NSR Report: 5G to Drive 1/3 of Satellite Backhaul Revenue by 2028

Cambridge, Mass., April 9, 2019 — NSR’s Wireless Backhaul & 5G via Satellite, 13th Edition report, released today, forecasts over US$ 32 billion in revenue by 2028, with 5G supporting 1/3 of the overall satellite backhaul market.  Mobile Wireless Backhaul is the largest opportunity in this space, as satcom becomes a mainstream solution and 5G opens opportunities for satellite to seamlessly integrate with the global telecom ecosystem.  Trunking also appears to be re-born via lower capacity costs and slowdown in fiber expansion, while Hybrid Networks represent a long-term play for emerging OTT content distribution models.

“The combination of competitively priced capacity with advanced ground segment makes satcom a relevant solution for MNOs continually seeking new sources of revenue and who are increasingly CAPEX-conscious and risk-averse,” stated Lluc Palerm, NSR Senior Analyst and report author. “The transition to broadband is accelerating in areas like Latin America, where for the first time in 2018, 4G generated the highest share of traffic over satellite versus 2G and 3G.”

The direct impact of 5G in satcom won’t be seen before mid-2020s, but growth will be sizable, generating 1 of every 3 new $ for backhaul capacity revenues through 2028. The ground segment has a key role to play in the integration of satcom into 5G, by responding to new performance requirements and making the solution transparent and easy to adopt for mobile operators.

Satcom can also find the upside of OTT in Hybrid Networks. Satellite is still king for content broadcasting, and as content moves to the edge to support the explosion on IP Video and new formats like UHD and eventually VR/AR proliferate, satcom will emerge as a key tool in the ecosystem.

Business models are evolving rapidly. With MNOs focusing on core services and minimizing CAPEX exposure, managed services are the perfect match between satcom’s streamlined operations for remote areas and the MNO need to continue expanding coverage profitably. New technologies like smallcells expand the addressable market into the most ARPU-constrained and remote locations, where revenue-sharing schemes are gaining traction.