Wireless backhaul viasatellite, 5th edition

Northern Sky Research, LLCOne Mifflin Place

119 Mount Auburn StreetSuite 400

Cambridge, MA 02138 USA

Phone: 617-576-5771Fax: 617-812-1271

Email: info@nsr.com

s a t e l l i t e c o m m u n i c a t i o n s

B r o a d c a s t i n g & D i g i t a l M e d i a

H y b r i d & E m e r g i n g

A p p l i c a t i o n s

C o m m e r c i a l S p a c e

T H O U g H T L E A D E R S H i P

The foundation of NSR’s business is the ability to

continually help clients stay ahead of the curve

and anticipate trends before it is too late to react.

Whether it is a market research report covering a new

application area or a unique consulting service tailored

specifically for you, NSR prides itself in leading the

industry with new, innovative offerings.

This “first-to-market” approach has enabled NSR to

successfully anticipate market direction for a range

of services and applications in all regions of the

globe. Never content to only provide analyses on

legacy markets, NSR has routinely broken new ground

by analyzing and forecasting a range of up-and-

coming applications and services across a wide range of

coverage areas. Mixing technical expertise with

business acumen, NSR’s forward-looking thought

leadership is a critical element of our client’s decision

making in all regions.

S AT E L L i T E C O M M U N i C AT i O N S

From spacecraft manufacturing

and launching to the

applications

that drive capacity

supply and demand

B R O A D C A S T i N g & D i g i TA L M E D i AVideo is the core and

foundation of the industry,

typically accounting for

60% or more of total

revenues

H y B R i D & E M E R g i N g A P P L i C AT i O N S

NSR’s leading edge

coverage has shown that

satellite is more than ever

intertwined with the fabric of

terrestrial networks

C O M M E R C i A L S PA C EBeyond telecommunictions

services, Commercial Space

presents promising opportunities

for the space industry

neW in this edition:Mobility Platforms (Land, Air & Sea)•Picocells•Dedicated Forecasts for O3b•Dedicated Forecasts for Wideband Ka-band (Newsat)•SWOT Analysis:•

SCPC•TDMA•L-band•Wideband Ka-band (Newsat)•O3b•

In this latest NSR study, the wireless backhaul via satellite roadmap is analyzed both from a qualitative and quantitative perspective. Extensive primary research from equipment manufacturers, service providers and key players in the wireless ecosystem help form the emerging satellite wireless backhaul solution mix, particularly as it translates to market prospects as well as market shares per technology and platform over the next 10 years.

Specific satellite earth station equipment forecasts and picocells for wireless technology solutions are provided per region, and the SCPC versus TDMA debate is assessed and forecasted. The evolution or move towards IP as well as the impact of HTS, Wideband Ka-band and O3b are quantified as well. Programs such as the current iPSTAR and Viasat-1, to name a few, are thoroughly examined in order to determine how each program stacks up against the others.

NSR likewise provides a SWOT analysis to determine a proposition’s market fit, including:

Traditional C-band and Ku-band offerings•SCPC•TDMA•Picocells•

HTS platforms•O3b•

Together, quantitative forecasts and qualitative assessments provide a roadmap for satellite backhaul demand on traditionally-served fixed locations as well as emerging demand for mobile assets, specifically commercial airliners, trains and maritime vessels.

The ultimate goal of this study is to act as a tool that can be utilized to provide strategic insights for companies that are looking to serve various business models that tap the satellite backhaul market in individual as well as integrated propositions that include space segment solutions, earth station equipment, frequency mix and regional targeting.

Primary Forecast elements include:• SatelliteBackhauledSites,byTechnologyPlatform• AnnualUnitShipmentsofSatellite-basedequipment• InstalledBase&UnitShipmentsofbackhaulearthstations

o SCPCo TDMA

• Pricing• C-bandTransponderDemand• Ku-bandTransponderDemand• TheHTSImpact• O3bDemand• WidebandKa-bandDemand• Picocells

o Lando Maritimeo Aeronautical

elements analyzed per region & Wireless Platform• SupplySide

o Platform Competitiono CAPEX & OPEXo Distribution Partners

• DemandSideo Application Requirements - Rural & Remote Areaso Digital Divide / internet Connectivity Needso Population & Urbanization Trendso Regulatory Environmento End User Equipment & Service Price Considerations – Price Elasticity

Primary Questions addressed in this report include• Whichtechnologyofferingorsatelliteprogramisthemostcompellingtodayand

over the long term? Why?• Isglobalbetterthanregional?• Issimplebetterthancomplexandvice-versa?• Whichprogramorofferingwins,andwhichprogramslose?• WhereareSCPCandTDMAheaded?• WillO3bsurviveonlywithabackhaulplay?• WhatistheoveralleffectofHTS?• Whoarethekeyplayers,andwhatistheirmarketdifferentiator?• Whatistheroleofsatellitebackhaulcurrentlyandoverthelongtermforeach

regional market? • Whichregionsprovidethebestbackhaulprospectsoverthenext10years?• Whatistheexpectedtake-uprateperwirelessoffering,andwhataretheimplica-

tions for satellite-backhauled equipment? • Whatlevelofsatellitebandwidthdemandislikelytoberequiredineachregional

market for the provision of wireless backhaul services? • Whatistheimpactofwirelessbroadbandconnectivitytothesatellitebackhaul

market?• Howdopricesaffectmarkettake-upforsatellitebackhaulsolutions?

r e p o r t o v e r v i e w

r e g i o n s c o v e r e d

North America

Latin America

Western Europe

Central & Eastern Europe

Middle East/North Africa

Sub Saharan Africa

Asia

Atlantic Ocean Region

Pacific Ocean Region

indian Ocean Region

r e p o r t s p e c i f i c snsr coverage

areas

1 2

the nsr difference This 5th Edition report continues to build upon NSR’s body of work with more strategic and Bottom Line insights as

technologies and satellite programs enter the marketplace. Lingering questions on the future of SCPC as it competes

withTDMA,thefinancialprospectsofO3b,andtheroleofHTSandWidebandKa-bandprogramsareexplored,not

just in terms of individual market performance but more importantly, in terms of competitive positioning vis-à-vis

legacy and new program offerings.

AseparateforecastonWidebandKa-bandviaNewsat’sprogramaswellasO3bisfeatured,whichindicatestheir

market viability, in terms of the wireless backhaul market over the long term. For O3b specifically, since backhaul is its

main offering and market target at this given point in time, market numbers specific to O3b should indicate whether a

single service offering is enough to anchor its business plan or whether other offerings need to be targeted as well.

This unbiased report, which builds upon market needs that include application requirements, urbanization trends,

cost structures and other end user elements, serves as a reality check on whether the latest “hyped” technologies will

make the grade or will go by the way side similar to a few highly technically ambitious programs of the past that have

led to bankruptcies. Hard line demand side analysis will test engineering prowess and will be the main gauge in pick-

ing market winners.

The report provides an honest assessment of legacy FSS systems that have been the technology choice of backhaul

engineers,whileprovidingananalysisofnewprogramssuchashighthroughoutsatellite(HTS),WidebandKa-band

and O3b. L-band in Mobility Platforms is likewise assessed with new offerings. Value proposition are scrutinized and

their future role in the complex interplay of technology choices is determined.

Those looking for the bottom line can expect to find both qualitative and quantitative elements for each technology,

highlighting and examining their unique and compelling value proposition as they address traffic needs while being

subject to stringent ROi benchmarks.

By segmenting both the 2010 baseline and the 2011-2020 forecasts by equipment type and space segment category,

the reader is able to navigate this market, which is both promising and risky, and determine the best course of action

and strategic direction to undertake for areas of growth and future impact.

Finally, this 5th Edition study provides expected long term trends that will affect the entire wireless business for

current developments that include the introduction and perhaps the proliferation of bandwidth intensive, complex

devices that could end up in the hands of developing country users. in Mobility Platforms, the impact of developed

country usage is assessed as well.

e X e c u t i v e s u M M a r YIntroduction

The wireless backhaul via satellite market has been considered or characterized by many in the industry as flat in

terms of growth and relegated to C-band SCPC solutions. The prognosis certainly appears true, particularly when

viewed over the past decade when one company in particular has dominated the market -- Comtech.

However, within the industry solutions like TDMA are posing a challenge and gaining headway either via its

own unique market space or competing head-on with SCPC in the area of new installations and replacements.

HTS, notably iPSTAR, has entered the fray as well and has in 2010 established a solid foothold in the market. On

the horizon of course is O3b as well as other players such as Newsat for a Wideband Ka-band offering and other

HTS systems such as Inmarsat’s GlobalXpress that could potentially compete and impact the market.

Global Wireless Backhaul In-service Units, 2010-2020

The wireless backhaul via satellite market is expected to show steady growth within the forecast period. The

following exhibit provides a summary of platforms and their corresponding penetration in terms of in-service

units within a 10-year period. By way of a roadmap, the solution mix shows steady growth levels for systems

currently being used, specifically SCPC and TDMA. In a way, the industry players who considered the market

as flat, in terms of SCPC C-band at least, appear to be right.

However, other platforms that have recently entered or are about to enter the market are expected to

show better growth prospects, particularly those targeting Mobility Platforms. In fact, NSR expects Mobility

Platforms in-service units to outpace Fixed Land Tower installations by the 2015-2016 timeframe.

Overall Market Findings

The market includes three core segments, and each one is expected to exhibit positive growth with Mobility

Platforms accounting for the highest levels of market expansion as well as the highest levels of revenue

beginning in 2016. It is worth noting that some solutions including O3b and Wideband Ka-band are still not

included in this report edition as no strategic plans were publicly announced or disclosed to NSR for tapping

Mobility Platforms. Market dynamics and the revenue mix can and should change if these camps enter the

Mobility market with a compelling solution.

Global Wireless Backhaul Revenues, 2010-2020

Global Wireless Backhaul In-service Units, Macrocells & Picocells 2010-2020

Picocell technology is expected to be a major factor in impacting the market going forward. By definition, Mobility

Platforms (except for large cruise ships and passenger vessels) run on picocells. Picocells can also serve traditional Fixed

Land Towers, which should add to its market proposition. The picocell CAGR compared to macrocell growth is expected

to be highly dynamic, leading to an almost doubling of installed units when compared to macrocells by 2020.

Regionally in revenue terms, Asia, Sub Saharan Africa and Latin America were dominant in 2010. By 2020, similar

trends in in-service units are expected where Asia and Sub Saharan Africa get the top posts. But here, the third

largest market is likely to be North America and fourth Latin America. Once again the market in transition from Fixed

Land Towers to Mobility Platforms impacts regional market prospects significantly. Western Europe and the Middle East/

North Africa region likewise improve their rank and more importantly, their revenue potential.

Global Wireless Backhaul Revenues by Region, 2010-2020

Conclusions

• The wireless backhaul market offers various opportunities for service providers, satellite operators and

equipment manufacturers where each player can carve a niche.

• Comtech or SCPC is still expected to account for a large share of the market; however, other players are

likely to gain inroads, particularly in targeting the market transition that is beginning to take place.

• Themarkettransitionregionallyimpliesthefollowingmarketcharacteristicsordynamics:

o The Fixed Land Tower market is a developing country proposition.

o The Mobility Platforms market is mainly a developed country market offering.

o Thus, as the number of wireless subscribers or the penetration level of the wireless industry increases

throughout the globe, the next stage of market growth for satellite backhaul services at least will

be wireless subscribers from developed countries that need connections while in motion or in

transit.

NSR is a leading international telecom market research and consulting firm with a mission to provide unique insights & assist organizations in strategic decision making.

With an experienced group of analysts located in all regions, NSR is a premier global market research and consulting company.

NSR’s products and services cover all analytical aspects of each market, including both business and technical issues. A solid understanding of both issues is critical to understanding the current and future state of any market, so our team and offerings are built to tackle these stringent requirements. it is through this approach that NSR has assisted companies in many segments and regions to successfully plan for growth.

in addition to both products and services, NSR is often quoted as an expert in many leading publications such as The Wall Street Journal, New york Times, Financial Times, Washington Post, Time Magazine, Business Week, The Economist, CNN, Forbes, Network World, international Herald Tribune, Total Telecom, Asia Times and Space News. NSR analysts are also frequently asked to chair and participate in telecommunications conferences around the world.

NSR clients range from start-ups to market leaders in various sectors of the telecommunications industry. The common theme across our clientele is the requirement for unbiased, actionable analysis that provides each company with the intelligence it cannot find elsewhere. it is this approach that has enabled NSR to stay ahead of the curve across all industries covered.

NSR is focused on emerging applications and services in the Satellite Communications, Broadcasting & Digital Media, Hybrid & Emerging Applications and Commercial Space markets in all regions.

satellite communicationsFrom spacecraft manufacturing and launching to the applications that drive capacity supply and demand, the Satellite Communications research practice addresses the heart of the satellite market. NSR investigates every link in the market chain in order to provide an in-depth and granular analysis of all demand drivers and restraints that customers need in order to choose a future direction.

our goal is to help manager’s worldwide

plan for growth based on unbiased, actionable

intelligence and analysis

“

“

a b o u t n s r

n s r c o v e r a g e a r e a s

b r o a d c a s t i n g & d i g i t a l M e d i aVideo is the core and foundation of the industry, typically accounting for 60% or more of total revenues, while other digital media applications show some of the industry’s fastest growth rates. NSR’s extensive coverage of this important market leverages its geographically diverse analyst pool to capture the regional differences of video traffic and digital media applications around the world. By analyzing growth in video channels and feeds, in addition to location of emerging video platforms and applications in each region, NSR is able to provide detailed market insight for our customers.

h y b r i d & e m e r g i n g a p p l i c a t i o n sNSR’s leading edge coverage of new hybrid and emerging applications has shown that satellite is more than ever intertwined with the fabric of terrestrial networks. By analyzing how convergence impacts competition and cooperation between these two worlds, this practice area helps unlock new growth potential for our customers.

commercial spaceBeyond telecommunications services, Commercial Space presents promising opportunities for the space industry. Ranging from all aspects of earth observation services to navigation and positioning services and government space programs, NSR presents a wide-ranging analysis of demand for these applications as well as the all important aspect of public spending for space activities.

NSR is a global telecommunications consulting firm with vast experience in areas like Satellite Communications, Broadcasting & Digital Media, Hybrid & Emerging Applications ,and Commercial Space . NSR’s consulting expertise has played a pivotal role in the board rooms of many large and dynamic telecommunications organizations across the region/sector. We help organizations in making the right business decisions with a focus on delivering the financial results.

Our consulting services are designed to suit your organization’s requirement in terms of quantitative and qualitative research drawing upon our collective experience of 100 years in the industry. Our analysis and insights help you focus on challenging issues and aid you in channeling your resources towards sustainable business strategies.

To know more about our Consulting Services please visit our website www.nsr.com.

n s r ’s c o n s u l t i n g s e r v i c e s

r e s e a r c h r e p o r t to p i c s gov’t and Military Satellite Communications

Broadband Satellite Markets

Machine to Machine (M2M) and SCADA

Mobile Satellite Services

Wireless Backhaul via Satellite

Satellite Capacity Supply & Demand

iPTV via Satellite

Advanced Satellite Coding and Modulation

Direct-to-Home (DTH)

Digital Signage

Mobile TV and Mobile Video

Earth Observation

High Throughput Satellites (HTS)

Remote Sensing

Video Broadcasting

and more...

Place your order for the research reportson above topics at www.nsr.com

Guiding Principles

T h e f o l l o w i n g p r i n c i p l e s a r e t h e

c o r n e r s t o n e o f o u r s u c c e s s a n d h a v e

h e l p e d N S R i n d e v e l o p i n g i t s

u n i q u e o f f e r i n g s :

i n t e g r i t y & Tr a n s p a r e n c y

P u r s u i t o f E x c e l l e n c e

C u s t o m e r P a r t n e r s h i p

R e s u l t O r i e n t a t i o n

F l e x i b i l i t y

O u r g l o b a l N e t w o r k