand coverage; coverage will increase demand; demand will sustain investment.

Of course, there will be obstacles. Regulation matters. Satellite constellations are capital intensive, and many will take time to break even. Geopolitical tensions could derail or delay progress. And the incumbents won’t surrender market share without a fight. But the fact remains the character of the sector is now changing. Space is starting to be funded by end-users, not a tiny minority of wealthy and/or powerful individuals. And in this way, it will begin to look like other utility industries: quietly indispensable and therefore reliably profitable.

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