Despite Investments, SES Still Skeptical of Sat Broadband

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PARIS — It has more consumer satellite broadband subscribers than anyone else in Europe and is investing in Ka-band broadband capacity on four satellites to be launched in the coming 30 months, but make no mistake: SES still believes satellite-delivered consumer broadband in Europe is a fool’s errand.

In a May 22 presentation to investors, SES went so far as to include “Limited Exposure to Consumer Broadband” on its list of the company’s principal attributes, alongside “Strong Core Video [direct-to-home] Business” and “Rising Free Cash Flow.”

SES’s Astra2Connect consumer broadband service, now called Astra Broadband, counts more than 80,000 subscribers who have taken advantage of available Ku-band capacity on Luxembourg-based SES’s current fleet. SES Chief Executive Romain Bausch said this figure is growing only slightly but is likely to grow more rapidly once the Astra 2F, 2E, 5B and 2G satellites — listed in order of their scheduled launches — are placed into orbit between late this year and late 2014.

Each satellite’s main mission will be television transmissions in Europe, SES’s core business. But each will carry two Ka-band beams that Bausch said cost no more than 6 million euros ($8 million) per satellite. When the ground-based gateway stations necessary for the Ka-band service are included, SES will have invested no more than around 50 million euros, he said. Each of the four satellites should be able to handle 60,000 subscribers, depending on service levels.

As he has before, Bausch contrasted this with rival Eutelsat’s decision to invest some 300 million euros in an all-Ka-band satellite, Ka-Sat, which entered service in mid-2011. Paris-based Eutelsat has declined to disclose the number of subscribers to its Tooway broadband service, which is mainly powered by Ka-Sat.

“We deliberately decided not to invest in a dedicated Ka-band satellite,” Bausch said. “We do not believe [consumer satellite broadband] is a sustainable business over the life of the satellite. A satellite takes about three years to build and then is in operation for about 15 years.

“You need a good feeling about the business for 18 years. The last mile for broadband for consumers is best done by terrestrial, not by satellite.”

Bausch gave no hint that his position has been changed by the arrival of high-throughput satellites on the market, the first of which is Ka-Sat. Similar satellites, and other Ka-band broadband initiatives, are under way in the United States, Canada, the Middle East, Russia, East Asia and Australia.

 

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