China's Commercial Starlink Competitor Sets Sail

Plus Pakistan accepts the PakSat-MM1 satellite 🇵🇰, CAS Space breaks ground on Jiuquan launch site 🚀, and HITSat announces some jobs in Harbin ❄️

Dear Readers,

Happy August, and a big thanks to the couple dozen subscribers who have opted for paid subscriptions over the past few months. The newsletter will always be free, but coffees are nonetheless appreciated. This month brought us the most significant commercial launch in Chinese space industry history, and then in the days thereafter, a media storm surrounding that very launch, and a cloud of debris created in low earth orbit by the Long March-6A. With the issue ultimately reaching China’s Ministry of Foreign Affairs, it is safe to say an historic launch become highly politicized. Many virtual punches were thrown across the internet.

Which makes it all the more important to take a step back and unpack the event from as neutral and well-informed perspective as possible. And so here we go:

Why was this the most significant commercial launch in Chinese space industry history?

It’s cliché, but in a sentence: it’s the first official batch launch of a “Chinese version of Starlink”. I’ve written before about the dynamics of China’s NGSO broadband megaconstellation plans so will spare most details, but in short, the 18 satellites launched for the Qianfan constellation (千帆, “Thousand Sails”, and formerly known as G60) of Shanghai Spacecom Satellite Technology (SSST, aka Yuanxin Satellite) represent the first such launch of a Chinese NGSO broadband project.

Which is to say, SSST launched their first batch before state-owned China Satellite Networks Limited (SatNet). This is a somewhat big deal in the Chinese context, as the SOE would typically get first dibs at claiming the first of something so monumental. We absolutely speculate that SSST was “allowed” to launch first because SatNet remained somewhat far (months?) from a first launch, or otherwise had suffered some setback. In short, it is slightly unusual for a commercial company like SSST to achieve such a first, and was likely due to their lining up powerful backers and executing quickly.

In terms of backers, most of SSST’s funding ($935M in February) has come from the Shanghai Government and the Chinese Academy of Sciences (CAS). Despite that, they are a nominally commercial company, and therefore have somewhat freer reign over their activities and risk-taking than does SatNet. This has apparently come in handy, with the company moving quickly to launch a batch of 18 satellites which, according to the company, are all operating nominally following launch.

In the days following the first launch, SSST was part of a full-on Chinese media tsunami, with a torrent of articles coming from space industry publications, and more notably, investment firms that highlighted various publicly-traded companies likely to benefit from the ramp-up in these constellations. Soon after the launch, SSST boldly reiterated plans for 108 satellites by EOY 2024, 648 by EOY 2025, 1,296 by EOY 2027, and 15,000 by EOY 2030. Manufacturer Genesat, for their part, had previously announced that the second batch of Thousand Sail satellites had been completed and was being dispatched to the launch site.

Launch timelines for China’s two most credible NGSO broadband constellations. China SatNet figures are derived from their statements about 10% of ITU filing launched by 2030

In the days following the launch, we also learned that the first 18 satellites were not built by SSST-linked manufacturer Genesat, but rather by the CAS Shanghai Engineering Center for Microsatellites (SECM), a major shareholder in Genesat (alongside the Shanghai Government). CAS SECM apparently won a contract in late 2022 to build 324 of the 648 initial Thousand Sails satellites, with Genesat presumably building the other 324. This is reminiscent of projects like BeiDou, of which ~1/3 of the satellites were built by SECM and the remaining ~2/3 by CAST. In any case, with SECM owning ~50% of Genesat and both companies being in Shanghai, there is clearly scope for tech transfer and collaboration between them as they build satellites.

All this is to say that in a country where 1) SOEs reign supreme in strategic industries, and 2) “commercial” companies are to some extent under influence of the state, we have seen a commercial company make a heck of a lot of progress on a complicated project in a very short period of time. And even more notably, they reached this point much more quickly than their state-owned counterparts, partly due to their ability to line up state support, while maintaining a high enough degree of operational control.

China SatNet, for their part, has recently furnished their headquarters with greenery, while also reiterating plans for a first launch before the end of 2024. Interestingly, those reiterations included a comment that by 2030 China SatNet only plans to launch ~10% of the 12,992 satellites for which they have applied in two filings. With a first launch in 2024, this would by definition mean that they would not meet ITU deadlines, and would not be able to deploy the full 12,992 satellites, unless they were to receive a waiver from the ITU. TBD, but in the meantime we anxiously await their first launch, best of luck!

China SatNet’s Mammoth HQ Building in Xiong’an New District as of August 2024, near Beijing

The Broader Ramifications

The most immediate broader ramification was the >700 pieces of orbital debris created by the breakup of the Long March-6A rocket. At first glance, one would expect some clarity from the launch vehicle provider (SAST), the parent company (CASC) and/or launch broker (CGWIC). The lack of official comment by any of those three entities up to now is somewhat striking, though the Chinese Ministry of Foreign Affairs was asked about it by CNN and provided a fairly standard answer. In any case, the breakup of the rocket stage caused short-term hysteria and may encourage medium-longer term caution to a degree. And the debris is still up there.

Back on earth, in the weeks following the launch, Songjiang District and a few of the above-mentioned companies put together a 1-day conference that was effectively a celebration of the launch and of the Thousand Sails constellation. The conference included talks from SSST and Genesat, and more broadly it represented further validation and support from the Shanghai Government for this project.

In the very near-term, the launch and surrounding media storm have likely made SSST more credible when going abroad, credibility that would be improved further by launching another 90 satellites within this year, as planned. We should expect to see SSST making moves in Belt and Road countries that would benefit from government tailwinds, as well as countries with vast, sparsely populated land areas.

SSST has also, as far as we understand, started a countdown for reaching certain milestones on its ITU filings, of which they have made 4 that are searchable via the word “SAIL” at the ITU’s website.

Various SAIL ITU Filings

Ultimately, the most important takeaway from this month’s launch is that SSST and Thousand Sails reached orbit before Guowang/SatNet. This is a big deal, and with more than a billion dollars to spend, SSST is likely to keep the launches coming for awhile, meaning an entire industrial base will see new business (more than ten suppliers announced they’d supplied components for the satellites).

Inevitably, SSST will need to find uses for the constellation, and we should expect to see a commercial footprint start to make its way outside of China along the Belt and Road and into countries that are open to China’s tech ecosystem. The challenges and opportunities that this creates are now all the more near-term following this launch.

And in other news this month

🇵🇰 Pakistan’s Space & Upper Atmosphere Research Commission (SUPARCO) and CGWIC held a virtual final system acceptance meeting for the Paksat-MM1 high throughput GEO satellite, launched in late May. The project is the first pure-play GEO commsat export by China in quite some years, with the most recent prior to this being the ill-fated Palapa-N1 (failed) launched for PSN of Indonesia in 2020, and before that the AlcomSat-1 launched for Algeria in late 2017. The project also represents a biggish win in Pakistan for China’s exporting of major infrastructure.

The good folks from CGWIC on their side of the virtual PakSat-MM1 acceptance meeting

🛰️ CEO of GeeSpace Wang Yang was interviewed by CCTV’s “Dialogue” (对话), whereby he discussed the company’s ambitions and the commercial space sector more broadly. Of note were Wang’s comments about GeeSpace’s direct-to-device plans, including an idea to implant a 4mm chip into a standard smart phone.

🌆 Shanghai, Nanjing, and Suzhou all announced space industry development plans. In Shanghai we saw the “Shanghai City Low Orbit Economy Industry High Quality Development Action Plan (2024-2027)”, while Suzhou published the “Suzhou Low-Altitude Economy Industry Development Promotion Regulations”, and Nanjing published the "Action Plan for the Cultivation and Development of the Commercial Aerospace Industry in Nanjing". The three cities are all in the Yangtze River Delta in eastern China, and are all considered hub cities for Thousand Sail constellation suppliers.

🚀 The Haiyang Oriental (Sea) Launch Site will have 2-3 more launches in 2024, this according to Party Secretary and Director of the Haiyang Municipal Culture and Tourism bureau Ren Fei. One of the launches occurred on 29 August when a Ceres-1 rocket from Galactic Energy sent 6 satellites into orbit.

🏭 Much further to the west, CAS Space broke ground on their launch pad at Jiuquan. According to CAS Space Chairman Yang Yiqiang, the launch site will allow rockets to “be launched as soon as they leave the factory…pressing the fast-forward button for high-frequency launches”. In short: having their own launch pad and a factory nearby, is one way for CAS Space to whittle away at the factors preventing commercial launch companies from reaching faster launch cadences.

Rendering of CAS Space’s Jiuquan Launch Site

🔦 Laser comms component and terminal manufacturer Laser Link announced a “more than ¥100M B1 Round” with the company planning to expand manufacturing capabilities and R&D activities in the field of laser comms. The company is building a batch laser terminal factory in Changshu, near Wuxi in the Yangtze River Delta. Elsewhere, Deep Blue Aerospace announced a B3 round, this just weeks after their B2 round. During DBA’s B2 round in late July, they noted that with other B rounds, they have raised nearly ¥1B, we take this to mean the 3 B rounds.

✈️ A Sichuan Airlines flight from Wenzhou to Chengdu was provided live Olympic TV coverage by AeroSat Link, an IFC-focused subsidiary of China Satcom. The flight was connected using Ka-band capacity, likely ChinaSat-16. The IFC penetration rate in China remains very low (well under 20% of aircraft).

🛜 Just a few weeks after the above-mentioned launch, constellation operator SSST signed a strategic cooperation agreement with China Mobile. While early-stage, this represents an interesting example of SSST starting to develop a downstream strategy.

❄️ And last but certainly not least, for readers interested in taking up roles in Harbin, Heilongjiang Province, HITSat posted job offerings for 2025, including:

• ¥150-200K/year (~US$21K-28K) for bachelor’s graduates

• ¥200-300K/year for master’s graduates

• ¥300-500K/year for PhD graduates

HITSat getting creative with their recruiting materials

In addition, PhDs receive ¥100K for housing settlement, with Master’s receiving ¥30K. As a reminder, the company is a commercial spinoff from the Harbin Institute of Technology (HIT), one of China’s top universities and an academic, historic, and technological stalwart of China’s Rust Belt Northeast.

And that, as they say, is all folks. If you’ve made it this far, a big thanks for reading, and we will see you next month.

Until then,

Blaine