'Intense' Satellite Data Price Competition Coming, Says NSR
With satellite data capacity growing exponentially in coming years, expect "intense" price competition, Northern Sky Research founder Chris Baugh said Wednesday in a webinar. Satcom operators wanting to grow need a telco strategy for integrating their capacity into terrestrial telco…
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networks, said analyst Lluc Palerm. Baugh said capacity has historically increased a few percentage points per year, but it will jump 254% 2021 through 2023. Low earth orbit constellations and new geostationary orbit (GSO) high-throughput satellites (HTS) will drive up that capacity even faster in coming years, Baugh said. He said the satcom industry is at the early stages of oversupply, and steep GSO pricing declines in 2017-2019 have moderated, but that decline trend will accelerate again as GSO HTS capacity floods the market in the next couple of years. Palerm said integration with telcos requires adoption of standards -- "something the satellite industry hasn't been particularly good at" -- and adoption of 5G standards will be key to telcos' easy adoption of satellite services. He said there also should be more work creating an ecosystem of terrestrial telco partnerships. The direct-to-device marketplace is a major opportunity for satellite since its inherent simplicity -- existing mobile phones connecting with satellite coverage -- will drive a lot of demand, Palerm said.