While satellite news of late primarily has focused on voice and data services, broadband satellite communications services are expected to play an increasingly important role in the next 10 years, eventually commanding a $2.7 billion market by 2007, according to a report by Allied Business Intelligence.
ABI noted most broadband service providers will not launch until late 1999 and continue through 2004. As such, service revenue for broadband access in the United States is estimated to be $8.2 million in 2002 and rise to $1.21 billion in 2007. Globally, the market will be $17.52 million in 2002 and $2.75 billion by 2007.
ABI expects three types of satellite service to be offered: voice service, which will launch first in Iridium L.L.P.; short-messaging service, offered by little low-earth-orbit operators, will be launched next; and finally broadband services. Broadband services will be able to transfer large amounts of data.
Voice service is expected to be the largest market because it has the most global use. “The service will be a must-have for those with multinational operations,” the report said, especially in non-industrial locations with poor infrastructure.
Little LEO operators are expected to offer short-messaging services for monitoring and fleet tracking. Half of the market will be in North America and the other half spread throughout the rest of the world, ABI said.
Broadband services will be popular mainly in industrial nations, where the corporations are located that can pay for it, said Larry Swasey, senior analyst at the think tank. Broadband services could expand into emerging markets as companies add offices into those areas where infrastructure is not developed.
Additionally, as broadband satellite services become more popular, they are expected to bolster the millimeter-wave-component manufacturing industry. Broadband systems and local multipoint distribution services both require millimeter-wave frequencies and components. Millimeter-wave components traditionally have been expensive.
“Subassembly and chip manufacturers simply cannot supply the performance that millimeterwave system manufacturers desire at a price that is feasible for significant penetration into the consumer market today,” said Andy Fuertes, senior analyst at ABI.
But as LMDS and broadband satellite services become more ubiquitous, there will be more demand for millimeterwave components, allowing manufacturers to mass-assemble them and drive down cost. Once cheaper, these services can be offered to consumer and small-office customers.
The growth of LMDS and broadband satellite “have brought about the economy of scale to manufactures to make cheaper components aimed at consumer and small business market,” Swasey said.
The market for these systems is expected to grow from $33 million this year to $1.2 billion in 2003, Swasey said, with even sharper growth afterward.
