Satellite Capacity Sales Biggest Growth Segment for Satellite Industry
Launch of the U.S. military's NFIRE satellite from the civilian MARS facility.
SAN DIEGO, CA, June 13, 2007 - Satnews Daily - Satellite capacity sales from both government and commercial customers will remain the main revenue engine for the satellite industry in the next two to three years, according to a joint survey by Hannover Fairs USA, Inc. and Futron Corporation at the recent International Satellite Communications exchange (ISCe 2007).
Continuing a trend identified in previous Futron/ISCe surveys, satellite capacity sales represent the largest area of anticipated new business. More than 40% of all respondents forecast that their biggest growth will come in this area from both government and commercial customers. A slightly smaller percentage (20-30%) forecast their greatest areas of new revenue to be hybrid network services or hardware sales.
Less than 10% of respondents said they thought new software products and services would drive new government or commercial revenues in the foreseeable future.
Respondents reported that their commercial revenues in 2006 were fairly evenly divided among video distribution, private data network, and mobile services. They anticipate that this split will continue over the next two-to-three years, with mobile services growing considerably faster than the other two markets.
In keeping with the “Satellite and Hybrid Network Solutions” theme of ISCe 2007, commercial attendees were asked about their revenues from such networks. Almost half reported than Hybrid Network Solutions represented less than 25% of their current revenues, with one-third reporting 26-50%. Only one-tenth said hybrid networks were over 75% of their revenues.
Military attendees were asked their perspective of the impact of upcoming military satellite launches on their use of commercial capacity, as well as their views on how commercial satellite suppliers understand or meet their capacity needs and procurement requirements.
A majority (69%) of the military respondents said the new military launches will have no impact on their commercial capacity requirements. Seventeen percent forecast a potential reduction of commercial usage of less than 25%, with just 10% forecasting a reduction of 25-50%.
An overwhelming majority of military respondents affirmed that commercial satellite providers meet their needs in a timely manner most of the time (64%) or always (16%). Only 11% claimed their needs were rarely met in a timely manner. On the other hand, there was a clear message to the private sector from the fact that 40% of the military respondents said commercial satellite vendors do not understand their needs or procurement requirements.
Futron’s study was tabulated from written responses of conference attendees, composed of executives representing the world's leading satellite operators, manufacturers and service providers along with representatives of most branches of the U.S. military. Attendance at ISCe 2007 was nearly 550, a 15% increase over ISCe 2006 registrants and exhibitors.
ISCe is an annual satellite and communications event that focuses on satellite and hybrid network solutions for the business, retail, entertainment, government and military sectors.
Hannover Fairs USA, Inc., the U.S. subsidiary of Hannover, Germany-based tradeshow organizer Deutsche Messe AG, organizes tradeshows, group exhibits and marketing programs at events throughout the world.
