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The idea that led to John Hoffman’s breakthrough came from an unlikely place: a government bureaucrat. Hoffman had been thinking of ways to incorporate high-quality satellite data-the kind that intelligence agencies use-into his fledgling aerial photography business. The problem was that the sort of data the United States has is mostly on places like Siberian oil fields. Not much commercial potential there. But the government official’s remark turned the whole thing around. “He said to me,” Hoffman recalls, “You know son, what you ought to do is to go up to the blankety-blank Russians, because by God they’ve been taking pictures of us for 20 years.’”

That advice led Hoffman to experiences reminiscent of a Tom Clancy novel. With the aid of Mike Laserson, who had helped broker U.S.-Soviet grain deals in the 1970s and 1980s, Hoffman finagled a meeting with the Russian Ministry of Defense in late 1994 to promote his idea of putting spy-quality satellite images on the commercial market. Things didn’t start off too well, Hoffman recollects: “Here were a couple of Americans walking into the Russian intelligence community and saying, Hey, you have all these neat photographs. We want you to declassify them so we can sell them to people.’”

But after a few days of discussion followed by a vodka-soaked dinner at the OMNI hotel in Moscow, Hoffman and Laserson won over the Russians. Which made it possible to form a joint venture between Hoffman’s company, Aerial Images, Laserson’s one-man consulting firm, Central Trading Systems, and Sovinformsputnik, the government spinoff that promotes and markets products and services of the Russian Space Agency. After a first failure, a SPIN-2 satellite launched by the joint venture succeeded, spending 45 days in late 1997 snapping thousands of pictures. Then Microsoft, Compaq and Kodak pooled their skills to create a Web-based catalogue and fulfillment service called the Terraserver, which they touted, byte for byte, as the largest database on the Internet.

With 2-meter satellite images (which resolve objects as small as 2 meters across) on sale last summer for as little as $10 each, Hoffman and his partners won an early leg of a new highly competitive race to cash in on data that were once the province of the spooks. “The intelligence community had a 30-year monopoly on high-quality satellite imagery,” says Marty Faga, former head of the formerly classified National Reconnaissance Office, which has been responsible for U.S. spy satellites since 1962. “The monopoly is over.”

In fact, that monopoly is over with a vengeance. In the next months and years a gaggle of companies around the world plan to launch high-resolution imagery satellites, some capable of achieving resolutions fine enough to detect objects less than a meter across-which used to be state of the art for the intelligence community. According to projections by some industry analysts, sales of this new commodity, along with value-added services, such as merging satellite imagery with geographic land-use data, could reach half a billion dollars within a few years. Companies could use the spy-quality data to see what their competitors are doing. It might help foresters to inventory trees by species. News outlets could use it to identify breaking stories. Urban planners could see how cities grow and where to put streets or highways.

That’s the upside of this explosion of once-super-secret information. But looked at from another perspective, a darker image appears. What if, for example, Saddam Hussein had access to 1-meter spy-satellite data during the Gulf War? Might his troops have put up a tougher fight? What if some other rogue state or terrorist groups could use the satellite to target nuclear-tipped missiles on major international airports? According to John Logsdon, director of the Space Policy Institute at George Washington University, there are plenty of terrorists, industrial spies, rogue governments and other miscreants waiting to get their hands on such data.

The problem, says Logsdon, is that this information is poised to spill into the marketplace so fast that policy-making hasn’t had a chance to catch up. This is an area, he says, where “capability may be running ahead of a thoughtful, comprehensive assessment of the pros and cons of going forward.” The Clinton administration’s policy goal to (in the words of an administration official who insisted on anonymity) “strike a balance between foreign policy and commercial interest” has put things on the fast track; the Department of Commerce’s process for licensing purveyors of high-quality satellite data is a fairly business-friendly one. And with foreign competitors in Canada, France, India, the former Soviet Union, Japan and Israel, the data are likely to become available to just about anybody, anywhere in the world.

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