SIA Report Says Transponders Are Filling Up

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WASHINGTON — The annual Satellite Industry Association (SIA) numbers on the revenue generated in the global satellite services market show strong growth, particularly in the business of providing transponder capacity for high-definition television services.

Total satellite revenues rose to $62.6 billion in 2006, up from $52.8 billion in 2005, an 18 percent increase. Direct broadcast services were up to $48.8 billion in 2006 from $41.3 billion in 2005. Fixed satellite services hit $11.8 billion, up from $9.8 billion. Mobile satellite services inched up to $2 billion from $1.7 billion the year before.

But the big trend story was this: transponder use is up from 58 percent in 2004 to 70 percent this year.

Over the next few years the industry will be watching the growing impact of high-definition television signals on transponder use, David Cavossa, executive director of SIA, said May 22 at an Institute for Defense and Government Advancement conference on military satellites.

The enormous amount of bandwidth high-definition services required will gradually eat up the remaining space, Cavossa said.

Since the end of 2005, high-definition traffic has grown from 67 channels to 471, Cavossa said.

Still, even with that growth high-definition television channels “still account for only 2 percent of total television channels carried via satellite,” he said. But that is projected to change over the next seven years. Cavossa pointed to estimates by the Washington-based consulting firm Futron Corp., which show that transponder demand will begin to outstrip supply around 2014.

As that happens the pressure on the Defense Department, which still shies away from buying transponder space in multi-year batches, will grow, he said. “We’re going to do our best for you, but it’s going to be very tight.”

Those who buy access earlier rather than later will be in the best shape, Cavossa said.