[Satellite News 06-30-10] The Asian VSAT market has held its own over the last 12 months of the global recession, according to Comsys Senior Consultant Simon Bull, who told Satellite News that the region’s resilience has exceeded expectations.
    Bull believes the Asian VSAT markets have seen less dramatic changes because “a great deal of the more excessive projects have been wiped out in previous downturns, resulting in a more pragmatic and consistent growth story over the past 10 years or so. Asia also enjoys possibly the most competitive satellite capacity market of all the regions of the world, and this has helped ensure the lowest prices and highest availability of bandwidth.”
    In terms of individual VSAT markets in Asia, Bull said Indonesia is one that stands out as the most prolific and advanced VSAT market of Southeast Asia alongside India, Vietnam, Pakistan and Afghanistan. “By holding their own unique position, Indian operators are amongst the most innovative to be found anywhere, but this is also reflected in some service price levels that appear to be unsustainable in the longer term, even with the huge volumes that are generated. Indonesia has continued to grow strongly, and in a different way than the markets in Vietnam, Pakistan and Afghanistan, where demand and growth has been tempered by shortages of space segment,” said Bull.
    Asia’s major standout VSAT deals revolve around GSM backhaul, with both thick route E1 links and thinner route connections using TDMA and shared bandwidth platforms. “These are important in a global context because they herald an increasing trend to bring cellular operators into the universal service obligation (USO) agenda,” said Bull. “VSAT is often the only viable way of extending service to rural areas, and the potential numbers are very large. Harnessing cellular operators to USOs allows governments to take advantage of low cost, easily available handsets; gives rural customers much more flexibility; and brings faster rollout and adoption rates.”
   Comsys believes that this will be a major segment of growth for the VSAT industry over the next few years and Asia, particularly Indonesia, is leading the way. Bull still considers the Asian markets to be extremely fragmented, but consistent players like CSM, Lintasarta and Primacom establish a strong presence in Indonesia. “We also believe that IPStar has finally managed to lay the foundations for good future growth for what is, arguably, the best satellite for VSAT services in the region,” said Bull.
   Consultant firms like Comsys also are considering the region’s maritime VSAT market as a major growth contributor. The latest Comsys maritime VSAT report, released in June, found that most global operators believed that Asia’s maritime VSAT market will grow significantly in importance in the future — an assessment based on past performance. The number of regional vessels with VSAT grew by more than 35 percent in 2009, and Bull expects that this rate will increase in 2010 and 2011. “The region is important because so much shipbuilding takes place there, and 2010 is expected to be a record year for deliveries. Asian fleet owners appear less concerned with crew welfare — the primary purchase driver for VSAT on a vessel — but this and other applications have definitely moved the maritime VSAT market in the region to another level over the past two years against some observer’s expectations,” he said.
    Overall, Bull expects Asia to contribute more to the overall revenues generated from the global VSAT market over the next year. “There are so many imponderables surrounding some large projects, such as the NBN initiative in Australia, the performance of some of the cellular/USO extension networks, the development of new markets, like Vietnam, the availability of satellite capacity in some areas, and the progress of IPStar. Overall, we expect Asia to maintain its consistent performance and, as some other markets elsewhere in the world see growth slow down, the region’s overall proportion of the VSAT market will increase slightly.”