US and European economic stimulus packges are hampering the prospects for delivering broadband Internet access via satellite, SES, the world's largest satellite operator, has warned.

Support for wireless broadband technologies through tax breaks in the US and auctions of broadcast spectrum in Europe were giving terrestrial technology the edge, Romain Bausch, chief executive, said. "I personally believe the rollout of terrestrial broadband will be such that you can't demonstrate the viability of satellite in the long term," Bausch told FT.

SES provides two-way satellite broadband to 45,000 customers in Europe but would not invest in new capacity, he said. Instead, it was focusing on a hybrid satellite-terrestrial strategy for broadband, which offers its satellites to telecoms clients to reach the 40-50 per cent of households whose fixed-line connections cannot carry a full video service.

Shielded from economic fluctuations by decade-long contracts, SES expects recurring revenue growth of 3-4 per cent this year. Bausch predicted similar growth for the next seven years from the spread of multichannel television and mobile phones in emerging markets, the rollout of HD video technologies and increasing military demand.

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