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Business Insight

Business that's Blasting Off

Giang Nguyen

Outer space was once a frontier for research, but it increasingly provides opportunities for business. One young entrepreneur is making micro-satellites by overturning conventional design wisdom to lower costs.

Axelspace president and CEO Yuya Nakamura, 36, operates his firm from a small building in Tokyo. The company is preparing for a spring launch for a satellite commissioned by a weather information enterprise.

"It will be used to observe sea ice in the Arctic Ocean," explains Nakamura. As the impact of global warming shrinks Arctic ice, the waters are becoming a potential new sea route connecting Asia and Europe. The Axelspace satellite will provide the latest information to ships on safe passage through the ice.

Price was the key factor in winning the contract. Nakamura's product costs less than $5 million. He says that is just one percent the price of a full-sized satellite.

"I'd like to create an environment where people can have easy access to data from space via micro-satellites. That's my goal," says Nakamura, who became interested in the technology 15 years ago while at university. He designed and assembled a satellite 10 square centimeters in size and once in orbit, it successfully communicated with Earth.

He founded his company eight years ago, and says the secret to keeping costs low is that employees design and manufacture the satellites themselves. Nakamura made one component - an optical device called a star tracker, the heart of any satellite - for about $67,000, by using a commercially made CPU.

He says that shaved tens of thousands of dollars. "It was crucial to lower cost. Without that, nothing could be achieved. Our basic approach was to focus on the whole system and not try to make each part infallible. This allowed us to lower the reliability of some components, which in turn enabled us to create a satellite that could realize its mission without aiming for unnecessarily high reliability," Nakamura explains. Axelspace hopes to build on its test model, the Hodoyoshi-1, which was launched two years ago and is still transmitting images intermittently. Nakamura has plans to launch 50 more micro-satellites by 2022 to cover most areas with human activity, and transmit images every day.

He says the satellites' application can extend well beyond shipping: "We'll be able to judge crop growth from space. And to photo huge farmlands abroad and decide when to harvest or how much fertilizer to apply."

It is a business model that may sound like a dream, but Nakamura rejects that. "When people tell me it's good to have a dream, it just proves that space isn't used seriously yet. It shows that people think that space has nothing to do with them," he says.

Nakamura is part of a business vanguard trying to commercialize space. Time will tell if he succeeds.

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