Consumer Market Opportunities
Private networks are not the only area of opportunity for the satellite industry: consumers also count. For instance, "entertainment and information delivered via satellite to handhelds and cars are definitely proving to be hot applications," says Peter Nesgos, a satellite legal expert and partner in the New York law firm of Milbank, Tweed, Hadley & McCloy LLP. "They are catching on faster than anyone would have thought. The market is just starting to explore the possibilities in terms of creating unique content."
Nesgos' opinion is echoed by Andrea Maleter, technical director of Futron Corporation's Space and Telecommunications Division. "Anything mobile is definitely popular, with many developments supported by increased funding for security and emergency response services around the world," she says. "This includes satellite radio."
"HDTV and video-on-demand via satellite are also in demand," Nesgos adds. "Increased bandwidth combined with satellite delivery enhances the viewing experience at the receiving end and offers users the opportunity of customizing and tailoring the content and timing of programming. Finally, let us not forget radio-navigation by satellite, such as GPS. It is ubiquitous; few people appreciate how pervasive GPS has become."
The Military Helps Out
1Q 2005's numbers would have been even more disappointing, were it not for the military's increased use of satellite products and services throughout the past few years "The military sector has been tremendously important to the commercial satellite sector, particularly in the U.S. where other satellite markets have been flat," says Irwin. "It has reduced the glut of capacity and has been a proving ground for new satellite products and services. In fact, military spending and interest have dwarfed other sectors in terms of growth and this appears to be continuing in 2005." Better yet, "the military is treating satellite communications much like the broadcasting and enterprise sectors did in the early eighties; as a technology that they are building into their long-term plans."
Fortunately for the commercial satellite industry, military customers are predisposed to use its services. "Senior managers of U.S. government communications prefer to lease capacity rather than own space assets," explains Roger Rusch, president of TelAstra, Inc., a satcom consultancy in Palos Verdes, CA. "It is easier to obtain money for expenses than for capital appropriations. Meanwhile, government use is considered in a favorable light by FSS operators because governments almost always pay their bills."
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