Top Fixed Satellite Service Operators: SkyPerfect JSat Corp.

by




In an industry that is sometimes referred to as “the Big Four and the rest,” SkyPerfect JSat is the fifth-ranked fixed satellite services operator by revenue and has been for several years. It is more likely to lose its position to fast-growing smaller companies such as Star One of Brazil and perhaps Hispasat than it is to climb into fourth place ahead of Telesat.

For the moment, Tokyo-based SkyPerfect JSat is thinking less of growth than of improving its profitability to approach the 75 percent-plus gross-profit margins of some of its fellow operators.

In a May presentation to investors, the company suggested that its in-orbit fleet would be shrinking, not growing, as it focused on improving performance rather than maintaining a satellite infrastructure as big as Telesat’s. The company referred to a “drastic reform” of its satellite operating business cost structure to bring its in-orbit infrastructure into line with its current business demand.

Aside from playing a role in post-earthquake Japan’s disaster recovery effort, the company said its ambition is to expand in Asia and Oceania before other growing satellite operators begin to nibble on SkyPerfect JSat’s home market. The company said “increasing the ratio of overseas business considerably” is a top priority.

At the same time, the company will “achieve a cost structure comparable to world-class operators by streamlining [our] satellite fleet and reducing operating costs, and fortify a system for global competition.”

Japan’s new Basic Law for Space, which is helping liberate Japan’s satellite manufacturing industry by focusing on commercial applications in addition to research, will also help Japan’s premier satellite operator, SkyPerfect JSat says. Mobile communications for the maritime and aeronautical industries  — an area that several fixed satellite services operators are targeting — will also be a part of the company’s focus.

SkyPerfect JSat’s misfortune is to be in the part of the world with the most heated competition for provision of satellite bandwidth. South Korea, Thailand, Indonesia, Singapore, Vietnam, and most recently Laos all have invested in national telecommunications satellite systems. Added to these are the two Hong Kong operators, APT and AsiaSat, and China’s national operator. Growing in the region will not be easy.