Their share price may suggest it to be a poorly kept secret, but Electro Optic Systems (ASX: EOS) has today announced the launch of a space communications business, an area which the company has spent more than $250 million researching over the past ten years.
Key to their decision to spin out the new business, EOS Communications Systems, was the final technology breakthrough through the development of new tech which enables laser effects to be achieved in space using just 0.1% of the power required previously by similar tech.
“The breakthrough EOS has achieved in space communications is not a scientific experiment or a specific technical phenomenon. It is a complete suite of interactive and deployable solutions for the next generation of space communication,” said EOS Group CEO, Dr Ben Greene.
“We have identified at least $120 billion of satellite communications infrastructure investment over the next 20 years which must be aligned with, and ultimately adapt to, the wave of optical communications capabilities emerging globally. We will enter this market immediately.”
The company predicts $400 billion worth of space communications infrastructure will need to be replaced over the next 20 years. In what is still a new industry, EOS anticipates having first-mover advantage in a landscape where they have not detected any other group that has achieved commercial space optical communications.
Underlying technology within EOS laser beams is the ability to measure the distortion caused by the atmosphere which enables the company to eclipse existing products in the market. This ability to overcome the negative impact of the atmosphere on lasers was previously unavoidable and thus meant lasers lost notable intensity upon projection.
By advancing the technology to the point where EOS can use the atmosphere as a corrective lens, the lasers are restored to near perfect quality to move through the atmosphere and into space.
EOS intends to formalise the launch of EOS Communications Systems in Q4 2019 and for the business to be cash flow positive from the outset. The suite of EOS tech to be deployed will have collateral beneficiences in other valuable markets including space debris management, traffic management, security and defence.
Having hit a 52-week low in January 2019 at $2.25, shares in EOS reached a high of $8.21 in early morning trade.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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