Since the creation of the Indian Space Research Organisation (ISRO) in 1967, India has placed its space program and the use of space technology within its national development goals. The Indian space program has focused on the autonomous development of satellite applications (telecommunications, Earth observation, meteorology and navigation) to address the societal needs of a large rural population over a large territory.
To build up its own space capabilities, ISRO has engaged in wide international cooperation with development assistance from established space powers, mainly including the United States, Russia and France. This is especially true for the development of communications satellite systems and satellite communications services.
While ISRO, together with its commercial arm, Antrix, remains dominant all along the country’s satcom value chain, from satellites’ manufacturing to their launch and use, India has remained a growth market for domestic and foreign suppliers at the different levels of the satcom value chain.
Currently, India has the capability to design and manufacture geostationary communications satellites weighing between 1,500 and 3,000 kilograms, as is the case for the current Insat-4 series, the country’s fourth generation of communication satellites. However, not all parts of the satellites are produced in India; about 20 percent of the value is outsourced to foreign suppliers. Foreign outsourcing should increase with ISRO’s planned move into high-throughput satellite services, with the country’s first multi-spot-beam Ka-band satellite (GSAT-Ka) planned for launch in 2018. The revenue potential for foreign suppliers of communication satellites should thus remain in the hundreds of millions of dollars over the next 10 years, despite continuous improvement of domestic capabilities at ISRO.
A similar move toward increasing national autonomy has been observed in launch services, even if dependence on foreign suppliers remains for the largest Indian-made communication satellites.
While the Polar Satellite Launch Vehicle became the country’s workhorse for launch into low Earth orbit, also for non-Indian satellites, the country has yet to reach self-sufficiency in launching geostationary satellites above 2,000 kilograms. One of the primary objectives of India’s 12th five-year plan, covering 2012-2017, is to achieve self-reliance in the design and development of the Insat and GSAT series of geostationary communication satellites and to develop more capable versions of the Geosynchronous Satellite Launch Vehicle (GSLV Mark 2 and Mark 3). The successful launch of GSLV-D05 using an indigenous cryogenic engine in January was a critical milestone for ISRO’s communication satellite program. Routine operation of GSLV Mark 2 will help ISRO in achieving self-reliance for launching satellites now in the pipeline for Direct to Home television (DTH TV) and broadband communications. The development of the GSLV Mark 3 with its capacity of 4,000 to 5,000 kilograms should accelerate in the coming years after success with the indigenous cryo-stage, which has been a bottleneck in ISRO’s geostationary launcher development program over the past 20 years.
On the level of satellite operations and satellite communications services, ISRO together with Antrix has a quasi-monopoly for the trading of satellite bandwidth in India. However, less than 50 percent of commercial satellite capacity in India is served today by Indian satellites, with the majority being provided by foreign satellite operators such as SES, Intelsat and AsiaSat that sublease capacity to ISRO. There are now seven foreign satellite operators, including one high-throughput satellite operator (Thaicom), that provide bandwidth commercially, the vast majority indirectly through ISRO. This situation is the result of a disparity between the lack of capacity available from ISRO and the strong growth in demand in recent years, driven by DTH TV broadcasting.
In Euroconsult’s recently released study “India Satcom Markets 2014,” we found an average growth of 8 percent per year in commercial bandwidth demand driven by DTH satellite pay-TV platforms, cable television, cellular backhaul and enterprise and government VSAT, or very small aperture terminal, communications networks. To meet growing commercial demand, ISRO has engaged in foreign subleases in the past 10 years, especially for Ku-band, though it considers those subleases as gap-fillers until sufficient domestic capacity becomes available. However, it is highly likely that ISRO’s dependence on foreign operators will continue, as it has not been able to launch more than one communication satellite per year in the past. Also, ISRO has to reserve capacity for government users such as the Department of Telecommunications, All India Radio, Prasar Bharti and the military that account for more than one-third of its current bandwidth supply, therefore limiting the capacity available for commercial users.
Regulation still limits market growth, as all Ku-band leases have to go through ISRO/Antrix in a process that is often lengthy and cumbersome for operators, including strict price regulations, royalty fees and service-level license regulations by the Department of Telecommunications and the Ministry of Information and Broadcasting. Some of these regulatory restrictions are, however, revised in the country’s new satcom policy, which is expected to be released in 2014. Expectations are high from satellite operators, equipment vendors and service providers alike.
According to the research report, the demand for regular C- and Ku-band capacity should grow at about 6 percent per year over the decade in addition to new demand for satcom services using high-throughput satellite systems that should have a strong take up by end of the decade.
Deepu Krishnan is a senior consultant for Euroconsult.
