Recently the UK’s Industry and Parliament Trust (IPT) kindly provided me with the opportunity to brief Parliamentarians from both Houses, as well as other industry representatives. I spoke alongside fellow panellist, Will Whitehorn, President of UKSpace and former President of Virgin Galactic. Inmarsat is a longstanding member of the IPT, which is a non-partisan charity based in Parliament. Over the years we have hosted, with the IPT, many MPs and Peers at Inmarsat for discussion sessions on topics ranging from anti-piracy measures and maritime security, through to fisheries conservation, the digital divide, and the UK’s space strategy.
IPT conversations are held under the Chatham House rule so I can’t provide a detailed review of the discussion here, I carefully prepared my remarks in line with what I understood to be the main interests of the Parliamentarians. I recap some of my comments below. I’m pleased to say that I found, as I usually do, IPT event attendees to be informed, interested, and energised by the exciting topic of space.
For those of you not familiar with Inmarsat, we are the world’s leading mobile satellite communications company, the largest UK-headquartered space company, and 95% of our revenues – that’s over £1bn per year – come from exports. We are a highly entrepreneurial and innovative company, driving constant reinvention and disruption in our global industry. For example, Airbus’s operations in Stevenage and Portsmouth are currently building five new satellites for us, as part of a $1.5 billion investment in innovation by Inmarsat that will be brought to market over the next two or three years. We spend on average more than $500M a year on space innovation.
But I want to emphasise that space innovation – especially on a global basis – is very challenging, involving huge up-front expenditure over many years before first revenues can be garnered. Most large-scale space ventures have failed. Once profitability has been established, however, it provides a really powerful base for future innovation and growth. Inmarsat is very fortunate in this respect, as a 40 year veteran in the global space industry.
Many don’t realise it, but space is embedded in much of our daily lives. Satnav enables our smartphones and GPS devices; earth observation services inform our weather and climate monitoring; satellite broadcasting provides our television services; and satcoms enables planes to fly, ships to sail, governments to defend us, and those in remote and rural communities to have access to broadband. It is estimated that the space industry already underpins over £300bn of UK GDP. With 5G, IOT, quantum computing and AI all gathering pace and beginning to transform our world anew, and with the enabler to all of those initiatives being secure, pervasive connectivity – the only way is up for space-based services.
We are in a golden age of innovation in our industry. Twenty years ago, our services were costly and specialist. Today a satphone costs less than $200, fits in your coat pocket, and its airtime is cheaper than 4G mobile roaming. Millions of suburban Americans today take their broadband services by satellite in preference to any other delivery medium. If you fly British Airways in Europe, you will be connected in your seat to your own device by Inmarsat broadband services at 100 MB/second. The space industry is now ready to take its place centre-stage in the global economy.
I’d like to conclude with three key points that I believe are critical for the success of our sector:
- The UK’s Space Strategy needs a major strategic reframing to affirm that the UK’s ‘core’ space capability is a strategic asset, and to accept that deep and broad space capabilities are critical to our security and global influence.
- While the UK’s strategic priorities should be the focus, the UK’s Space Strategy should also prioritise the commercial growth and innovation within the sector, with investment in skills, the R&D base and the innovation ecosystem. I’m thinking of what diverse capabilities can and should come together in powerful ways to create the autonomous vehicle, the digital ship, the connected aircraft and the civil drone, for example.
- Once defined, the strategy will need to be implemented through well-chosen programmes that confer sovereign capability where the market cannot act alone. A clear assessment should be made of the best mechanisms and partnerships for delivering the strategy and programmes, and the US and other partners are absolutely key to this.
About the author
Rupert Pearce joined Inmarsat in January 2005 as Group General Counsel and, from January 2009, additionally held the position of Senior Vice President, Inmarsat Enterprises. He became Chief Executive Officer in January 2012. Previously, Rupert worked for Atlas Venture, where he was a partner working with the firm’s European and US investment teams. He was previously also a partner at the international law firm Linklaters, where he spent 13 years specialising in corporate finance, M&A and private equity transactions. Rupert received an MA (First Class) in Modern History from Oxford University and won the 1995 Fullbright Fellowship in US securities law, studying at the Georgetown Law Center. He has been a visiting fellow of the Imperial College Business School, London, lecturing on the school’s Entrepreneurship programme, and is the co-author of Raising Venture Capital (Wiley).