2013/14 inflection point for broadband by satellite

NSR’s Broadband Satellite Markets 12th Edition report forecasts the entire broadband satellite market’s installed base of VSAT sites, broadband access subscribers, trunking and backhaul sites will increase by just over 5 million by 2022 and generate $9.9 billion in revenues.

Fully 87% of this growth will come from new subscribers to satellite broadband access services with the North American, Western European and Latin American markets leading the way.

“It appears that 2013 and 2014 are going to be an inflection point in the satellite broadband Internet access market,” stated Christopher Baugh, NSR President. “Thanks to the full entry into service of the Viasat-1 and EchoStar-XVII satellites, North America could score a record gain in broadband access subscribers, likely over 300,000 net new subs in 2013, while the Australian NBN Interim Satellite Service is projected to reach its subscriber cap at least a year sooner than previously anticipated.”

NSR also expects that a revamped Tooway management team and new HTS capacity for SES will lead to better subscriber growth in Western Europe in 2013/2014, while Latin America saw the launch of its first HTS provisioned broadband access services in late 2013.

“Another major inflection point will arrive in 2014 with the entry into service of O3b Networks’ new MEO-HTS constellation,” noted Baugh. “The new MEO-HTS supply as well as upcoming HTS payloads will bring a surge of lower cost capacity that will be especially beneficial for the satellite trunking and backhaul markets.”

NSR also anticipates the enterprise VSAT networking market will remain dynamic in the coming years helped too by the availability of new HTS capacity.

“The new HTS capacity will grow specific VSAT verticals like ‘high availability/backup’ services as well as bring lower cost services to the most cost conscious clients,” explains Baugh. “Yet, at the same time classic C/Ku-band enterprise VSAT networks will be focused on driving new value for clients where coverage, uptime, and end-to-end network management have a priority over pure cost per bit delivered.”

NSR maintains its view that, on a net-net basis, the new HTS-provisioned VSAT services will do more to grow the overall enterprise VSAT market than to cannibalise existing FSS services. This being said, “there will certainly be a period with some winners and some losers during this transition phase,” according to Baugh.

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