Telekom Austria Exec Examines Satellite Broadband Opportunity

Telekom Austria Group. Photo: Telekom Austria Group

[Via Satellite 03-10-2015] Telekom Austria believes its satellite broadband service in Austria, as well as Central and Eastern Europe, where the telco operates, has the potential to reach up to a third of households in these territories. The opportunity is likely to be smaller in Austria, which has a more advanced telecoms market, but there still is the potential to reach 18,000 households in the country. Telekom Austria announced a new deal with Eutelsat earlier in February, which will enable it to deliver download speeds of up to 22 Mbps and upload speeds reaching 6 Mbps. The deal also equips the company to offer triple play services comprising broadband, voice and television via the Eutelsat 16A satellite to any home in the region using a single dish. Stefan Amon, director of wholesale at Telekom Austria Group told Via Satellite, that the operator took its time when choosing a satellite partnership.

“From a technical and price combination, we liked the offer from Eutelsat,” he said. “It was a long process, to be honest, to decide which company to choose. The purchasing process took four to five months. We negotiated with three players; it was a very detailed discussion from a technical perspective.”

Over the next 12 months, Telekom Austria’s main focus will be to address the right target group. It will look to satisfy the communications needs in areas such as farming, and search and rescue in Austria. “I would personally like to have this service available to organizations that help save lives. We would not just measure this service in terms of subscriber numbers,” says Amon. “I would be happy if we can help farmers in remote regions sell their products better. This extends the value we can offer and enhances our differentiation in the market. I would really like to have super use cases where we enable people who are not connected to the Internet to have connectivity.”

For Eutelsat, the deal is another key customer win in Europe. Jean-Francois Fenech, general manager at Eutelsat Broadband, told Via Satellite that the company was seeing some interesting growth in its broadband business. “We are seeing steady growth for our Tooway broadband service that clocked more than 175,000 terminals across Europe, the Middle East and North Africa at December 2014, up from 124,000 a year earlier, and 166,000 at Sept. 30 2014,” he says.

Fenech said there is growing recognition among governments, telcos, commercial operators and local communities that satellite has an important role to play in Europe’s digital future, adding that the extension of the Telekom Austria Group deal is another landmark on the way to achieving much more .

The broadband opportunity in Europe is an interesting one for satellite and Fenech believes there are “multiple opportunities” for an operator like Eutelsat.

“As well as consumers trapped in the ‘digital divide’ there are also a variety of other attractive markets for satellite solutions including businesses in remote locations, such as utilities and energy companies requiring access to the Internet and data services. Also, many businesses require data connections that are independent from their fixed lines for services such as failover or back-up. Mobile operators are using satellite data connections to help deliver 3G and LTE services to remote regions and airlines are using satellite to offer passenger in-flight connectivity. These are some of the multiple opportunities,” he said.

Amon described satellite technology as having “developed very well” being easy to install, and a plug and play product. Coming from a prominent telco, this is a major validation for satellite technology in this area.  “Another thing to point out is that this is a service where there are not huge amounts of customers on the network. So, compared to our fixed line or mobile network, which are fairly busy, it is not such a shared volume. You pretty much get the guaranteed bandwidth. We did a lot of tests, and all the tests are positive. The only disadvantage of the satellite offer is the latency, which is longer than what you have on your fixed line or mobile network. We are talking about customers who have had maybe no connectivity now getting 6 Mbps up and 22 Mbps down. I don’t think these people really want connectivity for online gaming, so this will be a very good service for working, surfing and for 90 percent of the usage needed. Live streaming could be a little difficult but, as technology is developing, this will develop as well,” Amon said.

Another benefit from this deal is that Telekom Austria does not have to make huge investments in infrastructure — it already has a teleport available. Telekom Austria offers triple play services already, so it has the infrastructure in place. Its satellite broadband service builds on what the company can already do. “The additional expense is in the customer premise equipment. The ROI is good for us because we don’t have to make huge investments in infrastructure,” admitted Amon.

While this service is not targeting large numbers of people in Austria, for those people it will target, this service will bring huge benefits. “This is an enormous increase in their possibility to have better broadband,” he added.