When a Delta 2 rocket blasts off from California in August carrying the GeoEye-1 imaging satellite, it could mark the end of one era and the start of another.

If the 2,000-kilogram satellite works as planned, it will introduce free-market competition into the sale of black-and-white fine-resolution imagery, showing objects on the ground as small as half a meter across. That level of detail is thought to be roughly in the neighborhood of America’s government-owned spy satellites. In fact, the U.S. intelligence community has signed up to buy the imagery. For at least a few more weeks, though, GeoEye’s competitor, DigitalGlobe of Colorado, retains a hold on the market for 0.5-meter-class-resolution imagery. Its WorldView-1 satellite launched last September delivers 0.5-meter resolution and its QuickBird satellite launched in 2001 delivers 0.6-meter resolution.

The possible end of an era is this: GeoEye-1, owned by GeoEye of Virginia, might be the last product of an unusual cost-sharing agreement between private companies and the U.S. intelligence community. The U.S. government helped DigitalGlobe and GeoEye, then known as Orbimage, start construction of their new satellites several years ago under a $1 billion program called NextView. American policymakers are rethinking the NextView approach, in which the government bought imagery upfront, and split satellite manufacturing costs with the companies, a strategy that helped the firms attract investors.

“The optimal solution is for companies to do that themselves, without government money out front,” said Dave Burpee, a spokesman for the U.S. National Geospatial-Intelligence Agency (NGA), which helps decide where to point America’s spy satellites and signed the NextView contracts with GeoEye and DigitalGlobe. “It doesn’t preclude it from happening again, but that’s not our plan.”

Advocates of the commercial systems have not given up. They argue that NextView has worked well, and putting fine-resolution imagery collection solely into the hands of the government, where it used to be, would lead to more late deliveries and broken budgets. GeoEye-1 is a year behind schedule but on budget, said Mark Brender, GeoEye’s vice president of marketing. That is possible only because GeoEye procured the satellite from General Dynamics in Arizona under a fixed-price contract. When assembly and testing of the satellite took longer than expected, neither GeoEye nor the government were on the hook, as the government often is in other satellite programs, Brender said.

“We’re delivering GeoEye-1 at $502 million, the same price as it was in 2004,” he said. “That’s for the satellite, the launch, launch insurance, four ground stations, salaries and the ground processing facility.”

GeoEye is about to enter a free-market competition with DigitalGlobe, a motivation the government does not have. “Competition is our fear factor,” Brender said. “It drives companies like ours to offer the best products and services.”

Few observers expect the U.S. intelligence community to stop buying imagery from GeoEye and DigitalGlobe anytime soon, however. America’s government-owned spy satellites have been buffeted by the demand for tactical battlefield imagery in Iraq and Afghanistan and the need to continue strategic monitoring of suspected nuclear plants or terrorist training grounds around the world.

With demand rising, NGA awarded a $500 million NextView contract to DigitalGlobe in 2003 and a second $500 million contract to Orbimage, now GeoEye, in 2004. NGA allocated about half the money to help with construction and the other half as an advance on imagery purchases. Intelligence officials received the right to monopolize the satellite’s imaging time and buy the imagery at reduced prices for 18 months.

“We’re clearly committed to the commercial industry for the long haul,” NGA’s Burpee said. “Whether we call it NextView or it morphs into some other name, we’re still going to provide contracts in the millions of dollars every year as long as we get the money from Congress.”

Advocates of the commercial systems are concerned that the U.S. intelligence community and Defense Department are discussing a possible new program called the Broad Area Space-based Imagery Collector (BASIC) system. The commercial imagery companies fear they could lose a considerable chunk of their potential future business, and they are raising alarm bells over the possible program. To them, BASIC sounds a lot like what they are doing now.

“The nation has to make a decision about what strategy it’s going to pursue,” a senior industry official said. “That decision will beget more decisions about future missions and architectures.”

Although no one can be sure how GeoEye-1 will turn out, advocates said the success of commercial imagery satellites such as GeoEye’s 1-meter Ikonos satellite, launched in 1999, and WorldView-1, offers proof that the partnerships with the government have been cost-effective and important to national security.

BEAUTY IN THE DETAILS

General Dynamics’ Advanced Information Systems division in Arizona built GeoEye-1. The spacecraft’s telescope will return images of Earth showing details as small as 41 centimeters across, although the government has licensed GeoEye and DigitalGlobe only to sell images commercially at 0.5 meters. The finer-resolution GeoEye images will be available only to the U.S. intelligence community or to allies with permission from the U.S. government. GeoEye technicians will blur the images slightly for others. DigitalGlobe, by contrast, chose to tailor the altitude of its WorldView-1’s orbit to make its images arrive in 0.5-meter resolution from the start.

In addition to the 0.41-meter resolution imagery, GeoEye-1 will deliver color images at 1.65-meter resolution. The satellite will pinpoint any feature to within about 9 feet of its location, a critical factor for producing highly accurate maps.

Traveling at 16,800 miles per hour in a sun-synchronous, polar orbit at an altitude of 425 miles, GeoEye-1 will circumnavigate the globe 12 to 13 times daily. At that rate, it will revisit any point on the planet every three days. It will survey 700,000 square kilometers in black-and-white and about half that in color each day, for at least seven years. Should the onboard systems last longer, it will carry enough fuel to operate for 15 years.

Controllers on the ground can quickly swivel the GeoEye-1 satellite to look to either side of its orbital path, or to the front or back. If the satellite were passing over Chicago, ground controllers could aim the system at New York, though with a sacrifice in resolution. As it moved south — over, say, New Orleans — the controllers could again aim the system at New York to produce a three-dimensional image of the Manhattan skyline.

“Each pixel in an image will have its own associated latitude and longitude,” Brender said.

PAST AND FUTURE

GeoEye was formed in 2006 when Orbimage of Virginia purchased Space Imaging of Thornton, Colo., owner of the 1-meter-resolution Ikonos satellite launched in 1999 that still operates today. The company said it envisions a succession of fine-resolution satellites, starting with the launch of GeoEye-2 in about 2011. GeoEye plans to press forward on GeoEye-2 without any funding commitment from the government, if necessary. However, the pervasive feeling there is that some funding will be forthcoming.

“There has been solid, bipartisan support for the commercial remote-sensing industry,” Brender said. Two presidents from different parties — Bill Clinton in 1994 and George W. Bush in 2003 — signed off on policies saying as much, Brender added.

Inside the government, however, a debate rages over what constitutes the right mix of commercial and government-managed space imagery. Few expect a repeat of the debate in the 1990s over whether companies should be permitted to image Earth in fine detail and sell the pictures commercially. Nor do they expect the government to relinquish all interest in development of imaging satellites to commercial ventures.

One possible middle ground could involve service-level agreements between NGA and companies such as GeoEye and Digital Globe that would be less extensive than NextView. A government client might hire GeoEye to provide images of all of Africa, collected at a quarter-meter resolution, once every other year. GeoEye then would buy the satellites to perform the mission.

Another option would relegate much of the medium-resolution imagery to the companies, with the government retaining responsibility for developing and deploying the more powerful satellites.

When a new president takes office next year, Brender said, “GeoEye plans on making our case at every opportunity. We expect any new administration to look favorably upon such technology as a better way to do business for the taxpayer.”

For its part, Digital Globe is taking a wait-and-see approach.

“We have every expectation this relationship will continue. [As to] what it means and what it looks like, we’ll defer to the NGA,” Digital Globe’s Chuck Herring said. “They are the customer. What comes next is requirements from them and how we can best service those requirements.”

Whatever the precise relationship with the government turns out to be, advocates expect their customers to continue running the gamut from the top-secret intelligence agencies to individuals who just want to buy posters of their hometowns. Now they will have a broader and more impressive palate from which to choose.