Title: Sacramento
1LIMITED DISTRIBUTION - FOR USE BY CSTA SPACE
COMMITTEE ONLY
Secretary Lon Hatamiya Technology, Trade, and Co
mmerce Agency
California Space Infrastructure Program
(CSIP) STRATEGIC SIMULATION EVENT OUTCOMES REC
OMMENDATIONS
Sacramento January 24, 2001
This report is intended solely for the
information and use of the client to whom it is
addressed.
LIMITED DISTRIBUTION - FOR USE BY CSTA SPACE
COMMITTEE ONLY
2OVERVIEW
- WHY THE STRATEGIC SIMULATION
- CALIFORNIAS SPACE LEGACY
- RECENT CONDITIONS AND TRENDS
- STRATEGIC SIMULATION CULMINATES CSIP PHASE I
II
- WHAT WE LEARNED
- CHALLENGES AND OPPORTUNITIES
3WHY THE STRATEGIC SIMULATION WAS CONDUCTED
ITS ALL ABOUT
SPACE LEADERSHIP
COMPETITIVENESS IN THE GLOBAL SPACE MARKET PLACE
ATTRACTING AND GROWING SPACE/HIGH TECH
ENTERPRISES
JOBS AND REVENUE
COMMUNITIES QUALITY OF LIFE
EDUCATION AND INTELLECTUAL CAPITAL FOR SPACE
A TECHNICAL WORK FORCE PIPELINE FOR SPACE
MODEL FOR FEDERAL-STATE-INDUSTRY SPACE
PARTNERSHIPS
A SPACE VISION, A PRACTICAL SPACE STRATEGY, AND
AN
INTEGRATED IMPLEMENTATION PLAN
4CALIFORNIAS LEGACY AEROSPACE INFRASTRUCTURE
- The Cold War and the Race to Space set the
stage
- for forty years of laissez faire California
infrastructure
- development and success.
442500 Indirect Jobs
- Major Assets
- 3 NASA Centers ( Ames, Dryden, JPL)
- Air Force Flight Test Center _at_ Edwards AFB
- Western Range _at_ Vandenberg AFB
- Space and Missile Systems Center in El Segundo
- Industrial Base of 40 of Global Satellites
- 42000 Aerospace Suppliersl
- World Class Research Universities
5CALIFORNIAS SPACE LEGACY
THE COLD WAR AND THE RACE TO SPACE SET THE
COURSE
- STRATEGY National Security brought programs
and dollars
- INFRASTRUCTURE Aerospace enterprises leveraged
existing aerospace industrial base and
intellectual capital to meet Federal
needs - BUSINESS CLIMATE Growth was a watchword and
trend
- FINANCING Investment climate was subsidized by
federal funding
- COMPETITION Enough work to go around, best
enterprises advanced,
- competition with Russia, domestic/
foreign and domestic
- space competition not significant
Strategic Defense Programs
Lunar Missions
ICBM Development
1960
1970
1980
1990
California was a natural for aerospace/high
technology infrastructure growth
6A DECADE OF A CHANGING ENVIRONMENT
Reductions In Defense Funding
Lack Of Grand Space Missions
Commercial Business Prevails--
Requires Profit Based Efficiency
And Agility
- STRATEGY Cold War faded - Federal programs
reshaped -
- Commercial programs take drivers seat
- INFRASTRUCTURE Growth in infrastructure
capacity is mature, but aging and inefficient
- BUSINESS CLIMATE Aerospace industry growth has
become industry consolidation
- FINANCING Federal budget severely constrained,
commercial space sector is services oriented,
profit driven
- COMPETITION Strong international competition
New set of U.S. space state players IT
industry strong
- competitor for high tech work
force
2001
1991
1995
Incumbent complacency changing environment
vulnerability
7THE CALIFORNIA SPACE INFRASTRUCTURE PROGRAM
(CSIP)
- CSIP WAS CREATED TO ASSESS THE STATUS,
SHORTFALLS, AND
- ENHANCEMENTS NEEDED FOR A COMPETITIVE
CALIFORNIA
- SPACE INFRASTRUCTURE AND BUSINESS OF SPACE
The Strategic Simulation was the Culmination of
CSIP Phases I and II and a Real-World Validation
of the findings
8Phase I and II Task Summary
Phase I and II Task Summary
Phase II
Phase I
Stakeholder
Strategic
Analysis
Simulation
Preparation
Market
Design Simulation
Demand
Post
Data
Analysis
Strategic
Simulation
Phase III
Compilation
Simulation
Develop Briefing
Analysis
Analysis
Book
Competitor
Analysis
Prepare Players
Test Simulation
Infrastructure
Database
07/01/00
08/01/00
5-7/Dec
12/15
SIMP Draft 2
08/
31
/00
00
02/01
Task Complete
BOD
08/
03/
00
Aug/Sept
10/05/
00
Regional Meetings
9CALIFORNIA WAS A STRONG PLAYER IN ALL SEGMENTS IN
1999
1999 GLOBAL SPACE MARKET BY
GEOGRAPHY AND SEGMENT
TOTAL MARKET - 71.1B
Other 1B 11
Other 3.8B 25.5
Foreign 7B
35
Foreign
Foreign
Foreign
Other US 1.3B 9
45
3.4B
10.4B 50
37
Foreign 3.4B
MARKET SHARE BY STATE
22.5
UT .9B 10
Virginia 1
US 9.0B 45
OTHER US 3.5B
FL 1.4B
18
Florida 20
15
MD 1.2B 6
CO .9B
CO 1.3B 6
10
CA 6.6B 43
CA
CA 4.0B 20
CA 4.3B 20
California
1.6B
12
17
Launch
Ground
Spacecraft
Commercial
Govt OM
Launches
Vehicles
Equipment
15.3B
Services
6.0B
78
9.2B
20.0B
20.7B
BAR WIDTH IS PROPORTIONAL TO MARKET SIZE IN
Source Forecast International, Teal, company
sources,NASA, USAF, Satellite Industry
Association, Futron, and BAH analysis
Excludes
foreign government service expenditures.
17.7B --- 25 of Global Market in California
10SPACE SEGMENTS TAX GENERATION PER
MILLION DOLLARS REVENUE BY SOURCE
250
200
150
TAX REVENUE (000)
Corporate Income Tax
100
Personal Income Tax
Personal Sales Tax
50
Users Tax
0
Satellites
LV
Ground Equipment
Commercial
NASA
Services
Source BEA, Census Bureau, Company annual
reports, BAH analysis
Note
Tax revenue is per 1 million revenue in each
market segment
11CSIP UNDERPINNING FOR THE STRATEGIC SIMULATION
- EXAMINED INFRASTRUCTURE CONDITIONS
- Infrastructure Baseline
- Stakeholders
- Market Analyses/Projections
- Competition
- Technical and Business Analyses
- Evolving space paradigm
- STRATEGIC SIM TESTED, VALIDATED, AND BROUGHT
INSIGHTS
- Real world problems
- Space experts from Federal, State, Commercial,
Academia
- Live interaction and deliberation
To find the right answers, you must ask the right
questions
12STRATEGIC SIMULATION SNAPSHOT
- Approximately 75 Participants
- - Federal (NASA, DoD, FAA)
- - State
- - Industry
- - Academia
- Three State Teams / Two Segment Teams
- - California - Federal
- - Florida - Industry
- - Colorado
- Three Decisions Cycles
13WHAT WE LEARNED FROM THE STRATEGIC SIMULATION
- BOTTOM LINE DIMENSIONS
- SPACE VISION AND LEADERSHIP
- COMPETITIVE ROBUSTNESS
- BUSINESS AND ECONOMIC GROWTH
- JOBS, EDUCATION, AND QUALITY OF LIFE
-
14- SPACE VISION AND LEADERSHIP
- California has taken space business for
granted
- California previously didnt need to seek space
business -- no longer the case
- By and large, California has been reactionary
to events - not visionary
- California does not have state level emphasis--
Florida - Alabama- Colorado
- - Alaska - Virginia do!
- A clear implementation schema for space strategy
is not in place
- Need codification and commitment to put vision,
policy, and resources into
- practice
- Aerospace work force issue is a national
problem
- Education/work force development is a critical
component
Pro-active Leadership Necessary
15- COMPETITIVE ROBUSTNESS
- California has been a one stop shop state in
the past-- not true anymore
- California has not worked collaboratively well
in the past
- Export controls affect other space states, but
California has most to lose
- California vulnerability includes both BRAC and
industry losses
- Other states are making better business cases
than California to draw space
- industry
- Other space states have better consensus,
financing, policies, advocacy, incentives,and
organizational structure
- State must organize to operate agilely for space
business
- The power of public-private partnerships must be
leveraged
Competition is real, CALIFORNIA should leverage
its Incumbency
16- BUSINESS AND ECONOMIC GROWTH
- U.S. space industry is no longer sheltered by
national programs
- California is vulnerable in both federal and
commercial arenas
- Foreign technology and competition is
increasing
- Other Space states increasing play in
national space program arena
- Continuing acquisitions/consolidations in space
industry
- Industry will always do whats best for its
shareholders
- Industry is not tending its own long term
interests( 2 to 3 year horizon)
- State-industry partnerships/strategic alliances
are critical to future
A positive thrust required to sustain the Legacy
17 - JOBS, EDUCATION, AND QUALITY OF LIFE
- Space is a fulcrum for many high tech areas, but
viewed as unattractive as
- intellectual capital
- Continuing drain from space workforce to other
high tech areas
- Need to fit space into other state agendas --
e.g., education, transportation,
- labor, etc.
- Need to enhance Californias space industrial
base
- Space financing needs to use non-traditional
approaches
- There are multiple real time issues/impacts--
e.g., current energy crisis in California
Space can be a strong catalyst for workforce
development
18WHAT WE ARE RECOMMENDING
- DECLARE CALIFORNIAS SPACE VISION THROUGH A SPACE
POLICY
- Support commercial, civil, and military space
- INTEGRATE AND EXECUTE SPACE MASTER PLANNING
ACROSS GOVERNMENT DEPARTMENTS
- IMPLEMENT SPACE STRATEGY WITH REALISTIC
OBJECTIVES , ROADMAPS, AND NECESSARY RESOURCES
(INCLUDING FUNDING)
-
- ENGAGE ON ALL FRONTS-- LOCAL, STATE, CROSS-STATE,
- NATIONAL, INTERNATIONAL
- Attain State Federal delegation consensus
- Attain Federal, Industry, Cross-State
partnerships/alliances
- EXTEND CALIFORNIA'S LEADERSHIP AND SPACE LEGACY
TO INFLUENCE NEW NATIONAL AGENDA ON SPACE
19WHAT WE ARE RECOMMENDING
AND, START NOW!