THE OECD HANDBOOK

ON MEASURING
THE SPACE ECONOMY (2016)

EXCERPTS

Version 15 July 2016

OECD DRAFT VERSION

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 TABLE OF CONTENTS

FOREWORD...................................................................................................................................................3
CHAPTER 1. INTRODUCTION ....................................................................................................................4
The OECD Handbook and its rationale .......................................................................................................4
Scope and content of the Handbook ............................................................................................................4
Users of the Handbook.................................................................................................................................5
Next steps .....................................................................................................................................................5
CHAPTER 2. DEFININING THE SPACE ECONOMY AND ITS THREE PERIMETERS.......................6
Background ..................................................................................................................................................6
Defining the space sector and the wider space economy .............................................................................7
Delimitating the three perimeters of the space economy .............................................................................8
Classifying activities, products and services..............................................................................................10
Product-based and technology-based taxonomies ..................................................................................10
International classifications remain the baseline ....................................................................................13
The ecosystem of actors .............................................................................................................................17
References ..................................................................................................................................................19

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 FOREWORD

This handbook is part of a broader systematic effort within the OECD to understand and assess the
contribution of industrial sectors to economic and social development more generally.

The handbook is based on the OECD Space Forum’s original research and analysis, in cooperation
with the broader space community. Hosted in the Directorate for Science, Technology and Industry, the
Space Forum was established to assist governments, space-related administrations and the private sector to
better identify the statistical contours of the space sector, while investigating the space infrastructure’s
economic significance, innovation role and potential impacts for the larger economy (e.g. reports "The
Space Economy at a Glance").

In spring 2016, the Space Forum’s Steering Group includes eleven members, ten national space
agencies / official bodies in charge of space activities from OECD economies (AEM, CSA, NASA, CNES,
DLR, ASI, KARI, UKSA, NSC, SSO) and the European Space Agency
(https://www.innovationpolicyplatform.org/oecd-space-forum).

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 CHAPTER 1. INTRODUCTION

The OECD Handbook and its rationale

1. This second version of The Handbook on Measuring the Space Economy is part of a broader
systematic effort within the OECD to understand and assess the contribution of different sectors to
economic and social development.

2. This increasingly involves looking beyond the core industrial sectors to explore their wider
interactions with other sectors and other markets. Thus, in the past, attention has shifted from the
Information and Communication Technology (ICT) sector to the information economy, from the
biotechnology sector to the bioeconomy, and more recently from the space sector to the space economy.
Like the information economy and the bioeconomy, the concept of the space economy endeavours to
capture the numerous complex value chains and downstream applications that reach into many aspects of
economic and social life.

3. Moreover, in the current economic context, the search is on to identify new potential sources of
economic growth. The space economy, with its vast array of scientific, technical, environmental, business
and consumer applications is a particularly promising field of study. For all the aforementioned reasons, it
is crucial to improve our ability to measure the space economy.

Scope and content of the Handbook

4. This Handbook is intended to assist in the consistent application of concepts and definitions, as
well as the collection of comparable data via statistical surveys. The report identifies the obstacles to
reliable measurement of key aspects of the space economy and offers several avenues for data
improvements. A wide international consultation took place in 2015-16 with public and private
stakeholders in the space community. This consultation was also supported by several workshops.

5. What’s new in this edition of the handbook?

This edition proposes revisited definitions for the space economy, with now three main
perimeters better identified (upstream space sector, downstream space sector, other economic
sectors including space-related or derived activities), to encourage international comparability of
data;

The handbook takes into account evolutions in concepts and frameworks, in particular the
International Standard Industrial Classification (ISIC) Rev. 4 and the System of National
Accounts (SNA)-2008, as well as recent recommendations on research and development (R&D)
developed in the updated Frascati Manual (2015).

Several pilot industry surveys and methodological pointers are provided to help administrations
and other stakeholders in the space community draft their own surveys and better map and track
their space activities.

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Users of the Handbook

6. As in the case of other manuals published by the OECD, the audience of this Handbook includes
a broad range of users.

Policy makers and representatives of governmental agencies form a major part of the demand for
more detailed information on the space sector.

Commercial actors, active in the space community and beyond, many of whom have contributed
data and analysis for this Handbook, as well as potential investors in space products and services.

Researchers in different disciplines and policy or financial analysts who interpret statistical
information and need to access the methodologies that underlie that information.

And finally, international organisations, whose information requirements centre on comparability

across countries, are part of the target audience.

Next steps

7. Like other OECD manuals, the handbook remains a living document and will probably have
subsequent revisions in the coming years, as the space sector and its downstream activities are evolving
rapidly. Some open questions also remain concerning definitions of selected space products and services,
and the ongoing research on the broad socio-economic impacts of investments in space programmes.

8. The OECD Space Forum will work with its members, academia, research institutes and the wider
space community to move forward on these issues.

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 CHAPTER 2. DEFININING THE SPACE ECONOMY
AND ITS THREE PERIMETERS

An increasing number of countries are developing space systems and

applications, but internationally agreed definitions for statistical terminology
on space activities are still debated. This section provides a set of basic
definitions that can be used for the space sector and the wider space economy.
They are the result of a large international consultation and of consensus in the
framework of the OECD Space Forum.

Background

9. An increasing number of countries are developing space systems and applications, but
internationally agreed definitions for statistical terminology on space activities are still not formal, and
existing international and national classifications do not identify many of the space products and services.
This is creating difficulties for governmental agencies and well as the private sector, as international
comparability remains limited when examining space sector’s existing statistics.

10. In that context, the OECD Secretariat launched in late 2014 a consultation process concerning the
evolving definitions of the space sector and its derived activities. Based on the interest of the community at
large, the consultation was extended and as of spring 2016, more than a hundred organisations were
consulted from national administrations, industry and professional associations from some thirty countries.

11. One major output of the consultations was a consensus on definitions to standardise the
overarching space economy definitions, as to promote common definitions at the highest levels. This
involved a top-down approach, allowing at least a common vocabulary when trying to distinguish different
space activities. A second parallel avenue to map the downstream activities is a bottom-up approach,
cataloguing existing products and services. The objective was to list as many products and services as
possible, that objectively rely on satellite signals or data. One primary source consisted of space
administrations’ reports and other market studies published by public and private organisations. This
bottom-up approach aimed to encourage common understanding and high-level definitions of selected
products and services. This is still very much work in process, as innovative semantic tools has become
available to map value chains.

12. As it will appear in the next sections, there is a general consensus on the list of industries that
define the space sector, although a narrower list of industries limited to space manufacturing is sometimes
supported. The majority of countries consulted preferred a rather broad definition to take into account the
many derived downstream activities, but here again the scope varied somewhat by country. The end-result
of this exercise is a set of definitions. This will help stakeholders get a better sense of what activities and
actors should be included in their analysis of space activities, taking into account existing surveys and
time-series conducted by several countries over the years, which should still fit well within the definitions
that were selected.

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Defining the space sector and the wider space economy

13. Statistical perimeters of economic sectors and industries are often delimited according to the data
needs of different users, such as local and national policy-makers, administrations, industry, and
universities. This results in different priorities regarding definitions and approaches to measure economic
sectors.

14. Based on the specificities of space activities, one generally accepted definition for the space
sector is the following:

The space sector includes all actors involved in the systematic application of engineering
and scientific disciplines to the exploration and utilisation of outer space, an area which
extends beyond the earth’s atmosphere. (OECD, 2012)
15. This is a useful definition when trying to separate ‘aeronautics’ and ‘space’ activities. However,
recent trends are showing the limits of this definition. The number of public and private actors involved in
space activities worldwide has increased over the past decade and space applications have started
permeating many different economic sectors. The space sector’s definition, as mentioned above, has
become too restrictive when trying to cover these new activities derived from space applications.

16. The OECD Space Forum participants established that the space economy should not be limited to
only a few characteristics, because of the growing pervasiveness of space applications in many daily
activities (meteorology, telecommunications…). Using lessons learned from other sectors (the information
society notably), a broad definition of the space economy seemed appropriate, to encompass the different
dimensions of programmes, services, and actors. The following working definition formed the starting
point of the first Handbook to Measuring the Space Economy (OECD, 2012).

The space economy is the full range of activities and the use of resources that create and
provide value and benefits to human beings in the course of exploring, understanding,
managing and utilising space. Hence, it includes all public and private actors involved in
developing, providing and using space-related products and services, ranging from
research and development, the manufacture and use of space infrastructure (ground
stations, launch vehicles and satellites) to space-enabled applications (navigation
equipment, satellite phones, meteorological services, etc.) and the scientific knowledge
generated by such activities. It follows that the space economy goes well beyond the space
sector itself, since it also comprises the increasingly pervasive and continually changing
impacts (both quantitative and qualitative) of space-derived products, services and
knowledge on economy and society (OECD, 2012).
17. This space economy definition has been used extensively since the publication of the handbook
by the space community and public bodies, with some different interpretations in terms of the activities
that should be included in specific segments of the space economy.

18. One important issue concerned the inclusion or not of derived sectors that may benefit directly
for their development from products or technologies developed in the traditional space sector (limited
definition 1). In other words, should the scope of the definition of the space sector be limited to industries
producing products or technologies intended to fulfil the functions of a space programme or should the
definition be extended to include industries producing products that are quite remote from traditional space
manufacturing, but who clearly rely on space capabilities to exist, such as satellite signals and data? The
issue of growing embedded satellite signals (e.g. GPS devices) and data (e.g. commercial GIS software) in
different products and services was an important issue for discussions. The comparison of different
segmentations of products and services by different national administrations was very constructive, as in

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the end, many of these were providing definitions of activities in the upstream space sector that could be
well correlated to each other (see table 1).

Table 1. Comparisons of different segmentation of space products and services in selected industry surveys
(top level)

Sources: DoC, CSA, Eurospace and KARI industry surveys.

19. Building on the broad space economy definition established in the first edition of the Handbook,
the objective of the 2015-16 international consultation was to take a step forward in the taxonomy, as to
make available to communities of statisticians, economists and analysts more practical definitions for
economic data gathering and analysis. This led to an international consensus on how to divide the space
economy in three main perimeters as described below.

Delimitating the three perimeters of the space economy

20. Like in many other R&D-intensive sectors, such as the nuclear industry, nanotechnologies or
biotechnologies, the many space activities, products and services are difficult to track down. For the space
sector, a separation between the upstream and the downstream segments is still very often used, to
delimitate the traditional space sector from the wide diversity of space services and increasingly remote
space–related activities that are developing without any clear links to the traditional players in the industry.

21. However, dividing the economic activities into only two segments does not solve many issues,
since the upstream segment often excludes a number of “core” space activities (e.g. research activities by
universities), while downstream services are so extremely diverse that they are hard to take into account.
Downstream services are traditionally divided into three large application domains: telecommunications,
Earth observation (also called remote sensing) and navigation. But increasingly new services and products
are not referring at all to these original categories.

22. In order to move forward the discussions and propose a common method to start delimiting the
main space economy perimeters, a concentric approach was proposed. The approach received broad

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international support from administrations and space industry players alike. It constitutes a general model
allowing better international comparisons, also with existing data. There are three main perimeters in this
model that irrigate each other, as shown in the figure 1 below.

Figure 1. Defining the perimeters of the space sector and its derived activities

Main perimeters Activities Products and services

Upstream space sector = Scientific Upstream space sector= Space

research, R&D, manufacturing and research / technology / product /
production service specific to the space
sector (e.g., astronomy research,
satellite, sub-system, space
Upstream component manufacturing...)
space sector
Downstream space sector = Space- Downstream space sector= Space-
enabled activities which WOULD enabled product / service (e.g.,
not exist / function without satellite television broadcast,
Downstream satellite signal or data selected GIS, GPS-enabled
space sector devices…) and dedicated ancillary
services (e.g., insurance...)

Space-related or derived activities Space-related or derived activities

Space-related or derived
activities in other sectors
in other sectors = Activities in
various economic sectors that may
derive from or have relied on
space technology to develop, but
not anymore
in other sectorss = Activities /
products / services that are
derived from space technology,
but not dependent on it to
function (e.g. ad-hoc spin-offs in
automobile or medical industry…)

23. The first inner circle constitutes the upstream
space sector, from research to systems’
operations. It includes fundamental and applied research activities (conducted by universities or research
centres for example); scientific and engineering support activities (e.g. dedicated information technology
support); materials and components supply; manufacturing of space equipment, subsystems, systems; and
telemetry, tracking and command ground stations. These activities are conducted by actors active in the
traditional space industry and the scientific community at large, and they are essential to irrigate the
downstream activities in the second circle.

24. The second circle constitutes the downstream space sector, comprising very diverse activities,
which directly rely on the provision of satellite technology, signals or data to exist and function. It includes
suppliers of devices and equipment supporting the consumer markets, as well as services and products for
consumers using satellite capacity, such as communications, satellite television services; value-added
services (e.g. earth observation data processing), geospatial products, meteorology and location-based
services. It also includes providers of dedicated ancillary services (e.g. insurance, financial and legal
services). For decades, commercial satellite telecommunications operators have been separated from the
upstream space sector in surveys, and included as the first actors in downstream activities. Satellite
operators were indeed the first space segment to interface with a wide range of businesses with no previous
links to the space community in order to commercialise satellite capacity. Their privatisation in the 1980s
and 1990s and dynamic presence on stock markets, as well as their links with customers from so many
various sectors (e.g. media groups, oil exploration companies…) have led operators to be dissociated from
space manufacturing actors, even if in some cases multinational groups have both interests in upstream and
downstream activities. As major customers of commercial satellites, operators are often the instigators of

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much innovation in space and ground segments. The mass-market development of GPS devices was one
the drivers for trying to map the ever-expanding uses of satellite signals by the general public.

25. The third outer circle includes a much wider perimeter ever-more distanced from the original
upstream space sector. It consists of other economic sectors including space-related or derived
activities. Indeed, there are increasingly significant commercial activities that derive from or have relied
on space technology to develop, but not anymore. This includes spin-outs or products and services that
came out of technology transfers originating in the upstream space sector. The automotive and medical
sectors for instance are home to many derived products that benefited from initial investments done in the
upstream space segment. It would be an interesting addition to the space economy, for policymakers and
the space industry alike, to track these often unexpected outcomes of space programmes.

26. Based on this taxonomy consensus, the following terms should be used in reports to help clarify
international comparisons:

The space sector is implicitly understood as the upstream space sector in most countries and
thus needs to be qualified when there is doubt, mentioning if one means the upstream or
downstream space sector;

Contrary to the more limited space sector (qualified with the terms upstream or downstream),
the space economy of a given country does encompass by design both upstream and
downstream activities, as well as other space-related or derived activities present in different
economic sectors;

Actors from the space economy include de facto actors from the space industry (often active
in both the upstream and downstream sectors), but also many non-space industry actors . One
should therefore be careful not to interchange the space industry category with the much
wider space economy actors category.

Classifying activities, products and services

27. The three main perimeters of the space economy have been defined above, and the different
underlying space activities and their corresponding products and services can be classified, still with some
challenges particularly for downstream activities. The applicability of product-based or technology-based
taxonomies can help in some cases, although international classifications still remain the baseline when
conducting surveys, to facilitate international comparisons. They have some limitations and can be
complemented with industry-specific surveys and micro data as we will explore further in this report.

Product-based and technology-based taxonomies

28. When classifying economic activities that have close links with technological domains, one
option is to compare product-based taxonomies and technology-based taxonomies. Both approaches have
advantages and constraints, since there are hundreds of products and services that need to be taken into
account when examining the space economy.

29. Examining some lessons learned from the decade-long discussions surrounding the now
internationally-agreed ICT sector definition, there was much debate in successive expert groups meetings
at the OECD concerning the possible inclusion of a number of specialised industries in the ICT definition’s
perimeter. The following general definition is used to identify ICT economic activities (industries): “The
production (goods and services) of a candidate industry must primarily be intended to fulfil or enable the
function of information processing and communication by electronic means, including transmission and

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display”. The list of ICT industries that meet this condition is provided in the box below. The list currently
includes more than hundred products, ranging from ‘point of sale terminals’ to ‘installation services of
radio, television and communications equipment’. An ICT product list identifying ICT goods and services
was first developed in 2002 (OECD, 2002) and has been revised several times since, with revised
definitions of the ICT sector (OECD, 2007) and of ICT products (OECD, 2008). The specific industry
“Manufacture of measuring, testing, navigating and control equipment” (ISIC code 2651) was considered
for inclusion in ICT. In the end, it was decided to exclude this particular industry from the scope, since it
became increasingly difficult to distinguish industries that use electronic processing in a significant way
from those that do so in an incidental way given that ICTs are embedded into a growing number of
products produced by a variety of industries.

Box 1. Industries included in the ICT sector definition

ICT manufacturing industries:

2610 Manufacture of electronic components and boards
2620 Manufacture of computers and peripheral equipment
2630 Manufacture of communication equipment
2640 Manufacture of consumer electronics
2680 Manufacture of magnetic and optical media

ICT trade industries:

4651 Wholesale of computers, computer peripheral equipment and software
4652 Wholesale of electronic and telecommunications equipment and parts

ICT services industries:

5820 Software publishing
61 Telecommunications
6110 Wired telecommunications activities
6120 Wireless telecommunications activities
6130 Satellite telecommunications activities
6190 Other telecommunications activities
62 Computer programming, consultancy and related activities
6201 Computer programming activities
6202 Computer consultancy and computer facilities management activities
6209 Other information technology and computer service activities
631 Data processing, hosting and related activities; web portals
6311 Data processing, hosting and related activities
6312 Web portals
951 Repair of computers and communication equipment
9511 Repair of computers and peripheral equipment
9512 Repair of communication equipment

Source: OECD.

30. Based on these experiences, one important lesson-learned for the space economy is that some
technologies are often embedded in a variety of products and the way they are used changes rapidly. This
is similar for many space products and services.

31. As a different approach, product-based taxonomies differ from technology-based classifications

as many-to-many correspondences are possible, in other words each product relies on one or more
technologies, and the very same technology can be used in a wide array of products. For example, products
such as ‘satellite phones’ rely not only on computer technologies for data processing, but also on satellite
and often ground-based communication technologies for cellular or other wireless network access.
Moreover, as mentioned previously, many relevant products and services rely on limited but crucial
satellite technologies to function. For example, ‘GPS devices’, which are considered space products by

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many market analysts, rely on ICT-related technologies to compute and integrate geospatial data and other
information into useful information. A product-based taxonomy is usually based on a user’s interest and
needs. That is where it is very useful to examine sector-specific information to track relevant products and
services.

32. The two tables below provide a summary of the main families of activities, products and services
to be considered in the upstream space sector and in the downstream space sector. The next chapter
provides illustrations and definitions of specific products and services.

Table 2. Activities, products and services, organisations in the upstream space sector

Activity Selected products and services Examples of organisations

Fundamental and Fundamental and applied research
applied research
Scientific and Research and development services
engineering support Engineering services (design, testing…)
Suppliers of Materials and components for both space and
materials and ground systems: passive parts (around 70% of
components components in space sub-systems: cables,
connectors, relays, capacitors, transformers, RF
devices…) and active parts (e.g. diodes,
transistors, power converters, semiconductors)
Designers and Electronic equipment and software for space and
manufacturers of ground systems
space equipment Spacecraft / satellite platform structure and data
and subsystems handling subsystem (e.g. on-board computer,
interface unit, satellite and launcher electronics)
Guidance, navigation and control subsystems,
and actuators (e.g. gyroscopes, sun and star
sensors rendezvous- and docking sensor)
Power subsystems (e.g. electrical propulsion,
power processing unit, solar array systems, photo
voltaic assembly,)
Communications subsystems (e.g. receivers and
converters, fibre optic gyro, solid state power
amplifier, microwave power module, downlink
subsystem, transponders, quartz reference
oscillators, antenna pointing mechanism)
Propulsion subsystems (e.g. propellant systems,
tanks, valves, electric propulsion systems)
Other satellite payload’s specific subsystems
Integrators / full Complete satellites / orbital systems
systems suppliers Launch vehicles (and launch services provision in
some cases)
Control centres and telemetry, tracking and
command stations
Universities, research centres
Engineering firms: Altran (FR), Serco Group
(UK)… Universities: Durham Univ. (UK), Univ.
of Ulster (UK)…
Components manufacturers include:
Composite Optics (USA), M/A-COM (USA),
Thales Electron Devices (FRA)…
Selected equipment manufacturers include:
Sodern (FRA), APCO Technologies (CHE),
Bradford Engineering B.V (NDL), Selex ES
(ITA), Airbus’ Space Engineering (ITA),
Aeroflex (USA), Raytheon (USA), Kongsberg
Gruppen (NOR)…
Selected subsystems manufacturers: Snecma
(FRA), OKB Fakel (RUS), L-3 ETI (USA),
Aerojet Rocketdyne (USA), Com Dev (CAN),
UTC Aerospace Systems (USA), Teledyne
Brown Engineering (USA), Ruag (CHE)…
Selected primes: Airbus Space and Defence
(FRA, DEU), Thales Alenia Space (FRA, ITA),
Orbitale Hochtechnologie Bremen (OHB
System) (DEU), MacDonald, Dettwiler and
Associates (MDA) (CAN), Lockheed Martin
(USA), Boeing (USA), Space Systems/Loral
(USA), Orbital Sciences Corporation (USA);
Northrop Grumman Space Technology (USA),
Mitsubishi Heavy Industries (JPN), Alenia
Spazio (ITA), Surrey Satellite Technology Ltd
(GBR), China Aerospace Science and
Technology Corporation (CASC) (CHN),
Krunichev State Research and Production
Space Center (RUS), Israel Aircraft Industry
(ISR)…

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 Table 3. Activities, products and services, organisations in the downstream space sector

Activity Selected products and services Examples of organisations

Operators of Launch services provision More than 50 satellie communications
space and ground Satellite operations, including lease or sale of operators established around the world (e.g.,
systems satellite capacity (telecom: commercial FSS and Eutelsat (FRA), Intelsat (USA/NDL), Inmarsat
MSS operators; earth observation operators) (UK), Telenor (NOR)...)
Provision of control centres services to third parties For earth observation, smaller satellite
operators are generally involved, although
some of them have been taken over recently
by larger groups (e.g., BlackBridge’s Rapid
Eye (DEU), Airbus’s Spot Image (FRA), DMC
International Imaging Ltd (UK), DigitalGlobe
(USA), ImageSat (ISR)…).
KSAT (NOR) and SSC (SWE) are examples of
ground station networks including domestic
and foreign-owned ground stations as well as
collaborative ground stations at polar and mid-
latitude locations.
Suppliers of Direct-to-home (DTH) providers Actors included in the “space economy” as far
devices and Location-based signals services providers as a share of their activity directly relies on the
services Data-derived commercial services providers provision of satellite signals or data.
supporting the (sometimes called value-adders: telematics, E.g. Communications, satellite television
consumer markets surveying, meteorology). services (e.g. BskyB, Dish and DirectTV),
Very Small Aperture Terminal (VSAT) network geospatial products and location based
providers services (e.g. Trimble, Garmin).
Satnav and telecom equipment and connectivity Chipset manufacturers: Broadcomm (US), St
devices vendors Micro (EU)…
Chipset manufacturers Device manufacturers: Honeywell (US),
Rockwell Collins (US), Thales Avionics (FR),
Garmin (US), TomTom (NL)
Other ancillary Insurance Actors included in this category include
services Financial and legal services insurance, law and research consulting firms
Market research for example.

International classifications remain the baseline

33. The international and national statistical classification systems structure industrial and economic
activities and products in ways that facilitate comparison of national economic data on a year-by-year
basis, or evaluate comparisons between countries. As we will see below, there are clear limitations when
trying to link many of the space products and services to existing classifications, but there are also some
interesting perspectives.

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 Figure 2. Overview of relationships between different international and European classifications

Adapted from Eurostat (2008), NACE rev. 2: Statistical classification of economic activities the European
Community, Brussels.

34. In statistics, a classification is a “set of discrete, exhaustive and mutually exclusive observations,
which can be assigned to one or more variables to be measured in the collation and/or presentation of data”
(OECD, 2007a). The terms "classification" and "nomenclature" are often used interchangeably, despite the
definition of a "nomenclature" being narrower than that of a "classification". Hierarchical classifications
range from the broadest level (e.g. division) to the detailed level (e.g. class). Examples of classifications
include the United Nations’ International Standard Industrial Classification of All Economic Activities
(ISIC Revision 4), the statistical classification of economic activities in the European Community (NACE
Rev. 2), and the International Standard Classification of Occupations (ISCO-88). In addition, the System of
National Accounts (SNA), which is concerned with almost all economic activities occurring anywhere
within national economies, is the standard framework for statistics and analysis in OECD member
countries. Other related classifications for products and trade are mentioned later. An overview of
relationships between different international classifications can be seen in Figure 2.

35. The International Standard Industrial Classification (ISIC) consists of a coherent and consistent
classification structure of economic activities based on a set of internationally agreed concepts, definitions,
principles and classification rules. These economic activities are subdivided in a hierarchical, four-level
structure of mutually exclusive categories. ISIC includes most parts of the space sector under different
aggregate categories, space manufacturing is de facto aggregated with aeronautics for example (see box
below). Space products and services in general can be found in several industries, including aerospace with
some segments appearing in electronics and telecommunications and even armaments, since rockets are
considered as weapons in many countries (e.g. missile technology) (OECD, 2007c).

36. Since the publication of the first OECD Handbook on Measuring the Space Economy, an updated
ISIC classification came into force. The current edition of ISIC (Rev. 4) still includes most parts of the
space sector under different aggregate categories, but a new category on satellite communications has been
created.

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 Box 2. A closer look at ISIC Class 3030: Manufacture of air and spacecraft and related machinery

Section: C - Manufacturing
Division: 30 - Manufacture of other transport equipment
Group: 303 - Manufacture of air and spacecraft and related machinery
Class: 3030 - Manufacture of air and spacecraft and related machinery

This class includes:

- manufacture of airplanes for the transport of goods or passengers, for use by the defence forces, for sport or other
purposes
- manufacture of helicopters
- manufacture of gliders, hang-gliders
- manufacture of dirigibles and hot air balloons
- manufacture of parts and accessories of the aircraft of this class:
· major assemblies such as fuselages, wings, doors, control surfaces, landing gear, fuel tanks, nacelles etc.
· airscrews, helicopter rotors and propelled rotor blades
· motors and engines of a kind typically found on aircraft
· parts of turbojets and turboprops for aircraft
- manufacture of ground flying trainers
- manufacture of spacecraft and launch vehicles, satellites, planetary probes, orbital stations, shuttles
- manufacture of intercontinental ballistic missiles (ICBM)

This class also includes:

- overhaul and conversion of aircraft or aircraft engines
- manufacture of aircraft seats

This class excludes:

- manufacture of parachutes, see 1392
- manufacture of military ordinance and ammunition, see 2520
- manufacture of telecommunication equipment for satellites, see 2630
- manufacture of aircraft instrumentation and aeronautical instruments, see 2651
- manufacture of air navigation systems, see 2651
- manufacture of lighting equipment for aircraft, see 2740
- manufacture of ignition parts and other electrical parts for internal combustion engines, see 2790
- manufacture of pistons, piston rings and carburetors, see 2811
- manufacture of aircraft launching gear, aircraft carrier catapults and related equipment, see 2829

Source : United Nations (2008), International Standard Industrial Classification of All Economic Activities: Revision 4, Statistical
papers Series M No. 4/Rev.4, , New York, http://unstats.un.org/unsd/cr/registry/regdntransfer.asp?f=135, Accessed 30
March 2015.

37. The issue of aggregated categories for space activities is problematic, and can be found also in
the other international classifications, such as the Central Product Classification (Version 2) at the product
level or the Harmonized Commodity Description and Coding System (HS) of the World Customs
Organization. A “space” category is also not found in the System of National Accounts. However, as we
will see in the next sections, trade data are often more detailed than domestic industrial classifications.

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 Table 4. Selected space activities in international classifications

ACTIVITY CPC Ver.2* ISIC 4 SITC Rev.4 HS 2007

Space manufacturing 49630 Spacecraft and spacecraft launch vehicles 3030 792.5 8802.60
49640 Parts of aircraft and spacecraft 3030 792.5 8803
88824 Air and spacecraft manufacturing services 3030 792.5 -
4313 Motors and engines for aircraft and 3030 792.5 -
spacecraft
Space launch services 65320 Space transport services of freight (i.e. 5120 792.5 -
Launching of satellites into space)
64250 Space transport services of passengers 5110 792.5 -
67640 Supporting services for space transport 5223 792.5 -
Insurance 71332 Marine, aviation, and other transport 6512 - -
insurance services (Includes “satellite launching
insurance policies, underwriting of”)
Earth observation 83430 Weather forecasting and meteorological 7490 - -
& navigation services (more than satellite data activities)
83421 Surface surveying services (includes 7110 - -
surveying by satellite)
84190 Other telecommunications services 6110 6120 - -
(includes Satellite tracking services ) 6130 6190
48220 Radar apparatus, radio navigational aid 2651 764.83 8526.91
Telecommunications apparatus and radio remote control apparatus
(includes “satellite linked auto security device
used to send signals via satellite to a specific
vehicle to carry out electromechanical
commands on that vehicle based on an encoded
signal)
49630 Spacecraft and spacecraft launch vehicles 3030 792.5 8802.60
54614 Residential antenna installation services 4321 - -
(includes Installation of satellite dishes)
84131 Mobile telecommunications services - 6120 6130 - -
access and use (includes satellite telephone
services)
84150 Data transmission services (includes 6110 6120 -
satellite space segment, occasional use feeds, 6130 6190
broadcast applications, VSAT satellite service,
occasional use, broadcast or two-way
applications)
84634 Home programme distribution services, 6010 6020 - -
pay per view (includes pay-per-view television
program, by satellite (i.e. Video-on-demand, by
satellite)
91134 Public administrative services related to 8413 - -
transport and communications (includes
administrative services related to satellite
communications)
47223 Other telephone sets and apparatus for 2610 2630 764.11 764.12 8517.18
transmission or reception of voice, images or 8517.61
other data, including apparatus for 8517.62
communication in a wired or wireless network 8517.69
(such as a local or wide area network) (such as a
local or wide area network) (includes: Field
telephones (military))
* The classifications codes usually all include more than just the space products and services indicated.

38. The next chapter will provide further concordance of selected products and services with
relevant classification codes.

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The ecosystem of actors

39. Decades ago, relatively few actors were involved in space programmes. Today, governmental
space programmes as well as major commercial activities relying on satellite signals or links for some of
their services (i.e. such as satellite television) represent in some countries very large and diverse
ecosystems of actors that are difficult to assess. There are different ways of mapping the different
industries, all requiring a level of efforts. The typical categories of actors include: public actors, higher
education actors (universities, research institutes), and business enterprises (large industrial groups, but
also small and medium enterprises).

Public actors

40. Governmental bodies play a key role in the space economy as developers, investors, owners,
operators, regulators and customers for much of the space infrastructure. As in the case of terrestrial large
infrastructure systems (e.g. water, energy), government involvement is key to sustaining the overall space
economy and to dealing with strategic implications of such complex systems. The government sector’s
legal entities are usually classified into three categories according to the level of government involved:
central and federal government units; provincial and state government units; and local and municipal
government units. When looking at other governmental actors involved, particularly as customers for
products and services (e.g. municipality buying products based on satellite imagery), a classification of
these bodies can be used, like in the recent Eurisy survey of public authorities using space applications
(Eurisy, 2015).

41. In OECD economies, space research and development (R&D) can be conducted by a diversity of
different public actors (e.g. space agency, technology centre) and they are not always easily identifiable.
The international classification of actors involved in R&D, as described in the Frascati Manual, is often
used to gather comparable data concerning the R&D activities of governments. According to the Frascati
Manual, government actors involved in R&D include:

“All departments, offices and other bodies which furnish, but normally do not sell to the
community, those common services, other than higher education, which cannot otherwise be
conveniently and economically provided, as well as those that administer the state and the
economic and social policy of the community;
Non-profit institution (NPIs) controlled and mainly financed by government, but not
administered by the higher education sector.”
42. Public enterprises or partially-public enterprises, which are often quite active in the space sector,
are included in the “business enterprise” categories.

Higher education actors (research institutes)

43. Universities, laboratories, and research institutions play a key role in space research and
development in both OECD and non-OECD countries. They may act as contractors to space agencies and
industries, but they constitute a particular source of innovation for the sector (i.e. basic research,
patenting). Cubesats for instance are originating from universities and used increasingly as technology
demonstrators. Cubesats are less than twenty years old, with their standardization realized in 1999 by
academics at CalPoly and Stanford University in California.

44. According to the Frascati Manual definitions, higher education actors include:

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 All universities, colleges of technology and other institutions of post-secondary education,
whatever their source of finance or legal status.
It also includes all research institutes, experimental stations and clinics operating under the
direct control of or administered by or associated with higher education institutions.”
45. Some recent findings from the US Department of Commerce (DoC) provide an interesting
illustration of the importance of universities in space programmes. NASA, the U.S. Air Force, and the
National Reconnaissance Office partnered in 2011 with the Department of Commerce to initiate the U.S.
Space Industry “Deep Dive” assessment. The principle objective of the assessment was to gain an
understanding of the intricate supply chain network supporting the development, production, and
sustainment of products and services across the American defence, intelligence, civil, and commercial
space sectors. Respondents identified whether they manufactured, distributed, or provided any of the
products and services on the US DoC Product and Service List. They then identified their critical suppliers
and customers for the selected products and services. The Product and Service List consists of 16 general
segments comprising 360 individual products and services (they are detailed in the next chapter). In April
2013, the data collection period ended. In total, BIS received 3 780 completed survey responses from
commercial companies, universities, non-profit organizations, and U.S. Government agencies (see table 5).

Table 5. US respondents to the 2011 DoC survey by type of organisation

Commercial companies 3 585

Universities 125
Non-profit organisations 49
US government 21
Total : 3 780
Source: DoC, 2014

Business Enterprises

46. Since the 1980s, the number of businesses involved in space activities has grown. Large
aerospace and defence groups tend to be the main actors, many of them active along entire value chains in
space manufacturing and services. Smaller actors are active in specific segments (e.g. components,
subsystems, equipment, services). Notwithstanding the main mergers of the 1990s and 2000s, an
interesting ongoing trend is the emergence of small actors competing in the same market segments as the
large groups. The small and medium-sized (SME) enterprise sector accounts for 99% of firms in the OECD
area, and 50-75% of value added across these countries (OECD, 2010). Although SMEs are quite
numerous in services, they probably play a rather small role in space manufacturing. For example in
Europe, more than 70% of space manufacturing employment is estimated to be in large groups (Eurospace,
2015).

47. As mentioned in the Frascati Manual (OECD, 2015), the business enterprise sector comprises
both private and public enterprises, and includes:

“All resident corporations, including not only legally incorporated enterprises, regardless of the
residence of their shareholders. This group includes all other types of quasi-corporations, i.e. units
capable of generating a profit or other financial gain for their owners, recognised by law as
separate legal entities from their owners, and set up for purposes of engaging in market production
at prices that are economically significant.

The unincorporated branches of non-resident enterprises deemed to be resident because they are
engaged in production on the economic territory on a long-term basis;

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 All resident NPIs that are market producers of goods or services or serve business.”

48. In terms of the practical steps to identify actors, most countries have national statistical business
registers, built on administrative and statistical sources (e.g. surveys, tax registers). These registers serve as
the primary and preferred source of information for business demography statistics (OECD, 2007). One
challenge is that the comprehensiveness of these registers varies across countries and time, and the level of
detailed information on companies’ activities may be limited. The industrial statistical classifications issue
is also one major stumbling block, when looking for data on enterprises involved in space activities. The
industry codes used nationally usually give indications about actors involved in the aerospace sector, but
even this type of information may be limited. National statistical offices also conduct census on specific
sectors from time to time to have a better idea of the businesses involved, but the cost of running a regular
census makes this approach unrealistic for most countries with a small aerospace sector.

49. Another source of data concerns specific industry surveys, which have the advantage of
assembling relevant micro-data on the industry, but may be limited in scope. The European industry
association Eurospace for example has developed an efficient and systematic methodology when
compiling data from its annual survey of the European space manufacturing (Eurospace, 2015). It
measures consolidated sales at company level, but takes also into account intermediate sales throughout the
value-chain when possible, thus avoiding possible double-counting.

50. One relatively untapped resource on the business enterprise sector can be found in space agencies
administrative and contracts’ databases. A number of space agencies in OECD economies have the
responsibility to publish regularly data on their contracts and grants, as governmental space programmes
increasingly involve many types of actors as contractors. In the example presented in the table below,
NASA awards by contractors are provided for the 2013 fiscal year. Most of the NASA contracts and grants
went to business firms, with other key contractors such educational and other non-profit organisations.

Table 6. NASA awards by type of contractors, fiscal year 2013

Value (USD million) Percentage

Business Firms 11,431.5 73.4%
Educational Institutions 968.2 6.2%
Non-profit Organisations 643.6 4.1%
JPL 1,708.3 11.0%
Governmental Agencies 473.1 3.0%
Outside U.S. 347.1 2.2%
Note: The Jet Propulsion Laboratory (JPL) is a Government -owned research and
development facility operated for NASA by The California Institute of Technology.
Out of the USD 1,708.3 million awarded in fiscal year 2013, JPL awarded USD
720.6 million as subcontracts with business firms.
Source: NASA, 2014

References

To be completed

OECD (2002), "The ICT Sector", in OECD, Measuring the Information Economy 2002, OECD
Publishing, Paris.

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 OECD (2006), “Information Economy – Sector definitions based on the International Standard
Industry Classification (ISIC 4)”, Working Party on Indicators for the Information Society,
DSTI/ICCP/IIS(2006)2/FINAL, OECD, Paris, www.oecd.org/dataoecd/49/17/38217340.pdf.

OECD (2008), “Information Economy Product Definitions based on the Central Product
Classification (Version 2)”, Working Party on Indicators for the Information Society,
DSTI/ICCP/IIS(2008)1/FINAL, OECD, Paris.

OECD (2011), OECD Guide to Measuring the Information Society 2011, OECD Publishing.
http://dx.doi.org/10.1787/10.1787/9789264113541-en

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