Asian telco SingTel prides itself on progressive strategies towards satellite. It has recently launched its ST-2 satellite, a joint-venture project with Taiwanese telco Chunghwa Telecom, which aims to give SingTel even more coverage in its core broadcast, maritime and oil and gas markets.

With most of the capacity already taken on this satellite, however, the operator is looking to develop alternative capacity on other spacecraft — namely, an upcoming ST-3 satellite. Titus Yong, SingTel’s vice president of satellite business, talks about the operator’s plans beyond ST-2. 

VIA SATELLITE: How much capacity have you sold on the ST-2 satellite now that it has launched?

Yong: Most of the capacity on the ST-2 is more or less sold right now. It has been sold to customers in Singapore and India. A big chunk has been sold for maritime services, as well as some into the Middle East and Afghanistan. 

VIA SATELLITE: Considering that most of the ST-2 is sold out, has there been a situation where you have had to turn customers away due to lack of available capacity?

Yong: We have to be selective in terms of talking to our better customers. ST-2 is a high-quality, high-powered satellite. We don’t turn customers away, but we can move them to other satellites if they are more appropriate. We also have our ST-1 satellite, which has a lifetime of another three to four years and we are able to bring some budget price capacity into the market where we can serve lower-end markets as well. We also have an investment in APT, so we have the possibility of customers taking capacity on those satellites. 

VIA SATELLITE: What lies beyond ST-2 in your efforts to increase your capacity options?

Yong: We are now very committed to our ST-3 satellite. The ST-3 program is being done in collaboration with Asia Broadcast Satellite (ABS). Our program with them involves us getting capacity on ABS-1 soon. A lot of capacity on ABS-1 will be used for SingTel. We are also starting long-term leases with another provider for capacity into Central Asia and the Middle East, and we are in discussions with other Middle East satellite operators to develop capacity partnerships and offer end-to-end IP-based satellite services into Africa.

Other capital expenditure programs we are looking at involve launching our play-out services and HD channels. We have just launched an end-to-end play-out service for our own IPTV head-end and we are launching an Asian Ethnic content channel, which is a 24/7 channel that is done in-house. This has all come about because of our investment in more broadcast capability.

We are also putting a lot of capital expenditure investment into value-added services. We recently launched a managed voice service on IP links. We are probably the first in the world to offer a codec service that is most efficient at 6 Kbps. We are looking to develop IP prepaid voice services over satellite that will be delivered to maritime as well as branch offices.

We are also spending a lot of money in delivering our own software for maritime services, as well as an integrated management system that would allow us to have end-to-end management of all devices and satellite links. This way, we can provide customers with a portal so they can have true visibility of these services. 

VIA SATELLITE: When do you expect the talks with potential Middle Eastern partners to come to fruition?

Yong: We might have an announcement closer to the end of the year, but it depends on the customer base we are looking to open services to. We may or may not disclose too much. This is really about an Asian provider like SingTel and a Middle East provider coming together to do a marketing alliance in respective markets. The deal will likely be signed with an FSS operator or a service provider. 

VIA SATELLITE: Has the economic downturn had any impact on the demand for satellite capacity in the region?

Yong: I think it depends on which segment you are talking about. For the FSS segment of customers, we have yet to feel the pinch of the recession. This is perhaps due to all the long-term projects we are committed to. People are still ordering capacity from us. In terms of maritime and oil and gas, we are seeing a stronger pinch now, due to the glut in supply of vessels. Rates are still dropping, and therefore, people are most cost-conscious and looking for a more low-cost bandwidth type service with us. There are still strong drivers from the maritime market such as crew welfare communications. Companies are under pressure to deliver a basic crew welfare environment and they are being forced to move into that direction. As broadband prices are dropping there is still growth, but growth is undoubtedly slowing down. That situation is unlikely to change during the next 12 to 18 months. 

VIA SATELLITE: What are SingTel’s international aspirations in terms of new verticals for satellite business?

Yong: Our maritime business is pretty global, but when it comes to FSS, we definitely want to go a bit further. With ABS-1 and ABS-2, we have C-band that will allow us to offer branch network support for Singaporean companies and Asia based customers who are branching off to emerging markets such as Africa. We are also beginning to see services from North Asia going to the Middle East and Africa, so we are working with some Middle East partners that can offer us some end-to-end service to resellers into these kinds of markets. 

VIA SATELLITE: Does this mean that SingTel’s revenue mix is changing?

Yong: There are a couple of ways to look at it. The maritime mix is changing rapidly from narrowband to broadband. The ARPUs of vessels are increasing, and they are driving the demand for managed services and broadband. When you look at the mix between the maritime business and the FSS business, the FSS business is growing stronger now, as there has been a commitment to long-term projects and transponders with IP-based services. We now have a more even mix between FSS and maritime services. 

VIA SATELLITE: Are new service markets opening up for satellite capacity in the Asian region?

Yong: We are investing considerably in developing software-based services in order to be bundled together with our satellite services. We want to look at more managed services, and have software behind all of these links. We are also seeing ourselves as having a stronger role in crew welfare solutions. You can see us playing a bigger role in offering totally managed network operation solutions to service providers. We are going very strongly into these fully managed VNO services. We are also going to get more involved in broadcast and market segments like digital cinema; we want to position ourselves to be a media hub. We also want to get into teleport alliances with other media hub owners probably in the United States, where we could get more involved in video distribution and digital cinema distribution. 

VIA SATELLITE: How do you see the communications/broadcast landscape changing in the next 12 months?

Yong: The Singapore government wants to position the country as a strong media hub. Many new TV channels have launched in the region. Singapore remains a very strong broadcasting hub for the likes of HBO, Sony and Disney. We are also seeing more opportunities for disaster recovery in Singapore. We see the hottest growth coming from the big broadcasters that want more play-out services, etc. We are helping the big channels launch onto IPTV platforms as well as further into the region.

In terms of data communications, we’re seeing a lot more acceleration technology. We are examining the possibilities of deploying the next generation of technology where 352 Mbps can squeeze on a 72 Mhz transponder, for example. We see some of this new technology coming in to help us, and drive a lot more optimization. I think the growth in the demand for capacity will slow down a bit because we are already committed to a lot of new capacity, and there is a lot of bandwidth optimization coming to our network.