[Satellite News 09-20-11] Telecom operators are viewing the advent of Ka-band satellites as a significant offering to companies that had previously looked away from satellite in order to re-assess the technology and added reach to customers. One such telco that is now intriguingly looking towards satellite is Scandinavia’s TeliaSonera, which inked a deal with Eutelsat to bring satellite broadband services to Finland. The operator said its deal with Eutelsat marks a sea change in the company’s attitude towards satellite technology.

   TeliaSonera Director of Satellite Services Jorma Hämäläinen told Satellite News that Ka-band has forced a change in the operator’s thinking. When asked if Ka-band made a huge difference to TeliaSonera’s thinking, Hämäläinen said that when the company had previously been reviewing satellite Internet services, they viewed it as too expensive. “With Ka-Sat, we now see such services as much more competitive. The speeds available are also much higher than before. As well as higher speeds, these services are now much easier to install. In terms of revenues, it might not equate to a huge amount, but it is important in terms of building suitable cost-effective services and customer loyalty.”

If successful, TeliaSenora could export these services outside of Finland. “We see this as the first real cost-effective solution to provide satellite Internet services in Scandinavia. We are starting in Finland to see what impact it has first in Finland, and then we might look at other markets. But, the initial pilot will be Finland,” adds Hämäläinen.

  The operator has now started a trial involving a satellite broadband service based on Eutelsat’s Ka-Sat satellite. In terms of how satellite fits in to its plans, Hämäläinen said the service package is different from what the copmany has in terms of 3G and mobile services. “We want to see our customers’ reaction to satellite services and what sort of expectations they have for this sort of service. So, we want to get a little more information about how they are seeing this service. In Finland, we are building up mobile and fiber networks, so there won’t be huge coverage gaps. We are testing the satellite broadband service between consumer and corporate customers, such as construction companies. We can also use satellite as a way of boosting our 3G coverage. In some areas, we are having capacity shortages, so we can use satellite to pick up the slack.”

   Finland, which has been viewed as more of a wireless market, is now starting to see satellite make an impact – and not just in terms of DTH. TeliaSonera, a combination of the national telcos of Sweden (Telia) and Finland (Sonera) is a major presence across the communications landscape in both countries. In Finland, Sonera has also launched an IPTV service. However, the geography of the country has provided an attractive option in satellite. “Our country Finland is quite long. We have about 18 inhabitants per square kilometer. Around a third of the population is in the Southern part of Finland. There are a lot of rural areas in the country, and it is difficult and challenging to provide sufficient speed via fixed-lined services. Of course every day we are building up our fiber capability and 3G/4G services. But, there are customers who are not very well provided by those services. This is the reason why we need to have these satellite services in the near future. This will be a good tool for us to provide these new connection services to customers. Satellite services can now provide up to 6-10 Mbps in terms of speeds,” said Hämäläinen.

   With competition in the market coming from different communications technologies, the use of satellite could give TeliaSonera an edge in serving rural communities in Finland “There is a radio network based Internet service in Finland and several Wimax solutions, but they are providing limited capacity. One of the key factors regarding markets in Scandinavia is there is a lot of competition in all of the different markets,” said Hämäläinen. “So, providing value is a key thing. Customers are interested in having cost-effective solutions, so that is why we are looking at Ka-Sat in these difficult to reach areas. There are some Ku-band services available, but we want coverage in Finland based on this new Ka-band service.”

   For Eutelsat, the deal with TeliaSonera is one of the most highly significant as it indicates a change in telco thinking and more deals like this will validate the considerable investment in the Ka-Sat satellite. Eutelsat CEO Michel de Rosen told Satellite News that the market for broadband based on Ka-band is beginning to open up. “The entry into service of Ka-Sat on May 31 was a milestone event for Eutelsat, and on a wider scale, for the overall broadband landscape in Europe and the Mediterranean Basin. It coincided with an update on the Digital Scorecard by Neelie Kroes, EU Vice-President,” De Rosen said. “She indicated that 10 million homes in the EU27 are still not served by broadband; and that satellite is one of the core technologies that will help reach these users in order to meet the EU objective of broadband for all citizens by 2013. This unserved market will drive demand for services through Ka-Sat.”

   Idate Satellite Analyst Maxime Baudry also sees growth opportunities for satellite broadband in markets such as the Middle East and Europe. “Several regions are attractive (for Ka-band) but we consider the Middle East as one of the most promising at the moment. Africa could also be a good bet but some obstacles still exist there. Europe is also an interesting market but with lower opportunities, as DSL is very well implemented there (about 95 percent coverage of the population in most countries). In this region, we also see a strong development of mobile broadband though 3G and LTE to come in the coming months/years.”