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Wednesday, June 27, 2012

Catapult 2

  The briefing for the Catapult meeting included this
...the government's recognition of the economic growth potential of the space sector. The 2010 Space Innovation and Growth Strategy set the objective of growing the UK space industry from 6% to 10% of global market share, realising a £40 bn market for the UK by 2030.
    In the Q&A session at the end I asked, though I have changed some of the figures I gave then after using my calculator and records. 
May I suggest that the growth prediction in your introductory sheet are overly modest. £40 billion as 10% of the total implies a world space industry of £400 bn. It is currently about £200 billion. This implies a growth rate of 4% over the next 18 years. The conventional world economy is growing at 5%. If we were to take 10% current overall growth rate of space industry that would be would be over £1 trillion by 2030. If the 17.6% growth rate of the American commercial space industry it would be £3.7 trillion.
This is an important difference since if you want the politicians to take this opportunity seriously you have to tell themm what the potential is.
  The answer was that
I completely share your ambitions. That growth rate is low but it is what all parties could agree to
   Which means it is what all the various government departments and quangos would agree to. Since most of them represent other industries it is unsurprising they would want to downplay the opportunities and that they get a veto because there is no political push for a more accurate figure.

   Compare and contrast with the way the wind industry works - the Scottish Renewables government quango repeatedly claims that "over a third" of  our electricity is already produced by windmills. Since the true figure is 12-15% it is clear that not only do they not give anybody else a veto they aren't influenced by what everybody knows. I am not suggesting that the space community ever lie as the renewablists do - I would much prefer that it remain impossible for any uncorruot politician to claim tom believe the windmillery case more than the space one.

   Some of the figures here are variable - I suspect because it depends on what you count as space industry and that we are seeing a relatively narrow interpretation excluding much of satellite communications.

   The US 17.6% commercial space growth figure came from here, as does a  British government estimate of the industry being £6.5 billion 3 years ago and growing at 5%.which makes it £7.5bn now. To get from there to £40 bn in 18 years would mean 10% annual growth which is what the BBC says we are already doing. Not so ambitious then.

   If the government say Britain is already 6% of the international market that would imply that the world market is about £125 million but this shows that it was £160 bn back in 2009 which at 10% growth would be at least £200 bn today.

   I would not by any means think that the 17%growth rate is likely to be the minimum. The game changer is that SpaceX is now lauunching and says it can do it for $54 million compared to $1,300 million for the shuttle. Moreover that "SpaceX intends to make far more dramatic reductions in price in the long term when full launch vehicle reusability is achieved. We will not be satisfied with our progress until we have achieved this long sought goal of the space industry."
   Any industry that sees it costs reduced to 1/20th with lower to come is going to improve its rate of growth - spectacularly.

   If we posit a growth rate of 25%m 8% more than the current US rate. We would have a worldwide (humanitywide?) space industry worth £11 trillion by 2030. I don't quite expect that, though there is nothing technically impossible in it. I would, however, say that that growth rate is much more probably than that it grow 1% below the average of all industries which the UK government expects.

   Of course for us to have 10% of an £11 trillion, or even a .£3.7 trillion or indeed even of £1 trillion would seriously enhance our economy.
  In 2 ways it doesn't matter

- firstly government "support" for the fastest growing industrial sector in the country amounts to £10 million (or even say about £40 million if you include our "space agency" and other bodies), for an industry we expect to be worth £40 billion is barely enough to be called a token. This anti-progress attitude has to change if we are ever to get out of recession.

- secondly it doesn't matter whether a 17.6% or even 25% growth rate is achieved across the world so long as it is technically possible. In the same way that the first person to make a gold strike doesn't lose out because he is ahead of the competition if Britain decided to make the effort to achieve 10% of possible world space industry (or Scotland 1.5%) we would not lose anything if most of the competition didn't make the effort.

   All that matters is that it is possible and when something has been done, such as the US 17.6% growth rate, then by definition it is possibble to do it.

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