Satellite Industry Needs to Work on Perception

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PARIS — The satellite industry has done a lousy job of selling itself, resulting in a public perception that satellite links are risky and expensive despite the fact that end-user costs are dropping fast, according to a Gilat Satellite Networks manager.

Doron Elinav, vice president for marketing at the Petah Tikva, Israel-based builder of satellite networks for corporate and government markets, said too few people know that advances in satellite terminals and throughput speeds have made satellite links increasingly competitive with terrestrial communications.

Elinav said the satellite sector has only itself to blame for the fact that the people like Susan Crawford, U.S. President Barack Obama’s special assistant for science, technology and information policy, continue to view satellites as a technology of last resort.

“Susan Crawford’s remarks on satellites signify where we are going wrong,” Elinav told the VSAT 2009 conference here organized by the Comsys consultancy. “If policymakers are not convinced satellite is a good option, then we are not doing our job.”

In the past decade, the price of a two-way satellite terminal has dropped to well under $1,000 while throughput has increased substantially. But the satellite industry has not gotten the word out, Elinav said.

“Look at the plastics industry,” he said. “Plastics is not exactly unknown, and yet the $350 billion plastics industry in the United States is investing in a $10 million advertising campaign to promote plastics. How much is the satellite industry in the United States or Europe spending to promote itself? I think it’s far less than $10 million.”

Builders of corporate and government satellite networks like Gilat, Hughes Network Systems, ViaSat Corp., iDirect and Newtec have created a growing global business for satellite two-way technology. But still only 25 percent of the retailers in the United States use it.

“The question is: What’s wrong with the other 75 percent? I think it’s one of perception,” Elinav said.

The success of consumer-broadband service providers Hughes and WildBlue in the United States may help correct the misimpressions, Hughes Senior Vice President Mike Cook told the conference.

 “In the consumer world, [satellite connectivity] is a mainstream activity,” Cook said, noting that Hughes’ nearly 500,000 consumer and small-business subscribers increased their average monthly payment to $70 for the three months ending June 30 from $63 in 2007 despite the economic downturn.

Hughes has contracted with Space Systems/Loral of Palo Alto, Calif., for a large all-Ka-band satellite, called Jupiter, to be launched in 2012. With 100 gigabits per second of throughput, it will be 10 times more powerful than Hughes’ current Spaceway 3 Ka-band satellite, which itself has 10 times more capacity than a conventional Ku-band satellite.

Germantown, Md.-based Hughes has loaded nearly 200,000 of its customers onto Spaceway 3, which is permitting Hughes to let its Ku-band satellite leases on other companies’ satellites expire. But Hughes still leases more than 120 transponders on 18 satellites worldwide, including two satellites over North America.

Cook said the industry needs to work to push consumer prices down still further. Instead of asking subscribers to pay around $700 for a terminal, including a rooftop antenna, Hughes is offering its HughesNet users the possibility of renting the equipment for $99 per month including a service contract and free installation.