WASHINGTON, DC – Despite an oversupply of capacity in the market, many operators still are convinced that the Asian market offers rich pickings. This was one of the main conclusions on a panel at Satellite 2003 on the Asia Pacific market. Yet, despite the potential in the region for new services and applications, there already are a number of operators in the market. With current low pricing for transponders, it is a difficult market to be a success in right now. There are also regulatory issues in a number of countries in the region, which is making it difficult for satellite operators. But the good news is that China and India are potentially huge markets for satellite services due to their size and the potential of satellite compared to terrestrial alternatives.

One operator with a bullish attitude is AsiaSat, which intends to launch its AsiaSat 4 satellite this year, despite operating in a tough environment. Peter Jackson, AsiaSat’s CEO, said the operator planned to target the Chinese market aggressively. “We are launching a new satellite even though there is spare capacity in Asia. We are looking at China. China is surprising everybody with its growth … The demand for broadband content will also increase. But, the countries have got to see economic growth to support satellite. However, I think satellite will be a major force in the region.”

AsiaSat is also trying to avoid being drawn into a pricing war in the region. Jackson said, “We were there first and we developed an extremely good neighborhood. You may go somewhere else that is cheaper. We will charge you a bit more but we spend a lot more. We don’t have any interference. We get the customers that are serious and want maximum coverage. I think the type of business available in Asia is very difficult. Unfortunately, for a lot of countries in Asia, they don’t have the cash.”

While AsiaSat remains one of the top operators in the region, other big players are also pitching for their share of business. PanAmSat, which has contracts with some of the region’s top programmers also paints a bright picture of the future. Mike Antonovich, senior vice president of global services, commented, “In terms of oversupply, we are going to focus on where we get paid, rather than some ISPs who are here today and gone tomorrow. There is more failed DBS in Asia than successful. But, we take a long-term view in Asia. We have been waiting for DBS in Asia. It is an important part of the world. It is great for satellite. It is not where the fiber lands; it is where the customers are. I don’t see fiber as a direct threat to our core business.”

New Skies Satellites is another operator who is also hoping to make its presence felt more in the region. The operator only derived less than 7 per cent of its revenues in the region in 2002, but its repositioning of its NSS-8 satellite (see Interspace issue 763) is an indication of how seriously the operator is taking the market. Recent deals with operators such as ChinaSat in China and Reliance Infocomm in India have seen the operator dramatically ramp up its deals in the region. Srini Prasanna, vice president of sales IMEA, New Skies Satellites said, “There are several countries where there is high demand, but also there are high barriers. In India, de-regulation has offered new opportunities. When the international voice monopoly ended, we signed contracts with private telcos. Another important market in India is DTH. I feel it is on its way. It is one of the fastest growing markets for New Skies. There are other areas such as broadband, rural telephony, distant learning etc.”

John Stanton, president of global sales and marketing at Intelsat believes the military and government sectors are potential growth areas for the operator in the region. He said: “We are looking at increasing VoIP business in Asia. We see opportunities in the government and military sector. We see increasing interest in VSAT networks from oil and gas companies.”

Intelsat has also made some significant recent moves in the region. It recently announced a deal where it took a 51 per cent stake in Galaxy Satellite Broadcasting Limited, which is licensed to provide pay-TV services in Hong Kong, as well as teleport services. But, Stanton believes pricing in the region is also making things difficult to generate returns. He added, “It is one of the two regions of the world where more tears and blood has been spilt. Some very courageous pricing has taken place. We want to ensure that price points remain sane.”

–Mark Holmes