There were three recurring themes running through the Comsys VSAT Conference in London: helping close the digital divide, Mobility – Maritime in particular and integrated service provision.
Satellite’s role in extending broadband services to unserved areas was frequent topic, with several speakers talking about satellite’s role in eliminating the digital divide, not only in emerging markets but also in unserved areas of the developed world, where rural users are increasingly expecting the same services that their urban cousins can access. Government initiatives around the world are aiming to facilitate this although in many cases – the US being a prime example they take some persuading that satellite is a viable solution. In some cases the satellite service will be delivered directly to the consumer as it is in the US with WildBlue and Spaceway and in others satellite will be part of a hybrid network with the consumer being connected to a wired or wireless terrestrial service. With over 15 satellites (excluding O3b) either wholly Ka-Band or with a significant Ka-Band payload scheduled to be launched in the next few years we could be at the tipping point of consumer broadband satellite services. The US with around 1 million subscribers is obviously the current leader in this field.
David Drucker CEO of atContact described his company’s service in Alaska where vast distances and inhospitable terrain make terrestrial connectivity expensive and problematic to deploy, maintain and operate. He illustrated this point very graphically talking about SABRE (South West Alaska Broadband Rural Expansion project) an integrated system funded by the USDA. SABRE serves a population of 30,000 people spread between 53 remote villages in an area roughly the size of the UK. 4G IP services – wireless, voice, video and data, are provided by a hybrid network consisting of WiFi with Satellite Mesh backhaul. David was confident that the Alaskan Model could be replicated globally, and other speakers talked about projects where this had happened or was happening. O3b being a prime example. O3b’s mission is to connect the Emerging Markets – the other 3 Billion. O3b counts Liberty, Google, HSBC, North Bridge, Allen & Company and SES amongst its investors. Debt financing has been secured from Coface and project financing is expected to be completed in the next few weeks. 8 Ka-Band 10 Gbps MEO satellites are expected to be operational in 2012 and 20 by 2015. Brian Holtz, EVP and CTO showing different network topologies that could be used by O3b depending on local needs. These included carrier class point-to-point connectivity, Wireless and Mobile backhaul, enterprise networks and Path Diversity to offload Metro Networks. A striking example was Thailand and Indonesia where O3b believes they can provide users with twice their current data rate at just over half the contention ratio for the same cost simply by using their satellites for backhaul and interfacing with the existing terrestrial network. The potential demand however is huge and even with a full constellation O3b addresses less than 0.5% of the Emerging Markets 3G backhaul needs.
VSATs are increasingly being used in Mobile situations, Maritime being the prime example, followed by aeronautical and COTM (Communications on the Move) the latter being primarily a Military or Government service. In the opening session Simon Bull pointed out that the prime driver for maritime applications was actually internet access for crew members. In 2007 80-90% of installations were for internet access, this figure is now down to 50-60% with engineering management, electronic charts and other value added services increasing in importance. Currently there are approximately 9,000 vessels with VSATs on board and Comsys forecasts 18,500 vessels by 2014 out of an immediately addressable market of around 35,000. The largest segment accounting for 34.6% is the commercial operators followed by Mass Sail Yachts at 29.5%. Compared to the average revenue from a fixed land based VSAT, revenue from maritime installations is significantly higher. The average is around $3-5,000 per month whereas for a fixed terminal $100-500 is the average. Specialized operators can earn as much as $50-100,000 per month from a vessel or rig.
However every new maritime VSAT customer was previously a high end L-Band Customer, which is one very good reason for Inmarsat to be moving into the VSAT market with Global Xpress. Leo Mondale, Managing Director of Global Xpress gave more information about the constellation and service than had been disclosed previously.
In order to try and overcome the limitations of fixed beam satellites and allow Inmarsat the flexibility to respond to changing demand the 3 Ka-Band satellites will each have two payloads, fixed spot beams: 2x72x40MHz Channels operating simultaneously for each satellite and a High Capacity Overlay (HCO) of 6 fully steerable beams per satellite providing 2x12x125MHz Channels. Traffic from the fixed spots will be landed at the 3 Inmarsat Gateways – location TBD whilst traffic from the HCO may also be landed at those Gateways or may be landed within the beam or within another HCO beam.
Orbital slots are also to be decided. Co-location with Inmarsat 4s is desirable but neither guaranteed nor necessary and co-location with Inmarsat 3 may be more likely. However on the basis that “If you can’t beat ‘em –join ‘em” Inmarsat is pursuing multiple filings. Once the slots are allocated frequency coordination will become a major issue, but Leo didn’t see this as a major risk factor as “We’re good at it”.
One of the criticisms of the system has been that it’s Ka-Band and rainfall is likely to be an issue in some of the areas served. Leo expressed confidence that they understood the physics of Ka-Band and had designed the system to provide a service equal to that of Ku-Band. Since the vast majority of Inmarsat’s target customers already have L-Band receivers there are no plans to produce an integrated L-Ka terminal and integrating the two services doesn’t require this.
Obviously the architecture is different for a Ka-Band system serving a mobile market to that of one serving a fixed market and the efficiency is not as great. Therefore the service won’t be as cheap as that provided by ViaSat1 for example, but there will be a cost advantage compared to a Ku VSAT for maritime. The key target markets for Global Xpress are: · Maritime as would be expected. Ships spending more than $5,000 per month on Ku Service and which need more than 5Mbps down are a key segment.
· Oil and Gas Exploration and Production – a return link of up to 5 Mbps over a 60cm antenna will be available to support data-intensive requirements of exploration and production.
· Government and Military – 40cm antennas or even smaller will be made available to provide ease of installation and increased mobility.
The HCO beams provide flexibility for "unplanned high capacity events” which I think most of us would call “wars.” Other Markets that may also be addressed include:
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Enterprise VSAT for large Multi-Nationals
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Wireless Backhaul
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Aeronautical – although there is no polar coverage.
In Paris at World Satellite Business Week, Andrew Sukawaty showed a slide showing a 5 year annual revenue target of $500M per annum. Leo Mondale was more circumspect stating that they didn’t know what the market would be like 8 years from now and refused to be drawn what projections had been used internally. The third theme was heard from a number of the operators, Customers particularly multi-nationals and those in challenging environments want an integrated service. This was summed up most aptly by Peter Shaper CEO of CapRock Communications who talked about his customers wanting “One throat to choke!”
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Elisabeth Tweedie has over 20 years experience at the cutting edge of new communication and entertainment technologies. She is the founder and President of Definitive Direction a consultancy that focuses on researching and evaluating the long term potential for new ventures, initiating their development and identifying and developing appropriate alliances. During her 10 years at Hughes Electronics she worked on every acquisition and new business that the company considered during her time there. www.definitivedirection.comShe can be reached at: etweedie@definitivedirection.com
