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Batelco Ready To Improve Satellite Offerings In Middle Eastern Market

By | May 28, 2007

      Bahrain Telecommunications Co. (Batelco) believes satellite technology will be a vital element in its growth strategy as it looks to become a bigger player across the Middle East. The Bahrain-based telco signed a deal in April with Asia Broadcast Satellite (ABS) to offer broadband and satellite services throughout the Middle East and Asia.

      Hisham Mustafa, Batelco’s manager for satellite and next-generation services, said that the operator was focusing on a number of satellite-based applications to improve its position in the Middle East.

      "We are really focusing on maritime VSAT applications, which is a really big area for us considering that Bahrain is an island in the Arabian Gulf," he said. "We have lots of ships going around. We are also looking at wide area networking and the delivery of [local area networks], satellite connections and mission-critical applications. The third area we are looking at is mobile VSATs for vehicular based broadband access."

      International Presence

      The operator has a growing international presence across the region, with a presence in Jordan, Egypt and Yemen and recently winning a fixed-services license in Saudi Arabia.

      "In these markets [Jordan and Saudi Arabia] we are not the incumbent, so we will be competing against the incumbent service provider, and we are developing our international services portfolio, be it global MPLS [multi-protocol label switching] all the way to these countries and back to Europe and Asia and complementing it with satellite services," Mustafa said. "It is going to be a full portfolio of international services with a mix of MPLS and VSAT to offer different disaster-recovery applications with a focus on corporate customers. In Saudi Arabia, we have seen that the broadband penetration rate is not very high. The market is hungry for broadband services. That has been identified as a key market for us as we go and deploy the services."

      While the main focus will be on the corporate customer, Batelco also may look at other markets, Mustafa said. "For areas that we feel there is significant potential – such as Iraq, Saudi Arabia and Afghanistan – we are going to go directly to the end user," he said. "If we don’t have a subsidiary in a particular country we will be working with resellers in these key markets to offer these services."

      Batelco has been aggressive with its next-generation network, and satellite has become a vital component in its network strategy. Mustafa explained how the operator’s recent investments in its network will also boost its satellite proposition to customers.

      "We can offer triple-play services on an MPLS based platform," he said. "What we have done recently is that the newly established satellite platform has been integrated with Batelco’s [next-generation networks]. This will enable us to offer a set of very innovative services to customers that are going to use satellite as an additional access medium. [As] a good example of that, our investment in soft switches in Bahrain has been extended to other markets. Customers are experiencing carrier-class VoIP services using Batelcos’s [next-generation network] platform. … The technology will allow us to access new markets as and when that opportunity arises."

      While the efforts that Batelco can control are going well, the loss of the NSS-8 satellite in a January launch failure has had a strong impact on satellite communications in the region Batelco wants to serve, Mustafa said.

      "There is a shortage of the right capacity over the Middle East especially in terms of Ku-band," he said. "It is becoming a serious threat for any service provider who wants to expand. With NSS-8 going out, things have changed with respect to offerings. Everyone is running short of capacity."

      ABS Sees Advantages

      The deal with ABS, while providing more capacity, also goes beyond just leasing space on a satellite, Mustafa said.

      "We are also perceiving ABS as a strategic partner as they are supporting us by providing a triple-play redundancy back-up package for our own recently developed VSAT platform," he said. "We have entered into an agreement with them to replicate everything back to the platform in Hong Kong. It is a disaster recovery site for our teleports in Bahrain. That is another big selling point for us when we are communicating with customers. So in case of serious disaster – apart from the redundancy, which we are taking care of within the platform – all the data is being transferred elsewhere. Obviously we will leverage on ABS’s contacts with major technology partners to develop various satellite applications across the Middle East and Asia."

      For ABS, the deal was an important one the company looks to play a major role as Batelco expands across the Middle East and Asia.

      "The ABS-1 satellite has the widest Ku-band coverage of any single satellite in Asia," Richard Pak, ABS’s senior vice president of business development, said. "Our southern Ku- band beam connects most of Asia, the Middle East, the CIS [Commonwealth of Independent States] region, Northeast Africa and Eastern Europe in one contiguous, high-powered beam."

      ABS has sold about 70 percent of the capacity on the ABS-1 satellite, and planning for ABS-2 is well underway, Pak said. "We released our initial [request for information] to the satellite manufacturers in the beginning of this year and are currently in the process of reformulating the design and technical specifications of the satellite for a projected launch in 2009. We are very optimistic about the growth of our business over the next few years, and our plans for launching [ABS-2] is a testament to our conviction."

      Pak believed the use of satellites for broadband and communication services in the Middle East will act as a complement to terrestrial technologies rather than an alternative.

      "In today’s digital age, critical applications and communications used by companies, governments and consumers all require and demand continuous, uninterrupted service," Pak said.

      "Recent experiences and the unpredictability of natural catastrophes have reinforced the importance of disaster recovery and backup redundancy to ensure quality of service from the operators. Satellites will always continue to serve as a vital and efficient means to offer communications services whether as the primary source in underdeveloped countries or rural areas with little or no terrestrial infrastructure or as the primary or secondary source even in more developed countries with infrastructure in place."

      While Asia is often seen as a tough place for satellite operators to do business, Pak sees are strong growth opportunities for a player such as ABS. "We don’t necessarily agree with the sentiment that there is an oversupply of satellite capacity in the region," he said. "We do see that there is some overcapacity in certain countries, but there are definitely plenty of markets across the region where we see a lot of demand for satellite capacity. I don’t think it’s as simple as trying to measure whether there is too much or too little satellite capacity covering the region because each satellite has its unique core characteristics."

      — Mark Holmes

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