Teleports often are characterized as the ground-based infrastructure of a satellite network, but the term means different things to different people. There is a surprising amount of diversification in the field, and the term teleport covers a wide range of facilities and business models, making it challenging to pin down exact the costs ratios of doing business. In a 2007 study, the World Teleport Association (WTA) details a fractional teleport industry with many different forms of ownership, including: telephone companies, commercial operators, DTH and cable companies, satellite operators, and system integrators, and the business dynamic is different for each business. For instance, a teleport operator providing data services to thousands of maritime vessels has a completely different business model than a DTH provider broadcasting content to millions of subscribers. But while business models vary significantly, there are a few costs which are common to most teleport operators.
Independent teleport operators have been the heart of the industry since the early 1980s. Teleport operators historically have been entrepreneurs, have focused on a geographic region and, initially, were focused primarily on the media and entertainment industries. Over time, corporate entities have been built up, acquiring teleports on different continents and operating them as an integrated service offering, often with interconnecting fiber networks. In its 2004 Teleport Benchmarks study, the WTA surveyed the marketplace about factors such as revenues, technology assets in place and employment. The data was compiled in 2004 and provides good metrics for the comparison of different teleport operators. The report breaks down the operators into classifications: small, midsize, and large and found that small teleports, on average, operate 20 satellite antennas, employ 14 people, and generate $5 million in revenue per year. Midsize operators enjoyed annual revenues between $29 million and 30 million and operated 28 antenna. Employees per teleport were not available for this market segment. Large teleport operators on average had revenues of $33.4 million, operated 87 satellite antennas and employed 57 people. While there is considerable overlap, it is rare to find two teleports offering the exact menu of services.
Video Driven Teleports
TIBA (Teleport International Buenos Aires), based in Argentina, is privately held with annual revenues between $30 million and 40 million. Founded in 1992 as a teleport serving broadcasters, TIBA expanded into data services for a period before returning to its roots over the last five years and concentrating on broadcasters. From their two facilities in Buenos Aires, TIBA support 30 customers, including Disney, Fox, ESPN and Turner, broadcasting 120 television channels and leasing about 550 MHZ of satellite capacity. More than half of TIBA’s revenues are generated by value-added services, such as playout, and the company employs 180 people, with 140 in engineering and operations.
The cost of satellite capacity is the number one cost driver for TIBA, accounting for 48 percent of revenues. Personnel and the cost of operations was the next highest cost coming in at 10 percent of revenue. Maintenance contracts totaled 2 percent of annual revenues, and energy costs were around 1.5 percent of revenue. “Our facility used to be owned by the former PTT and it sits on the national fiber ring,” says Dan Zonnenschein, vice president, business development. “We have four different fiber carriers to choose from. Although 20 percent of the channels we broadcast are received on fiber, it isn’t a significant cost of doing business.”
Arqiva Satellite & Media operates an integrated teleport and fiber distribution network. The company’s 125 uplinks can bring nearly 50 different satellites into play. The company, with U.S. operations based in Washington, D.C., provides data services to the U.S. government and enterprise clients, but the majority of its revenues come from video services, broadcasting more than 400 television channels across Europe, the Middle East, Africa, Asia and the Americas. “Teleports are an enabling infrastructure for communicating via satellite. Of course, the cost of satellite bandwidth is always going to be there and is often the largest cost on a recurring end-to-end delivered service,” says Jon Kirchner, executive vice president and general manager for the Americas. “That said, the largest teleport-specific variables are staffing, the cost of the infrastructure, maintenance, and energy/HVAC,” he says.
RRsat Global Communications Network, based in Omer, Israel, operates satellite facilities on multiple continents, all interconnected with a fiber-optic network. While RRsat, the WTA’s 2009 Independent Teleport Operator of the Year, provides some data services, about 90 percent of the company’s revenues come from video-related services. RRSat uplinks more than 500 television and radio channels, supporting a significant number of the world’s leading broadcast networks with transmission services or value added services, such as playout. The company operates 160 antennas, with 35 percent to 40 percent of them being uplinks. RRsat communicates with 35-plus different satellites, providing clients flexibility in both coverage and costs. Lior Rival, vice president, sales and marketing, also says satellite capacity is the company’s largest single cost, noting that equipment and human resources were other significant costs.
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