Steady Growth in Satellite Broadband Services Assured Says  Northern Sky Research

ORLANDO, Fla., Jan. 26/Satnews Daily/ ¾ Satellite broadband services saw solid, incremental growth in 2004 and the window of opportunity remains open for a future generation of new broadband services, concludes Northern Sky Research (NSR) in its latest update to its Broadband Satellite Markets 4th edition study.

On a global basis, the NSR study found that total IP VSAT sites and subscribers to satellite broadband services increased by over 115,000 in 2004, and total revenues generated in this year exceeded US$2.7 billion. In the coming years, NSR projects a 7.8% rate of average annual revenue growth based on the market dynamics seen today.

NSR said the broadband satellite sector appeared to suffer through a difficult year in 2004. It cited the launch of the iPSTAR-1 satellite that was delayed once again, the failure of WildBlue and Telesat Canada to bring their new services to market, and the commandeering of DirecTV of the next generation broadband SpaceWay -1 and -2 satellites to be used exclusively for TV broadcasting. A year ago the industry thought that 2004 would see the launch of services from all of these programs, but instead another year slipped by and doubts have increased from some quarters that satellite broadband services will ever take off, said NSR.

NSR believes future generation consumer and SOHO satellite broadband services will finally be launched in North America in 2005, and the entire industry will be watching for the slightest signs of uptake.

"It may not be until early 2006 before we get some good hard data," said Patrick French, senior analyst and the study's author, "yet success in bringing a next generation of services using Ka-band capacity to this market sector will have positive ramifications around the world and in other segments of this industry.”

He added if the announced service price points are indeed met and, more importantly, the service can be tied to satellite TV offerings, then the challenges facing development of a large mass market for satellite broadband services are surmountable.

Turning to the enterprise and SME IP VSAT sector, NSR projects that the ongoing push to bring down equipment and service prices will keep growth steady and lead to ever better penetration into the potentially lucrative small and medium enterprise segment. The share of the IP VSAT market attributed to the SME segment is anticipated to increase to over 30% in 2009, up from less than 15% today.

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