The world of satellite broadband is on the cusp of an evolution to Ka-band global connectivity. Over the next year, ViaSat is looking to lead the North American satellite broadband market charge with the launch of its ViaSat-1 satellite. ViaSat-1 is a crucial element of CEO Mark Dankberg’s future growth strategy, as the spacecraft will be the highest-capacity satellite in the world at the time of its launch.
Positioned in geosynchronous orbit at 115 degrees West, ViaSat-1 will serve the U.S. market with 130 gigabits-per-second of bandwidth. ViaSat hopes the new satellite will boost its subscriber numbers and deliver high-speed Internet to more than 1 million customers.
Dankberg discusses the role Ka-band will play in commercial markets and the impact it will have on the military and enterprise markets as well, going so far as to predict military growth opportunities in the face of Pentagon budget cuts.
Via Satellite: How are commercial users driving the emergence of Ka-band in the North American markets?
Dankberg: Today’s market environment has created a user expectation macro-trend — customers want to be connected anytime, anywhere and at higher speeds. The current generation of smartphones, such as the Android and the iPhone, require much more bandwidth than the older phones. More people that fly and travel have Wi-Fi-enabled laptops and portable devices, and they expect to be able to use them. That’s what ViaSat-1 and Ka-band is all about — meeting the demand.
At the same time, the customers that demand more and more bandwidth obviously don’t want to pay more money for services. Interestingly, the amount that customers are willing to pay for connectivity service is relatively constant, even though they are consuming bandwidth at a much faster rate, so to drive the economics of your offering, you need to offer higher speeds and more bandwidth while cutting costs somewhere in the architecture. If you can get 100 gigabits-per-second or more through a satellite by spending $300 million to $400 million for everything from the satellite launch to the ground infrastructure, compared to spending the same amount to get 10 gigabits, then you’ve found the key to providing cheaper service. That’s what breaks through to the mobile enterprise and commercial costumers.
Via Satellite: How do you work with satellite manufacturers to lower the cost of the space segment?
Dankberg: From our viewpoint, we are not seeing lower costs being driven by the satellite manufacturers themselves. Satellite manufacturers currently have a fairly well-defined set of modules, subsystems and components that they offer. There’s not much room to lower costs there. To get to that lower-cost satellite, you need to assemble the right combination of systems. Our industry has come to a general understanding that people demand infinite capabilities from a finite supply of broadband bandwidth coming from cell phone towers or a satellite. When we look at our infrastructure, we all ask the same questions: “How much did I invest in a cell phone tower? How much did I invest in a satellite for bandwidth? How much capacity is available? What will our users pay to support?” Those are the economics that drive these services.
You have to have a teleport and ground infrastructure that’s consistent with the overall architecture. You have to have user terminals, whether they are mobile or government, that are consistent with the satellite’s architecture as well, so when we talk about getting the right cost for a satellite, we’re really looking at the system-level.
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