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SES criticises “over-simplistic” market reaction

SES CEO, Karim Michel Sabbagh, has complained that the market doesn’t appreciate the quite dramatic changes that the satellite industry is going through. The past week or so has seen significant market value reverses for the share prices of SES, Eutelsat in particular, and Inmarsat.

He explained that the traditional market view of the industry, which in essence has been to build new satellites which added capacity for new tasks or regions of the planet, is outmoded.

“This may have worked for some time, but this lens is ill-suited to the multiple applications, technologies and business models that are shaping present and future markets. Failing to fathom these dynamic and highly adaptive market developments has led the public discourse in our industry to zoom in on an over-simplistic explanation of increasing capacity build-up and price competition,” he wrote in an opinion piece in trade magazine Space News.

“We see technology first and foremost as a central element to pursue new opportunities,” he explained.

“To illustrate, the improving compression standards have enabled the democratisation of quality video experiences, e.g. the launch of new platforms through linear and non-linear distributions. This development is also improving the viewing experience, e.g. the accelerating transition from SD video to HD, and more recently the advent of UHD. Because we have the right capabilities, SES is reaping the reward of compression technology evolution and this is reflected in the unsurpassed growth of our global channel count, with HD and UHD as priorities, along with our segmental revenues. All these opportunities stop us from looking backward.”

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