Cover Story: Uplinkers: Supply And Demand
Peter J. Brown
The need for network origination, occasional use and ad hoc services, along with a long list of video, data and voice distribution services, including Direct-To-Home (DTH) and IP data, have kept uplinkers scrambling, despite the sense that demand in general has softened throughout the past 18 months.
The market is very weak, but it is not a shrinking market. We have seen our revenues remain fairly constant throughout the past three years, although I remind you that we are providing 25 percent more services to maintain this level,” says Bob Behar, president and CEO of Globecast America, a subsidiary of France Telecom. “The teleport industry has gone through a lot of changes with our customers exerting considerable price and service pressure. We have all learned to do more with less.
“It is a good time to acquire less efficient operations if the idea is to turn them around, but it is definitely not a good time to engage in acquisitions simply for the sake of getting bigger,” Behar adds.
Globecast is one of the better-positioned companies in the United States with four teleports nationwide. By consolidating traffic, and by using 155 Mbs links between teleports, the company has been active in creating one large virtual teleport. Globecast’s transatlantic ATM network, which also offers 155 Mbs links via New York to its European teleports in London and Paris, further enhances the company’s interconnectivity.
“The trick here is to not be overburdened with a lot of transponders. If you are, my advice is that you need to get rid of them. We have all of our syndicated traffic including our WorldTV service on T5, and everything else on GE 1,” says Behar. “You have to be innovative and you cannot push automation too far at the same time because customers always like human interaction.”
The full service approach is obviously the best way to proceed. In some instances, this means that uplinkers have to enlighten potential customers about what services are available.
Although AT&T Digital Media Centers (ADMC), formerly the National Digital Television Center (NDTC), was initially devoted to providing cable programming support, it has evolved into a full service provider.
“Actually, in addition to the cable market, we are creating, managing and delivering content for a wide range of clients, including the enterprise markets,” says Les Shutter, manager of satellite resources at Littleton, CO-based ADMC. “We can provide occasional use or ad hoc services without further expansion or requiring much of a capital expenditure. Do these represent high growth businesses? I would say they are growing, particularly in terms of increasing interest in rich media applications.”
ADMC recently combined with Headend In The Sky (HITS). With a growing emphasis on two-way services in the cable sector in general, and with lots of changes underway at the digital cable headend, ADMC is jointly developing a full complement of solutions, including interactive advertising and streaming media. And ADMC is expanding its Los Angeles and New York facilities as well.
“We have three uplink antennas now in LA, and recently picked up the origination business for the new G4 network. In New York, expansion will occur in tandem with increasing demand for our services there,” Shutter says.
With so many customers seeking end-to-end or integrated solutions, a number of satellite service providers, including satellite fleet operators, are just following the curve. “What is driving our launch of GlobalConnex, and our movement into the hybrid arena, including our establishment of points of presence in London, New York, and soon LA and Asia, is our desire to be more responsive to our customers’ requests,” says Erich Fischer, director of strategy and business development at Intelsat Global Service Corp. He indicates that Intelsat is almost done with its refurbishing of the recently acquired Lockheed Martin teleport in Maryland, and another Deutsche Telekom uplink facility in Germany.
“It is an issue of maintaining competitiveness and we were not able to undertake this move prior to our privatization. In the deregulated markets in particular, there are a large number of diversified carriers and ISPs, and the number is growing,” adds Fischer.
Extending the reach of existing customers is also high on Intelsat’s list of priorities. The Communications Authority of Thailand (CAT) is a case in point. Recently, CAT upgraded to a 45 Mbs duplex link.
“We do not detect any migration away from SCPC at this time. DVB has come on strong lately,” says Fischer. “We see good demand for both, and a fairly reasonable balance of traffic overall, although in fact, I think it is safe to say that a lot of players have gone overboard with respect to DVB. They need to be reminded that DVB is not the only platform out there today.”
Getting the customer headed down the right path is not exactly the easiest thing to accomplish. Fortunately, uplinkers are finding the right tools to get the job done in quick and affordable ways.
“Our African customers tend to be small operators, and the issue of procurement costs or capital expenditures is a big one. Because a lot of their concerns are focused on what it will actually cost to install and operate a hub, and because some of the products offered by larger VSAT vendors are just beyond their reach, companies like Vipersat are worth watching closely. We are about to install a trial hub using their equipment,” says Pier du Plessis, sales director at Biddinghuizen, The Netherlands-based Carrier to Carrier Telecom N.V.
“Up until two years ago, our African customers would take just about anything. Now, they have become more discerning. This is happening as the Internet is becoming the classroom in Africa as well. Because a major share of all traffic into Africa is Internet-based, and because countries like South Africa are still not deregulated, we see a strong future for our model,” says du Plessis.
Delivering Internet-based education to developing countries is not the only customer base that bears watching. The network origination arena linked to a streaming or online component is continuing to exhibit strong growth as well.
“As a teleport, we have been able to add resources as the demand has warranted. When it comes to network origination and live insertions, for example, we are doing 150 to 200 hours per month for one network client alone now. This includes turning around live, international backhauls as well as providing a small studio for talking head type shots,” says Ed Deckert, director of teleport operations and special projects at the satellite services division of Crawford Communications in Atlanta.
Crawford Communications moved to a new 26-acre site two years ago.
“We rebuilt our infrastructure from the ground up. We are doing everything from HDTV to simulcasts involving live, streamed events. We also have 10 uplink trucks either on the road, or standing by here to help us deal with any overflow,” says Deckert. “We can do all of this with a staff of five teleport operators and three engineers in a company with 300 employees.”
Rebuilding infrastructure from the ground up, and creating a virtual teleport using 155 Mbs fiber links are two ways to ensure that you are able to meet your customers’ needs, while preparing for a profitable future. Again, as we mentioned above, this is not necessarily a shrinking market, and with the right mix of insight, timing and perhaps a little luck, uplinkers will find new ways to keep the profits coming.
Peter J. Brown is Via Satellite’s Senior Multimedia Editor. He lives on Mount Desert Island, ME