Investing in Space: On satellites, the invisible backbone of global industry

CNBC’s Investing in Space newsletter offers a view into the business of space exploration and privatization, delivered straight to your inbox. CNBC’s Michael Sheetz reports and curates the latest news, investor updates and exclusive interviews on the most important companies reaching new heights. Sign up to receive future editions.

“Space-based technologies are the building blocks of innovation on Earth. GPS, geospatial intelligence and satellite communications are the invisible backbone that powers the world’s largest industries today.”

That’s the core of Space Capital managing partner Chad Anderson’s pitch to new investors about the value of the space industry – and I think the “invisible backbone” element serves as an important reminder. Much of the sector’s investable opportunity falls in the realm of a quiet hum: GPS satellites that enable the world’s financial markets, communications satellites that make inflight Wi-Fi possible, radio frequency satellites that improve weather forecasting, imagery satellites that are changing agriculture, and the list goes on.

Bringing that “invisible backbone” idea back down to Earth (pardon the pun) is simplest in my opinion when we have tangible, quantifiable examples of just how space technology improves our lives and powers the global economy. Take, for one instance, Maersk’s implementation of SpaceX’s Starlink internet service.

David Sherry, the Danish shipping giant’s corporate platforms portfolio technology leader, says his company has seen “a sea change” (pardon his pun) as a result of Starlink’s service. 

“Vessels are challenged by connectivity and therefore satellite is absolutely crucial to our operations – and it doesn’t matter if that’s navigation, it doesn’t matter if that’s meteorological, it doesn’t matter if that’s fuel efficiency – and increasingly so as we digitize our assets and our supply chain,” Sherry told me.

A few data points for context here: Maersk operates one of the world’s largest shipping fleets, with 681 ships crewed by 12,500 company seafarers. Maersk last week announced a deal to add Starlink to the 336 ships that it owns, boosting onboard internet to speeds over 200 Megabits per second. Maersk conducted a pilot program with Starlink on 30 ships, and Sherry says the company was “delighted with the success.”

Sherry explained that, from Maersk’s point of view, there are three major stakeholders that benefit from bandwidth that’s many times faster than what was available before. First, and foremost, are the crew living and working for long stretches on its massive ships.

“The feedback we’ve had from them as seafarers has been overwhelming,” Sherry said, adding that Starlink allows for live telemedicine and “streaming video, supporting the health and safety and welfare of our crew, allowing them connectivity with their friends and family.”

Second, is the broader Maersk company, with Sherry saying “notoriously, there’s bad coverage in some areas” where its ships sail, and Starlink brings “more parity between shore-based cloud capability and the vessels,” improving fuel efficiency and telemetry and allowing for “real-time decision making” and remote inspections.

Third, is Maersk’s customers. Sherry emphasized customers “want access to greater levels of data” on cargo in transit – such as a ship “full of bananas” where “the customer may well be deciding when they want the ripening process to take place.”

Maersk isn’t alone among maritime adopters of Starlink. We’ve seen a recent “rush to sign up” by shipping companies including Hapag-Lloyd, Seaspan, Mitsui O.S.K. Line, Eastern Pacific Shipping, Polembros Shipping and more.

Satellites have been, are, and will continue to be a critical backbone of the world’s industries – even if we don’t notice.

Executives from SpaceX, Blue Origin and Virgin Galactic urge Congress to improve the FAA, with a quintet of representatives and experts saying at a Senate hearing that the regulator’s space office in particular “is struggling to keep pace” with the industry’s need to license rocket launches. While the FAA was not invited to testify at the hearing, an FAA spokesperson said that “keeping pace with industry demand is a priority.” – CNBCPsyched about the latest Falcon Heavy launch: SpaceX’s most powerful rocket in operation ripped out of Florida carrying a $1 billion NASA mission, which will spend the next several years traveling to the asteroid Psyche. – CNBC / Watch highlights$2 billion Berkeley Space Center in development by The University of California and SKS Partners, which will be located on NASA’s Ames center campus in California. The Berkeley Space Center aims to begin construction in 2026, with a 36-acre “innovation hub” that would feature 1.4 million square feet of office and research and development space. – Berkeley / NASAVirgin Galactic to phase out carrying an astronaut instructor on spaceflights with the mission after next, as it looks to boost revenue generation by carrying four passengers instead of three. The company’s Galactic 05 mission has a launch window opening on Nov. 2, which will carry a trio of passengers including researchers Alan Stern and Kellie Gerardi. – Virgin GalacticIndia targets 2040 for astronaut moon landing as part of wide-ranging expansion of the country’s space capabilities, including goals such as launching an Indian Space Station by 2035 and flying spacecraft to Venus and Mars. – SpaceNewsKuiper prototype satellites are healthy, Amazon says in a brief update since the Protoflight mission launched. KuiperSat-1 and KuiperSat-2 “are fully activated, generating power independently, and communicating with our mission operations center.” – AmazonOne person’s space trash is Privateer and Kall Morris’ space treasure: The companies announced a partnership to put a price tag on space debris, calling it a “significant step forward in the debris removal market” that “will support not only further growth of key orbital services, but also ultimately the safety and sustainability of our orbital highways.” – Privateer1997 US law limits satellite imagery collection over Israel, with the volume and quality of imagery released by companies much lower in the ongoing conflict compared to companies’ images of Russia’s invasion of Ukraine. – PayloadIt’s a tug! No, it’s a spacecraft! No, it’s Blue Ring! Blue Origin confirms development of the platform, known as Blue Ring, that is designed to carry over 3,000 kilograms to multiple orbits and even to planetary bodies, which the company says will be able to launch on a variety of heavy-class rockets and is expected to debut in 2025. The company established a new business unit, called In-Space Systems, to lead Blue Ring work. – Aviation Week / Blue OriginViasat opening satellite Internet-of-Things facility in Dubai, through partners MinFarm Tech and Global Beam Telecom. – Via Satellite

Investors put $1.6 billion into space companies in Q3, with Space Capital’s latest quarterly report pointing to a trend of funds flowing into companies that are pursuing and winning government contracts as a broader market “liquidity crunch” approaches two years. Space infrastructure companies have brought in $8.4 billion in investment year to date, surpassing 2022’s total of $8.3 billion. – CNBCHawkEye 360 adds $10 million to previous funding round, with Lockheed Martin Ventures and company insiders participating to bump the satellite radio frequency company’s total raise to $68 million. As part of the investment of its venture arm, Lockheed corporate signed “a strategic cooperative agreement” with HawkEye 360 “with a particular focus on delivering sophisticated RF intelligence systems globally.” – HawkEye 360Startup K2 raises $7 million as satellite mega-bus development continues, with the company adding Alpine Space Ventures as a backer and growing its team to 18. Additionally, K2 has won three Pentagon contracts, worth a combined $4.5 million, over the last three months. – TechCrunchQatar Airways adds Starlink, the largest airline yet to add SpaceX’s internet service for inflight Wi-Fi. – Qatar AirwaysViasat expands deal with Canada’s Porter Airlines, adding 20 Embraer aircraft to its previous deal for installing satellite connectivity service on 30 aircraft. – ViasatBlackSky adds Air Force vehicle-tracking research contract, a multi-million dollar deal covering more than a year. The Space Development Agency-funded contract will see the company “build an automated target recognition service that will gather and combine radio frequency and electro-optical satellite sensor data to track mobile assets in real-time.” – BlackSky

Lockheed Martin’s space unit saw higher sales but lower profit in Q3: Net sales increased 8% to $3.1 billion from a year ago, but its operating profit fell 15% to $259 million, which Lockheed primarily attributed to decreased equity earnings from ULA’s lower launch rate. Its space backlog grew slightly to over $30 billion at the end of the third quarter helped by the $800 million transport layer tranche 2 award for 36 beta satellite. – Lockheed MartinIridium stock slips after Q3 report, with the satellite communications company announcing a $1.6 million net loss for the quarter, down from net income of $2.2 million a year ago, which it primarily attributed to “the result of costs incurred in connection with the successful refinancing of Iridium’s credit facility during the quarter.” Q3 revenue was $197.6 million, 7% higher than a year ago, with Iridium ending the quarter with 2.24 million subscribers, up 96,000 from the previous quarter. – Iridium

Adel Al-Saleh named SES CEO, taking over in January from interim chief Ruy Pinto, who has led the European satellite company since the departure of Steve TK in. – SESPayam Banazadeh is stepping down as CEO of Capella Space, with Frank Backes taking over as chief executive, having joined from Kratos. – Capella / Banazadeh / BackesDawn Massop Love promoted to COO at Advanced Space, having started with the company as director of strategic communications. – Advanced SpaceTony Frazier departs Maxar, having served as the company’s Executive Vice President and General Manager of Public Sector Earth Intelligence. – Frazier

Oct. 21: SpaceX’s Falcon 9 launches Starlink satellites from California.Oct. 21: SpaceX’s Falcon 9 launches Starlink satellites from Florida.Oct. 25: Boeing reports Q3 results before market open.Oct. 25: SpaceX’s Falcon 9 launches Starlink satellites from Florida.Oct. 25: Russian spacewalk at the International Space Station.Oct. 26: Northrop Grumman reports Q3 results before market open.