[Satellite News 05-18-11] Global Crossing recently signed a new satellite capacity deal with SES World Skies to support growth it is seeing in Latin America. Pablo Yañez, Senior Data Product Vice President, Global Crossing told Satellite News, “We are hoping to grow revenue this year by 15 percent in the region. We want to maintain the speed of growth that we have achieved in the region. I would say the communications market in Latin America is growing faster than it is in other regions, such as North America and Europe where the markets are more mature. Here, in Latin America, you have markets like Brazil, Colombia, Peru and Argentina where the demand for services is growing very nicely. In some countries, like for example Brazil, we have a low market share, however, we are growing at a higher speed than the market.”

     The company is a global IP, Ethernet, data center and video solutions provider with an integrated global IP-based network. It offers a full range of data, voice, collaboration, broadcast and media services. The company acquires satellite capacity to support its operations throughout the world. Global Crossing’s Latin America unit now utilizes about 290 MHz of capacity aboard SES satellites to serve markets across the region. On the heels of last year’s 90 MHz renewal on NSS-10, Global Crossing has now secured an additional 12 MHz of C-band capacity on the spacecraft to enable the implementation of a new VSAT network to meet growing demand for corporate connectivity in Brazil.

     “Today, satellite services account for about 15-20 percent of our revenue in Latin America. So, it is not our main focus, but having these services in our portfolio gives us a competitive advantage because many companies in Latin America need an integration of technologies to cover all their requirements. So, we can do that in the same offering,” says Yañez.

     Incorporating satellite into its solutions gives the telco a competitive advantage. According to Yañez, “Where there is a lack of terrestrial infrastructure, the only option is satellite links. By extending our IP services by incorporating satellite, we provide a homogenous solution that customers can use to link different branches and sites. We also can offer satellite back-up and disaster recovery networks for customers that want to have a backup to the terrestrial network. Finally, we sell satellite services to customers that need a fast deployment of large and scattered networks. These are the main uses for satellite.”

     In terms of the types of companies that benefit from these types of solutions, Yañez adds, “Oil companies involved mostly in the exploration and extraction part of the oil process are one of our main customers for this service. This exploration usually takes place in remote areas. The only option for them here is satellite communication. You have other industries like mining and fishing that also benefit from satellite. I would say these are the three main industries which benefit most from satellite in Latin America.”

     The balance between terrestrial and satellite communications is showing some interesting dynamics. “The region has seen economic growth over the last few years. Many companies have been investing in terrestrial IP networks. Therefore, we have seen a migration from satellite services to terrestrial services. But, there are still many areas throughout the region which are not covered by such terrestrial networks. However, there are cases where companies use satellite because either they don’t have an option, need a backup network with diverse connectivity or require a fast deployment. So, satellite is still the best solution for a number of applications. In fact, we have been able to grow our IP satellite service revenue in the region, in spite of the migration to terrestrial solutions,” says Yañez.

     SES World Skies also sees strong growth in the region. Robert Bednarek, who was previously CEO of SES World Skies and is now a strategic advisor to the SES President and CEO in SES’s new management structure, says Latin America has many opportunities for the operator. “Latin America is a very interesting market. There is a great combination of video and data applications. There is a lot of interest in rural inter-connection and rural Internet for education purposes sponsored by various governments. There are pretty strong and established programmes there for Ku-band,” he says. “We anticipate the continued growth of that type of application. As well, there is a robust cable market and that is beginning to digitize. As we have seen in North America, the digitization will entice the need for more capacity and more programming. So, the traditional role of satellites in cable networks will remain alive and well. It won’t be just U.S. broadcasters expanding to South America. Programmers in the region will also look for more presence.”