Who Was Larry Boisvert?

Does anyone remember Laurier (Larry) J. Boisvert? He was once supposed to be a "keeper" for the Canadian Space Agency (CSA).

Biosvert was the President of CSA from April 12 to December 31, 2007. He got the job after finishing up a successful career at Canadian satellite communications provider Telesat. According to Gordon Sheppard and Agnes Kruchio in their book Canada's Fifty Years in Space: The COSPAR Anniversary:

Biosvert had spent 34 years with Telesat, the final 13 as president and CEO during which Telesat achieved dramatic growth and became an international competitor in satellite services. He was prepared to establish a new direction for the CSA as well ... reducing the level of bureaucracy to something closer to that of the private sector. However, he resigned in December 2007, saying that a president with a longer tenure would be required for the challenge.

The SpaceToday.Net website disagrees with Sheppard and Kruchio's explanation for Biosvert's retirement. According to the Jan 10, 2008 article CSA President Resigns "Boisvert's departure may be linked to the sale of the space business of Canadian firm MacDonald, Dettwiler and Associates to US aerospace and defense company ATK."

In January 2008 Canadian space focused company MacDonald Dettwiler (MDA) announced that it was selling it's space focused business to US firm Alliant Techsystems (ATK). That sale was eventually blocked by the Canadian government.

According to historian Chris Gainor in his June 2, 2008 Space Review article "Blocked sale exposes the neglect of Canada’s space program" the core reason for the attempt by MDA to sell their space assets was quite revealing:

Over the past decade, Canadian governments allowed the Canadian Space Agency (CSA) and its programs to run on autopilot, rejecting new program ideas and freezing funding at a level that caused Canadian space spending to fall behind other advanced countries’ levels of support for space activities. The growing problems at the CSA were masked by events such as last December’s successful launch of RADARSAT-2 and the successes of the Canadian-built shuttle robot arm and the Mobile Servicing System on the International Space Station.

Since 2008, MDA has prospered and remained Canadian. The government has taken the company under it's wing and is attempting to provide a consistent revenue stream to fund ongoing Canadian space program contributions including the Mars Science Laboratory (MSL) and the Radarsat Constellation.

But for the rest of the Canadian space program, very little has changed. New program ideas and projects are still few and far between.

Boisvert's successor, astronaut Steve MacLean, was given two months by then Industry Minister Jim Prentice when he was named CSA president in fall 2008 to create a new Long-Term Space Plan to address CSA problems and define specific technology areas where Canadians should focus.

Maclean and was told specifically that "time is of the essence."

But the MacLean generated long term space plan was never publicly released and all indications are that it was either ignored or rejected outright by the Canadian government because of cost and non-compliance with the commercialization policies of Industry Canada, the Canadian government department to which the CSA is officially a part.

Of course, the US National Aeronautics and Space Administration (NASA) is still providing free rides for Canadian astronauts in exchange for our CanadArm, CanadArm II and Dextre contributions to the International SpaceStation (ISS) which helps to hide ongoing problems in the Canadian space industry behind a facade of astronaut activity.

But the the recent firing of Com Dev International CEO John Keating as outlined in my September 7th edition of "This Week in Space for Canada," suggests that at least some of these issues are slowly percolating to the surface. Keating was fired for delays and cost overruns on government satellite programs; the Com Dev private satellite business was growing in a consistent, profitable and predictable manner. 

Maybe Larry Boisvert didn't need to resign in 2008. Certainly Steve MacLean doesn't need to resign today. But perhaps, just perhaps, something does need to be done to improve the business environment for Canadian space focused companies.

If not now, then when?


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Goin' to a Party! Meet me on after School!

The Commercial Space Blog is closing down for the summer, mostly because much of the rest of Canada seems to have already done so. The sole official exception to this seems to be the Canadian Space Agency (CSA) which has been promising a new set of requests for proposals sometime over the summer months.

Until they're released, I think I'm going to a party.



For those who'd prefer not to leave their comfy cubicle for adventure but still need an ongoing dose of Canadian space focused news and commentary, I'll be writing an ongoing column for Spaceref.ca under the title "This Week in Space for Canada,"  once a week throughout the summer.

If you need more, I'd recommend pretty much anything from Marc Boucher, Keith Cowling and their associates over at both Spaceref.ca and the US based Spaceref.com. I'd also recommend checking out Elizabeth Howell's work over on the PARS3C blog, EVA Interviews: The business of the new space age, the Space Politics blog which focuses on US space policy and any of the other links you might see in the two columns on the right side of this page.

Hopefully these links will keep everyone occupied, informed and aware until Commercial Space returns with all new stories beginning September 7th.

We'll see you then.

Radarsat-2 Checking Out Top Italian Tourist Spots

MacDonald, Dettwiler and Associates Ltd. (MDA) could soon be using their satellites to check out the Roman Coliseum and other top Italian tourist spots, at least if you take the June 24th, 2010 Canadian News Wire (CNW) press release "MDA to provide a RADARSAT-2 ground information solution"at face value.

The press release states that MDA has:

"signed a multi-million dollar contract with e-GEOS, a leading provider of satellite services in Europe to provide a RADARSAT ground information solution into their existing ground station in Matera, Italy.

The solution includes a RADARSAT-2 and RADARSAT-1 reception and processing capability and grants RADARSAT data distribution rights to e-GEOS for the European Union in support of a variety of maritime and land surveillance applications."

According to the e-GEOS website, the company (a partnership between the Italian Space Agency and Italian based space services firm Telespazio) is a leading international player in the geo-spatial business, offering products and services related to Earth observation and geomatics using optic and radar satellites plus aerial surveys.

Sample images on the e-GEOS website include e-GEOS (COSMO-SkyMed), GeoEye (GeoEye-1 and IKONOS) and DigitalGlobe (WorldView-2 and QuickBird) images of South African stadiums used for the 2010 World Cup and recent COSMO-SkyMed images of the Gulf of Mexico which show black oil slick closing in on the Louisiana coast.

The MDA sale comes hot on the heels of a recent  Euroconsult report titled "Earth Observation: Defense and Security, World Prospects to 2019" which predicts government procurement of commercial satellite Earth observation data will reach $2.6 billion by 2019, up from only $735 million in 2009.

RADARSAT-1 is Canada's first commercial Earth observation satellite. RADARSAT-2 is Canada's next-generation commercial Earth observation satellite and the follow-on to RADARSAT-1.

Mining as a Model for the Commercial Space Industry

Eva-Jane Lark, a BMO Nesbitt Burns VP and investment adviser, space advocate and author of EVA Interviews: The Business of the new Space Age™ sent me an e-mail last week referencing a recent interview I did with Elizabeth Howell over on the Pars3c web blog under the title "High Five: Chuck Black, Canadian Space Commerce Association."

In the article, I stated that the original idea of funding space focused Canadian companies though an extension of the tax credits presently provided to the Canadian mining industry came from John Chapman, a retired mining executive and three Macdonald Dettwiler and Associates (MDA) employees who first presented a paper on the topic at the 2008 Canadian Space Summit.

Eva politely mentioned that she has also written about tax credits and the use of flow through shares to fund space focused activities as far back as 2005. Her article “Investment Financing of Exploration to New Worlds” gives some overall context of the issues involved and a paper she presented at the 2006 International Space Development Conference titled Investment Financing of Exploration to New Worlds: Historical Investment Financing of Exploration for New Worlds, Current Analogies to Other Industries, and Ideas for the Future specifically discussed mining industry analogues beginning on page eight.

I think this was her way of reminding me that the idea has a surprisingly broad genesis going back several years in Canada and even possesses US based advocates like Burke Forte, Director of the 8th Continent Project (an organization affiliated with the Colorado School of Mines) and quite a few others.

So what is this idea all about anyway?

To begin with, the modern intersection of mining and space activities goes back to 1972 and a soil sample retrieved by the Apollo 17 astronauts containing helium-3, a lightweight isotope of helium suitable for fueling atomic reactors, at least it does according to "Mining the Moon" an article published in the December 7th, 2004 edition of Popular Mechanics.

According to the article, the "vast stores" of this "nonpolluting nuclear fuel" are the key to our technological future and also a great way to make lots and lots of money once a whole bunch of intermediary technological, financial and market difficulties have successfully been dealt with.

But details are for accountants and not many accountants ever became space advocates so the extraterrestrial mining of exotic resources slowly became one of those things brought up (along with space based solar power and space tourism) when advocates wanted to give unsupported, "pie in the sky" examples of the enormous commercial potential awaiting those brave or foolish enough to invest in the high frontier.

But after awhile, even the mining companies jumped on the bandwagon and began to point out that the same tools used to scrape minerals off the ocean floor or dig deep into the bowels of the Earth are also suitable, with appropriate modifications, for mining pretty much anywhere, even on the Moon or in the asteroids.

Of course, they weren't initially terribly serious about the idea, although it did turn out to be a good way to obtain grants to fund R&D activities and gain publicity with articles like this 2007 Universe Today post "Heavy Construction on the Moon" which promotes Caterpillar Inc. the worlds leading manufacturer of construction and mining equipment.

But over time, mining and resource companies started coming into more direct contact with space based activities through their use of earth imaging satellites and technology to assist with resource location and development activities.

Eventually all this cross-pollination and idea exchanging got the space gurus and the mining geniuses talking about commonalities and several concluded that the industries are quite similar, with both being highly speculative and requiring large amounts of money up-front for a potential return on investment that could take decades to materialize.

But since mining companies often depend on tax credits to fund their activities, they also normally have quite a few accountants on the payroll and some of the brighter accountants started thinking that there was essentially no real reason why space focused companies can't use the same tax credits that mining companies use to raise money, just so long as mining eventually occurs somewhere.

Even if that somewhere eventually ends up being in space.



After all, the costs for deep water mining and resource collection are the same order of magnitude as space focused activities these days. Plus, space based resource collection also has less terrestrial economic and ecological consequences should something break (and pretty much any British Petroleum public relations person should be able to provide some background in that area right now).

I finally came across the idea in 2008 when retired mining executive, John Chapman and several people working for Canadian space focused firm Macdonald Dettwiler and Associates presented a paper on the topic at the 2008 Canadian Space Summit.

According to their abstract (which is available online here):

"Financing of space research, exploration and development in the past has been done mainly by governments. To create a vibrant and sustainable space program, the private sector needs to be aggressively involved, building upon the foundation established mainly by the USA and Soviet Union governments.

There is an analog that could point the way to rapidly opening space to private enterprise - that is the (existing) Canadian flow through tax incentive for mineral exploration. The flow through tax credit program in Canada has facilitated the raising of billions of dollars annually for mineral exploration companies, mainly by wealthy individuals, and this has kept Canada in the forefront of mineral exploration and mine development."

According to the authors, the conquest of space is no longer rocket science. It's all about the tax code and accounting. Raising money is simply a question of extending the tax code provisions already in use by the Canadian mining industry to cover space focused activities.

Of course, this idea has essentially dropped off the face of the Earth since the presentation in 2008, but now might be a good time to revisit it since Canadian Space Agency (CSA) President Steve MacLean recently indicated that Canada needs $2 billion over five years in order to "put us at the table" according to the article "Bill to push Canada in space to top $2B: MacLean" from the PARS3C web blog.

$2 Billion over five years seems like a pretty small amount compared to what the Canadian mining industry can raise. Perhaps the Canadian space industry should take note.

Besides, no one is going to fund anything off the Gulf coast for the next little while and the money might just as well go somewhere useful.

Venture Capital and New Space Investments

According to Investors.com author Brian Deagon in his June 18th, 2010 article "VC Funding One Void In Commercial Space" the venture capitalists who provided seed funding for so many other industries have so far stayed away from commercial space activities.

The article can find only one exception. Space Exploration Technologies (Space-X) has received $20 million from venture capital firm Founders Fund, whose partners include PayPal co-founder, Peter Thiel plus $20 million from VC firm Draper Fisher Jurvetson (Deagon might have missed the undisclosed amount provided in June 2007 by Boston Harbor Angels to XCOR Aerospace as outlined in this June 7th, 2007 X-Cor press release).


Of course, these amounts were only a fraction of the total that Space-X needed in order to finance it's recent successful Falcon 9 rocket launch. That launch led directly to Space-X receiving a $492 million USD contract with Iridium Satellite Communications to replace the sixty six aging satellites in the Iridium satellite constellation with an updated Iridium Next constellation.

Look for Space-X to land a few more contracts for a lot more money over the next little while. According to the article June 16th, 2010 article "Space-X Undercut Competition To Clinch Head-turning Iridium Deal" from the Space News website:

The implied price — $6.8 million for each 800-kilogram Iridium satellite launched into a 780-kilometer orbit — is at a level not seen in the launch industry since Russian and Ukrainian rockets were first introduced into the commercial market in the mid-1990s. These vehicles’ prices have since risen sharply.

The contract is a good match for both sides with Iridium able to launch several satellites on each Falcon-9 at a lower cost per launch and Space-X getting a second revenue stream large enough to render it virtually independent from NASA and it's budget woes (and for some context on recent NASA budget woes, it might be worthwhile to check out the recent posts on the Space Politics blog).

According to the article "Elon Musk on Why His Rockets Are Faster, Cheaper and Lighter Than What You’ve Seen Before" posted June 18th on the Private Equity website (peHUB), there are a number of good reasons for the Space-X success including vertical integration, more innovation, less outsourcing and an almost "silicon valley" mentality.

According to Space-X CEO Elon Musk as quoted in the article:

Some of what we’ve done is really just common sense — for example, using the same propellant in the upper and lower stages means that operationally, you only need to have one set of fuel tanks. If you can imagine a situation where you have a kerosene first stage, hydrogen upper stage, and solid rocket side boosters, you’ve just tripled your cost right there.

Also, the upper stage of Falcon 9 is simply a short version of the first stage. That may seem pretty obvious, but nobody else does that. They tend to create upper stage in a totally different way than they create the first stage.

The Merlin engine — we used it on the upper stage of Falcon 9, on the main stage of Falcon 9 and on the first stage of Falcon 1. So we get economies of scale in use of the Merlin engine.

Our tanks are friction steel welded, [aluminum] skin and stringer designed as opposed to machined aluminum, [giving us] a 20 fold advantage in the cost of materials, and our stage ends up being lighter …because geometrically, we can have deeper stringers.

No doubt, the two venture capital firms supporting Space-X will very shortly receive a suitable return on their investment. When this happens, watch the market open up.

Understanding and Profiting from Geomatics

According to his biography on the Kim Geomatics corporate website, Robert (Bob) Ryerson is not just the firms president and founder.

He's a former Director General in the Government of Canada, a past Chair of the Canadian Remote Sensing Society (now part of the Canadian Astronautics and Space Institute) and a former member of the Board of Directors of the American Society for Photogrammetry and Remote Sensing (ASPRS).

He's also a writer, having contributed to the Manual of Remote Sensing as an author/editor of the 2nd edition and editor in chief of the first three volumes of the 3rd edition. He currently sits on the Board of Directors of the Geomatics Industry Association of Canada (GIAC).

All of which makes Ryerson both a busy person and an acknowledged expert in something called geomatics, which Wikipedia describes as the discipline of gathering, storing, processing, and delivering geographic or spatially referenced information.

Geomatics is essentially an interesting "mashup" of surveying and cartography with additional components relating to geodesy, hydrography, photogrammetry and remote sensing mixed in and with everything wrapped up around the latest orbital imaging and data tracking technology.

Of course, it's also one of those new and innovative technologies that Ontario Premier Dalton McGuinty is promoting on trade trips throughout the world, as per this recent OMNI News report which highlighted Canadian geomatics focused company PCI Geomatics.


PCI Geomatics featured on OMNI News from pcigeomatics on Vimeo.

According to GeoConnections, a Canadian government website focused on uses for location-based (or "geospatial") information:

Geomatics has been one of the fastest-growing technology sectors in recent years, and Canada is at its forefront. 

Canada's geomatics community is a recognized world leader in providing the software, hardware, value-added services and knowledge that help clients address challenges and opportunities in such areas as the environment, health care, land management and reform, development planning, infrastructure management, natural resource monitoring, weather reporting, education and school curriculum, recreational industries, sustainable development, and coastal zone management and mapping.

All of which gives quite a bit of scope for developing new business applications.

As for Ryerson, he's an acknowledged expert in this emerging field so it's only natural that his next book (co-authored with Kim Geomatics Senior Associate Stan Aronof) takes advantage of this expertise.

Titled "Why "Where" Matters: Understanding and Profiting from GPS, GIS and Remote Sensing," the book focuses on the business applications surrounding geomatics. According to the pre-publication literature:

This book identifies the key geospatial technologies you need to know, what they can do, and how individuals, business, and government will profit from them as they increasingly power our future economic well-being. It closes with advice on how these technologies can be applied to the benefit of the reader, no matter who – or where – that reader may be.

It sounds like an interesting read so I'll definitely be picking up a copy when it becomes available through the Kim Geomatics Corporation, Box 1125, Manotick, Ontario, Canada, K4M-1A9 in September 2010.

But for those of you who don't want to wait until September, the 2010 Canadian Geomatics Conference is in Calgary, Alberta from June 15th - 18th and will focus on "the abundant yet largely untapped potential of Intelligent Mapping and the critical role Geomatics can play in bolstering Canada’s productivity, innovation, global competitiveness and overall socio-economic well-being."

COMDEV Stock Down: Long Term Space Plan Blamed!

COMDEV International, one of the "three kings" of Canadian commercial space activities has certainly had a bad last couple of months, if you believe the business publications.

The June 11th, 2010 CanadianBusiness.com blog stated "Com Dev stock down sharply on disappointing earnings report" while the Wall Street Journal reported on the same day that "Com Dev Reports Third Straight Disappointing Quarter" and Reuters Canada reported that "Com Dev shares hit 52-week low."

But the most interesting story was posted June 11th on the online edition of The Exchange, which bills itself as the magazine for business, economic development and entrepreneurs under the title "COMDEV Announces Second Quarter Fiscal 2010 Results." The article quotes COMDEV CEO John Keating as stating that:

Our commercial products business, which now generates over 60% of revenues, continues to perform very well.

According to the article, Keating then goes on to blame the revenue shortfall on delays launching their first two operational satellites, delays in funding the RadarSat Constellation program and the lack of federal government funding for the Canadian Space Agency (CSA) long term space plan (LTSP). According to Keating:

The funding of Radarsat Constellation in the recent federal budget could lead to over $80 million of revenues for us over a five year period, but it might also result in deferring the start of the next significant optics program.

An important priority for us is to secure optics work for our COMDEV Canada division to replace the James Webb Space Telescope program which is nearing completion. The Canadian Space Agency’s proposed Long-Term Space Plan prioritizes a number of programs that would most likely involve a role for COMDEV, but the Plan has not yet been funded. We are pursuing all possible avenues to win new orders for the division.

These articles follow close on the heels of CSA astronaut Julie Payette's June 9th comments at the Greater Victoria Chamber of Commerce where she is quoted on "the importance of funding for a Canadian space program" according to the post "Canadian Astronaut Speaks to the GVCC" on the C-FAX 1070 News website.



On May 11th, 2010 while speaking before the House of Commons Standing Committee on Industry, Science and Technology (INDU), CSA President Steve MacLean stated that the CSA likely needed an additional $2 billion over five years in order to "drive innovation."

Iridium Completes Stunning Turnaround

Iridium Satellite Communications, the satellite phone company that went belly-up soon after going live, filing for Chapter 11 Bankruptcy in 1999 has just completed a stunning turn around by ordering 81 spacecraft to upgrade its global network according to the June 2nd, 2010 BBC News article "Huge order for Iridium spacecraft."



According to the article:

Thales Alenia Space (TAS) of France will build the satellites - 66 to form the operational constellation, the remainder to act as spares. The order makes the Iridium Next venture the biggest commercial space project in the world today..

The overall cost of the project, dubbed Iridium Next is likely to be about $2.9 billion USD, much of which the company expects to finance out of its own cash flow.

Based in McLean, Virginia, with about 360,000 subscribers worldwide, Iridium has earning revenues amounting to hundreds of millions of dollars with just under a quarter of those revenues deriving from US government and Department of Defense contracts.

But all that ongoing domestic revenue makes it even more surprising that TAS has beaten out Lockheed Martin for the contract. According to the follow-up June 3rd, 2010 BBC News article "The magic touch of French satellite finance" the secret has to do with the role played by the Compagnie Francaise d'Assurance pour le Commerce Exterieur (Coface) which "underwrites risk and has been particularly active in supporting the French satellite manufacturing sector."

The article goes on to state:

Its (the Coface) commitment to projects like Iridium Next allows those projects to secure loans at very favourable rates. In what are tough economic times, Coface support has facilitated ventures that might otherwise not have been able to get financing.

Coface is also underwriting another deal for TAS to build satellites for Iridium competitor Globalstar, which operates 48 spacecraft in a slightly higher orbit and will see its first next-generation spacecraft launch later this year.

Canadian banks and Canadian politicians looking to grow Canadian  space focused business might want to take close note of this interesting turn of events.

Revisiting "NASA as the Next General Motors and What That Means for Canada"

According to Pulitzer Prize winning author Paul Ingrassia in his June 1st, 2010 Wall Street Journal article "The Lessons of the GM Bankruptcy," it's been one full year since auto manufacturer General Motors (GM) filed for bankruptcy protection. According to Ingrassia:

Everybody knew it was ridiculous and unsustainable to pay workers indefinitely not to work (in the United Auto Workers union's Jobs Bank), to keep brands such as Saturn and Saab that hardly ever made money, and to pay gold-plated pension and health-care benefits to employees. But all of these practices, paid for by mounting debt obligations, continued for decades in GM's 30-year, slow-motion crash...

Problems denied and solutions delayed will result in a painful and costly day of reckoning.

Of course, the day of reckoning eventually did arrive.

The Jobs Bank is now gone (as part of the deal to help GM, Ford and Chrysler secure bailout funds), the Saturn brand will be phased out in 2011 and Saab was recently sold to the Dutch automobile manufacturer Spyker. GM is a much smaller company today and what's good for General Motors is no longer necessarily good for the USA and "vice versa," as was once said by Charles Edwin Wilson, the US secretary of Defense under Dwight D. Eisenhower.

So what does this have to do with my August 27, 2009 post on "NASA as the Next General Motors and What That Means for Canada" where I compared the General Motors of 2007 with the NASA of 2009?

That's easy. The National Aeronautics and Space Administration (NASA) isn't formally bankrupt yet but their time of reckoning is coming. We likely have another year or two before the final crunch occurs and this is much like the GM of the 2007 - 2008 period.

Of course, we're not talking about a private corporation so what happened at GM can't happen in the same way at the US space agency. It's even possible that the process will move forward as the Obama administration expects and the US president outlined in his April 15th, 2010 speech from the Kennedy Space Center.



But no matter what, NASA employees and their subcontractors will need to develop new skills, associations and capabilities to survive or else risk slipping into the ranks of the unemployed as the old NASA becomes the new.

These changes are driven by the funding crises within NASA. As outlined in the 2009 NASA Review of US Human Space Flight Plans Committee Final Report, existing plans to fund the Ares/ Constellation program and explore the Moon and Mars are financially "unsustainable" for NASA in much the same way that GM's fiscal structure and employee commitments were described as being "ridiculous and unsustainable" by Paul Ingrassia.

The first change is represented by the launch yesterday of the Space-X designed and built Falcon-9 rocket, videotaped below from the roof of the Vehicle Assembly Building at the Kennedy Space Center as it lifted off from nearby Cape Canaveral.



This represents the opening of NASA to new and non-traditional space focused companies with less infrastructure to maintain and younger, perhaps more innovative employees. These "newspace" firms are in stark contrast to the gigantic "legacy" manufacturing and research facilities (plus their associated jobs which are generally held by people well into their 40's, 50's and 60's) that have typically grown up around NASA contractors over the last five decades. 

Of course, the "legacy" companies and their political representatives aren't likely to take kindly to the emergence of "newspace" firms as demonstrated by the June 4th post "Congressional Reaction to the Falcon 9 Launch" from the Space Politics blog. But there is no longer any money to pay the costs associated with legacy companies so these larger firms will eventually lose their budget battle.

The second change is likely to be an increase in international cooperation which is the logical outgrowth of the fact that the US no longer possesses sufficient capital to create gigantic "cost is no object" space focused projects independently, as was done in the 1960's during the Apollo era.

But the problem with international cooperation is the potential for two way sharing of knowledge. This could encourage some international space focused organization with lower legacy operating costs to figure out how to run an entire space program on their own more effectively and for less money than the US. There are obvious parallels here with the way that Toyota, Hyundai and a whole bunch of other car makers slowly developed methods to compete effectively with GM and other American firms.

Which brings us to the third change, which is the investments in breakthrough propulsion and other new technologies which are perceived by the American's as the "game changers" needed to keep ahead of other countries who can certainly compete on costs using existing technology, which was mostly developed in the 40's, 50's and 60's.

So now we know what's coming  down the pipe at NASA. We've got the opening up to new and non-traditional space focused companies, international cooperation and the search for "game changing" breakthrough propulsion and other new technologies.

Now that Canadian's know what the US policies are and why they are that way, we're in a better position to take cooperate, contribute and even take advantage of the new NASA.

As for GM, they're also doing things a bit differently lately and their recent news is decidedly more upbeat with the May 28th announcement that the company is starting a $100 million USD venture fund and the June 1st announcement from GM Canada that it is investing a further $224 million CDN to build a new line of fuel-efficient transmissions.

According to the June 2nd, 2010 Canadian Press article "Stay tuned' for more investments: GM Canada president," the money:

committed to build new transmissions at GM's St. Catharines, Ont., plant reflects a brighter future for the company and Canadians should "stay tuned" for further announcements, said new company president Kevin Williams.

The same thing will happen to NASA after it gets it's house in order. After all, everything new has a beginning.

This Year in Space for Canada!

The Commercial Space blog is officially one year old as of May 29th and what started as a personal vanity project to inventory government agencies, educational facilities and private corporations involved in space focused activities has evolved into a more interesting discussion of existing Canadian capabilities and future potential relating to research and development, technology commercialization and how they all relate to the high frontier.



Of course, since it's called "commercial" space, there's always the part where we're trying to make a little money and this tends to focus and define the 90+ posts and 50,000 words that have been generated here over the last year.

But while some of those posts have certainly been useful and informative, it's best to keep in mind my July 21st, 2009 post which pointed out that "Even Werner von Braun was Wrong Once in Awhile."

Going forward, the blog focus will remain pretty much as stated in my very first post:

Businesses operating space related ventures have been commercially viable since at least the 1960's when the first Early Bird satellite was successfully launched into geosynchronous orbit according to David M. Livingston in his paper, Space: The Final Financial Frontier.

And Canadian companies have always been leaders in this area, beginning with the launch of the Allouette and Anik satellites and moving forward from there. 

In fact, it's got to the point where Cabinet Minister Jim Prentice has gone so far as to say that "Canada has more than 200 firms that are involved in space" employing thousands of skilled workers who know that “working in space or working in the space-based industries is just another career option.”

We'll continue to focus on those industries, the partnerships and the politics surrounding those partnerships. Perhaps we'll even continue to mention some of the better opportunities to make some money off the high frontier.

Is this a great country or what!

Micro-Satellites with Practical Applications

"Micro-satellites are not just for science anymore" states David R Cooper and he should know at least a little bit about the topic given his position as Chief Executive Officer of Microsat Systems Canada Inc. (MSCI), the company acting as the Canadian Space Agency (CSA) prime contractor and systems engineer for the Near Earth Object Surveillance (NEOSSat) micro-satellite.

NEOSSat is expected to launch in 2011 and according to the CSA NEOSSat website:

In addition to searching for asteroids, NEOSSat will also update the positions of satellites and space debris orbiting high above the Earth as part of a project by the Defence Research and Development Canada (DRDC) known as HEOSS (High Earth Orbit Surveillance System). While this has been done from space before, it has never been done using such small spacecraft....

"NEOSSat is a technological pathfinder for us to demonstrate the potential of micro-satellite technologies to satisfy operational requirements of the Canadian Forces," explains Major Tony Morris of the Department of National Defense."

All of which makes this particular little micro-satellite quite the useful tool, but other small micro-satellites similar to NEOSSat (which weighs 75-kilograms and uses only 50 watts of solar power) are already proving their worth in many different fields, according to Cooper.

For example, while the enormous Hubble space telescope may have grabbed media attention over the last two decades, the future of astronomy may actually belong to smaller satellites like the Microvariability and Oscillations of Stars (MOST) micro-satellite telescope. According to Wikipedia, MOST is also the smallest space telescope in the world (which is why its creators nicknamed it the “Humble Space Telescope”).

But while the larger Hubble telescope is indeed a magnificent technology, it also cost billions of dollars to build and maintain which is multiple orders of magnitude more than the MOST. On top of which, groupings of micro-satellite telescopes like MOST could also combine their capabilities and signals together into "satellite constellations" with far greater capabilities than could be created within just one satellite or ground based telescope, no matter how large.

So the future may belong to the micro-satellite and this is what MSCI is banking on.

The firm operates the MOST micro-satellite under contract to the CSA and is using the lessons learned from it's design, manufacture and operation to not only improve MOST but to design and build the next generation of micro-satellites, starting with  NEOSSat. According to Cooper, there are:

"many useful applications for constellations of micro satellites including planetary imaging and satellite tracking, but also a wide range of operational and commercial applications are possible. That's why we've designed our micro-satellites around a standardized and cost-effective, multi-mission micro-satellite bus (MMMB) architecture."

The MMMB features a core mechanical structure approach, adaptable to a wide variety of payloads, and a suite of optional bus components to meet a variety of mission requirements.

In addition to MSCI's core expertise in the area of systems engineering and attitude control systems, the firm has developed expertise in structures and power sub-system and can call on long time strategic partners for thermal, communications, solar arrays, and computers and any other particular application.

MSCI also teams with an appropriate payload expert. "We don’t try to do it all ourselves" states Cooper. Instead:

We focus on those sub-systems where we have world class expertise the, crown jewels of the company and over time focus our R&D efforts to keep us leading edge in these areas. In parallel we work with our external partners in other sub-systems to keep them informed of directions we are going. This approach of standardizing the MMMB architecture, rather than the technology, allows us to use the latest advanced components while minimizing non-recurring engineering cycles.

This is the primary difference between a "micro-satellite" systems engineering approach and a traditional "waterfall" space systems engineering approach. The other major difference is the application of commercial electronic parts carefully selected and tested to meet the harsh environment of space. Using commercial parts instead of traditional space parts significantly reduces the cost and schedule impact of building a satellite. New designs can be rapidly prototyped, tested and modified if necessary.

Cooper feels that the benefits of this approach include:

• Increased capability: MSCI’s use of carefully-screened and radiation-tested commercial components allows them to capitalize on the latest available technology to pack more capability into a micro-satellite mass and volume for more on-board processing, bandwidth and memory. As well, data processing that previously required ground station processing, or bigger satellites, can now be done on the micro-satellites themselves. As a result, ground stations no longer need to be as complex or expensive to run which saves on infrastructure costs.
• Flexibility and scalability: The MSCI developed MMMB architecture is designed to partition bus and payload subsystems because key subsystems, such as power, attitude control system and communications are now able to scale up or down to accommodate a wide range of payloads including optical or electronic surveillance, multi-spectral sensing and communications.
• Bigger bang for the budget: With limited budgets everywhere, the MSCI built MMMB flexible architecture is simpler to adapt to new payloads, easier to reconfigure for new capabilities and faster to bring to completion and this mean it's less expensive.

For commercial customers, this means cost effectiveness with shorter implementation schedules, since an MMMB buss based micro-satellite can be deployed in as little as twelve months.

MSCI considers itself to be Canada`s oldest and most successful Canadian micro-satellite company and also the last independent micro-satellite company left in North America. "All the other US based companies have been acquired by "big space" companies," states Cooper who continues:

"We're the only one left but this has allowed MSCI to focus on what it does best, which is growing our core micro-satellite business."

The MSCI built MOST micro-satellite will reach its seventh birthday on June 30, 2010 and is expected to be still in orbit and going strong which provides solid proof that the MSCI claims are real and not just a good science fiction story.

Feedback on "The Bill to Push Canada's Agenda in Space"

There's been quite a bit of feedback from my May 16th, 2010 post titled "The Bill to Push Canada's Agenda in Space" which focused on the May 11th, 2010 House of Commons Standing Committee on Industry, Science and Technology (INDU) meeting with Canadian Space Agency (CSA) President Steve MacLean, Canadian astronaut Robert Thirsk, Japan Aerospace Exploration Agency (JAXA) astronaut Koichi Wakata and European Space Agency (ESA) astronaut Frank De Winne.

During the meeting, CSA President MacLean stated that the CSA required an additional budget of "2 Billion over five years" to "put us at the table" and drive innovation. He also stated unequivocally that “Everything we do is to align with (Canada’s) science and tech strategy.”

Those of us interested in having a little context to the discussion before wading into the comments and opinions might want to listen to this audio recording of the meeting hosted on the ParlVU website. To listen, you simply click on “Advanced View” and select “English Audio 32K”and your reward is almost two hours of fascinating context on our politicians and our space program which will help to illuminate the discussion below.

As for the rest of us, who might perhaps be too impatient to do the appropriate due-diligence, here are some of the more interesting comments, views and opinions received over the last few days interspersed with some context, some personal opinions and even a list of four things that independent space focused businesses should lobby the government about.

To begin with, Canadian Space Society President Kevin Shortt (who also subscribes to the discuss@spacecommerce.ca e-mail list where I get some of my best ideas), seems to have provided perhaps the most direct and relevant commentary on the discussion by stating:

"The thing that struck me was that everyone (in the meeting) seemed interested in the idea of pursuing exploration of the solar system but lacked the knowledge to ask the intelligent questions on what it would take to accomplish those goals. Then they would turn around and ask questions concerning why so much money is being invested in space technology.

This tells me that while there is an interest to invest in this kind of thing, there is a fundamental lack of understanding in the basic process to get this technology "off the ground" which makes justifying the expense that much more difficult. My feeling is that until there is that fundamental understanding, any programs that involve spending money on space will be short-lived and hard to maintain."

Shortt's comments certainly seem accurate to those of us who have listened to the meeting, but are also confusing to those of us (including Shortt) who are aware of Canada's longstanding science and technology strategy which encourages the commercialization and utilization of newly developed technologies as described in my May 22nd post "The "Three Kings" of Canadian Commercial Space".

This policy has essentially remained unchanged for decades and enjoys a broad consensus of support across the generally partisan, Canadian political party lines. Of course, it is certainly possible that those politicians who were aware of the strategy, like Liberal MP Marc Garneau, either attended the meeting but intentionally kept quite or else managed  to be absent for the discussion.

Some readers focused on good reasons why Canada should continue on with space focused activities whatever the cost. After all, $2 billion extra spread out over five years on top of the existing budget does seem like a lot of money and politicians might want some sort of justification to authorize those expenditures. These justifications could include:

1. The encouragement of high-tech job creation which will increase exports and grow tax revenue.
2. The creation and distribution of new technologies and products that will improve the efficiency of industries.
3. Building international reputation and goodwill to gain access to important places like the International Space Station (ISS) and/or encourage the Americans to maintain their subsidy of Canadian astronaut activities.
4. The inspiration to youth to study science and technology based subjects which are needed over the long term to do one or more of the items listed above.
5. How it's in our "essential nature" to "boldly go where no man has gone before."

No doubt the above are valid points, but the first two items need some sort of tracking mechanism which politicians can use to justify their decisions, while the third and the fourth are generally nice to have but only follow logically upon the successful completion of the first two.

After all. kids and foreign politicians generally aren't inspired or interested in giving out goodwill without something useful actually being done that they can see and become excited about.

So what about that final point about our essential nature and going boldly? It sounds great and it's made some people who write fiction quite a bit of money, but as a practical justification of why we should undertake space focused activities it just doesn't seem to have worked so far to convince the skeptics.

Even the great 1960's adventures of the Apollo program only went boldly in order to keep the Russians from getting their first.

So while going boldly often make for a good story, maybe the time has come to find new hero's with different stories to tell. Perhaps we need someone like Delos D. Harriman, an entrepreneurial businessman who masterminded the first landing on the Moon as a private business venture in the 1949 Robert A. Heinlein novel "The Man Who Sold the Moon."

Or maybe that's a topic for another time...

Moving back to today's topic, it's important to note that several readers took me personally to task for my suggestion to move the debate into the political arena and lobby the federal government. One commented said flat out that "since we don't officially know what the LTSP is yet or why it will cost an additional $2 billion over five years, it might be worthwhile for you to suggest some good things to lobby for, rather than just suggesting that we call up the our local MP to say hi."

They're right and an alternative is indeed needed. So here's what I'd personally call up my MP to lobby for:

1. First of all, I'd ask for the existing LTSP to be formally released, if only because it can't really be discussed unless we know what's in it (although by now we must all have at least a general idea).
2. Secondly, I'd request the creation of CSA programs specifically targeted towards small business and tech start-ups because there aren't any programs in that area right now and they're needed. I first wrote about this state of affairs back in July 2009 under the title "OK, So Maybe the CSA Does Provide Some Support for Small Aerospace Firms" but was joking in the title, since there were no specific CSA programs whatsoever for small businesses then. Nothing seems to have changed since, so maybe we should suggest more strongly a second time that the CSA develop some small business specific programs for their subcontractors. From a political perspective, I'm pretty confident that the announcement of a small business specific program from the CSA would go far towards building a consensus in favor of the organization getting the extra money needed to fully implement the LTSP.
3. Thirdly, I'd lobby to make sure that something called "Section 116" of the tax code is removed as promised in the last federal budget (I talked about section 116 in my March 8th, 2010 post "Happy Days Are Here Again"). In  essence, section 116 makes it hard for foreign companies and individuals to invest in Canadian based companies and I'd like Canadian companies to have all the capital they can get.
4. And finally, I'd advocate that the "super-flow through share" tax credits presently used by the Canadian mining industry to fund speculative mining ventures also be extended to fund science and technology commercialization activities. After all, there is certainly overlap between mining activities and science and technology commercialization since they both are highly speculative and require large amounts of money up front for a potential return on investment that could take decades to materialize. Of course, this is nothing new to readers of this blog since I've previously talked about flow-through tax credits as recently as my post "Preparing for the Next Great Canadian Gold Rush." An abstract on the topic by John Chapman, Nadeem Ghafoor, Christian Sallaberger and Frank Teti from the 2008 Canadian Space Summit is also available online here for those of us who'd like to learn more.

Points three and four are specifically focused on funding through tax credits for space science and R&D, which is quite palatable to politicians right now, if only because there are no requirements for up-front government funded capital investment or ongoing financing. Plus, the returns from the program can be easily measured through the filed tax forms of the program participants.

Taken in total, these four points are proposals that politicians will understand without a lot of education, training or prompting and be able to track without the need to refer to any deeper philosophical arguments.

They are also helpful for companies interested in raising money to do a little science and commercialize some technology for space focused activities and that's why I'd advocate them.

Of course, I'm fully aware that taxation is a blunt instrument for social policy and sometimes leads to unintended consequences as you can infer from the recent May 2010 SR&ED Update on the Canadian Advanced Technology Alliance (CATAAlliance) website, which talks about another Canadian tax credit program and what it's supposed to accomplish:

"Once again, the (SR&ED) program seems to have strayed back to the CRA’s (Canada Revenue Agency) traditions and focus on compliance instead of on the effective delivery of an incentive program.  For whatever reason, the program’s leadership just cannot get it right."

So the ideas aren't perfect but they are a start and we all need to start somewhere.

I'm also fully aware that my four proposals don't really address national security and economic infrastructure issues arising out of the aborted  2008 sale of portions of Canadian space focused  business icon Macdonald Dettwiler (MDA) to American-owned Alliant Techsystems (ATK).

But again, they are a start and we all need to start somewhere. In this case, I'm even willing to publicly go on record as stating that I don't think that the MacLean proposals, as summarized in the as yet unreleased LTSP, will address national security and economic infrastructure issues either.

Anyone looking to prove me wrong is encouraged to release the LTSP and point out the appropriate passages in the document.

The "Three Kings" of Canadian Commercial Space

Communications giant Telesat, robotics expert Macdonald Dettwiler (MDA) and micro-satellite upstart COMDEV International (COMDEV) have emerged as the "three kings" of Canadian space focused activities.

These three firms will likely have more effect on Canada in space than anything happening at the Canadian Space Agency (CSA) and much of the reason for this is the ongoing government policy to encourage research commercialization as the cornerstone of the Canadian science and technology strategy.

The latest Conservative government under Stephen Harper may have gone so far as to attempt to define and state this explicitly in policy documents such as Mobilizing Science and Technology to Canada's Advantage (May 2007) and the Mobilizing Science and Technology to Canada's Advantage Progress Report (June 2009) but the general policy has been in place for generations and enjoys wide support across party lines.

It's also generally been a very, very successful policy.

For example, Telesat (created in 1969 as a Canadian government owned or "crown" corporation under the Pierre Trudeau liberal government) was originally mandated simply to develop communications services in the far north. It used technology developed through another government department, the Communications Research Centre (CnRC), which was then responsible for coordinating research and development activities in communications.

CnRC activities then were much like CSA activities now and included most of Canada's early satellite launches such as Alouette 1, the first satellite designed and built by any country other than the United States or the Soviet Union.

The technology transfusion from CnRC certainly helped Telesat to become an iconic representation of how Canadians use space focused solutions to solve terrestrial problems, tie together the country and then continue forward to make a bit of money on the side.

Telesat is, of course, directly credited with several space focused "firsts" of its own including the world's first domestic communications satellite in geostationary orbit operated by a commercial company (ANIK A1). It currently owns a fleet of 13 satellites plus operates 13 additional satellites for other entities. These assets are administered by 500 employees with a yearly budget twice that of the CSA, which makes Telesat the fourth-largest fixed satellite services provider in the world.

But whatever the bottom line might show, the recent awarding of the John H. Chapman Award of Excellence to the first president of Telesat, Dr. David Golden for his "outstanding contribution to the Canadian space program" reinforces the longstanding perception that Telesat has always been more than just a business. One day writers will create fascinating historical accounts of Telesat's early activities in much the same way Pierre Burton wrote about the railroads when he called them "The National Dream."

The same could also be said for MDA, although the genesis for this perception is more recent and grew out of the aborted sale of the space portions of the company to American-owned Alliant Techsystems (ATK) in April 2008.  The sale, eventually blocked by the Conservative government, served to highlight national security and economic infrastructure issues which have not yet been formally addressed or resolved although MDA has since moved on to become the prime benefactor of Canadian government contracts relating to Earth imaging and arctic sovereignty.

In fact, MDA has become such an iconic Canadian company that there is even an MDA satellite (RADARSAT-1, the first Canadian Earth observation satellite) along with it's Gatineau based ground station tracking antenna on the back of the Canadian $100 dollar bill. Radarsat International, Inc. (RSI), the Canadian private company created in 1989 to process, market and distribute Radarsat-1 data was acquired by MDA in 2006 and renamed MDA Geospatial Services International (GSI).

MDA also used the skills gained through it acquisition of SPAR Aerospace Ltd., the company which designed, developed, tested and built the first Canadarm, to do the same with the Canadarm2 as part of Canada's contribution to the International Space Station (ISS).

COMDEV is the newest on our list but is also the firm with perhaps the most potential and the greatest part of it's story still to come. With 1300 employees and FY2009 revenues of around $240 million, according to Bloomberg Businessweek, it has about 2/3rd the cash flow but more than twice the employees of the CSA.

Founded in 1974 to supply microwave equipment to the emerging space industry, the firm is currently moving into the miniaturized (or micro-satellite) market in a big way through the ongoing activities of COMDEV subsidiary, exactEarth Ltd. It is also moving forward with a micro-satellite based automatic identification system ( called exactAIS™), the maintenance of ongoing R&D relationships with Canadian universities including the University of Toronto Institute for Aerospace Studies (UTIAS) Space Flight Laboratory (SFL) and it's recent purchase of Routes AstroEngineering (Routes).

According to the firm website, "over 80 percent of all commercial communications satellites ever launched have had COMDEV technology on board."

So now that we know the players, we need to ask how the CSA, the government agency "committed to leading the development and application of space knowledge for the benefit of Canadians" according to the website "CSA - About the Canadian Space Agency," should go about interacting with these "Three Kings" of Canadian commercial space.

At the very least, the CSA needs to do it in a way that fulfills and compliments the ongoing government policy to encourage research commercialization as the cornerstone of an overarching science and technology strategy.

So does the CSA ignore the Three Kings, subcontract out to them, administer and guide their activities or act as an incubator for their eventual successors and competitors? Maybe it should perform all or none of these functions or even perhaps try something else entirely to grow our Canadian space footprint?

The discussion on the appropriate actions for the CSA to take will likely be the subject of a future post. Stay tuned.


COMMENTS:

From: Kieran A. Carroll

Chuck;

(I still can't seem to figure out how to post comments to your blog...)

In "The "Three Kings" of Canadian Commercial Space", you referred to the Communications Research Centre as CnRC; AFAIK, everyone in the community refers to it as CRC. You also wrote:

In fact, MDA has become such an iconic Canadian company that there is even an MDA satellite (RADARSAT-1, the first Canadian Earth observation satellite)..."  

Radarsat-1 was built by Spar Aerospace, and I'm pretty sure that the satellite belongs to the Crown. (Unlike Radarsat-2, for which the CSA agreed to a deal in which MDA owns the satellite). You also wrote:

"MDA also used the skills gained through it acquisition of SPAR Aerospace Ltd., the company which designed, developed, tested and built the first Canadarm, to do the same with the Canadarm2 as part of Canada's contribution to the International Space Station (ISS)." 

If I recall correctly, the Special Purpose Dextrous Manipulator("Dextre") was the only significant element of the Mobile Servicing System for the ISS that wasn't complete at the time that Spar sold their space division to MDA."

-Kieran-

Editors Note: Kieran is not the only person having trouble posting comments right now and I'm not sure how to go about fixing the problem. Anyone able to assist (especially someone who knows HTML) is more than welcome to give me a call and we'll see what can be done.

Otherwise, I'll be posting comments manually so don't be shy. Send your questions, queries, concerns and comments to mr.chuck.black@gmail.com.