Why should New Space companies custom-build their imaging technology?

The space industry, particularly the Earth observation segment, is evolving at a rapid pace. New Space companies, characterized by their commercial focus and shorter timelines, use a diverse array of optical, radar, thermal, and spectral technologies to provide low-cost access to spaceborne data, each tailored to specific end-user needs.

Traditionally, Earth observation satellites have been large, expensive, and highly complex, with prime contractors relying on specialized subcontractors to develop mission-specific components, including imaging payloads. While these purpose-built solutions ensured high performance, they also came with long delivery timelines and high costs.

In contrast, New Space has ushered in a more commercially driven approach, emphasizing miniaturization, faster development cycles, and cost efficiency. This shift has increased off-the-shelf imaging payloads designed for mass production and rapid deployment. These systems offer an easy path to orbit and a quick go-to-market strategy.

But for companies serious about long-term success and market differentiation, relying on such generic solutions presents a fundamental limitation: Where is the competitive edge when everyone has access to the same payloads? In Earth observation, your imaging technology defines your advantage—and for most companies, custom-built solutions are the key to unlocking superior performance, innovation, and market leadership.

Customization addresses user-specific needs better and provides long-term competitive advantages.

The allure of off-the-shelf imaging technology is its simplicity and speed. Purchasing pre-designed payloads allows companies to accelerate their time-to-market because there’s no in-house development, lower upfront costs, and focus on data utilization. But this convenience comes with significant tradeoffs.

Commercial performance limitations

Most commercially available imaging payloads, including hyperspectral cameras, are designed with broad applicability in mind. This “one-size-fits-many” approach compromises critical performance metrics. For example, many off-the-shelf hyperspectral cameras cannot capture the fine spectral details required for precise material classification or change detection. This limits their utility for applications that require high accuracy, such as monitoring environmental changes or assessing biomass health.

Currently, Earth observation’s commercial adoption is limited by its reliance on satellite tasking to capture a designated area of interest and the additional analytics capabilities needed to process this data. If “basic” off-the-shelf solutions fail to provide customers with tangible insights, the problem will be exacerbated even more.

In contrast, custom-built solutions offer the flexibility to optimize each specification to meet the criteria for specific applications.

Dependency and risk

Relying on external suppliers introduces a host of risks—from delays in delivery to quality issues with systems not meeting their specifications. If the most critical core technology for your company is provided externally, any outages, problems, or delays could severely impact your ability to deliver important services to your existing customers and create a bad reputation with future customers.

In contrast, custom-building imaging technology gives companies greater control, lowers integration risk, and ensures timely delivery. While the custom-building approach may be more expensive and initially slower, it guarantees better results and long-term competitive advantages.

Advantages of in-house development

Developing imaging technology in-house is not without its challenges. It requires significant investment, technical expertise, and time. But the benefits can far outweigh the costs by providing companies with long-term advantages that are crucial within a competitive and fast-changing industry.

By owning the development process, companies can innovate beyond the payload itself to create synergies with satellite design, data processing, and analytics. This holistic approach leads to advancements across the entire value chain and ensures every aspect of the system is optimized for performance and reliability.

Custom-built solutions also provide an opportunity to maintain control over the technology and intellectual property. By developing and manufacturing technology in-house, companies have better transparency and knowledge of every detail—and it reduces reliance on external providers to mitigate potential failure modes and quality issues.

Enhanced integration and reliability

When imaging technology is developed in-house, it integrates seamlessly with other onboard systems, which minimizes potential points of failure and allows engineers to optimize the overall satellite design. Unlike commercial solutions, which often operate as black boxes with limited transparency, custom-built systems provide full visibility into potential failure modes and quality issues.

Freedom from external risks

The space industry is rife with stories of delayed deliveries, substandard systems, and unforeseen supplier issues. Developing core technologies internally eliminates these risks to ensure critical timelines and quality standards are met. Building in-house also fosters a deep understanding of the technology, which empowers teams to address challenges proactively and identify opportunities for improvement.

Balancing cost and value

While the costs of custom development are high, the long-term cost savings can be significant. Once production scales, custom-built systems can achieve substantial cost reductions that often outpace the financial efficiency of commercial alternatives. The strategic value of owning core technology also far outweighs the initial investment, particularly when raising investor confidence and securing long-term financing.

Future outlook

Looking ahead, the landscape of imaging technology within space is likely to evolve, with a growing need for diverse imaging technologies. While off-the-shelf solutions may offer immediate convenience, custom-built imaging technology holds the potential to help solve Earth’s most pressing problems by offering unique and high-performing solutions that cater to the diverse needs of users.

For Earth observation companies, developing core imaging technology in-house is critical for maintaining a competitive edge within the industry. Custom-built imaging technology offers the strategic necessity of freedom to operate and the potential for new innovations.

Developing solutions in-house can uncover the possibilities for new innovations and differentiate companies within the market. By focusing on custom-built imaging technology, companies can disrupt markets, achieve long-term competitive advantages, and drive innovation in space technology.