Between 1st February 2018 and 30th April 2018, we undertook a Phase 1 Feasibility Study under the SME Instrument to determine the technical and economic viability of our optical communication system solution, ODALISS, for nano and microsatellites. This study proved instrumental to investigating the market landscape, strengths, as well as meeting requirements, to ensure successful first revenues from the proprietary technology. The Feasibility Study showed that an updated business model and financial plan was needed to approach the market and achieve higher rates of market penetration. The main achievements reported in the study were:
• Upon further in-depth market analysis through investigations and meetings with key market players, we found that the problems and needs in this market aren’t being adequately met by the current nano and microsatellite communication systems, with no company looking to transfer over their optic communication system from large satellites to the smaller market. The reason for this is that they are still developing their technology and it would be a completely different product needed for the smaller satellites. Due to the need for a smaller size and lower power requirement, these developments can’t be made.
• We found that our business model would need to be modified for improved commercial success. To do this we looked at the revenue streams we would make form our customers. The most beneficial business model to approach the market would be to start making the majority of our profits from the sale of the ODALISS platform but to generate more revenues from the annual maintenance fee in a mature market >10 years. For this to work correctly we conducted an in-depth analysis on the pricing structure with potential customers, and by several iterations on our financial plans.
• As part of the new business model, we have decided to modify the pricing structure. We will charge €200K upfront for the ODALISS satellite platform and optical communication system, with further annual payments of €40K per ODALISS system for maintenance and monitoring of the system to ensure it is operating correctly and to its full capabilities. This razor-blade business model will ensure we don’t need to sell large numbers of ODALISS systems (suiting the market as there is not a significant demand in numbers and rather in quality) and instead benefit annually from each system operating. All customers have shown positive interest in our planned costs as they dramatically reduce the current costs incurred for high quality satellite platforms and communication systems.
• During our further market research we found the ideal target markets for initial commercialisation are France, Germany, and Spain. The reason for this is due to the European space industry being a strong component in these countries, as they currently lead the European market. Additional European regions in the space industry will be targeted following this, along with other countries such as the US, South-East Asia, and Russia. This global approach will help to secure all potential customers throughout the globe by first securing strong relationships in Europe and proving our technology. These markets are being targeted not only due to their positions in the space industry, but also due to our strong connections with key players and potential customers throughout these markets.
