[Satellite News 06-11-10] Satellite broadband generally has been a hot topic at satellite events throughout the past several years. In the United States, Hughes and WildBlue (now owned by ViaSat) have close to 1 million subscribers, and SES Astra and Eutelsat also are targeting a better performance in Europe. In Asia, the story is less clear, with only Thaicom really placing a huge bet on satellite internet services.
    Satellite News spoke with Paul Brown-Kenyon, COO, Measat Satellite Systems; Masanori Akiyama, CEO, Sky Perfect JSAT; Peter Jackson, CEO, AsiaSat; Tom Choi, CEO of Asia Broadcast Satellite (ABS); and Arak Chonlatanon, CEO, Thaicom, about the prospects for satellite broadband in Asia.

Akiyama:  The implementation of higher frequencies, particularly Ka-band, is still challenging due to heavy precipitation and strong regulation in the region. However, thanks to technological advancements, the obstacles to utilizing higher frequencies are not as daunting as they used to be. In the near future, we believe there will be good opportunities to promote satellite broadband in the region once technological and commercial issues are resolved, as terrestrial broadband systems in some parts of the Asia-Pacific region are still not impressive. We will continue to monitor trends.

Chonlatanon: We have spent significant resources on the regulatory side due to its complex nature in Asia. After three to four years, we have achieved a significant milestone, as we have now landed in all 14 countries that we serve through Thaicom 4 (IPStar). The issue of rain fade is not significant at all due to mitigation techniques that we have successfully implemented, such as having a diversity gateway RF site in addition to the main gateway. Many major telcos and corporates, with their high [service level agreement] requirements, are our end users. The slightly lower availability compared to traditional C-band VSAT networks is compensated by the significant cost reduction and scalability of our system.

Brown-Kenyon: We have spent time looking at satellite broadband in Asia. [Universal Service Provision] is changing in this region. It is no longer about providing telecoms services but providing broadband. Given the limited terrestrial infrastructure across many countries, this new objective lends itself to wireless and to satellite technologies. We are seeing a lot more interest using the Ku-band DTH model to provide broadband to the home. I am still to be convinced about Ka-band given the rain fade, but it is something that we are spending a lot of time looking at.

Choi: I don’t think so. I believe the big test for satellite broadband in Asia was in 2004-2005 with the launch of IPStar, which was a dedicated broadband satellite for Asia. Based on the relative cost of this project and underutilization of the capacity on board this satellite, I  think that most would agree that this hasn’t proven to be a very successful business. If there was a legitimate demand for satellite broadband for consumers in Asia, IPStar’s business should have proven to be very successful. My theory is that in Asia, you have two types of markets. You have highly urban and more Westernized markets such as Korea, Japan, Taiwan, Hong Kong, Singapore and China, where broadband penetration is very high but well-served by terrestrial broadband supplied by the local telcos. You also have pockets of major cities within some countries in Asia, where you have very urban populations with high GDP per capita relative to the rest of the country. Some examples may be Kuala Lumpur, Jakarta and Mumbai, just to name a few. In these major cities, you also have high broadband penetration which is well served by terrestrial broadband.
     Then there are the lower GDP per capita countries where there are more rural populations but almost no demand for broadband service. Most of the homes in these rural areas don’t have PCs. Many don’t even have electricity or phone lines in some cases. In these markets, where satellite broadband would have a clear advantage over terrestrial broadband due to the lack of terrestrial infrastructure, the demand is simply not there. The demand for broadband is in the major cities, however, the local telcos in the major cities have done a good job in laying out the infrastructure to provide affordable broadband service through terrestrial means such as ADSL. Satellite broadband will not work in the medium term due to terrestrial competition, and the lack of demand outside of the major cities make it difficult to successfully sustain the business.

Jackson: Broadband via satellite will be an opportunity where people are living or working in locations that do not have good terrestrial services but the residents or companies can afford the higher priced satellite service. We have seen that model working in North America, and it is set to work in Europe. The total quantity of users will dictate whether the service would be provided on a dedicated satellite or just part of the payload. The next iteration of that model will be the linking of a femtocell to the service as often these areas also have very poor cellular service. A large dedicated satellite can bring down the price per bit to very reasonable levels, but it needs a lot of users distributed evenly over the beams. Even using a dedicated satellite, the price of the terrestrial broadband service should always be lower, and this will be exaggerated as users demand more and more bits for their video applications and downloads. In Asia, the people that can afford the satellite service predominately live in the city suburbs and they generally have good terrestrial services. Thus it will only be where the service is not available or the quality is poor where satellites will be a compelling story, and when I talk about poor quality that does not just mean reliability but also the speed of service.