Commercial Earth Observation Market to Surpass $8 Billion by 2033

The commercial Earth Observation (EO) market is set for transformative growth over the next decade, according to the latest edition of the Earth Observation Data and Services Market report by Novaspace.

The report forecasts that the EO market, currently valued at $5 billion, will surpass $8 billion by 2033. This growth is driven by advancements in technology, expanding defense budgets, and increasing demand for actionable insights in sustainability and security.

Novaspace, the company authoring the report, is a space consulting and market intelligence firm formed through the merger of Euroconsult and SpaceTec Partners. They delivers insights, strategic guidance and professional services to clients around the world. The company is also the organizer of the World Space Business Week.

Key drivers of growth in the EO market

Defense contracts and advanced Earth observation products are highlighted as the primary engines behind this market expansion. These products offer enhancements like higher resolution, advanced spectral bands, and 3D capabilities, which are increasingly paired with innovations such as cloud computing and artificial intelligence.

These technologies facilitate large-scale monitoring and decision-making, meeting the needs of sectors like defense, climate monitoring, and infrastructure security.

“Market growth isn’t just about replacing aerial geolocation systems,” explained Alexis Conte, Manager at Novaspace and the lead author of the report. “It’s about scaling up EO monitoring capabilities to provide actionable insights over time. This focus on tracking and analyzing activities at scale is driving both technological and market innovations.”

Defense and regional dynamics propel momentum

The report underscores the important role of defense-related contracts in advancing Earth observation technologies. Agencies like the U.S. National Reconnaissance Office (NRO) and National Geospatial-Intelligence Agency (NGA) are fostering innovation through large-scale contracts that push the boundaries of real-time monitoring and higher-resolution imaging capabilities. Defense Earth observation revenues alone are expected to grow by $1.1 billion by 2033.

Regionally, North America remains the dominant EO market, generating 44% of global revenues in 2023, followed by Europe with 22%. However, Asia is poised for the fastest growth, with its market share projected to rise to 23% by 2033.

This growth is attributed to relaxed domestic policies and increasing regional demand, particularly in Southeast Asia. Additionally, the Middle East is strengthening its position through enhanced procurement strategies and asset consolidation.

The role of commercial constellations

Commercial satellite constellations are set to play a critical role in shaping the Earth observation landscape. Novaspace identifies over 150 constellation projects involving more than 7,500 satellites. However, the report estimates that only 2,300 satellites will likely be deployed in the coming decade due to challenges like funding limitations and shifting strategic priorities.

Of the approximately 110 companies involved in these projects, about 25% plan to deploy constellations of 50 or more satellites, although most will operate smaller fleets. The market is expected to consolidate around companies offering innovative sensors, new business models, or regionally strategic capabilities.

This trend reflects the growing emphasis on efficiency, as mid-inclination orbits and technological advancements reduce the number of satellites required for certain missions.

Expanding capabilities and applications

The EO sector has seen a steady increase in the diversification of satellite payloads, with a growing focus on synthetic aperture radar (SAR), hyperspectral imaging, and thermal imagery.

The number of satellites supplying commercial data, currently over 800, is expected to grow to around 1,430 by 2033. This growth will support new services and applications, such as high-frequency change detection analytics.

Leading Earth observation companies like Planet, BlackSky, and ICEYE have been pioneers in developing competitive, low-cost solutions for monitoring and analytics. Their approaches enable the creation of new services tailored to evolving market demands, particularly in areas like climate monitoring and infrastructure management.

Challenges ahead

Despite the optimism surrounding the EO market, challenges remain. The development of new services and applications may outpace demand, posing risks for smaller operators. Companies are relying on revenues from existing satellite generations to fund the development of next-generation systems, creating financial pressure in an increasingly competitive environment.

Additionally, while the replenishment cycle for satellite constellations allows for rapid adaptation to changing market needs, slower-than-expected demand growth could lead to further market consolidation. Operators must differentiate themselves through innovative sensor technologies and unique business models to remain competitive.

_{*Cover photo credits: Synspective}