Top Satellite CEOs Discuss Potential for Market Disruption and Opportunity in a Competitive Landscape
Leaders of Eutelsat, Telesat, Inmarsat, Intelsat, and ViaSat, converged to talk everything from reduced launch prices, new markets for satellite, as well as the future for GEO-, MEO-, and LEO-based satellites at SATELLITE 2017.
Market disruption and continued innovation in spite of continued financial and technology challenges were some of the main themes to come out of the Opening General Session Tuesday morning at SATELLITE 2017. Leaders of Eutelsat, Telesat, Inmarsat, Intelsat, and ViaSat, converged to talk everything from reduced launch prices, new markets for satellite, as well as the future for GEO-, MEO-, and LEO-based satellites. All agreed that this was a great time to be a satellite operator, with demand for capacity from markets such as connected transportation providing unprecedented opportunities for the industry.
The panel kicked off on a positive note, as speakers took in the news of the just-announced partnership between Eutelsat and Blue Origin.
Throughout the 90-minute panel, the CEOs pointed out multiple ways that satellite could compete more aggressively with terrestrial wireless technologies. Most speakers agreed that the most meaningful opportunities would arise from a shift toward more collaborative thinking.
“It isn’t about operating GEO satellites or LEO satellites; it’s about looking at technology to meet requirements,” said Dan Goldberg, CEO of Telesat, which is currently developing a constellation of Low Earth Orbit (LEO) satellites to serve broadband customers around the world. “It’s about asking ourselves, ‘can we do something different?’”
Stephen Spengler, CEO of Intelsat, spoke about the company’s recent merger with OneWeb, and how that could impact the operator’s investment in GEO satellites once the deal with OneWeb closes. He said Intelsat’s intention was to leverage both LEO and GEO and that it planned to continue to investment in high-powered GEO satellites.
While acknowledging the satellite industry’s long-development cycles, Goldberg also expressed hope that the flat-panel user terminals would become available in higher volume at low cost, so “the addressable market for LEO will get wider and wider.”
As the satellite industry embraces collaboration and development, Eutelsat CEO Rodolphe Belmer stressed the importance of not losing sight of the universal industry goal: giving customers affordable broadband services, such as streaming video. He also said that the industry has over-hyped the importance of OTT players such as Netflix, and that satellite pay-TV is still performing pretty strongly.
“We need to focus on delivering what people want … a fiber-like benefit at a fiber-like price,” said Belmer. “If we don’t have [services] to which people can afford, there is no way we can have a shot at that market.” Belmer expressed his belief that the future of satellite draws on the industry’s ability to bring broadband to residential markets and conquer the digital divide. “We feel we need to invest in GEO satellites, because that’s the only technology that can bring the level of capacity … to cost … and allow people to do what they want, which is to stream video,” he said.
While players such as Intelsat and Telesat are looking to combine LEO and GEO, Eutelsat is still wedded to operating in GEO. When asked whether the operator would look to invest in other orbits, Belmer said there was nothing imminent in this regard.
Rupert Pearce, CEO of Inmarsat spoke at length about the importance of innovation, and called always-on communication a human right on par with the right to clean water.
“We’re standing in an era where space communications is going to be more and more important and not just to our traditional customer base,” said Pearce.
Perhaps one of the most buzzed-about applications, the connected car, could generate a lot of opportunities for collaboration, Pearce noted. In January, the operator teamed up with international technology company Continental at CES 2017, to showcase the capabilities of satellite communications and global over-the-air updates in powering the connected car of the future.
However, bringing the connected market will require both patience and capital. “Satellite has to get in to the right price threshold, but we can and we are,” said Pearce. “[Mark Dankberg] isn’t pushed to the margins … he’s competing head to head with terrestrial alternatives. The industry is capable of disrupting terrestrial alternatives.”
While Mark Dankberg, chairman and CEO of ViaSat, acknowledged his organization’s success in delivering broadband services to U.S. consumers to the tune of $50 million a month in revenues (through its ViaSat-1 satellite), he also agreed that the industry faces multiple challenges, such as focusing bandwidth to where people are in order to meet their needs for high-speed digital services.
“You don’t have to tell people anything to get them to start using YouTube and what other people are using in developed markets,” said Dankberg. “We have way more demand than supply, and as we can drive down our cost and give people more performance per dollar, that market is going to go up.”
Spengler urged the satellite industry not to lose sight of the big picture. “Maybe the conversation changes in the future and we’re not talking about GEO and LEO … we’ll be talking about telecommunications,” said Spengler. “It’s really going to be the services we’re going to be delivering that makes the difference in the end.” VS