Industry calls for leadership in the space race

Tuesday, May 25, 2010

With the right leadership, the British space sector could provide significant economic benefits, as Ian Godden, Chairman of ADS, tells Joel Shenton

British industry has had a few difficult years lately, and many businesses have felt the effect of the global financial crisis. During the recession, the decision was made to push for growth in the space sector, and this led to the formation of the Space Innovation and Growth Team (IGT), which was tasked with developing a long-term plan to guide that growth.

The Space IGT was chaired by Andy Green, CEO of Logica, and completed by Lord Drayson, Inmarsat's Perry Melton and European Space Agency astronaut Major Timothy Peake, formerly of the Army Air Corps. The IGT created a plan for the UK space industry to fully exploit space opportunities until the year 2030.

Industry bodies such as ADS have been in support of this work, citing the significant success stories already coming out of British space businesses and the promise of more to come.

"The innovation and Growth Team work that was done with the previous government, particularly driven by Lord Drayson, finished in February, and they did it quite fast," says Ian Godden, Chairman of ADS. "I'm glad to say that Lord Drayson's influence meant that whereas some of these things drag on and can be inefficient, this was very efficient; and it was a six-month exercise."

The end result was the Space Innovation and Growth Strategy, which sets out a vision for the development of the sector. ADS has accompanied this with its own space manifesto, which clearly sets out the main goals of UK industry. The manifesto calls for:
• Support for the newly formed UK Space Agency;
• The development of a National Space Technology Strategy,
• Procurement of a sovereign Earth Observation capability,
• The development of space as a complementary ICT infrastructure to existing broadband networks
• The use of space capabilities to cut the carbon dioxide emissions from ICT systems; and
• Training for the next generation of space engineers and scientists.

"We were very clear that we needed to speak to and make sure that we had a clear message for the 232 new MPs, for a start," says Godden on the development of the manifesto. "This [manifesto] was designed to make clear what the work that was done last year was really saying because we knew that it was important."

And there is a real danger that with all the proposed cutbacks and savings, government may not have the appetite for investment or leadership in a non-frontline sector such as space.

"Over the next six months the emphasis is on fiscal crisis," says Godden. "The debate at the moment is all about costs, but not about revenue and exports and so on. The wealth creating aspects of our economy have tended to get drowned out in this debate. In amongst all this noise it was important for us to put our heads up above the parapet and remind people for the opportunity for revenue and exports and success and wealth - all those good things that we tend to forget when we're in a fiscal crisis. Space is one of those."

In the manifesto, ADS says that space already brings in £5.6bn of value added to the UK economy; with each employee representing an economic contribution of around £145,000. With figures like these, surely paying attention to sectors like space is always going to make good economic sense.

"It is," says Godden, "but it has got muddied with what I would call the large amounts of money spent on space for human curiosity.

"The UK has not really joined either the arms race in space during the Cold War nor has it invested in exploration for the sake of pioneering," he says. "Some people have criticised that and other have said that's an advantage at this point because most of the rest of the economies that have exploited that are in meltdown. For example, Obama has decided not to fund lots of space programmes and he's getting a lot of criticism for that.

"In the UK we are actually quite well set up for commercially oriented space activity. At the moment we are structured for a niche positioning of ourselves in space. Having said that we are the 21st spender in the world and the 6th largest economy. We are 'a little bit behind' shall we say.

"The last 20 years we've had very successful growth in space but from a small base. It may be a bit foolish timing-wise to say the next year or two we can afford to spend lots of money on space, that's not what we're saying. What we are saying is we need to gear up for a level of ambition that I don't think we've made particularly public, either as an industry or as a nation; and there's a lot to go for. This manifesto is, in simple terms, laying out what we think there is to go for."

Some of the measures called for in the manifesto are already under way. The document calls for the UK Space Agency, launched on 1 April 2010, to be "resourced and empowered" to deliver the economic benefits from space.

"The two very positive first steps are the announcement of the executive space agency and the continued encouragement of innovation centres such as Harwell and the government recognising that it needs to reorganise itself internally and for the relationship with industry to expand and exploit those opportunities," says Godden.

"This is a natural growth area that is well beyond GDP growth. Space has been growing at 9 per cent where world economies have been growing at 3 or 4 per cent.

"Even as 21st investor - and I would argue that we should be closer to top 10, not the top 30 - even if we're not at our natural level, which I would say is 6th in the world, it's a high growth area and we should be trying to exploit it as much as we can."

So how is ADS preparing for the future of the space sector, and are its members ready to exploit the opportunities?

"There is an organisation called UK Space which we jointly sponsor with another trade organisation called Intellect that deals with IT systems. They represent more of the downstream applications: entertainment, communications etc. We're more of the upstream, the guys that make the kit and the services that go with it. It's been very active behind the scenes. It's not been as visible as some of the other industries so space has sort of squeezed in and has been active at one level as an industry, but we are keen that the nation realises that space is an attractive feature of what we currently do but is an opportunity for wealth creation in the future that the nation should look at much more carefully than it has. The spotlight has been on it as a result of certain ministers and industrialists taking that interest. It's time to be less ad hoc about it and be more systematic."

The success of the space sector so far has been typified by the work of some notable British companies. "There's huge success stories," says Godden. "One is SSTL (Surrey Satellite Technology Ltd), which was recently bought by EADS - a European aerospace and defence company. It was created out of Surrey University as a small start up from academic work and industrial entrepreneurship and has become a world leader in small satellites. It's a classic example.

"One of my great privileges is to travel the country and see the SMEs who are active in not just this area but security and other areas and I'm continuously amazed at how many small and medium sized companies there are in the space sector that we just don't hear about and don't promote," he says. "But it's not just a group of small companies operating; we have large companies and small companies actively working in this sphere within the UK.

"Qinetiq, coming out of the defence industry, has had a number of projects which are very significant for the space community. They do a lot of work behind the scenes. It's not so well known as a company except for the furore around the privatisation of it, but behind the scenes they're doing tremendous work on a number of aspects of space. They got a recent award for some of their transmission and communications work. There are plenty of good case studies, perhaps not well known.

"Astrium, which is owned by a European entity, has three or four major operations in the UK."

It's clear that the UK space sector has, with little encouragement, achieved some significant success, but Godden sees the space sector as lagging behind the other sectors represented by ADS, something he is determined to change.

"I personally don't like single digit world shares, having got four sectors [at ADS] one of which - civil aerospace - being 17 per cent global market share," he says. "We produce six times the number of engines that we use as a nation, six times the number of fixed wings. We export huge amounts, and 17 per cent global share for a country that has 3 per cent of the wealth is pretty, pretty good.

"There's also defence, where we punch above our export weight with 20 per cent global share of the export market; number two to the US.

"My ambition is always double digit, and in space we have 6 per cent. You can call me a foolish dreamer or whatever, but the IGT has identified that we really think that we can achieve a ramp up from 6 per cent to 10 per cent with an ambitious new government. Now this is not where the focus of the current politicians is, I accept that, but I think in 18 months or two years time it ought to be, and it's the very type of sector where we should be putting some of our attention because there's the revenue and wealth side that's going to fix us as much as the cost control side."

So what are ADS asking of the new coalition government to encourage further growth in the space sector

"We've laid out the six points in our actual manifesto, but the short term is to ensure that this new UK Space Agency is resourced," says Godden. "We're quite practical about this, we're not asking government to triple its money in the sector, but we are asking for an organisation and leadership drive over the next year.

"We want to spend the next year developing a very coherent national space technology strategy which is the underpinning of industrial policy. Just as we have a national aerospace technology strategy, which was worked out three or four years ago and has been crucial for some of the investment decisions over the last two years. Without that we all just go off randomly as a set of industries and as a government encouraging lots of random events.

"The other aspects, the capabilities around the carbon dioxide emission reductions - the use of solar power of course in satellites is a given - those are the things we can be working on in the meantime to get our act together in the desire that future funds can become a bit more available if we invested behind that leadership.

Godden is certain that with the right leadership, the sector can live up to its potential, but he's also certain that it can be as difficult to get good leaders as it can extra funds.

"Some people say that asking for more money is a difficult thing," he says, "but asking for more leadership is a difficult thing too."