Satellite CEOs See Need to Go Terrestrial, Mobile

The 2005 FSS headlines were all mergers and ownership changes, but those weren’t the real stories, Loral COO Eric Zahler said: “The real stories happening last year were all about innovation by companies like ICO, TerreStar, MSV and WildBlue. Those companies are enlarging the application of satellites and finding new areas where satellite has an advantage. The lesson for FSS is that we're going to have to innovate too.”

The Intelsat/Qualcomm and SES Americom/Crown Castle deals move in the right direction, said PanAmSat CEO Joe Wright. Both fledgling partnerships are for video distribution to mobile phones via satellite broadcasting to a terrestrial wireless infrastructure. “They're starting to come down to the ground,” Wright said of the Intelsat and SES cellular deals: “There’s no question we're going toward terrestrial IP, two-way and digital. We're either going to play in that and do it actively, or we're not.”

But satellite’s exact role in next-gen mobile services is a mystery, FSS executives lamented. When satellites see use in wide-scale broadcast mode, “we have an enormous advantage,” said Loral’s Zahler. But point-to-point and 2- way systems aren’t satellite operators’ strong suit. Substituting for retiring Loral CEO Bernard Schwartz, Zahler said he foresees the industry “working in conjunction with terrestrial systems more and more, building them out.”

That means satellite manufacturing may have to change, said Zahler. Future satellites will need to be “upgradable” in space to keep pace with advances on the ground, he said: “That’s something we're going to have to learn how to do.”

Video distribution-heavy PanAmSat aims to occupy the cutting edge of what it sees as the “5-play,” said Wright. The 5th component? Content, said Wright. Content delivery is a tough line for FSS to walk, but “there is content that we can deliver that doesn’t compete with our customers,” Wright said, citing rare content like the ethnic channels PanAmSat is soon to bring to the U.S. The firm said Tues. it’s starting a new business that will sell and distribute ethnic programming from Europe and the Middle East to cable, satellite, telcos and Internet distribution networks in the U.S. Officials said PanAmSat has signed deals to carry 12 international channels.

For FSS to reinvent itself for mobile video, timing will be critical, said McGlade. The industry must make smaller bets than before, and do so faster, he said: “We're a smaller industry than our brethren in telecom and media. We have to shorten the cycle of growing pains like we saw with broadband via satellite.” -- Adrianne Kroepsch

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In 2007 the FCC will push to harmonize spectrum allocation and obtain regulatory parity for U.S. satellite operators with global businesses, Chmn Martin said. Addressing a Mon. Satellite Industry Assn. dinner, Martin said the FCC is “working hard” to ensure the U.S. delegation “accomplishes its goals” at WRC-07. Martin lauded the satellite industry’s “lifeline” post-Katrina work, but urged continued engagement with domestic matters. “I encourage the industry to develop technologies that will provide public safety officials the means to quickly reach out on a national, regional, state, or local level when critical information must be communicated to the American public,” he said, alluding to Emergency Alert System rules widened lately to incorporate satellite radio, DBS and FSS. “The Commission recognized that commercial satellite services are well suited for the provision of an emergency alert system. Satellite operators can and must play an important role in current and future incarnations of this system,” he said. Recent FCC action permitting more flexible use of commercial satellite spectrum “should contribute to the industry’s ability to develop interoperable broadband mobile communications and enhanced 911 capabilities,” he said. Martin encouraged firms to deploy affordable “off the shelf” solutions for emergency responders and to provide enhanced 911 service to customers.