BRICS Emerging Powers in Satellite

In March this year, the South African National Space Agency (SANSA) and the Russian Federal Space Agency (Roscosmos) signed an agreement that will see the RadioAstron satellite mission collaborating with radio astronomy facilities in Africa. The agreement was signed on the sidelines of the 5th BRICS summit in Durban.

In the field of space, the BRICS countries are becoming more interwoven together than ever before. China has made important strides into Latin America through China Great Wall Industry Corporation (CGWIC), which has been involved in a plethora of deals in this region. In 2011, China and Venezuela signed a contract for the VRSS-1 remote sensing satellite program with CGWIC as the prime contractor. In 2010, CGWIC and the Bolivian Space Agency (ABE) also signed a satellite deal. Additionally, China is working with Brazil on the CBERS remote sensing satellites program as CGWIC continues to seek more opportunities in the region.

Brazil and India

Brazil has averaged almost 5 percent GDP growth over the last six years and remains major market for satellite communications, particularly given the low levels of pay-TV penetration (less than 25 percent), a growing middle class, and an economy on a consistent upswing. Government projects such as the school connectivity project GESAC, which uses 12,000 Embratel links, provide further evidence of the need for satellite.

Star One, one of the major satellite operators in the market, saw its Star One C3 satellite successfully launch in November 2012, and according to Gustavo Silbert, Star One’s CEO, the satellite has brought “expansion opportunities” for the operator.

“This new satellite replaces some of our existing C-band capacity but brings the equivalent of 32 new 36 MHz Ku-band transponders for the fleet that covers not only Brazil but all South America. Certain areas from the Brazilian government intend to expand existing VSAT networks for digital inclusion and other applications in 2013 and this may bring new business opportunities for Star One,” he says.

Marzio Laurenti, Telespazio Brazil CEO, says the major problem in the market could be a lack of capacity.

“Today, in Brazil, the fill rates for capacity are higher than 90 percent. The situation today, is that for sure there is a shortage of Ku-band capacity. This is a fact. I think the shortage of Ku-band capacity is expected to last for the next two years. In terms of C-band, there is not a large availability, but I think the difficult situation is more in Ku-band. There is little Ku-band available today in the market. Access to Ku-band is important for the services we want to provide,” he says.

Certainly, it is a market on the up, and whether for Direct-to-Home (DTH) players like DirecTV Latin America or major enterprises like Petrobras, one of the world’s biggest oil companies, the demands for satellite are strong.

“Satellite solutions will remain very important to us, as much as it has been in the past,” says Firmiano Ramos Perlingeiro, head of Information and Communications Technology (ICT) at Petrobras. “Petrobras has an optical fiber ring of 500 km in the Campos Basin connecting several rigs. This ring may be extended for other units in the future, but it depends on the business evolution and the economic feasibility. We expect providers of satellite communications solutions to deliver higher performance and low delays in communication, and mainly, lower prices. Demands for new offshore exploration of pre-salt reserves are a strong reason for using VSAT. There is no doubt about the importance of satellite communication for the oil and gas industry,” he says.

Russia

Russia, with a growing demand for pay-TV and broadband services, as well as an impressive legacy in the space arena, is also a market on the rise with local operators Russia Satellite Communications Company (RSCC) and Gazprom Space Systems (GSS) investing in new capacity. Research firm Point Topic recently said that annual broadband subscriber growth had reached 28.3 percent, underlying the potential opportunities for satellite. In September 2012, Deputy PM Arkady Dvorkovich reportedly stated that the government intended to make broadband services accessible to 95 percent of the population by 2015, and that Rostelecom had sufficient resources to accomplish this task. Pavel Marceaux, technology, communications and media analyst at Euromonitor International, says a program to deploy satellite broadband technology in the East, primarily Siberia, could be on the way. According to Marceaux, there is strong digital divide in Russia. Satellite could be key in reducing this.

“The Eastern market, which is Siberia and Far Eastern cities such as Vladivostok, are characterized mainly by lower take-up broadband rates, [and] less options for technology and consumers compared to the Western market,” he says.

There is little doubt that satellite has a major role to play in the broadband market in Russia. “This year, RSCC is planning to launch its own Ka-band satellites, and by the end of the year a satellite infrastructure for developing broadband services will be established over the whole territory of Russia,” Dennis Pivnyuk, RSCC CFO says.

India and China

India and China have combined population of more than 2.5 billion people, with markets that are proving more receptive to satellite. In India, there is not enough satellite capacity to meet demand. Smita Jha, who leads the Entertainment and Media practice in PwC India, said in a recent column for Via Satellite Asia that the economic outlook for the country over the next five years “was robust.” Jha says the demands for satellite capacity will also be in the increase.

“The demand for C-band transponders from Indian TV broadcasters is expected to almost double from about 30 in 2012 to approximately 55 in 2017. The ramp-up in demand for Ku-band capacity used by Indian DTH operators is expected to be even steeper, driven by their need to match channel counts of digital cable operators and accommodate more HD channels. The number of satellite transponders required by the Indian DTH players will rise from about 70 in 2012 to more than 220 in 2017 (in Ku-band),” she says.

The demands for capacity are placing a lot of strain on the Indian Space Research Organization (ISRO), which has the role of maximizing India’s space capability across a range of sectors. Like China, it is also looking to be more of a force in launch services. In February this year, ISRO’s Polar Satellite Launch Vehicle, PSLV-C20, successfully launched the joint Indo-French Satellite, SARAL.

In China, the role of satellite is increasing, with China Satellite Communications Co. (China SatCom) – one of the most important satellite players in the country – launching a number of new satellites. In March this year, the company’s ChinaSat 11 satellite with 45 C- and Ku-band transponders, was launched. This followed the successful launch of its ChinaSat 12 satellite late last year, which provides 24 C-band and 23 Ku-band transponders to its commercial clients in Asia, Africa and Europe. In total, China SatCom now manages 14 geostationary satellites.

According to CGWIC, satellite plays a key role in China’s economic and social development, especially in the area of broadcasting, navigation, disaster mitigation, and emergency communications. Satellite has also been vital in promoting social progress in the remote areas by providing TV, education, Internet and other communication services, and narrowing the information gap between the developed and less developed areas in China.

South Africa

SANSA has only been operational for about three years, but hopes to play a pivotal role in developing satellite communications across South Africa.

“The main program we are working on is the development of South Africa’s first contribution to the African Resource and Environmental Management (ARM) constellation. This is a constellation that was agreed in 2006 between Algeria, Kenya, Nigeria, South Africa. Algeria and Nigeria have contributed Earth observation satellites, and South Africa has a program for a satellite to go toward that constellation. We have embarked on that development and we are looking to launch that satellite in 2017,” Francois Denner, space program manager, SANSA, says.

Satellite is also likely to become more crucial in South Africa as part of its overall development. “There is a broad understanding in South Africa that satellite infrastructure is becoming an increasingly important part of the economic development of the nation,” says Denner. “If we look at capacity in terms of communications technology, there is a definite need for affordable capacity at very high bandwidth, specifically in the rollout of a number of potential services, which the government could offer to the developing communities in South Africa. I am talking about health, education services, etc,” he adds.