Economically, the System Differs Significantly from Its GNSS Cousins
John W. Lavrakas
In May 2007, I authored an article in GPS World looking ten years into the future and envisioning how the GNSS field would operate at that then-distant time. Reviewing my assessments, I see that I was both accurate and wide of the mark with my predictions.
The prediction that has proved accurate was that the GNSS world would be hybrid, with no one system as the sole provider of satellite-based positioning and timing services. This was hardly a risky prediction. Most in the GNSS community would have come to the same assessment.
But what I did not see coming were the advances China would take with its BeiDou program. My original assessment was based on three GNSSs only: GPS, GLONASS, and Galileo, and did not include BeiDou.
When I did my analysis in 2006, China was pretty quiet on BeiDou: no technical descriptions, no interface control document (ICD); no presentations at conferences of the Institute of Navigation. What little we knew about BeiDou was that it was a limited system, offering at best a regional solution. The original design was an active system using geosynchronous satellites, requiring each remote unit to request position from the satellite, which was calculated and sent back to the remote station.
How things have changed.
Since 2007, China has reshaped the BeiDou concept into a full-fledged modern GNSS, offering CDMA codes, navigation messages, and data rates comparable to GPS and Galileo — and lots of satellites. The ICD states in section 3.1, “When fully deployed, the space constellation of BDS consists of five geostationary Earth-orbit (GEO) satellites, twenty-seven medium Earth-orbit (MEO) satellites, and three inclined geosynchronous satellite orbit (IGSO) satellites.” No dates are provided, however, regarding attaining these numbers. So the BeiDou system promises to be on par with the other GNSSs.
Why does this matter?
While technically the BeiDou system resembles its cousins, economically it presents quite a different animal. Unlike other nations offering GNSS, China has a huge capacity for manufacturing at low cost. Considering this situation from a business perspective, a possible scenario could be that China offers GNSS chipsets that operate with BeiDou (either solely or as a hybrid with another GNSS)at extremely low prices. In doing so, China could corner the market for general purpose LBS applications (setting aside specialty receivers, such as for surveying and aviation applications). The price point would be so attractive that LBS services would employ Chinese devices in preference to the GPS ones, much like consumers purchase television sets: most come from China, and none are made in the United States any more.
China offers something, then, in this scenario that neither Russia, Europe, nor the United States can currently match. This may not be the scenario that eventually occurs, but it is possible. Other factors such as local terrestrial PNT solutions and dual-frequency improvements will come into play, but what I have described is one possible scenario. While the signal is free, the equipment is not, and when we are talking about a billion or more installations, cost is going to be a big driver.
Am I going out on a limb and saying that BeiDou will be the system of choice in another ten years or so? No, I would not go this far.
But I do say that serious competition for GNSS users (read “market share”) is now in play. Further, it is important for each GNSS operator to recognize this as they consider the services and features they choose to offer, and the impact these have in capturing their share of the market. GNSS providers now must factor the business aspect of their services as much as the technical, scientific, or safety of life. The U.S. government, for one, has gotten a bit complacent in upgrading GPS services to meet user needs, operating from a basis that it is the only GNSS on the block. It could wake up one day and find this no longer to be the case.
John Lavrakas is president of Advanced Research Corporation, where he provides consulting services on satellite navigation and fishery information systems. He has spent 32 years in GPS, supporting development of the GPS Control Segment, GPS user equipment, GPS performance analysis capabilities, and developing and marketing location-based systems. He is past president of the Institute of Navigation and an ION Fellow.