Latest News

Key Markets Are Sustaining The Industry

By Staff Writer | November 1, 2004

by Nick Mitsis

As the global commercial satellite industry enters the final months of 2004, business executives are examining which of the undertaken ventures worked and what strategic objectives they will need to execute in the coming years in order to increase revenues and improve their respective company’s bottom line.

It is no secret that the satellite technology customer base continues to change. Buyers are becoming more educated on satellite services and its capabilities and therefore now seek satellite with a more educated mind than in the past years. New applications are under development, additional bandwidth needs are growing in demand, hybrid network solutions are, more than ever, in the forefront and more advanced solutions are being introduced into the market.

Those developing such products and services within the commercial and military satellite sectors not only know what made their books remain in the black, but also know where the future revenues exist. For the most part, three key areas grew in demand in 2004: enterprise, military and broadcasting.

On the enterprise side, there was an increase of VSAT deployment worldwide for corporate communications and for data transfers delivering secure content to remote sites. Likewise, distance learning and disaster relief VSAT applications advanced in 2004, opening new revenue-generating opportunities.

On the military side, defense forces remained one of the largest customers of commercial satcom in 2004. In the early 1990s, the U.S. military began to increase its use of commercial satellites for communicating with its branches during times of conflict. In fact, according to U.S. Space Command, demand for satellite communications increased from 100 Mbps for 500,000 troops during the Gulf War to 700 Mbps for 50,000 troops during Operation Enduring Freedom, when commercial satellite platforms provided approximately 60 percent of the communications capability. During the ongoing Iraq offensive, commercial spacecraft carried 80 percent of U.S. forces’ communications, according to the U.S. Air Force.

Nearly all the world’s forces–including the United States’–rely on commercial satellites for relaying messages, obtaining imagery and navigating bombs and unmanned vehicles. The requirements for military communications are expected to continue to increase in the future. According to a Joint Chiefs of Staff document, satellite communication requirements for combat capability in 2010 are estimated to be 14 Gbps.

Lastly on the broadcasting side, content dissemination via satellite also remained one of the strongest sectors. In 2004, the growing buzz around HDTV, more specialized programming and robust broadband applications for both the corporate and consumer worlds increased business for content service providers and equipment manufacturers.

Gone indeed are the days of basic transponder brokering. Verticals, and the successful penetration of satellite services within various markets, are where current and future revenues exist. Markets ranging from defense, consumer and corporate to broadcasting garnered sizable returns in 2004 and are ear-marked to do the same in the coming years.