Expert Advice: Realizing Europe’s SatNav Ambitions

November 1, 2011  - By

Exp-Adv-NovBy Axelle Pomies and Gard Ueland

The 21st century today faces and will continue to encounter many new societal challenges, all mutually interdependent: health, environment, agriculture, ageing population, personal security, public and civil protection, safe and efficient transport and mobility, citizen rescue, land management, energy (supply, security, and efficiency), full employment, new consumer services, high-tech industry, business security, connectivity, globalization, intellectual property management and protection.

All these challenges have a common denominator: the economic health of Europe: growth, competitiveness, and job creation. Along these lines, the European Union (EU) created the Europe 2020 strategy for smart, sustainable, and inclusive growth. Its goal is to achieve growth by “developing an economy based on knowledge and innovation, promoting a more resource-efficient, greener, and more competitive economy, fostering a high-employment economy delivering social and territorial cohesion.”

The role of European institutions in the growth process is especially decisive at a time when all organizations struggle to borrow, spend, and invest in the current economic situation. The need to stimulate the economy and to ensure competitiveness and return on investment in Europe is more important than ever. Among the growth-enhancing items identified in the EU2020 strategy, research and development (R&D) and innovation are part of the top priorities: “3 percent of the EU’s gross domestic product (GDP) should be invested in R&D” is one of five top EU targets. The European Commission also put forward the Innovation Union concept initiative “to improve framework conditions and access to finance for research and innovation so as to ensure that innovative ideas can be turned into products and services that create growth and jobs.”

Given EU budgetary restrictions, as stated in the EU2020 strategy, the financial framework must be “devised to maximize impact, ensure efficiency, and EU value-added.” This is why the EU budget must be carefully invested in research and innovation areas that both have strong growth potential and satisfy Europe’s political, societal, and economic interests.

The domain of satellite navigation applications, rapidly becoming a pillar of 21st-century society, offers a splendid opportunity among the most promising ones!

Key GNSS Applications

  • Transport. Increased safety and efficiency for aviation, maritime and inland waterways, rail, road transport, and more.
  • Environmental protection. Support to environmental driving, car parking, waste control, low-cost sensors for landscape monitoring, resource monitoring. and land administration through surveying and mapping…
  • Health. Tracking and tracing of medical goods, assistance to elderly and disabled people.
  • Agriculture. Precision agriculture, livestock management…
  • Mobility. Navigation, road tolling and charging, location-based services, multi-modal transport services…
  • Security and Safety. Pay-as-you-drive insurance, law enforcement, protection of intellectual property rights, secure asset and personal tracking, unmanned vehicles, integration of GNSS, satellite communications, and global monitoring for environment and security, customs and freight monitoring…
  • Timing and Networks. Synchronization of smart grids, telecommunications, banking, and digital video broadcast networks…

Public Funding Requirement

EU public funding is necessary for Europe to attain excellence, compete in a global market, and expect future commercial and societal benefits.

GNSS positioning, navigation, and timing technology is fast becoming a mature commodity, but major improvements are still required. Without EU public support, such as the Framework Programs for R&D, GNSS development will continue to follow a purely economic approach from industry, that is, maximizing return on investment rather than seeking to innovate technology. Industries will naturally look to combine commercial off-the-shelf sensors and functions, with minimal effort on R&D, rather than improving GNSS technology’s ability to meet evolving needs.

This approach jeopardizes both European excellence in the GNSS field and the future take-up of European GNSS infrastructure.

Foster Knowledge, Create Jobs. There is a compelling need to foster European knowledge and capability to reach excellence in the GNSS field, in order to maximize competitiveness, growth, and job creation in Europe. The purely commercial approach will continue to place the U.S. GPS as a standard; this constitutes a major risk for Galileo and for the EU economy as a whole, as it would continue to rely on a GNSS service over which it has no control.

Therefore, EU public funding, through such initiatives as framework programs (FPs), competitiveness and innovation programs, and Horizon 2020, is essential to ensure the use of European infrastructures and the generation of benefits for Europe. This will give the means to the EU industry to get a better share of the global GNSS downstream market.

It is a question of business, growth, employment, and return of EU investment in the European GNSS programs. As an example, most non-aviation applications of the European Geostationary Navigation Overlay Service (EGNOS) infrastructure exist solely from the stimulation of FP6 and FP7 projects.

Finally, the cycle of EU public funding — which creates projects that link people not used to working together, to stimulate creativity and foster innovation — also must be underlined. Through these programs, small-to-medium enterprises (SMEs), large companies, academia, and research institutes from EU countries and beyond can meet and work together. To link people and brains and stimulate creativity is a perfect springboard for new ideas and market opportunities.

We emphasize at this point the huge risk of the absence of FP7 GNSS applications R&D budget until 2014 — the dedicated FP7 budget being exhausted due to extensive cuts, leaving only ϵ100 million in the GNSS FP7 budget line, instead of the ϵ350 million granted at the outset. A lack of public support for R&D effort would significantly limit the potential of innovation and growth as well as European ambitions in GNSS.

The European Parliament Resolution of June 7, 2011, on “Transport applications of Global Navigation Satellite Systems: Short- and Medium-term EU Policy” revives hope among European downstream research and innovation actors. Among other things, Parliament calls on the European Commission (EC) “to ensure that the ϵ100 million likely to be underspent in payment appropriation for research within the 7th FP is made available for the development of GNSS applications.”

Applications a Promising Market

GNSS-based positioning/timing technologies and services must be part of the long-term growth priorities of the European Union. As part of the solution to the next generation of challenges, GNSS technology can contribute significantly to all major EU policies.

GNSS applications and services development can bring immediate benefits — creation of new industrial activities and hundreds of thousands of jobs — and enhance daily life and well-being of Europe’s citizens; the core vocation of GNSS applications is fully in line with the Lisbon Treaty.

Further, GNSS applications and services constitute one of the most promising sectors for European growth. The global GNSS market amounted to around ϵ130 billion in 2010 and is expected to reach ϵ240 billion by 2020. This corresponds to a sustained growth rate of more than 11 percent per year.

EU public funds invested in GNSS applications R&D would catalyze growth, enabling market development and maximizing the efficiency of EU budget. With only a small part of its budget dedicated to GNSS applications R&D, the EU would see both an important and decisive impact on the GNSS market and a snowball effect, seminating further applications and domains with GNSS technology.

The 2010 FP7 budget for GNSS R&D was ϵ30.5 million. Assuming that EU27 member states made similar contributions at the national level and that two-thirds of GNSS R&D investments come from the private sector, the total EU investment in GNSS applications R&D totalled ϵ180 million in 2010.

Since the EU GDP of GNSS applications and services amounted to around ϵ26 billion in 2010, the rate of GNSS GDP to investment in applications R&D’ corresponds to a factor more than 100. In other words, ϵ1 invested by in GNSS application R&D generates about ϵ100 of revenue.

The Need for Dramatic Increase

As stressed in the EU2020 strategy, “R&D spending in Europe is below 2 percent [of GDP], compared to 2.6 percent in the United States and 3.4 percent in Japan.” The Barcelona EU goals specify that R&D financing should be shared between public (one-third) and private sectors (two-thirds).
In 2011, EU public investment in GNSS applications R&D is expected to be 0.1 percent of EU GNSS GDP — well below the required threshold. If the R&D budget is not restored, this rate will come very close to zero until 2014.

In the Barcelona and Europe 2020 goals, the level of EU contribution to GNSS applications R&D investments can be computed (Figure 1). Ensuring EU benefits would require annual public support to GNSS applications research rising from ϵ100 million in 2011 to ϵ200 million in 2021.


Figure 1. Minimum level of EU public funding required for GNSS applications R&D from 2011 to 2021.

Increased investment would enable Europe to boost its current 20 percent market share to reach the 33 percent share that Europe enjoys in other high-tech sectors. This would mean creation of more than 400,000 new jobs in 2020.

Contrary to the United States, China, and Russia, the EU lacks a large military applications R&D program, which elsewhere helps support industry investments in commercial and civil applications. Given European investments in other sectors and investment of other countries in GNSS application R&D, a level of EU public investment between ϵ100 million and ϵ200 million per year is essential.

Horizon 2020

Galileo Services makes the following recommendations for the EU program Horizon 2020.

GNSS technologies and services.

  • Support European industry in investing and developing critical technologies, applications, and services based on end-user requirements: security, reliability, robustness, and high performance;
  • Pursue research to improve GNSS performance, mainly multi-constellation multi-sensor receivers;
  • Encourage innovative ideas, whatever the domain may be, through very open calls for proposals.

Market penetration and development.

  • Adequate value-added content (such ashigh-precision or indoor digital maps) to leverage application development;
  • Market analyses and business cases, with a focus on new uses of GNSS;
  • Promotion and awareness activities;
  • Standardization in relevant domains;
  • A certification process for safety- and security-critical applications;
  • Demonstrations and pilot projects, focusing on implementation of GNSS solutions tightly integrated in the user workflow, involving all value chain actors;
  • Use of large European companies  — industry locomotives — and SMEs’ innovative capability to penetrate markets and spin off new business opportunities;
  • International cooperation established by: favoring EU industry interests within bilateral discussions between EU and non-EU countries, involving non-EU partners only if providing opportunities for market penetration beyond EU boundaries or specific skills and/or technology not available in Europe, and setting up adequate intellectual protection rights (IPR) policy.

Other support.

  • Expectations of significant public-sector funding and regulations will stimulate private GNSS investment. Such tools are widely exploited in America, Russia, and Asia;
  • Regional and national procurement plans would benefit from coordination at the EU level;
  • A close dialogue has been established between European institutions and GNSS downstream industry, represented by Galileo Services, in recent years. In this framework, crucial issues such as licensing rules, IPR policy, and international cooperation can be discussed. This initiative must be pursued and even reinforced.

Galileo Services is a non-profit organization founded in 2002 as a major partner for the Galileo program and GNSS application development. Although Galileo is a key area of interest for Galileo Services, the association focuses on all types of PNT systems such as GPS, GLONASS, Galileo, EGNOS, WAAS, and so on. Having merged with OREGIN (the Organization of European GNSS Industry of equipment and services) in 2009, Galileo Services network represents more than 180 member organizations from Europe, North America, and Asia, ranging from SMEs to large companies. Gard Ueland is president of Galileo Services, and Axelle Pomies is its permanent representative.

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