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Forecast: Space economy at $1.8tn by 2035

June 2, 2024

By Chris Forrester

McKinsey senior partner Ryan Brukardt and global editorial director Lucia Rahilly state the global space economy where innovation in space-based technology is generating a range of public- and private-sector opportunities that could reach $1.8 trillion (€1.65tn) by 2035.

The two McKinsey staffers, in a major report, say there is an “allure” about space, yet most people “probably don’t realize just how much their daily lives interact with space. Every day, people get in cars assisted with navigation by GPS. Every day, people order food online, assisted by both communications and navigation provided by space assets. The presence of space in our lives is probably more ubiquitous than people think.”

“What really has happened in the last several years is access to space, the ability to get to space—the cost of that has come down dramatically,” says Ryan Brukardt, saying that the backbone of the industry is launch vehicles, rockets, and satellites and all the ground equipment that makes those things work.

Brukardt lists three other further segments: Connectivity, mobility and data. “The first is connectivity. We have the ability to communicate with basically anywhere in the world using satellite communications technology. We can now do that with what’s called high bandwidth and low latency. That means we can send a lot of data very quickly. And the types of use cases that allows for are things like video conferencing, etc.”

“The second is mobility: understanding where you are on Earth. We already do that with cell phones, but increasingly, we’ll do that with even smaller devices to know where anything is in the world,” he continued. “The third is deriving data that only space-based applications can provide. You will see this in Google Maps—electro-optical imagery or imagery that allows you to see what’s happening on Earth. It used to be that a company or a government would take a picture of Earth once a day or once a week, but now it’s able to take that picture very often. These various elements all help create new jobs. “In particular, science- and engineering-type jobs, where there weren’t any,” and that smaller nations will benefit even though they may not be directly involved in launching satellites.”

McKinsey says that the space industry is now at an inflection point. “When we set out to think about what’s going to happen in the economy, we didn’t want to use some top-down number. We wanted to think through all the use cases, both government and private-sector use cases, and build this projection from the bottom up. We think that’s important because the space economy is likely to almost triple in the next ten years, from $630.0 billion to $1.8 trillion,” said Brukardt.

“It’s an exciting time, which is why we say we’re at this inflection point, as more and more folks on Earth benefit from space and figure out how to use those capabilities,” added the report.

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