The satellite sector must compete outside of its traditional industry borders in order to grow its market, but it could be a tough road as satellite players fight to overcome cost issues and customer perceptions, says Intelsat’s chief executive.
Satellite has the ability to capitalize on numerous opportunities related to things like unconnected communities, rural corporate connectivity, M2M and even OTT content distribution, but a key hurdle is that the satellite industry doesn’t have the economic clout compared to the overall telecoms sector, said Intelsat CEO Stephen Spengler.
“The satellite industry is a $200 billion a year business, compared to the global telecoms industry, which is a $5.4 trillion business,” he said. “This is the reality we face when we fight for spectrum or talk about growth.”
Another hurdle to growth is that satellite is often perceived as being “slow, expensive and complicated” compared to other access technologies, he added. “Some of our own corporate customers say satellite is the last resort option for connectivity.”
So the question becomes: can satellite compete in the broader global telecom industry, and leverage the strength of that industry to drive growth?
Spengler says that in order for the answer to be “yes”, satellite needs to offer higher performance, better ease of use, and better economics, to include lower TCO and cost per bit.
Spengler offers two ideas for industry growth moving forward. First: stay focused on what satellite does best - reach, ubiquity, reliability, point-to-multipoint economics, fast deployment and security. And second: compete across the broader telecoms industry.
Spengler said that high throughput satellite (HTS) technology is a good start in terms of performance and cost per bit, but it’s only one part of a much wider strategy.
“We need hybrid end-to-end solutions to improve the economics, and we need to capitalize on ICT industry innovations - meta materials, storage capacity, battery technology, miniaturization, software and so on. We have to bring that into our space,” he said.
“We also need to simplify access devices so that they just become IP nodes,” he added, drawing a comparison between old, complex hi-fi stereo systems and the iPod. “That’s how simple it needs to be to be able to access satellite connectivity.”
Spengler also advocated an open standards approach to drive growth and lower costs. “We’re too customized right now.”
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