The current landscape of satellite operators in the region includes several players who have been in the business for some time now: Arabsat, which has been building satellites at a healthy pace, plays in the VSAT, broadcast and telecoms spaces; NileSat specializes more in TV and broadcast; Yahsat is working in the DTH, telecom, scientific and government fields; newcomer Es’hailSat is preparing to launch their first satellite this year; and you also have NoorSat, which leases capacity from Eutelsat.

Broadcasting is a major trend in the region. It involves more than 650 unique FTA satellite channels whose expansion is based on engaging viewers by addressing local social or political issues. This is highly attractive to advertisers and, accordingly, ads are addressed to Pan Arab or to Gulf Co-Operation Council (GCC) countries on vertically focused TV channels. This in total means that the demand for satellite capacity continues to increase, as we witness the move from SD to HD.

The Middle East and Africa remain fertile grounds for satellite solutions. “Satellite communications is well suited for specific applications that can benefit from the technology,” Jean-Philippe Gillet, vice president of Europe and Middle East sales for Intelsat says. “The fundamentals of what makes [this] an attractive region have not changed, as we know better than anyone. That is why we have invested in capacity and infrastructure.”

Intelsat has significant capacity, which it offers as regional and global connectivity to serve cellular backhaul, either directly with operators or via value-added offerings by Intelsat customers. According to Gillet, the cellular backhaul sector is one of the fastest growing divisions in the Middle East and Africa.

Es’hailSat, an operator based out of Qatar, is a new presence in the market. Es’hailSat CEO Ali Al Kuwari says that the quality they target to provide should differentiate their services. Broadcasters are expanding, new networks and channels are created every day, and the market has potential for everyone. “I believe Es’hailSat will benefit from its prime location at 25.5 degrees East. The environment is stable and the broadcast sector is successful and growing. There have been no major regulatory obstacles,” he says.

Es’hailSat Strategy Revealed

With significant demand of satellite services in the MENA region, Es’hailSat has a plan to expand its satellite fleet to a further five satellites. As an emerging player in the region, Es’hailSat will look at a number of opportunities to achieve its objective and develop its satellite program. The choices of partnership, alliance, acquisition or merger will depend on specific opportunities and how these fit with their strategy, objectives and mission. “Our international opportunity is to build out a global fleet of satellites, serving key markets in the world while being controlled from our facility in Qatar,” Al Kuwari explains. Es’hailSat will link its expansion with its major stakeholders’ expansion. To strengthen its presence in the MENA region, the company is currently exploring potential orbital slots for its soon-to-be-announced Es’hail 2 satellite.

Es’hailSat aims to provide advanced satellite services to strategic stakeholders and commercial customers. “Es’hail 1 is scheduled for launch in the second quarter,” Al Kuwari says. “Our satellite will provide TV, voice, Internet, corporate and government services across the MENA region. This region is currently experiencing a growth in demand for satellite communication services, broadcast and Internet in particular, enabling current viewers receiving content and programs to diversify the content without the need to install a new satellite dish, translating into more diversification of broadcasters in the same location.”

He continues, “This will also support broadcasters and new organizations with advanced transmission connectivity of breaking news and special events.”

Enterprise

While the broadcast market is robust, the enterprise market also offers rich pickings. According to Arabsat president and CEO Khalid Balkheyour, “the enterprise market is playing a vital role for all satellite service providers. It secures satellite capacity in the long run once the quality of services offered is reliable. This market continues to be a driving force in the industry.”

Large corporations in different industries, whether banks, oil and gas or others, need efficient and quick set-up of their communication networks around the world or in region. Traditionally, large corporations have used satellite services for complex corporate networks and mission-critical applications. Yahsat introduced its YahClick service, which provides an opportunity for large corporations with remote locations to equip all of its staff with affordable Internet access, not only for corporate data, but also for regular usage. “Due to Internet interruptions that are common in our region through cable cuts, base station power outages, or congestion, theft or vandalism, YahClick offers an insurance product designed for back up requirements for corporate, allowing companies and government entities to pay a very low monthly fee, but pay only for the days they need to use the data in the event of any outage,” Yahsat CEO Tareq Al Hosani says.

Military

In the defence sector there is a reliance on commercial operators for capacity. This dependence is a result of domestic military satellites’ failure to meet milsatcom requirements, even during “peacetime.” There are also increasing budgetary pressures, which could result in demand for commercial satellite capacity. Fortunately for MSS operator Thuraya, most of the geopolitical hotspots fall within its geographic footprint. “As U.S. troops withdraw from Afghanistan, the opportunity for us expands as demand moves from fixed VSAT to more portable MSS and COTM with more rugged IP terminals,” says Jassem Nasser, Thuraya’s vice president of business development. “We believe Thuraya is best positioned in the MSS industry to serve those needs with the best suite of products, lease services, capacity and network capability, availability and security.”

For Gillet, the demand for connectivity in areas like Afghanistan and Iraq, even with a reduced number of U.S. troops, will not change dramatically. Since increased UAV usage for intelligence, surveillance and reconnaissance operations will require Ku-band capacity for the next decade and beyond; there is no plan to move off commercial capacity.

Potential Markets

In markets such as aerospace, oil and gas and cellular backhaul, Jawad Abbassi, president, Arab Advisors Group, a local telecoms/media consultancy firm based out of Jordan, believes that satellite systems will always be needed. “Satellite always demonstrates its importance in disaster recovery because of how infrastructure suffers at such times. It also plays a significant role in maritime and oil and gas, where capacity is much needed. Satellite broadband Internet right now is more of a ‘last resort’ technology in the region,” he says.

Nasser adds that “for MSS in general and for Thuraya in particular, strong opportunities exist across the enterprise sector markets in the long term. The energy sector, mainly oil exploration activities in remote environments, will further require the support of mobile satellite communications solutions.” Thuraya serves several markets including maritime services and broadband, voice services for the Defense, NGOs, and media sectors. The company is also seeing an upsurge in business coming out of Africa.

Outside of DTH and broadcast – and while telecom networks continue to be a major driver for satellite capacities – broadband through Ka-capacity is starting to create significant value to satellite operators in the region. “We have seen an overall equilibrium taking place in the industry as a whole, i.e. some verticals go down while others go up,” Balkheyour explains. “Arabsat’s most relevant vertical expertise is in the broadcasting and DTH, and we still see this vertical growing rapidly over the coming few years.”

African Content

Strong DTH, DTT and global demand for African content are driving the flow of media services usage across Africa. This has led to the arrival of new platforms driven by increasingly integrated and complex telecommunications infrastructure aiming to provide media companies with maximum broadcasting power and flexibility into the countries they serve. While DTH broadcasting is its initial focus, Es’hailSat believes they are in a position to provide services to other sectors such as oil and gas, which is a major business in and around Qatar. Es’hail 1 will also provide some services for VSAT and cellular backhaul.

Through Yahsat 1A and Yahsat 1B, different services for DTH and broadcasting are offered with a focus on HD channels on the company’s YahLive service, a collaboration with SES, which was announced around three years ago. Oil and gas, cellular backhaul and general telecoms verticals are also being served by Yahsat’s premium C-band capacity over Africa. This is all in addition to the YahClick broadband Internet service, which targets all verticals.

A number of Yahsat’s satellite solutions are powered by Yahsat 1B, one of the first satellites in the region to offer Internet connectivity through Ka-band multi-spot beams with reusable frequencies to maximize spectrum efficiency. The multi-spot beam technology means higher power on the ground, enabling the use of a smaller antenna size for a lower cost and easier logistics. Yahsat 1B brings 20 Gbps of capacity for distribution. These services are dedicated to providing solutions to communities across the Middle East, Africa and Asia.

Looking out into 2013, Gillet explains how the demand for connectivity continues to increase, with a growing need for broadband and video distribution. Customers are taking their programming to the global platform, such as having multiple versions of channels in different languages in the same region.

Intelsat is working on meeting the demand for broadband connectivity, growing at more than 30 percent per year. The upcoming launch of Intelsat 27 will complete a fleet investment campaign that included the launch of seven satellites since late 2011. Intelsat currently serves Africa and the Middle East with capacity on more than 20 satellites.

Meanwhile, Arabsat foresees more capacity requirements coming from MENA on Ku-band and from Africa on C-band for telecom services. “We will continue to act as a main provider of video and broadcasting services from our hotspot at 26 degrees East, in addition to its supporting video contribution satellites. The Arabsat Ka-payload will generate additional revenues in 2013 on Arabsat 5C,” Balkheyour says.

Over the next year, Balkheyour is confident that Arabsat will secure major hosted payloads transactions that will guarantee long-term business to the company and will construct the cornerstone of its coming satellites. Arabsat also foresees major alliances between key players in the region in DTH and broadcasting services, and predicts that “Arabsat’s HD initiative will secure Arabsat a leading position in the MENA as the prime portal for HD channels,” Balkheyour says. “We have recently announced our sixth satellite generation program with plans to design, manufacture and launch three new satellites: BADR-7, 6A and 6E, expected to be in orbit by the end of 2015 and beginning of 2016. These satellites will mostly add new capacity from different orbital locations supporting DTH, broadcasting, telecom and broadband services.”

As for MSS, Thuraya predicts that demand in this sector will continue to grow unabated across different vertical and horizontal land and maritime segments, and emerging geographies, with the development of new products and solutions and dual-mode capabilities.

Integral Part

Service providers also see the importance of satellite. Douglas Reed, Joint CEO, Vox, and one of Yahsat’s service partners explains how he sees the importance of satellite in operations saying that “satellite-based communication systems are an integral part to the telecommunications industry, especially in regions such as Africa where terrestrial connectivity is problematic or underdeveloped. Satellite broadband Internet has the capacity to provide wide reaching, cost effective and high speed broadband services to urban, rural and remote communities that have traditionally suffered from a lack of connectivity.”

As satellite broadband solutions are intended to complement terrestrial offerings rather than compete with them directly, satellite-based communication systems extend the industries’ overall offering ensuring that no matter where individuals or businesses are located, they can access the Internet. Additionally, satellite communications does not require the same infrastructure set-up, which is hugely beneficial to emerging economies that do not have the funding or time to wait for terrestrial cables to be laid down.