BeiDou reaches new heights
2014-09-19, Li Xiang, Zhou Lihua and Liu Kun

While China is methodically going about its quest to catch up with its competitors in the satellite navigation industry, a Thai princess has been pivotal in opening the overseas market for the Chinese technology.

The royal figure is Princess Maha Chakri Sirindhorn, who has been dubbed the “princess of technology” because of her interest in using it to dramatically advance her country’s development. 

One of her chief concerns is the heavy rains that regularly lash her country. So when she visited a geospatial research center in Wuhan, Central China’s Hubei province, nine years ago, she asked scientists if their country could offer Thailand a satellite to provide detailed images during bad weather.

Not only could China provide such a satellite, but it could do so much more cheaply than the West, she was told. That eventually opened the Thai market to China’s BeiDou Navigation Satellite System, a rival to the Global Positioning System (GPS) maintained by the US government.

Bangkok thus became the first overseas customer of BeiDou after the system began to offer services to customers in the Asia-Pacific region in 2012. 

Within six years from now, China hopes to have more satellites in place than the dominant GPS, as BeiDou is expected to achieve full global coverage with a constellation of 35 satellites by 2020. At present, 16 BeiDou satellites are in position.

“The BeiDou technology is completely developed in China,” says Ran Chengqi, director of the China Satellite Navigation Office. 

He called for cooperation among the countries operating satellite systems, including the US, Russia, and Europe. “We wish to see the BeiDou system being used together with the GPS system with no interference or impact between the two. In this way, we can reap the biggest benefits at the lowest cost.” 

Ran says that there are things that BeiDou hopes to learn from the GPS system, including application, experience and management. At the same time, he says, the GPS system will need a good technical partner like BeiDou. “As the reliance on satellites grows, one satellite system will be unable to meet all the needs,” says Ran. 

Meanwhile, Chinese companies are moving ahead with plans to venture into the overseas satellite navigation market, particularly in Asia.

At stake are billions of dollars in a market dominated by GPS, and it will be joined by the European Galileo system, which expects to have its full system in place by 2019, a year ahead of China.

Three BeiDou stations designed to enhance data precision and positioning accuracy of the system have been built in Chonburi province in eastern Thailand, from some of the 10 billion yuan ($1.6 billion) being spent on the BeiDou project there. 

The development in Thailand is just the beginning of China’s efforts to spread the commercial use of its BeiDou system in Asia Pacific.

Apart from Thailand, Chinese companies backed by strong government financial support are looking for opportunities in countries such as Brunei, Laos, Malaysia, Indonesia, Myanmar, the Philippines and Singapore as they hope to cut into the dominance of GPS.

He Yanxiang, vice-president of Wuhan Optics Valley BeiDou Geospatial Information Industry, which is taking part in the project in Thailand, has drawn up an ambitious plan of building 220 BeiDou ground stations in the country in the coming years. 

With these stations in operation, the positioning accuracy of BeiDou could reach within centimeters and the system could then be used in Thai agriculture, disaster forecast, electricity and transport, He explains.

China wants to build a network of 1,000 such stations across Southeast Asia. “With these stations BeiDou could better service local customers and will be able to gradually squeeze GPS’ market share,” he says. 

China’s ambitions for its homegrown navigation system are not just limited to neighboring countries. Middle East countries such as Saudi Arabia and the United Arab Emirates, and Latin American countries such as Mexico might also become potential customers in the near future.

But the size of the challenge BeiDou faces in doing that is apparent considering how late it is in joining the satellite navigation industry, and given that GPS has a stranglehold on 95 percent of China’s own market.

“One of the most pressing issues for BeiDou is why people would use your service while GPS is already doing a good job,” says Wang Li, director of the international cooperation department at China Satellite Navigation Office.

However, industry experts say that BeiDou, because of the design and positioning of its constellation, has better performance than GPS in low-latitude Asian countries, especially in high-density cities that have to contend with the urban canyon effect — skyscrapers often blocking GPS satellite signals.

BeiDou can also boast that it is the only satellite navigation system that offers telecommunications services. Users can communicate by sending text messages via the satellite network, which can be critical when mobile phone signals and Internet links are cut during disasters.

“The competition with the American GPS is not a zero-sum game,” Wang says.

“What BeiDou pursues is compatibility with other systems and the ability to be an important and reliable complement to the existing systems so that users can have more options and acquire more accurate positioning information.” 

In 2000, China sent its first BeiDou satellite to space, marking the beginning of Beijing’s quest to develop a global navigation system. 

Although it was almost 40 years after GPS went into service, the immense commercial potential of the satellite navigation industry prompted the government to accelerate investment in BeiDou’s civilian application in a wide range of fields such as transport, precision agriculture, disaster forecasting and relief, and environmental protection.

Several industrial parks dedicated to the research and commercial application of the BeiDou system have sprouted up across China, backed by an investment exceeding $800 million, according to media reports. 

The government aims to develop the industry into a 400 billion yuan business and boost BeiDou’s market share in the domestic market to 60 percent and 80 percent in some key strategic application areas by 2020, according to the mid- to long-term plan for China’s satellite navigation industry approved by Beijing last year. 

Industry experts are also optimistic about BeiDou’s prospects in the international market and believe the system could snatch about 20 percent of the global market by 2020.

If the BeiDou project in Thailand proves to be commercially successful, China also intends to copy the model for other Southeast Asian countries.

China has signed a cooperation agreement with Malaysian authorities on the development of BeiDou’s application in the country, while a joint research center on the system will be established in Singapore this year, according to Fan Jingsheng, deputy secretary of the Global Navigation Satellite System and Location Based Service Association of China.

“We are in discussion with the government of Singapore, which has expressed interest in BeiDou and hopes the Chinese system can help solve the issues of traffic control and automatic parking service,” Fan says. 

For Chinese companies, BeiDou has given them a competitive edge over their Western rivals while they venture into Southeast Asia, an underdeveloped market even for GPS in terms of the civilian application of navigation technology.

China Siwei Surveying & Mapping Technology, a State-owned satellite navigation service provider, is moving into the region with plans to become a major provider of real-time traffic information with a BeiDou/GPS dual-mode receiver.

“We’ve seen strong demand for services of traffic information collecting, data processing and vehicle positioning in cities such as Bangkok, Jakarta and Kuala Lumpur as they are facing high automobile growth and problems of serious traffic congestion,” says a China Siwei spokesman.

“BeiDou has offered us an advantage when we go overseas as our terminal supports both BeiDou and GPS systems, which means the reliability of our service is more robust than that of the single system,” he adds.

The company, which sees Inrix from the United States and TomTom from the Netherlands as its competitors in the field, plans to install its BeiDou/GPS terminals in at least 10,000 motor vehicles in each of the three Southeast Asian cities. Its technology has already been applied in Bangkok on a trial basis.

What has a far-reaching implication is that by exporting BeiDou-based products and services, China is also exporting its market standard, known as RTIC (Real-time Information of China), which will help shape the rules of the real-time traffic information market in Southeast Asia, says the China Siwei spokesman.

But he admits that China’s satellite navigation industry is still in its infancy and introducing BeiDou technology and services to foreign markets can still face customer concern due to the industry’s sensitive nature.

“It has to do with the improvement of the overall image of China and our national industrial capability,” he says.

Another major technical breakthrough China needs to accomplish before BeiDou can realize large-scale commercial success is the innovative capability for the research and development of the cost-effective BeiDou chip, a key component of navigation receivers.

In 2013, China released BeiDou’s Interface Control Document (ICD), the essential technical document to develop and make receivers and chips. It was good news for the system’s international commercialization as chip producers around the world could then freely develop BeiDou chips based on ICD information. 

US chip producer Qualcomm has collaborated with Samsung to launch the first BeiDou-supported consumer smartphone. It has indicated that China’s navigation system has become a major area of contention for chip producers in the world.

But the trend also means greater competition for young domestic companies that are already feeling the pressure from their Western competitors.

“The Chinese companies can only grow by engaging in this face-to-face competition with the world’s top companies in the industry,” says Wang with the China Satellite Navigation Office.

Wang adds that the cost gap has been narrowed with foreign producers, which will give Chinese companies more incentive to develop BeiDou-based product in the future.


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Zhao Yanrong in Bangkok contributed to this story.

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