International Archives of Photogrammetry and Remote Sensing. Vol. XXXII Part 7C2. UNISPACE HI, Vienna, 1999 
142 
UNISPACE III- ISPRS/NASA Seminar on 
“Environment and Remote Sensing for Sustainable Development” 
9:00 am -12:00 pm, 23 July 1999, VIC Room A 
Vienna, Austria 
content to communication bandwidth, the remote sensing and 
telecommunication industries can be cross-linked. This is 
important since as the price of content creation decreases, the 
cost of communicati on/storage must also decrease. It is 
typical that the cost to store and disseminate should be less 
than 10% of the cost to “content create”. Fortunately, this 
cross relation is positively occurring and is helping to fuel tire 
emergence of the commercial Earth information industry. 
True cost of goods economics will establish the product 
price- like computers and software products. For remote 
sensing space systems costs of goods include the space 
segment (satellite non recurring, recurring, launch, and 
insurance costs) which typically runs about two-thirds of the 
capitalization cost; the ground segment which is about one- 
fourth of the costs and the operations costs are about one- 
tenth of the system cost. Value added processing and 
production costs are on top of these costs. 
Price of goods depends on a true cost of goods 
model. 
Here is a simplified economic model to frame a cost of goods 
model, or the commercial thinking process of what this 
information costs to produce. 
Satellites in Low Earth Orbit pass over the populated land 
areas of the Earth on the average 2-3 hours per day. 
Assuming a $500M space asset that is depreciated over 5 
years( i.e. its mean mission duration), the cost is about 
$1,000-$2,000 per minute- of operation with no other costs 
(e.g. including the cost of money which governments 
normally do not factor into their economic modeling). When 
all costs are included, the cost per minute could easily 
double. Since collection rate can be expressed in megapixels 
per seconds, the fixed cost of dollars per megapixel can be 
determined. When a pixel is converted back to area on Earth, 
area one can retrieve the cost per unit area. 
If a product is sold in the few hundred dollars range, some 
significant subsidy is being applied; i.e. the product is being 
sold at a discount under the idea that it is in the greater good 
to do so. Such pricing policies should be called into question 
if the products compete with commercial endeavors. This 
national pricing policy leads to an interesting paradox where 
some governmental agencies tend to argue that there is no 
commercial market because of the subsidies which compete 
with the private sector. If the long-term goal is to encourage 
a complementary' commercialized information product of the 
remote sensing type, a more integrated national and private 
strategy needs to be developed. Some might suggest that 
there is no commercial market for space imagery products 
because the customers have been receiving “free goods” at 
the expense of national investments. If better, cheaper maps 
can be produced commercially, then subsidizing the 
nationalized production of competing products should be 
brought under review. On a global scale, all nations should 
examine their economic and national premises for competing, 
intentionally or unintentionally, with the emerging private 
information industiy. It is time to form a partnership for the 
future. 
What does it costs to develop indigenous capability-what 
decision to make? 
Historically remote sensing programs have taken decades to 
develop, with equivalently billions, (U.S. dollars) of 
expenditure. Programs in France. India, Japan, Israel, and 
others have been long standing national initiatives. Countries 
need to weigh the logic and basis of developing their own 
national capability for national sovereignty reasons against 
developing information systems and technology founded on 
acquiring and using Band 3 type products. Spending the time 
and money required to develop national capability and 
capacity to product Band 3-4 level systems diverts 
resources from developing the information systems and 
exploitation technology to apply toward solving national and 
economic problems. The decision is: spend money to create 
the content or spend money on the benefits of the 
information. 
Civilian observation systems, at low resolution, have offered 
a sharing scheme to lower total system costs to all countries. 
However, this Earth observation is scientifically oriented, 
not economically focused. Noting that low Earth orbiting 
remote sensing satellites orbit about 14-15 times a day, the 
development costs can be spread over a global business base. 
Countries must ask themselves: Is the value of developing an 
indigenous, highly specialized, space industiy worth the time 
and effort or is it a wiser national decision to develop the 
application sciences and technologies to promote a 
sustainable local economy? As long as the information is 
available to all peace-faring nations at affordable prices, the 
most cost effective economic model is to focus resources on 
the demand-side versus the supply-side. Spending funds on 
information products, and training local citizens to use the 
information to solve their problems, is a far more cost 
effective and time efficient course to pursue. 
Recommendations: 
■ Promote information systems and technology 
for the use and application of commercially 
availability open source Earth information. 
■ Promote an information control regime that 
ensures availability of products that are used for 
peaceful national, economic, environmental and 
security development. Uses of Earth sensing 
systems that are to promote terrorism, crisis and 
conflicts, and cross border military operations 
would be restricted or denied by providers 
subject to “clear and present” dangers to the 
peace-faring countries. 
The remote sensing industry is moving from a data 
provider to information supplier. 
The remote sensing industry is rapidly migrating away from a 
data collection focus to on information, “content creation”, 
supply-side industry. Issues of open source and access to 
data is giving way to issues related to ensuring open, free, 
and cost affordable geospatial information. The past issues of 
data access should now be redefined as information access. 
This is a “sea state” change in the industiy and one that will 
develop and advance by default if not design. If industiy 
does not reach a large market because it has no means of 
standardization, natural economic forces will adjust the 
development path. The role of the UN at this time should be