Asian Satellite Operators Pin Hopes on High-definition Television

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WASHINGTON — Asian satellite fleet operators and service providers said they are counting on the growth of high-definition (HD) television in the region to offset any drop in prices for C-band capacity due to oversupply.

Addressing the Satellite 2014 conference here the week of March 10, the operators also said they expected novel partnerships among them to continue and that consolidation is still a long ways off.

One of the more recent partnerships is between Measat of Malaysia, a well-established provider of satellite television whose owners at one time expressed an interest in selling, and Azercosmos of Azerbaijan.

Azerbaijan wants to grow a domestic satellite business and, in a deal with Measat, shared the cost of the Azerspace-1/Africasat-1 satellite at 46 degrees east, a Measat-controlled slot that affords Azerbaijan full national coverage.

“Consolidation hasn’t happened” in the Asian satellite communications market despite the industry consensus that the region does not need so many individual fleet operators, said Paul Brown-Kenyon, chief executive of Measat. “Azercosmos wanted their name on a satellite but they didn’t have an orbital slot.”

If the forecast oversupply in C-band capacity forces down prices, it should be good news for many, but not all, satellite solutions providers, said Pierre-Jean Beylier, chief executive of Speedcast Ltd. of Hong Kong, a satellite services provider with a broad portfolio of customers in the Asia-Pacific.

“The oversupply of C-band, and some customers’ move to Ku-band, is not a good thing for us if prices go down because competitors will get access to capacity at prices close to ours,” Beylier said. “As a big buyer, we’re not that keen on seeing prices go down.”

The one Asian fleet operator that purchased a high-throughput satellite well before these broadband spacecraft became fashionable, Thaicom of Thailand, is not about to repeat the experience.

Patompob Suwansiri, Thaicom’s chief marketing officer, said a follow-on to the company’s big IPStar satellite will almost certainly be a smaller craft given that IPStar in some regions is only 25 percent full, a utilization rate that necessarily increases the cost per delivered megabit of data.

“The technology for high-throughput satellites has advanced, with switchable beams and steerable beams, and there are more medium-sized satellites that can be used for it to mitigate risk,” Suwansiri said.

Thaicom is counting on the market adoption of high-definition broadcasts, which after accounting for new-generation compression technology uses about twice the satellite bandwidth of a standard digital channel, to shore up demand. In 2012, he said, Thaicom had 24 HD channels on its fleet. At the end of 2013, the number had climbed to 74, he said.

Several operators addressed the Chinese market, which for the past several years has been largely closed to non-Chinese operators as China has consolidated its satellite-television demand on its national satellite operator, China Satcom.

Huang Baozhong, executive vice president at Hong Kong-based APT Satellite Holdings, said the industry tends to overstate the near-term potential of the Chinese market.

“I used to be vice president of China Satcom,” Huang said. “There are few people in the government who really understand satellite. The market is not as big as people think.”

William Wade, chief executive of Hong Kong-based AsiaSat, said he expected nonmainland Chinese operators to be allowed to return to the Chinese domestic satellite television market once they have demonstrated an ability to defeat piracy and signal interference.

Wade said the Falun Gong protest movement, which has been made illegal in China and whose tactics have included pirating satellite channels for brief periods, was one reason China shut out operators with uplinks outside the Chinese mainland.

AsiaSat is one of several commercial fleet operators that are adopting technologies borrowed from the military that nulls jamming and piracy.

Wade agreed that HD broadcasts would be a growth driver in the Asian market in the coming years.