Over the next three years the demand in India will increase by 40 percent for C-band and 100 percent for Ku-band. —Jagbir Singh, Bharti AirtelCellular Backhaul in Asia: A Market Focus Mark Holmes is the Editor of Via Satellite.

According to “The Mobile Economy 2013” report issued late last year by the GSM Association and AT Kearney, there are around 3.3 billion mobile connections in Asia, generating 57 percent of all new connections between 2008 and 2012. The region is projected to grow at 7 percent per annum between 2012 and 2017, adding 1.4 billion new connections. The report also forecasts that Asia Pacific will add nearly half of all new connections between now and 2017, while 22 percent will be from Europe and North America combined.

As operators in Asia feel the strain of providing services to subscribers across the region, satellite makes a vital contribution in the backhaul arena. “The satellite industry is on solid ground here,” says Jose del Rosario, an analyst at NSR. “For instance, you have Indosat and Ipstar being used to support large amounts of satellite bandwidth capacity in the region for wireless backhaul. In terms of the overall global picture, Asia is leading the way today, and we expect that to continue. We think it will even increase its lead over other regions, including Africa and Latin America over time.”

One of the trends del Rosario is seeing is that legacy Ku- and C-band transponders based on 36 Mhz transponders will shift over to high-throughput satellites (HTS). “The reason for that is the cost of the bandwidth, the efficiency of the bandwidth, and the ability to control the bandwidth,” he says. “For instance, an operator like Softbank is currently using Ipstar, which is cheaper in terms of the bandwidth it can support, including a 3G platform. Right now, using a traditional Ku-band or C-band platform presents ROI challenges for 3G. But with HTS, and eventually with O3b, going forward, space segment capacity will increase exponentially while the cost of the bandwidth will decrease at high levels.”

Operators such as Intelsat, Thaicom and O3b Networks are likely to be some of the key beneficiaries of the demand for capacity, and del Rosario believes Inmarsat may even go after this market too. “There is enough capacity for legacy Ku-band and C-band, and with the shift to HTS with the likes of O3b and Ipstar, legacy capacity should increase even more,” he says. “We believe Intelsat’s next generation satellites, Intelsat EpicNG, will be perfect for cellular backhaul as well. They’re a big provider of cellular backhaul capacity. They are claiming that EpicNG will be backwards compatible to legacy systems. So hypothetically, if you have a C-band/Ku-band dish pointing to legacy 36 Mhz transponders, simple adjustments can get these to point to EpicNG. If it works technically, it could be a very simple swap-out of certain parts of installed equipment with bandwidth capacity increasing exponentially while OPEX decreases. There are HTS like Ipstar, and on the horizon are Intelsat EpicNG and even Inmarsat Global Xpress which will probably go after cellular backhaul as well.”

India

Bharti Airtel is a powerful presence across the Indian communications landscape. It offers wireless, telecoms, and DTH services and competes across all layers of the communications market. Its backhaul needs are also on the increase.

Jagbir Singh, CTO and director, Network Services Group, Bharti Airtel, says his company uses satellite to extend connectivity and VAS solutions to its customers, as well as to deliver TDM/TDMA technology in Ku-band and provide Single Channel Per Carrier (SCPC) services in C-band.

“We need satellite backhaul primarily for connecting banks, ATMs, e-governance, e-learning, stock trading, Internet/Intranet and backhauling mobile BTS’s in remote locations and difficult terrain,” says Singh. “We also cater to the broadcast needs of media customers in countries like Bangladesh, Africa, Middle East using our satcom services. With the Indian economy becoming increasingly rural focused, satellite services can provide connectivity without waiting for any infrastructural rollouts. Satellite services can cost effectively and quickly connect villages, hospitals and schools. Our demand for capacity has increased year-on-year by 30 percent for these applications.”

Singh adds that satellite is especially important when looking to connect remote villages in locations where there is no other option available. The Network Services Group recently launched voice and data connectivity services for people in Kargil, making it one of the first privately operated telcos to make inroads into this town. Kargil is known for inclement weather conditions and some of the toughest terrains in India. These are the main reasons why the connectivity has been extended to the region through VSAT links and especially designed telecom infrastructure, which can be adjusted as per the need in case of any unprecedented weather conditions.

“Satellite is also an important medium for redundancy of copper and fiber media and comes as a critical help during catastrophe situations,” Singh says. “Other than shared hub data services, we have presence in DTH, teleport and International Private Leased Circuit (IPLC). The company also uses its satellite assets to reach out to various carriers for supporting their voice and data services. Our DTH teleport services utilizes satellite assets to deliver high quality video services to the home users going forward there is lot of demand from banks to connect rural villages, and we see satellite playing a vital role in the Indian government’s broadband initiatives.”

The Network Services Group is not only a major acquirer of satellite capacity in India, but in Africa as well. The Network Services Group launched its first VSAT services in 1995. Singh says that the company knew then that satellite would work to connect the vast landmass of India and provide next-generation applications like DTH.

“We are a major user of satellite capacity globally with more than 40 transponders, including Africa, and it is no surprise that going forward this will increase further as new data/video applications and broadband will drive this growth. Over the next three years the demand in India will increase by 40 percent for C-band and 100 percent for Ku-band,” adds Singh.

Indonesia

PT Indosat has a unique position within the Indonesian communications market, being both a satellite and wireless operator. Because the country is spread across a lot of geography, Prashant Gokarn, chief strategy officer, PT Indosat, says it is difficult to assess Indonesia’s needs for backhaul services via satellite.

“To connect sites on remote islands via microwave is possible, but it can be quite expensive,” says Gokarn. “A more cost effective way to really connect remote sites is through satellite. We have around 52 million wireless subscribers, but a lot of these subscribers are in urban areas where there is not a need for satellite backhaul. In the rural and remote parts of Indonesia, much more of the sites will be using satellite. We have quite a number of sites using satellite for backhaul. One other key point when looking at these sites is that they are not all going to be profitable. Some are not making any money, so they do have the potential to be switched off. These are non-satellite backhaul sites. The other thing we might consider is moving to a more efficient solution in terms of managing the satellite capacity.”

PT Indosat already owns two satellites and has the flexibility to move more and more data onto these spacecraft. But, the company may need a new satellite sooner rather than later. “With the two satellites in operation, we have enough capacity to serve our backhaul needs,” says Gokarn. “However, one satellite is coming to its end of life in about 18 months time. The other satellite will go to about 2020. We are in the process of implementing a replacement satellite. We are looking at a number of options here. We have a number of C- and Ku-band transponders available. The main technical challenge for us is when the satellite comes to the end of life and moves into inclined orbit. We would then need to have some kind of interim tracking solution for sites that use satellite.”

The company has been putting up a lot new sites in Indonesia and satellite has naturally formed part of the backhaul equation, despite the fact that the voice market currently dominates in the country. “Almost all of the subscribers in remote sites are on 2G. At present, we don’t have any backhaul services on 3G on satellite. But, if we want to start offering more data services in rural areas, it could be over 3G or it could be over WiFi. We will need to adapt satellite backhaul solutions,” says Gokarn. “As we increase coverage in areas that are quite remote, we will have to backhaul many of them on satellite. The cost of satellite backhaul makes data solutions more expensive. The key is try and bring the costs of these solutions down.”

Another player present in Indonesia’s vibrant wireless market is PT Multimedia Nusantara. According to Bogi Witjaksono, managing director, MetraSat, PT Multimedia Nusantara, the demands for satellite capacity in Indonesia could reach record levels over the next few years. He predicts that Indonesia in total will use more than 200 transponders. “There are huge demands for satellite capacity,” says Witjaksono. “One thing that should be highlighted is that for satellite services in Indonesia, since optical fiber network has been fully deployed among the big cities in Indonesia, satellite will still play a very important role. Ultimately, satellite could be transformed from the main backhaul infrastructure to the back-up infrastructure for optical fiber networks especially in the eastern part of Indonesia.”

With the sudden increase in demand, and the failed launch of the Telekom-3 satellite, gaining access to capacity is becoming a major obstacle in the market. “I think over the next one to three years there will be a shortage of available satellite capacity. However, because there is a lack of supply, this is driving us to look for satellite bandwidth efficiencies by using advance ground side and better technologies,” says Witjaksono. “We have to move from technologies such as SCPC to carrier-on-carrier. We have to invest to modernize the ground equipment to we can get the most of our transponder capacity. The supply of the bandwidth is very limited.”

The Indonesian government has already started to arrange the bidding for new LTE services in the nation. According to Witjaksono, the demand from the cellular business is moving from normal voice to 3G and 4G. “In my personal opinion, the speed of developing fiber optic networks through an archipelago like Indonesia still cannot match the demand of broadband bandwidth because the nature of the country,” he says. “That is why I predict that the growth of satellite bandwidth will still be very aggressive until the fiber network infrastructure is finished. Since the optical fiber cannot penetrate the entire island, there is no choice and satellite is the only option to answer the demand of 3G or 4G in the Eastern part of Indonesia.”

Malaysia

With a population of close to 30 million, Malaysia is one of the smaller markets in Asia when compared to the likes of China, India and Indonesia. According to Shahruddin Salehuddin, executive director of Malaysian service provider Maju Nusa, satellite backhaul is vitally important in the country.

“We currently work very much with the government’s Universal Service Provision program (USP) and have been asked to install 138 sites across Malaysia,” he says. “There is a need for quick broadband. We will be using VSAT backhaul for all of these sites, though. We are initially using dedicated 1Mbps upload as well as 1Mbps download.”

Like others, Salehuddin believes the company could benefit from the move to HTS, which could be taking place in Asia over the next few years. “We have been offering satellite services for under a year. We started with around 46 Mhz, which is enough capacity for two VSAT hubs. Right now, we are using 120 Mhz of bandwidth, which is almost 3.5 transponders of capacity,” he says. “We still believe there is plenty of room to grow especially via high throughput satellites, there is growth to be had in rural areas of Malaysia, and we are finding that 4Mbps a second is a common thing. We think our bandwidth needs are only going to increase over the next two to three years. We reckon by the end of this year, we will need six transponders, which is around 400 Mhz of capacity. In Malaysia, there is an issue of lack of capacity, but I believe that new high throughput satellites will come to the region to alleviate the shortage. We are also looking at O3b as a potential option for us in the future. This is the major challenge for us. We are coming close to exhausting our capacity with Measat.”

Maju Nusa has recently been involved in tests in SchoolNet, a Malaysian government school project. Though the company planned to trial 4G services via WiMAX, it has been able to deliver the expected quality of service through satellite. Salehuddin admits that while Maju Nusa’s primary focus is Malaysia, the company could look to expand beyond its borders over the next few years. This will lead to increased demands for capacity and Maju Nusa seems well placed to serve Malaysia’s backhaul needs for the foreseeable future.

Japan

Japan is also a vibrant mobile communications market, known for its innovation and use of mobile services. Softbank Mobile has over 30 million 3G subscribers in Japan, and has added new customers at a fast rate. While NTT DoCoMo paces the Japanese market with around 60 million connections, Softbank remains a major player. The company made headlines last year when it acquired U.S. wireless giant Sprint. Softbank works with Thaicom to gain the capacity it needs for backhaul services. Yoshihito Shimazaki, deputy division head, mobile solution division & office head, SoftBank Mobile Corporation, admitted that the impact of Japanese Earthquake had brought the company’s needs for satellite into sharp focus. Shimazaki said that 3,800 sites in its Node-B had been damaged due to the Earthquake and that satellite has become a very valuable backhaul solution since the damage was done to these sites. Softbank Mobile also has launched LTE services in Japan, with the backhaul segment provided by satellite in rural areas. According to Shimazaki, SoftBank Mobile, which ranks in the top three of Japan’s top three mobile operators, is also planning to launch satellite phone in the next year and is on the hunt for more satellite capacity.