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Satellite Ground Segment Business Interview with John Higginbotham

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Asia-Pacific Satellite Communications Council ISSN 1226-8844




                                     NEWSLETTER




    Satellite Ground Segment Business
                                 Interview with
                           John Higginbotham
                         CEO, Integral Systems




                                       07J U LY 2 0 0 9
                                         C O                 N          T   E     N     T     S
                                                                     JULY 2009 Volume 15 lssue 3

PRESIDENT’S MESSAGE                                                                           03
COVER STORY                                                                                   04
Trends in Satellite Broadband Systems                                                         04
Celebrating 25 Years in Satellite Communications                                              10
Leveraging Space to Bring the other 3 Billion on-line                                         16

INTERVIEW                                                                                     22
John B. Higginbotham, Chief Executive Officer, Integral Systems, Inc.                         22

APSCC MEMBERS                                                                                 26
NEW MEMBER                                                                                    28
Information, Communications Technology and Post Authority (ICTPA) of Mongolia                 28

APSCC MEMBERSHIP                                                                              29
SATELLITE TRENDS                                                                              30
A Steady Market for Wireless Backhaul via Satellite in Asia                                   30
Financial Crisis - Opportunities in Asia despite the Global Crunch                            36
Satellite Insurance Markets – Recession Proof?                                                40
GSM Satellite Overview                                                                        44

INSIDE APSCC                                                                                  50
APSCC Activities Update                                                                       50
2009 APSCC Yearbook                                                                           51

SATELLITE INDUSTRY NEWS                                                                       52
CALENDAR OF EVENTS                                                                            55
ADVERTISERS’ INDEX                                                                            56
                                       P R E S I D E N T ’ S
                                       M E S S A G E


“Digital Divide” words that we used to hear in the 80’s that made us aware of the difference between those
who had access to the digital technology and those who did not.


Three decades later and we still have not seen any real progress being made toward closing this divide in
countries where it is needed the most. Is it because of the lack of money, human resources, or the priority of
countries, and can the satellite community support their needs?


When social needs meet business realities, there may be limited resources that can be spared if companies want
to provide a reasonable return to the shareholder on their investments. Satellite is one of the best means that
can be used to reach the rural and remote areas but our industry needs government support and subsidy to
launch an initial and successful model. All three stakeholders, the government, the carrier and the users have to
provide resources proportionally to make it a sustainable model.


The desire to close the digital gap is shared by officials from all around the world    even from the countries
where you will find the best technology and digital penetration. Any kind of large scale implementation has not
yet been done, but the step by step approaches have been proved to be effective and successful. Although each
country has a different situation, they can learn from the common experience.


While digital access is available anywhere in the world today, still the divide exists in the rural and remote areas
of some countries. This may be due to a lack of interest by a population whose living standards cannot provide
the basic human needs of life and in some cases the ridged culture that exists.


APSCC would like to urge our members to share their experience, resources and work with their own
governments and regulators to bring this digital divide to an end. During the next two years, we will put our
effort in bringing the awareness to all concerned parties starting with our annual conference in Kuala Lumpur,
Malaysia between September 29th and October 1st. Hope to see you there.


                                                                                         Nongluck Phinainitisart
                                             COVER STORY




                                           Trends in Satellite Broadband Systems
                                           Dave Rehbehn, Senior Director, Hughes Network Systems




                                           Consumer and business appetite for complex appli-                   broadband terminals (including over 300,000
                                           cations has transformed broadband from a “nice to                   terminals in 2008 alone), testifying to the growing
                                           have” to an absolute necessity. And satellite plays no              value of satellite broadband in the marketplace.
                                           small role in meeting the need for broadband ser-
                                           vices, particularly in remote and hard-to-serve                     Further, the success of Hughes in developing its own
                                           areas. Figure 1 illustrates the latest market data,                 service businesses in North America, Europe, India
                                           (Northern Sky Research, May 2009) showing over                      and Brazil underscores the strength of broadband
                                           2.5 million broadband satellite terminals in service                satellite as the primary solution in rural and remote
                                           globally, with a forecasted 12.5% CAGR.                             areas. Despite the challenging economic times in the
                                                                                                               first quarter of 2009, Hughes achieved an all-time
                                                                                                               high of 53,000 gross subscriber additions, bringing
                                                                                                               the total number of North America HughesNet con-
                                                                                                               sumer subscribers to over 450,000.


                                                                                                               Critical to maintaining this kind of market growth is
                                                                                                               the ability to continually develop and enhance
                                                                                                               satellite broadband technology and systems to meet
                                                                                       Source: NSR, May 2009

                                           Figure 1. Broadband Satellite Market Site
                                                                                                               market demand. This article examines the key
                                                                                                               market drivers and presents recent product innova-
                                           As further evidence of the demand, Figure 2 shows                   tions focused on these requirements.
                                           the cumulative shipments of broadband satellite
                                           terminals from Hughes during the last 5 years, with                 Getting the Most out of Satellite
                                           over 1.9 million units shipped to more than 100                     Broadband
                                           countries at the end of 2008. Growth is across a wide               Ever-increasing demand for Internet connectivity is
                                           range of market segments and applications, including                the strongest driver for satellite broadband. According
    Figure 2. Hughes Cumulative Shipment
    of Broadband Satellite Terminals       high-speed Internet services for consumers and SMEs                 to the International Telecommunications Union (ITU),
                                           (Small to Medium Enterprise); distance learning and                 the number of Internet users worldwide has increased
                                           video conferencing; Mobility services; cellular/Wimax               over threefold from 390 million to over 1.5 billion
                                           trunking; as well as increasing deployments of small                since 2000. Not all of these users are situated in urban
                                           private networks. Perhaps most strikingly, since 2004               areas, which enjoy high-quality terrestrial connec-
                                           Hughes has shipped well over one million satellite                  tions. But there is still a significant “broadband divide”:


4   APSCC Quarterly Newsletter
in North America alone, analysts estimate that 10 to        Key Developments to Improve
11 million households and over 3.5 million small            TCO, Performance and Quality
businesses don’t have access to terrestrial broadband       The price of space segment is a major cost compo-
services. Even urban and suburban areas that are            nent of a satellite broadband system, and conse-
otherwise covered by fiber, DSL, or cable have pockets      quently anything that can increase IP throughput
that contain no landline broadband access.                  over the satellite will substantially reduce its cost.       Figure 3. Hughes Cost-of-Ownership
                                                                                                                                                   Strategy
                                                            Spectral efficiency, while important, is but one
Turning to the developing world, the availability of        element of overall IP throughput. Interestingly, end
landline broadband becomes even more challenging,           users report better general performance when
and it is unlikely that terrestrial technologies can        efficiency improves.
provide cost-effective coverage in the near or mid-term
future. Whether it is DSL, cable or fiber, or terrestrial   Hughes produces a wide range of products based on
cellular or wireless broadband, capital cost rises as       a common set of core technologies and capabilities
distances increase and subscriber density decreases,        to achieve high IP throughput:
making it impossible to justify large investments in low
density rural and in many ex-urban areas. Even larger           DVB-S2/ACM - Hughes first brought to market VSATs
cell wireless solutions such as WiMax are cost-                 supporting the DVB-S2 standard using Adaptive
constrained to urban and close-in areas, thereby                Coding and Modulation (DVB-S2/ACM) in 2007. To
leaving those in rural and hard-to-reach areas without          date Hughes has shipped over 700,000 DVB-S2/
options for terrestrial broadband. This low-density             ACM-compliant terminals. Typically our service
market is where satellite technology is ideally suited to       provider clients who have implemented ACM for the
provide cost-effective broadband connectivity.                  forward channel realize approximately 50–60%
                                                                improvement on throughput of the forward channel.
Quality, performance and cost differentiate one
service provider from another. Hughes further                   Adaptive Inbound Selection (AIS) - Just as we are
differentiates itself by being both a service provider          able to dynamically change the forward link, it is
and broadband technology/ product developer, which              also possible to dynamically change the return
gives us the unique ability to rapidly bring new                channel link. Hughes introduced the AIS feature,
features and services to market enabled by new                  which includes dynamic coding, so that the return
system platforms and capabilities. As illustrated in            link is always optimized for the link conditions.
Figure 3, Hughes is focused on a two-pronged                    Typical implementations of AIS result in about 20%
development strategy The first part is to focus on the          improvement on the throughput of the return link.
reduction of the “total cost of ownership”, including
both one-time equipment costs and recurring or                  Header Compression - By compressing 40 bytes of
operational costs. The second part of this strategy is to       IP and TCP/UDP/RTP header data into 8–12 byte
focus on achieving higher performance to end users.             amounts, overall system efficiency is improved.
                                                                Particularly when the traffic is small, as is the case
While important, the cost of the equipment is only              with VoIP packets, this approach yields significant
one component to the “total cost of ownership” (TCO)            savings in bandwidth consumption and increases
in providing satellite broadband services; other                overall IP system throughput.
important factors include transmission and opera-
tional costs. Hughes has brought to market key                  Payload Compression - Hughes has integrated
developments to address each of these cost elements.            packet payload compression into our TCP spoofing


                                                                                                                                               JULY 2009      5
                                 Figure 4. HughesNet Internet Service Plans


                                      software, particularly with Web traffic where much          platform that provides the required quality and
                                      data is highly compressible. The “YK” algorithm used        performance for broadband services in rural and
                                      by Hughes provides almost double the compress-              underserved areas. Figure 4 illustrates the HughesNet
                                   Vega
                                      ibility   over other algorithms evaluated including the     service offerings available to consumer and SME
                                      “GZip” algorithm. As a result, 12:1 compression for         subscribers in North America; these kinds of services
                                      compressible payload data can be achieved, result-          can be offered by any operator in the world using
                                      ing in both faster performance and lower trans-             the Hughes platforms.
                                      mission cost.
                                                                                                  Using VSAT for Mobility Services
                                      TurboPage - Hughes has designed algorithms to               Internet users expect high quality, affordable broad-
                                      prefetch HTTP objects and cache them in remote              band services at their homes        and not surprisingly
                                      routers in advance of the user’s browser requesting         anticipate the same when they travel          whether by
                                      these objects       a key differentiator. This technology   land, ocean, and even by air. While mobile satellite
                                      allows the user to experience extremely fast “paint”        services at lower satellite frequencies (L-band in
                                      times for Web downloads, while significantly reducing       particular) have been available for some time, these
                                      the amount of traffic over the return channel,              services are typically limited to throughputs below
                                      because the object “gets” are not transmitted.              500 kbps and can be costly. Satellite broadband using
                                                                                                  higher frequency services such as Ku-band offers the
                                      Return Channel Efficiency - Beyond spectral effi-           promise of affordable, mobile broadband services, but
                                      ciency (bits/hertz) and the ability to compress and         the very nature of these higher frequency services
                                      optimize IP traffic, a key element of throughput on the     presents a significant challenge.
                                      return channel is the efficiency of the return channel.
                                      Using a variable burst length architecture along with a     Some of these challenges and how the technology
                                      number of other technology innovations, the Hughes          solutions were implemented on the advanced
                                      approach results in a return channel having effi-           Hughes HX platform are summarized as follows;
                                      ciencies up to 89%, meaning less return channel
                                      capacity is required to support more terminals.                 Changing Transmission Path - The primary challenge is
                                                                                                      in the satellite broadband system’s ability to dynami-
                                 These and numerous other developments have                           cally adapt to changing link conditions as the terminal
                                 helped Hughes successfully deliver a cost-effective                  moves, maintaining high availability while not wasting


6   APSCC Quarterly Newsletter
    satellite capacity. Use of DVB-S2/ACM enables               as voice or videoconferencing, there was a clear
    continuous adjustment of the forward channel to             market need for single-hop connectivity. In response,
    compensate for movement of the remote terminal.             Hughes recently introduced mesh capability within
    Hughes uses similar technology to dynamically vary          the HX System.
    the link on the return channel as well.
                                                                As illustrated in Figure 5, an important innovation
    Frequent Blockage - The challenge is to quickly             was to implement the HX hub TDMA demodulator
    recover links after obstructions block them; e.g.           technology in the HX260 mesh satellite router. By
    tunnels, trees, or part of a ship/plane. The HX System      doing this essentially enables these remotes to
    maintains a “persistent IP session” during brief periods    operate as “mini hubs.” Employing an integrated
    of link outages so that the end user’s IP session is not    multichannel TDMA demodulator means any HX260
    lost while the satellite link is absent. For the terminal   can communicate via a single satellite hop to one or
    itself, Hughes has implemented an advanced                  more other HX260’s in a defined group.
    “flywheel” mechanism so that recovery of the channel
    is immediate once the obstruction is cleared.               Furthering the “minihub” analogy, the HX mesh
                                                                system can also deploy “star in star” topologies, for
    Doppler Compensation - Another challenge for                easy setup of one or more small (star) private net-
    services to mobile vehicles is Doppler compensation.        works. Applications needing this kind of connectivity
    Transmission equipment must account for instan-             include cellular backhaul where a BSC needs to
    taneous change in movements (e.g., a truck taking a         connect single hop to a small number of BTS
    sharp turn), and enhancements to Hughes demodu-             stations (as illustrated in Figure 6).
    lators compensate for the frequency shifts of these
                                                                                                                                   Figure 5. HX Mesh Architecture
    high-speed movements.


Recent Hughes Product Introductions
Beyond high-speed Internet access, connectivity
requirements for SCPC replacement and cellular/
WiMax trunking place additional demands on
product designs. These applications require the ability
to transport a large number of packets per second
and to support low jitter, constant bit rate bandwidth
links using dynamic bandwidth assignment. In
response, Hughes recently introduced its latest
                                                                                                                 Figure 6. HX Mesh Enabling “Star in Star” Topology
generation HX200 broadband satellite router.


Taking advantage of higher processing power and
significant enhancements to TCP spoofing software,
the HX200 satellite router supports nearly double
the throughput performance of the HX100 unit,
thereby enabling a more cost-effective solution for
high-capacity links.


When supporting latency-sensitive applications such


                                                                                                                                                      JULY 2009       7
                                         When satellite capacity is limited, it is not uncommon                routing, phased array antenna and spot beams, the
                                         for the available capacity to be in small portions (a                 Hughes Ka-band SPACEWAY® 3 satellite system
                                         few MHz), split over multiple transponders and even                   launched into commercial service in April 2008 truly
                                         multiple satellites. As a result, customers have asked                represents a generational step forward from
                                         for hub systems that can support multi-transponder                    conventional Ku band, bent-pipe satellite technology.
                                         and multi-satellite operations. In response, the latest               Not only do the high performance SPACEWAY
                                         generation of Hughes HX Gateway stations (hub                         broadband routers operate with dynamic power
                                         system) are prewired so that expansion of additional                  control, but these systems have the capability to
                                         forward channels is achieved simply through the                       demodulate and process a 440 Mbps downlink from
                                         addition of an outroute expansion kit. Figure 7 shows                 the satellite. They are some of the first in the industry
                                         the latest generation of HX GW supporting multi-                      to incorporate an advanced chip set technology
                                         satellite expansion.                                                  especially designed for these high data rates.


                                         Hughes also recently introduced the “Configurable                     As SPACEWAY 3 has leapt forward, it is clear that
    Figure 7.
    HX GW with Multi-Satellite Support   Demodulator Subsystem” or CDS, recognizing that                       “next generation” satellites will have tenfold or more
                                         fewer demodulators at a hub are important elements                    capacity increases, up to 100Gbps and more, due to
                                         in reducing service delivery cost. As illustrated in Figure           extensive frequency reuse from many small spot
                                         8, the CDS is contained within a one-rack unit chassis                beams. In addition, these systems will likely utilize
                                         and is capable of simultaneously demodulating up to                   much higher forward and return channel data rates.
                                         nine channels over 36 MHz of spectrum. These chan-                    Further, it is clear that the bandwidth consumption
                                         nels can be a combination of different symbol rates,                  per user is on an inexorable increase, driven by an
                                         and each channel supports adaptive coding for indi-                   appetite for more content, such as peer to peer
                                         vidual TDMA bursts. The result is a lower investment                  applications and rich media downloads. This means
                                         cost for an operator while simultaneously achieving                   that the ground systems of tomorrow need to support
                                         higher operational efficiency because of the ability to               significantly wider channels, and with significant
                                         use different symbol rates and adaptive coding.                       channel throughput increases to provide end users
                                                                                                               with the broadband performance they expect.


                                                                                                               It means that all of us in this dynamic industry will
                                         Figure 8. Multichannel Demodulator                                    continue to confront the challenges and experience
                                                                                                               the joy in pushing the technology and business enve-
                                         Looking Forward                                                       lope of satellite systems and services globally, bring-
                                         With an extensive array of new technologies, includ-                  ing the many benefits of broadband to consumers,
                                         ing 10Gbps throughput, on-board switching and                         businesses and governments around the world.<



                                            Dave Rehbehn          is the Senior Director responsible for global marketing of Hughes broadband products and services. In this
                                            capacity Rehbehn develops Hughes market strategy, including product and service offerings, and is responsible for the strategic
                                            direction for the Hughes International sales force. Rehbehn has more than 20 years experience in the satellite arena including
                                            business development for the Hughes set-top box product family as well as the HughesNet™ Consumer internet service
                                            business. Before his current role in the International Division, Rehbehn was responsible for HughesNet corporate sales for the
                                            Southeast United States and worked closely with many of the US based Fortune 1000 companies to develop network solutions
                                            tailored to their needs.




8   APSCC Quarterly Newsletter
                                   COVER STORY




                                  Celebrating 25 Years in
                                  Satellite Communications
                                  Jim Chadburn, Director, Systems Engineering & Business Development, AAE




                                  Evolution of Satellite Ground                           initiated a complete change in the handling of
                                  Segment Business in the last 25 Years                   communications. The combination of demand for
                                  Since AAE Systems, Inc. (AAE) first started in 1984,    Internet services coupled with the need to provide
                                  the satellite ground segment business has shifted       service at a lower cost provided the impetus for a
                                  tremendously. Two major developments have been          shift in demand. A much larger scale demand was
                                  the most influential in eliciting this change: The      present for bandwidth efficient networks than had
                                  expansion of fiber optic technology as the primary      ever been seen before.
                                  telecommunications carrier medium, and the intro-
                                  duction of Internet service and the worldwide web       Simultaneously, demand structure across the
                                  (WWW).                                                  industry changed. As demand for Internet service
                                                                                          over satellite grew, preferences for traditional,
                                  As terrestrial carriers expanded the deployment of      dedicated point-to-point connection based service
                                  fiber optic technology, the role of satellite in        diminished, while transactional multipoint connec-
                                  telecommunications began to diminish. Although this     tionless service became more popular. These shifts in
                                  change led many experts to predict the end of the       preferences impacted both the space and ground
                                  satellite communications era, instead, the satellite    portions of the market. Higher power satellites were
                                  communications market adapted. A transitional period    launched to enable broader service networks of
                                  began as the industry began to focus on formerly        small ground terminals.
                                  underserved markets. Some major teleports began
                                  offering services such as video for newsgathering and   The Internet era changed the communications
                                  for enterprise communications. These newly tapped       industry forever. A new technology field evolved,
                                  markets were best serviced by Very Small Aperture       Information Technology (IT), and new interface
                                  Terminal (VSAT) technology, and its use began to        standards and communications routing protocols
                                  dominate the industry. As VSAT gained in popularity,    emerged (Ethernet, Internet Protocol, TCP/IP, to
                                  the cost and size of ground segment equipment           name a few). Consumers in the ground segment
                                  started moving downward, and demand increased.          market demanded managed, bandwidth efficient
                                                                                          networks that were able to serve a large number of
                                  The second major development, and by far the most       subscribers cost effectively. New system archi-
                                  dramatic, was the introduction of Internet service      tectures entered the market, including DVB-RCS, as
                                  on a global scale. Not only did it generate the         a standard, and several proprietary managed
                                  greatest demand for satellite ever seen, it also        systems. The goal of these new systems was to


10   APSCC Quarterly Newsletter
“As AAE celebrates its 25th anniversary, it is taking proactive steps for
response to the ever-changing needs of the satellite ground segment
market. Building upon its IP carrier based Eclipse MF-TDMA
products; it offers efficient, comprehensive, rapidly deployed
terminals providing Star, Mesh and hybrid services.”




                                                                                               AAE Systems Lightweight Mobile Communication Trailer (LMCT)


manage transactional communications efficiently         a combination of manufacturer and systems
using the same carriers that had served many            provider. The demand in the early years was for
ground users with contention-based services.            larger point-to-point earth stations serving voice
Increased demand for satellite services significantly   telephony. As the need to support both voice and
increased competition in the industry, reducing the     data evolved, AAE transitioned to more integrated
price of ground segment component products such         satellite terminals that combined both voice and
as VSAT antennas, RF products, and modem products.      data within the same carrier, through the intro-
                                                        duction of multiplexers. With the core of its experi-
Developments within AAE                                 ence in designing, integrating and deploying cus-
Over the past twenty-five years, AAE has transi-        tomized communications networks that employ a
tioned from a primarily systems solution provider to    variety of communications disciplines, platforms


                                                                                                                                            JULY 2009        11
                                  and interfaces, AAE stayed at the forefront of           ability to deliver the complete package, including
                                  ground segment technology.                               specialized VSAT platforms and interoperable
                                                                                           solutions that unify a variety of communications
                                  In the 1990s, foreseeing the need for an efficient       elements into a cohesive network.
                                  managed network with the flexibility to serve both
                                  Mesh and Star connectivity, AAE introduced the           Where AAE products have been
                                  Eclipse MF-TDMA DAMA product line. Eclipse               deployed
                                  provides a dynamic, flexible core building block that    AAE products and systems are currently deployed
                                  efficiently merges IP and satellite communications.      around the globe. With systems in the Middle East,
                                  Predominantly software configured, Eclipse may be        Africa, Russia, West Asia, and the Far East, AAE has
                                  quickly adapted to future changes without a              established a global presence. AAE is headquartered
                                  lengthy redesign effort. These changes may also be       in Sunnyvale, CA, USA, in the Silicon Valley.
                                  downloaded over the satellite to operating systems,      Additional offices in India and Saudi Arabia offer
                                  further future proofing the product. With the flexi-     around the clock customer service.
                                  bility to operate in various configurations, on both
                                  fixed and mobile platforms, the Eclipse product          Developments in the Satellite Ground
                                  significantly expands the satellite communications       Segment Market
                                  solutions business area for AAE.                         The ground segment market is continuing its
                                                                                           transition to EoIP (Everything over IP), making the
                                  Over the years, AAE has built a highly developed skill   satellite interface transparent to the terrestrial
                                  set that enables it to create cost-effective and         network. This development is good for the industry
                                  technically advanced VSAT satellite solutions.           and the markets AAE serves. Most potential
                                  Through its MF-TDMA DAMA product line, Eclipse, it       customers are IP network savvy and have IT staff to
                                  supports Mesh, Star, and Hybrid topologies in fixed,     manage their networks; specialized training for
                                  mobile, and portable applications. An Eclipse-based      satellite equipment interfacing is phasing out.
                                  solution is an end-to-end solution for data, voice,      Satellite modem and network manufacturers track
                                  and video communications that allows seamless            developments in Internet technology closely to
                                  management of mission-critical communications            ensure the satellite modem equipment is keeping
                                  with superior reliability, performance, usability,       pace. Additionally, modems now are much more
                                  security, and a future-oriented design.                  adaptable than in the past through the use of
                                                                                           programmable logic, modems become software
                                  Products and Services                                    changeable without a major hardware change. By
                                  AAE has long been a full service communications          incorporating many of the baseband and router
                                  solutions provider. The versatility of the Eclipse       functions in software, the modems have a longer
                                  MF-TDMA satellite router lends itself to applications    lifespan and are able to quickly adapt to the rapidly
                                  in many markets and provides a great value to            changing Internet environment.
                                  customers. As a systems solutions provider, AAE
                                  incorporates its TDMA DAMA products in a variety         The tools used by IT technicians in configuring,
                                  of commercial and official enterprise applications.      managing, and testing data networks are directly
                                  The Eclipse MF-TDMA satellite router is a basic          applicable to IP based satellite communications. This
                                  building block for a broad spectrum of applications      simplifies the implementation of satellite ground
                                  and services within its business portfolio. Key to       equipment within customer networks, replacing the
                                  AAE’s success in providing system solutions is its       cumbersome protocol conversions needed in the past.


12   APSCC Quarterly Newsletter
Managed networks that provide shared, on-demand
communications have all but replaced the point-
to-point connectivity of the early days of satellite
services. MF-TDMA applications permit multiple user
VSATs to share a common pool of carriers; thus, it is
more efficient using satellite bandwidth. Incor-
porating service prioritization techniques defined
for the Internet, modern-day satellite networks are
able to assure that critical communications receives
bandwidth priority over less critical communications.


Strategies for the Market of the Future
The future of the ground segment market involves
strategies in equipment development and addresses
two major areas: greater bandwidth efficiency in
managed networks and mobility of communications.                                                          Lightweight Mobile Communication Trailer (LMCT) Rear

Driven by developments in Internet communications,
the satellite ground segment market must continue to
closely follow and blend with the Internet as it evolves.


In this new era, the most serious limitation to satel-
lite based communications service is bandwidth.
Systems must be able to maximize use of small
amounts of bandwidth. Making the most efficient
use of limited bandwidth is the model for present
and future satellite systems. Where the terrestrial
portion of the Internet has an abundance of band-
width, economical satellite communications requires
stringent bandwidth efficiency. The satellite modem
must transition to a combined modem and router,
incorporating increased router functionality within
the unit. Bandwidth economy features such as                                                            Lightweight Mobile Communication Trailer (LMCT) Stowed
web-caching, header and payload compression, TCP
acceleration, and a variety of networking protocols         ing and tracking technology. Both phased array and
are being incorporated in satellite network ground          very small sub-meter mechanically positioned
segment elements.                                           antennas are becoming available. However, these
                                                            very small antennas present additional challenges
The second major area of change is in regards to            for the modem market. With an effective aperture
communications mobility. Demand already exists for          ranging from 0.2 to 0.4 meters, these antennas have
mobile, on-the-go satellite communications,                 a broader beamwidth than is permitted under the 2°
particularly in the areas of military and emergency         satellite spacing guidelines. Thus, to effectively use
response applications. Mobile on-the-go antennas            these antennas without consuming excessive
are becoming more prolific with advances in steer-          satellite power or causing adjacent satellite inter-


                                                                                                                                                JULY 2009        13
                                  ference, the communications modems must incor- porate spectrum
                                  spreading modulation. This involves spreading the carrier across a
                                  broader bandwidth thereby reducing its effective power density to an
                                  acceptable level. This is much less efficient than higher order
                                  modulation methods, but necessary to support the demand for
                                  mobile on-the-go communications.


                                  Reachback and service extension connectivity are still ideal applications
                                  for satellite communications in the near term. The capability to
                                  establish connectivity immediately, where terrestrial infrastructure is
                                  inadequate or unavailable, is a continuing strength of satellite
                                  communications. The public demand for personal communications is
                                  growing by leaps and bounds. It is one thing to provide localized
                                  cellular connectivity, but quite another to extend it beyond the reach
                                  of the terrestrial links. Satellite will provide a widening role in cellular
                                  backhaul, particularly as more bandwidth compression and efficiency
                                  technologies evolve to address this application.


                                  AAE Today
                                  As AAE celebrates its 25th anniversary, it is taking proactive steps for
                                  response to the ever- changing needs of the satellite ground segment
                                  market. Building upon its IP carrier based Eclipse MF-TDMA products;
                                  it offers efficient, comprehensive, rapidly deployed terminals
                                  providing Star, Mesh and hybrid services.


                                  AAE introduced its latest addition to its product portfolio, the
                                  Lightweight Mobile Communication Trailer (LMCT). It is a rapidly
                                  deployable stand-alone VSAT in a trailerized package featuring a
                                  one-button auto-acquisition antenna, independent power source,
                                  environmentally housed equipment, enabling full voice/data/fax/video
                                  conferencing; interoperability with a variety of HF/VHF/UHF auxiliary
                                  and emergency response radio systems; and wireless extended reach
                                  via WiMax. The LMCT incorporates EoIP technology and may be
                                  customized to meet numerous applications.<



                                    Jim Chadburn ,          Director of Systems Engineering and Business
                                    Development at AAE Systems, Inc., has been with AAE for more than a decade.
                                    He also has 21 years of U.S. Armed Forces experience in the communications
                                    technology field. His professional experience also includes positions held as a
                                    Senior Design Engineer for Raytheon and Senior Satellite System Engineer for
                                    MCI Standard A Teleports. Jim holds a Bachelors of Science in Information
                                    Systems from the University of Maryland.




14   APSCC Quarterly Newsletter
                                                     COVER STORY




                                                    Leveraging Space to Bring
                                                    the Other 3 Billion on-line
                                                    John Finney, EVP Global Sales, O3b Networks, Ltd.




                                                    Introduction                                           Yet, the challenge remains connecting emerging
                                                    Today, over half of the world’s population lacks       markets with the greater, global society. Here the
                                                    connectivity to the Internet. While on the surface,    use of space technology holds phenomenal promise
                                                    this may appear to be luxury, the reality is that         the ability to cover vast swaths of geography, to
                                                    today’s Internet has become a key infrastructure       quickly and easily connect populations, and to offer
                                                    requirement of any economy. Not only does the          equal access to all.
                                                    world wide web allow for basic communication
                                                    services it also has become a web of tools and         In order to successfully leverage space in connecting
                                                    applications for fostering commerce, education, and    the other 3 billion to the Internet, the solution must
                                                    medical services.                                      meet a minimum set of requirements for: Quality,
                                                                                                           Reliability, Usability, and Affordability.
                                                    With web 2.0 and cloud computing applications,
                                                    today’s entrepreneurs, educators, and physicians       Quality
                                                    have access to applications and services that had      As low latency space solutions become available,
                                                    traditionally been in the domain of only the largest   Carriers and Telecom Regulators must pay careful
                                                    organizations       providing key tools of commerce,   attention to ensure the quality of both their primary
                                                    access to vast stores of knowledge, and the latest     and resilient long haul traffic paths to the major
                                                    information on disease control and prevention.         Internet exchange points. Due to a lack of choice,
                                                                                                           Internet users have accepted the performance
     Load Time for wsj.com with various latencies
                                                                                                           degradation caused by high latency backhaul.
                        50                                                                                 However, with lower latency (and lower cost)
                        45                                                                                 solutions available in the next few years, Internet
                        40
         Load Seconds




                        35                                                                                 users will demand low latency internet access which
                        30                                                                                 can function with the newer web 2.0 and cloud
                        25
                                                                                                           computing applications.
                        20
                                                                                       load seconds
                        15
                        10                                                                                 Broadband and web traffic have different require-
                         5
                                                                                                           ments than voice, but just as stringent. Newer web
                         0
                             52   102 152 202 252 302 352 452 552 652 752                                  2.0 protocols are becoming more interactive with

                                                Latency(ms) - (1000ms = 1 sec)
                                                                                                           the server, and “Cloud” computing will make the full
                                                                                                           transition to applications running fully over the


16    APSCC Quarterly Newsletter
web. In some cases these applications will not func-
tion over high latency networks, in other cases they
will just run very slowly due to the continuous back
and forth stream of server calls necessary for the
applications to function. In web 2.0 load testing, a
single page of the Wall Street Journal took over 37
seconds to load when a simulator introduced the
600ms round trip travel (RTT) latency.


MEO Satellites will offer a lower latency solution
because they are closer to the earth. The physical
                                                                                                                Figure 1. Areas which were (or would be) effected by a Suez cable cut
distance between the VSAT and the satellite is 4.3x
shorter. Because each packet in IP requires 4 trips                        A prime example, and relevant to the East Coast of
(up-down then a return acknolwedgement) and                                Africa, is the Middle East which relies on four cables
newer web sites have hundreds of round trip trans-                         that transit the Suez canal. In 2008, those cables
fers per page, the MEO reduction in path length has                        suffered numerous cuts, with a combined avail-
a significant effect on end-user experience.                               ability of 95.2% (Figure 1). According the Telegeog-
                                                                           raphy, these cuts affected at least 60 million users
                                 36,000 km
                                                                           in India, 12 million users in Pakistan, 6 million users
   Earth                                                       GEO         in Egypt, and 4.7 million users in Saudi Arabia.*
                8,000 km
                            MEO


                                                                           Susceptibility to downtime will be an important
MEO satellites will offer a low latency solution with                      factor in locating important enterprise communica-
equivalent characteristics to long haul fiber at the bit                   tions for data centers and call centers. As reliance
level. For instance, the RTT latency to major internet                     on internet applications grow both Enterprise and
exchanges over MEO satellites will be approximately                        Government will demand the required security of a
125ms. One way voice latency will take only 62ms                           geographically diverse routing path.
allowing for normal speech patterns with no per-
ceivable delay.                                                            MEO satellites will enable a geographically diverse
                                                                           path to interconnect nations with each other and
Reliability                                                                the global Internet. For nations on a single string or
Nations reliant on either a single fiber cable or a                        single path of fiber, MEO satellites can offer an
single geographic path for those cables are                                affordable resiliency solution of identical quality
vulnerable to fiber cuts. Undersea fiber cuts are                          and speed.
caused by many reasons, including ship anchors
dragging in a storm, fisherman, tectonic plate shifts                      At the constellation level, using a redundant array
or even animals. Terrestrial fiber cuts happen for                         of independent satellites, where even the loss of a
many other reasons including accidental digging in                         satellite will have little effect on system integrity. At
the wrong place, theft, or power failures. Historically                    the satellite level, each satellite has internal
undersea cables have taken two weeks or more to                            redundancy to protect against component failure.
repair.                                                                    For example, for further security, at the network


* Khaleej Times Online, Cable damage hit 1.7m Internet users in UAE, 5 Feb 2008



                                                                                                                                                                      JULY 2009         17
                                  level, MEO networks can connect Africa to Europe         However the cost and quality issues have limited
                                  through three diverse and independent gateways to        GEO Satellite cellular backhaul to the relatively low
                                  the major European exchange points.                      bandwidth requirements of voice and for use only in
                                                                                           remote areas.
                                  Usability
                                  Carriers and Regulators must recognize the need for      Carriers in particular are considering the implica-
                                  bringing high quality and affordable broadband           tions of lower cost IP Backhaul at their core net-
                                  beyond the city limits. The social importance of         work. With the introduction of undersea fiber and IP
                                  connecting schools, health centers, civic institutions   trunking solutions, Carriers will have unprecedented
                                  and business creates one drive, while the economic       price and quality at their main switch. However, the
                                  benefits of broader coverage create another.             customers need the capacity at the edge of the
                                                                                           network, perhaps at each of thousands of cellular
                                  Cellular networks with both voice and 3G/WiMAX           towers. The in-country distribution of this low cost
                                  capability will play a major role in bridging the        access is both challenging and expensive.
                                  digital divide. GEO satellite cellular backhaul has
                                  been very effective in voice enabling remote sites.      MEO satellites can play an important role in over-
                                                                                           coming the major challenges to broadband expan-
                                                                                           sion. In many applications, the low cost and high
                                                                                           bandwidth capabilities of MEO satellites will enable
                                                                                           3G/WiMAX applications to be deployed equally
                                                                                           across the network.


                                                                                           MEO satellites, when used with VSAT systems can
                                                                                           connect hundreds of towers back to the core net-
                                                                                           work. Some Carriers are looking for a 3G overlay of
                                                                                           an existing voice system, while others will utilize MEO
                                                                                           solutions for a Greenfield expansion of 3G/ WiMAX
                                                                                           and voice capacity into new markets. In some cases
                                                                                           Carriers will rely on their current mature MSC/Billing
                                                                                           System/Core Network and expand into new license
                                                                                           opportunities with the simple addition of new towers.


                                                                                           Carriers continue to find new ways to use the high
                                                                                           bandwidth and low latency to expand their net-
                                                                                           works. For example, Carriers will continue to use
                                                                                           microwave for the very local transport, while
                                                                                           bridging back to the core network via MEO satellite.


                                                                                           The cost structure of MEO satellite Cellular Backhaul
                                                                                           bandwidth is low enough to create new opportuni-
                                                                                           ties for innovative and forward thinking Carriers.
                                                                                           With the introduction of 3G/WiMAX Access Net-
                                                                                           works, higher capacity demands are placed on the


18   APSCC Quarterly Newsletter
                                  transmission networks. MEO satellite operators, with     Second, is reliability, make sure there are geographi-
                                  their partner VSAT providers, are designing less         cally redundant connections to the global infra-
                                  complex transmission networks through a drop-in          structure. To be a viable backoffice, outsouring, or
                                  VSAT solution with clear advantages to terrestrial       active participant in the digital economy, countries
                                  alternatives.                                            must be continually connected.


                                  Affordability                                            Third, the networks must be ubiquitious within your
                                  The final requirement in bringing the other 3 billion    borders. Pushing the Internet far and wide will stim-
                                  onto the net, is affordability. For all economies to     ulate economic development in ways unimagined
                                  benefit from the global internet, the cost of con-       because we underestimate the entrepenuerial spirit
                                  necting to it must be reasonable. Today, most            that resides in all corners of our communities.
                                  emerging markets pay 100-200 times the cost to
                                  connect to the global internet when compared to          Lastly, the services must be affordable. Without
                                  developed countries. Previously, with few available      pricing that’s appropriate for each market, adoption
                                  options, operators were forced to pay exceeding          and ultimately economic growth will be hampered.
                                  high prices for connectivity and purchase far less
                                  capacity then they needed because of high price          This is a very exciting time for those of us in the the
                                  elasticity for bandwidth in their home countries.        satellite communication market. Technology has
                                                                                           evolved to allow us to cost effectively bring the
                                  So, for mass adoption in rural areas and in emerging     other 3 billion into the global, digital economy. Our
                                  markets, the cost of connectivity needs to be afford-    ability to replicate the economic benefits seen in
                                  able and scalable. As emerging economies realize         developed countries into rural and emerging mar-
                                  the benefits of broad access to the internet and         kets is understood and very real. But the ultimate
                                  GDP’s rise, then ability to pay for higher prices will   success will depend on all parties working together,
                                  become more apparent.                                    responsibly.


                                  With high cost sensitivity in the market, the advan-     Regulators, Carriers, and Vendors, together we can
                                  tages of a bent-pipe architecture become apparent.       create a global ecomonic pie that is far larger then
                                  By “dumbing” down the space vehicle, it will be          anyone believed is possible, but it will require cre-
                                  possible to provide raw bandwidth more affordably.       ativity, courage, and an entrepenuerial spirit.<
                                  As demand grows, additional capacity can be added
                                  on the ground segements of the network.


                                  Conclusion
                                  As Carriers and Regulators plan the future and the
                                  role their economies will have in the global, Internet
                                  economy, there are few key things to keep in mind.


                                  First, ensure minimum quality standards for the
                                  network. Latency and Oversubscription are two
                                  crucial elements to keep in mind.




20   APSCC Quarterly Newsletter
                                   INTERVIEW




                                  Interview with John B. Higginbotham
                                  Chief Executive Officer, Integral Systems, Inc.




                                  >> Tell us a bit about Integral Systems’ business model and capabilities.

                                                                                  Integral Systems is committed to delivering integrated solutions
                                                                                  for command and control, radio-frequency, and network
                                                                                  management needs that blend the efficiency and reliability of
                                                                                  commercially available hardware and software enhanced with
                                                                                  advanced system engineering capabilities.


                                                                                  Our enhanced COTS products are architecture and bus agnostic
                                                                                  and are updated and upgraded as technology evolves. We
                                                                                  release commercial upgrades to our software several times each
                                                                                  year. We employ our strong systems engineering skills to
                                  ensure our products are tailored to provide a best-value solution to achieve customers’ mission-specific goals.


                                  For 26 years, Integral Systems has set an exemplary standard of performance in providing solutions that meet
                                  critical customer requirements, on-schedule and within budget. This performance has allowed us to move
                                  forward and begin to address critical needs for delivering reliable capabilities beyond the space industry,
                                  extending to land, sea, and air applications.



                                  >> What is Integral Systems history in the Asia Pacific region?

                                  We have been providing satellite command and control systems in the region since 1994. Through our
                                  subsidiaries, SAT Corporation, Newpoint Technologies, and RT Logic, we have also provided satellite signal
                                  monitoring systems and equipment, signals processing, and network management systems since 1989.


                                  Integral Systems has systems deployed throughout Asia. We offer a range of solutions for our customers from
                                  product-specific solutions to complete turnkey solutions and provide customers with the solutions to meet
                                  their needs today and in the future.


                                  Our first system was provided in 1994 to ChinaSat for the ChinaSat-5 and ChinaSat-6 satellites. This


22   APSCC Quarterly Newsletter
successful relationship continues. In 2008, Integral Systems supported China’s broadcast of the Olympic
Games from Beijing. Chinese Central Television (CCTV) broadcast the games using China Direct Broadcast
Satellite Co. (China DBSAT) satellites. More than 92% of China’s population viewed the Olympics through
direct-to-home (DTH) channels. Through our wholly owned subsidiaries, Newpoint Technologies and SAT
Corporation, Integral Systems supports China DBSAT’s satellite network infrastructure, manage satellite
payloads, and detect carrier interference. Integral Systems also supports customers such as SingTel/Optus, SKY
Perfect JSAT, B-SAT, AsiaSat, NSPO of Taiwan, THAICOM, Mitsubishi Electric Corporation, and MEASAT.



>> What factors do you attribute your success in the Asia Pacific Region?

Integral Systems offers a complete set of commercial, product-based solutions to meet the needs of a wide
variety of customers    and we are constantly innovating. Through our family of companies, we provide the most
widely used satellite control software (EPOCH), industry-leading satellite RF processing and monitoring products
(RTLogic), and award-winning network management software (COMPASS). This year, we also acquired the satID
products and technology, which adds world class geolocation capabilities to our product and solution sets.


As our customers require, these products can be fielded as standalone elements or integrated with legacy systems.
However, a significant differentiator for Integral Systems is that by using our integration expertise, combined with
intimate product knowledge, we are able to offer customers a one-stop shop for turnkey solutions that satisfy
mission-critical needs. For a typical satellite communications operation, this spans customer design and
integration needs from RF/antenna systems all the way to complete network control solutions. We frequently
provide turn-key ground segment solutions for our customers providing single-supplier efficiencies. This is
particularly advantageous for our customers in the Asia Pacific region who often work with a global provider
in a separate time zone.


The single biggest factor contributing to business success in the Asia Pacific region is building valued, trusted
relationships with customers       not always a simple thing to do from half way around the world. Integral
Systems has successfully applied a multi-pronged approach to tackle the “long-distance relationship” issue.
We have invested in a network of local representatives throughout Asia and we have dedicated executive
management focused on our customer relationships in this region.



>> What do you expect for the future of your business in
the Asia Pacific region?

We believe that we offer a significant value proposition for our all of
customers. Our suite of products and complete solutions allow our
customers to optimize their operations by adding new satellites to their
fleet with little to no increase in staff. As customers work to maintain and
improve their quality of service, we can easily expand their core ground
segment capability with intelligent enhancements in signal interference,             Integral Systems demonstrates its Executive Dashboard System which provides
geolocation, frequency management, and network management.                           executive insight into satellite fleet operations and health




                                                                                                                                                       JULY 2009   23
                                  Integral Systems acquired the satID products and technology in February 2009,
                                  adding world class geolocation capabilities to their product and solution sets


                                  For example, satellite operators around the world use satID technology (acquired by Integral Systems in
                                  February 2009) to geolocate the source of satellite interferers, jammers, and unauthorized users to ensure
                                  quality of satellite service. We look forward to continuing to partner with our customers to provide
                                  value-driven solutions to optimize their quality of service and drive new levels of efficiency in their operations.



                                  >> Given your background as an entrepreneur in the space industry, where do you see
                                  the industry in the future?

                                  The space industry has gone through several stages of growth. The first wave of growth started in the
                                  mid-1940’s and lasted through the 1960’s. In this stage, civil and military government sponsorship was the
                                  main driver for the fundamental architecture of the industry. The 1970’s brought about the second stage of
                                  growth, during which the methods for using space in areas such as satellite telecommunications,
                                  geo-positioning (GPS), and remote sensing, were defined and deployed.


                                  I see that we are entering a third stage of growth. We are incorporating space-based and space-related
                                  applications into established economic sectors. As we move into the future, we will see the integration of
                                  mature commercial business models with the advanced capabilities of the industry delivering new levels of
                                  usability and efficiency for customers in virtually every developed economic sector.<




                                     John Higginbotham               is the Chief Executive Officer of Integral Systems, Inc., a global company providing integrated
                                     technology solutions for SATCOM-interfaced networks. Mr. Higginbotham is the founder and former managing general partner
                                     of SpaceVest Capital (now Redshift Ventures), an institutional venture capital organization for high technology companies. He
                                     also co-founded Intec, a globally recognized underwriting management leader for insurance and financial risk management
                                     services for aerospace companies, satellite communications operators, and national space programs. He started his career as
                                     with Hewlett Packard Company as product manager for their first microcomputers. He is the former Chairman, now Director
                                     Emeritus, of the Space Foundation, and is a member of a number of professional organizations including the IEEE, ASCE, and
                                     AIAA. Mr. Higginbotham was the recipient of the 2007 National Space Society Space Finance Award. He received his B.S. in civil
                                     engineering from Virginia Tech with Honors and his M.B.A. from Harvard Business School.




24   APSCC Quarterly Newsletter
Platinum Member




Gold Member




Affiliate Member




Regular Member (Governments)
                 APSCC MEMBERS
                          As of June 7, 2009




Regular Member
                                   NEW MEMBER              APSCC warmly welcomes a new Government Member




                                  ICTPA, Government of Mongolia




                                  In May 2009, the Information, Communications Technology and Post Authority (ICTPA) of the Government of
                                  Mongolia has joined APSCC as a Government Member.


                                  The Government of Mongolia pays a great attention to the development of the Information and
                                  Communications Technology (ICT) sector, which is one of the key drivers of human development and an
                                  accelerator for the economic and social development in the 21st century.


                                  Under the direct auspicious of the Prime Minister of Mongolia, the Information and Communications
                                  Technology Authority (ICTA) was established in 2004 and has been restructured into the Information,
                                  Communications Technology and Post Authority (ICT and Post Authority) which is responsible for ICT, Space
                                  technology and Post policies, planning and implementation issues on behalf of the Government of Mongolia
                                  with the organizational chart and structure as follows:


                                    Mr. SANSAR Jiimen, Chairman, ICT and Post Authority – Government of Mongolia
                                    Mr. BAT-ERDENE Jalavsuren, Vice Chairman
                                    Mr. BOLDMANDAL Khaltar, Director General, Public Administration and Cooperation
                                    Mr. AMGALANBAT Batsuren, Director General, Policy and Planning
                                    Mr. MUNKHBAT Ayush, Director General, Policy Implementation and Regulatory
                                    Mr. ODGEREL Ulziikhutag, Director General, Statistics, Information and Monitoring


                                  As an international association representing all sectors of satellite/space related industries, APSCC has been
                                  working hard to promote communications and broadcasting via satellite as well as outer space activities in
                                  the Asia-Pacific for the socioeconomic and cultural welfare of the region. In this regards, APSCC has built
                                  close relations with governments in the region to provide a world-wide network linkage between the
                                  government and enterprises. Moving forward, the active cooperation between APSCC and ICTPA will provide
                                  various opportunities as well as profits to both APSCC members as well as the Mongolian satellite/outer space
                                  industries.<



                                    Contact
                                    Ganzul Tserendorj
                                    Officer, Foreign Relations / Public Administration and Cooperation Department
                                    Information, Communications Technology and Post Authority of Mongolia
                                    Central Post Office, P.O. B-785, Sq. Sukhbaatar-1, Ulaanbaatar-13, 15160 Mongolia
                                    Tel: +976 11 330970 Fax: +976 11 330780 Website: http://icta.gov.mn Email: ganzul@icta.gov.mn




28   APSCC Quarterly Newsletter
                                                        APSCC Membership

Why APSCC?
A voice, a vision for the Asia-Pacific
APSCC is a non-profit international association representing all sectors of satellite and/or space-related
industries, including private and public companies, government ministries and agencies, and academic and
research entities. From its establishment in 1994, APSCC has served the satellite and space community in a
myriad of capacities.


APSCC works to develop, expedite and broaden the distribution of new services via satellite in the Asia-Pacific
region. APSCC also assists in the formulation of recommendations on policies, regulations and technical
standards within the region and around the world. From its publications to its events, APSCC provides its
constituents with the support and tools they need to flourish in their respective fields.


Overall, APSCC’s most important function is to bring together the various entities in the community for
communication and cooperation, and APSCC achieves this objective through its membership. APSCC currently
has more than 110 members from over 32 countries world wide, and the membership list is growing larger at
all the time.



Join APSCC Now!
Get connected with the strongest satellite network
APSCC membership consists of Platinum, Gold, Regular, Affiliate, and Individual Members. Members are
chosen from among the most prominent people and organizations in several space- and satellite-related
fields, including manufacturers, launch service providers, satellite service providers, satellite risk management
companies, telecom carriers, broadcasters, and government organization from Asia, Europe, Australia and
North America. Together, the members comprise one of the most powerful global networks of its kind.


APSCC Membership is open to any government body, public and private organization, association, or
corporation that is involved in satellite services, broadcasting, manufacturing, launch services, risk
management or associate fields such as data-casting, informatics, multi-media, telecommunications, and
other outer space-related activities with interests in the Asia-Pacific region.


Networking Opportunity Representation Facilitation Promotion Information Events Publications




  Contact us at info@apscc.or.kr
  Be an APSCC Member and enjoy the benefits and privileges

  If you would like to find out more information on APSCC Membership, please contact:
  Chloe Song, Membership & External Relations
  Asia-Pacific Satellite Communications Council (APSCC)
  Tel: +82 31 783 6244      Fax: +82 31 783 6249      Website: www.apscc.or.kr
                                   SATELLITE TRENDS




                                  A Steady Market for
                                  Wireless Backhaul via Satellite in Asia
                                  Jose Del Rosario, Senior Analyst & Regional Director, Asia-Pacific, NSR




                                  Introduction                                            of the global mobile market is expected to surpass
                                  Asia boasts the highest population base as well as      50% from the current 42% level within the next
                                  the highest number of wireless users in the globe.      two years. Mobile penetration currently stands at
                                  The market is led mainly by the two giants, China       40% and average annual wireless growth over the
                                  and India. The International Telecommunications         last 5 years has been nearly 30%. Over time,
                                  Union (ITU) reported in October 2008 that China         wireless penetration levels for the Asia Pacific is
                                  and India combined account for more than 900            likely to follow historical growth levels given the
                                  million mobile phone subscribers, which is close to a   market acceptance and penetration of the cell
                                  quarter of the globe’s total users.                     phone.


                                  However, October 2008 was quite an inauspicious         How then can this growth be sustained and accom-
                                  month as the global economy took a major turn for       plished from a backhaul perspective? In a region
                                  the worse. What then were the effects on the Asia       which covers a large geographic footprint, satellite
                                  Pacific region in general and on wireless usage in      communications services, specifically for wireless
                                  particular? In January 2009, India gained a record      backhaul, will have to be part of the network imple-
                                  15.41 million new mobile subscribers, taking the        mentation in order to achieve and sustain historical
                                  country’s total number of wireless subs to 362.3        levels of wireless usage in the next few years and
                                  million. The figure is the highest monthly growth,      within the next decade.
                                  which indicates that the Indian mobile market con-
                                  tinues to thrive under severe economic conditions.      Rural Demographics in Asia
                                                                                          Asia’s large population is still growing. Should
                                  China likewise posted impressive gains. In January      population trends continue, the total rural
                                  2009, China Mobile added some 6.67 million new          population base in the region should grow from the
                                  mobile phone subscribers to reach 463.9 million         current 2.43 billion to 2.68 billion by the end of
                                  subs. China Unicom ended January with 134.2             2017. Urbanization in many key countries is on the
                                  million GSM subscribers, which were up by 839,000.      rise, but the rate of population growth is also
                                  China Telecom had 28.9 million mobile subscribers       tempering the population loss in rural areas, which
                                  by the end of January and added over 1 million new      should have a net rural population percentage
                                  subscribers for the month.                              decline of just 1% from 2007 to 2017. In absolute
                                                                                          numbers, this actually represents a net gain of 250
                                  The ITU projects that the Asia-Pacific region’s share   million rural dwellers over a 10-year period.


30   APSCC Quarterly Newsletter
 Source : NSR




                                                                                                                    Asia - Population Demographics


Apart from the large markets (India and China),          The Future Asian Play for Satellite
demand for wireless service by smaller countries like    Backhaul
the Philippines is growing as well. Filipinos send on    Middle, upper-middle and high-income subscribers
average a staggering 650 text messages per user per      currently account for the vast majority of wireless
month, which is the highest in the globe. The            subscribers in the region. Future growth for wireless
Philippines is nicknamed the ‘SMS capital of the         carriers will thus have to come from lower income
world’ and the country has more than 54 million cell     groups. Non-voice applications via mobile phones,
phone subscribers out of a population of some 97         in particular text messaging or SMS, are increasing
million, representing a penetration level of 56%. Not    rapidly and currently account for more than one
bad for a country with a GDP per capital level of just   quarter of mobile revenues for the region’s wireless
over $3,000.                                             carriers. In the future, the application suite for rural
                                                         usage of lower income groups will likely be in the
Rural implementations will be the next step in the       form of text messaging and SMS.
wireless industry's target market in the next decade.
Indeed, given the increased competitiveness of           This trend has been recognized and the lower-
metropolitan areas as well as the potential of rural     income segment is beginning to be tapped. In India,
markets, technology developments to address non-         Spice Mobile unveiled in early 2008, the $20 mobile
traditional market territories are becoming more         handset called the “people’s phone,” which has no
important for incumbent as well as new service           smart features, not even a screen and instead, inte-
providers that are looking to sustain historical         grated an audio program that announces the digits
subscriber and revenue growth.                           dialed by the user. The company believes it can sell 10
                                                         million through 2009 in a country where over half
And here, satellite backhaul due to coverage and         the population does not own a cell phone as of yet.
instant infrastructure advantages becomes highly
valuable in being part of the mobile ecosystem in        This vast market has gained interest from other
many of the globe's Greenfield and emerging              phone makers as well, including Nokia. The company
markets.                                                 is setting its sights on the Asian market where the


                                                                                                                                    JULY 2009        31
                                                 company is reportedly looking to capture the Indian        bode well for core wireless market players. These
                                                 rural market as a core strategy. The Indian govern-        developments likewise favor satellite players that
                                                 ment is targeting 500 million mobile subscribers by        develop satellite-based BTS solutions as well as
                                                 2010 in a country where penetration is as low as 2%        provide space segment assets via C-band and
                                                 in thousands of villages.                                  Ku-band transponders.


                                                 In the equipment side of the business, a $20 phone         Steady…Not Explosive Growth
                                                 for 500 million subscribers translates to $billions in     A note of caution is essential in examining market
                                                 revenues. In the service side, India may be the            opportunities in Asia for satellite-based backhaul
                                                 world’s fastest growing mobile market but the ARPU         solutions. The addressable market is certainly large
                                                 level is around US$7, which is one of the lowest in        and operators and equipment manufacturers are
                                                 the world. But gaining 500 million subscribers with        eager to tap the rural user.
                                                 a $7 ARPU likewise translates to $billions in overall
                                                 revenues.                                                  However, tapping rural markets despite high
                                                                                                            subscriber numbers needing satellite backhaul
                                                 The Asian market can certainly be considered a             services will not lead to high levels of transponder
                                                 potential goldmine for satellite backhaul services and     capacity given that the application suite will be text
                                                 equipment given the impetus to seriously tap               messaging and SMS. For one, this relatively narrow-
                                                 thousands of rural villages representing hundreds of       band traffic despite the volume of messages gener-
                                                 millions of wireless users. Growth is expected to be       ated per subscriber such as that of the Philippines
                                                 driven by demand from the largest and most populous        can support a large number of concurrent users per
                                                 countries that include China, India, Indonesia and         transponder.
                                                 Australia, while niche opportunities exist for countries
                                                 such as the Philippines, Cambodia and others.              More importantly, given the potentially lucrative
                                                                                                            prospects presented by many Asian rural markets,
                                                 Market signals are being dictated both by pure             terrestrial wireless solutions are likewise improving
                                                 market forces as well as government initiatives that       their technologies in order to tap into the market

     Asia - Transponder Demand for Cellular & Wireless Backhaul
      Source : NSR




32     APSCC Quarterly Newsletter
                 140                                                           50
      Millions




                                                                                              Upper-middle & high-
                                                                               45             income subscribers
                 120
                                                                               40
                                                                                              Low and lower-middle
                 100                                                           35             income subscribers

                                                                               30
                  80
                                                                                              Asia-Pacific penetration
                                                                               25
                  60
                                                                               20
                                                                                              Upper-middle & high-
                  40                                                           15             income economies
                                                                                              penetration
                                                                               10
                  20
                                                                               5              Low & lower-middle
 Source : ITU




                                                                                              income economies
                   0                                                           0              penetration
                       2000   2001   2002   2003   2004   2005   2006   2007

                                                                                             Fixed Broadband Internet Subscribers



potential. And here, satellite, which has been the                  messaging and SMS migrates to higher level appli-
last option compared to other terrestrial solutions                 cation suites such as downloading rich media such
due to cost considerations in urban areas, will likely              as video clips or going to FaceBook.
fall prey to terrestrial technology competition in
rural markets once rural opportunities begin to be                  Is this scenario possible given that the rural user can
fully realized.                                                     afford a $20 cell phone unit and only afford an
                                                                    ARPU level of $7? In Third world countries like the
In order to maintain its value proposition in rural                 Philippines, smart phones from urban users that are
markets, satellite offerings need to improve on cost                highly functional and support broadband applica-
parameters both in the CAPEX and OPEX categories.                   tions make their way to rural markets via the sec-
But if or when satellite solutions begin to be at par               ondary or second-hand market. The rate of phone
with their terrestrial counterparts, the advantages                 change in Metro-Manila is on average 18 months
of reach, ubiquity and instant infrastructure may                   before the middle-to-high income urban user
lead satellite platforms to become one of the first                 changes to the latest model. The 18-month or
options in enabling wireless backhaul services in the               24-month old phone unit that is still functional and
region over the long term. Nevertheless, the appli-                 easily repaired make their way to rural markets for
cation suite in rural areas that is narrowband by                   about $20 per unit and all that is required is a SIM
nature should lead to steady levels of growth and                   card that costs $2 to $5. The pre-paid model has
not robust levels.                                                  also worked quite well and as 2.5G and 3G tech-
                                                                    nologies make their way, the cost of bandwidth in
The Broadband Wildcard                                              rural markets becomes cheaper over time.
Steady growth for transponder capacity is drasti-
cally changed when usage patterns change as well.                   In the satellite backhaul market, Ericsson announced
Should traffic move from narrowband to broadband                    that it had deployed a rural, solar-powered site with
in rural areas, the equivalent transponder capacity                 satellite transmission for Cambodia’s Star-Cell to
requirements for backhaul purposes are multiplied                   expand its network coverage in remote areas. The
exponentially. An illustration could be that a rela-                company claims the satellite transmission feature
tively low income rural user who is running text                    provides affordable mobile-network coverage in


                                                                                                                                    JULY 2009   33
                                  remote areas where other transmission solutions are               overall result is that over time, the number of BTS
                                  unavailable. Star-Cell is using Ericsson's solution to            sites should increase and commensurably, the num-
                                  expand network coverage and introduce EDGE-                       ber of satellite transponders used to support BTS
                                  based applications to enable mobile health and                    sites and subscriber traffic should increase as well.
                                  educational services for rural communities.
                                                                                                    But key questions remain, including:
                                  The Ericsson implementation is based on current
                                  and next-generation technologies such as EDGE in                  Will mobile operators bet on broadband use in rural
                                  rural areas where in some cases, such as Cambodia,                markets or will they stick to text messaging and
                                  80 percent of the population lives. Moreover, the                 SMS? It would appear that operators and equipment
                                  application suites targeted in the Cambodian con-                 manufacturers are targeting narrowband applica-
                                  tract are not basic narrowband services such as text              tions for the moment.
                                  messaging or simple voice (though these services
                                  are included as inherent features of any wireless                 In light of this, will countries or governments then
                                  service) but for advanced mobile health and educa-                implement Digital Divide programs to enable
                                  tional services that aid the underserved and impov-               broadband usage in rural areas? The ITU argues that
                                  erished population base of the country. This means                broadband technologies can help overcome many of
                                  that bandwidth requirements per subscriber, per                   the basic development challenges faced by poor
                                  base station and for transponder assets should                    countries and broadband connectivity has acted as a
                                  increase due to bandwidth-hungry applications that                catalyst for development. But the ITU itself recog-
                                  EDGE and other advanced wireless platforms                        nizes that governments must formulate concrete
                                  present over the long term.                                       broadband policies and targets, while providing
                                                                                                    incentives for achieving them.
                                  For the rural base where electrification is also just
                                  beginning to take hold, solar-powered BTS sites are               Given government’s role and the current impetus of
                                  vital for bridging the communications and digital                 the market, NSR is of the opinion that rural broad-
                                  divide. It is NSR's view that should contracts similar            band usage will remain a wildcard such that wireless
                                  to Star-Cell that target broadband application suites             backhaul for satellite will remain a steady and not
                                  in rural areas using solar power BTS be replicated in             explosive market. But as history has shown, the
                                  many other countries of the region, the transponder               wireless market can change very quickly.<
                                  requirements will change dramatically.


                                  More importantly, apart from BTS sites, other form
                                  factors in the wireless ecosystem will have to be
                                  developed as well or urban smart phones make their
                                  way to rural markets via the secondary market. The




                                    Jose Del Rosario       covers the Asia Pacific region and is a senior member of the consulting team at NSR where he focuses
                                    his research on quantitative modeling, data verification, and market forecasting for the wireless industry and satellite
                                    communications sector. He conducts ongoing research with specialization in policy analysis, regional economic indicators,
                                    regulatory initiatives and end user demand trends.




34   APSCC Quarterly Newsletter
                                   SATELLITE TRENDS




                                  Financial Crisis
                                  Opportunities in Asia despite the Global Crunch

                                  Salim Abu Haniffa, Industry Analyst, Frost & Sullivan




                                  In 2008, transponder usage for most Asian operators      since its progress in penetrating key markets in
                                  remained rather solid despite the persistence of         China and India has been disappointing.
                                  overcapacity following similar market conditions of
                                  2006 and 2007. While the global economic crisis          Meanwhile Australia, Japan and South Korea now
                                  effect on Asia is being felt on some levels, the         broadcast an increasing number of programs in high
                                  current Pay-TV and HDTV, new television channels         definition on their DTH platforms. Video applications
                                  and communication infrastructure upgrades in the         are expected to account for some 60% of the total
                                  region may help it weather turmoil better than other     leased transponders in Asia by 2011. Last years
                                  regions. Space industries have grown as well with        launch manifest for Asian communications satellites
                                  China delivering satellites for Venezuela and Pakistan   also indicated the importance of DTH as the main
                                  and new applications are beginning to drive the          revenue driver among satellite operators with some
                                  demand for bandwidth as operators are beginning to       6 out of 25 satellites in the region being mostly
                                  expand their traditional offerings.                      configured for DTH delivery. While customers have
                                                                                           not grown as fast as new the capacity, uptake is
                                  Operators such as Singapore Telecommunications           expected to be a matter of time.
                                  (SingTel) recently launched three solutions for the
                                  maritime industry: SingTel AITrac asset tracking         However, in South Asia, Ku-band shortage has Antrix
                                  solution, Collaborative Networking remote mainte-        Corporation Limited, the commercial arm of the
                                  nance solution and iMonitor VSAT network manage-         Indian Space Research Organization (ISRO),
                                  ment solution. Having previously grappled with a         announcing Ku-band transponder leases on
                                  regional average transponder utilization rate of 35%     MEASAT-3 and with ProtoStar Ltd. to provision DTH
                                  in 2006, operators are finding creative ways to face
                                                                                            Source: www.measat.com/media_image2_1.html




                                  off downward pressures to cut transponder lease
                                  prices.


                                  Thailand's Thaicom is looking to return to profit this
                                  year with the double-digit growth in revenue from
                                  key satellite IPSTAR. It reported a 2008 net loss of
                                  713 million baht ($21 million). It is looking at ways
                                  to reduce interest expenses and is in no rush to
                                  launch new satellites in current economic conditions                                                   MEASAT-3a scheduled for launch in June 2009



36   APSCC Quarterly Newsletter
 Source: www.boeingmedia.com/imageView.cfm?id=15417&ResID=6




                                                                              Indostar II/Protostar II replacement for Indostar-I



platforms for the Indian market which is expected to          of others and possibly offer mass market pricing with
grow to enjoy a 4-6 per cent growth this year.                premium content.


2008 also saw the bankruptcy of Japanese mobile TV            Elsewhere China, India and Japan have been beefing
business, Mobile Broadcasting Corp. The highly                up their space programs. China had its first space
touted TU Media mobile TV service in Korea is also            walk in 2008 and both China and India are planning
struggling to reach profitability. The first ever mobile      to have land manned missions to the moon by
digital TV service by satellite was launched in Japan         around 2015. China’s Shenzhen Aerospace Spacesat
and Korea three years ago via an S-band satellite             Co. Ltd. is expected to develop four to five satellites
jointly owned by Japanese and Korean interests.               every year for global navigation, telecommunica-
While mobile TV may have been over hyped it is still          tions, remote sensing and space exploration. This
viewed as a serious future market where those that            could be similar to the 60’s Space Race between the
are not first to market could learn from the mistakes         US and the Soviet Union and could result in great


                                                                                                                                    JULY 2009   37
      China’s launch of its second geostationary                                                                                                           put in place such as ProtoStar Ltd.'s recent launch of




                                                                                                     Source: www.china-defense-mashup.com/?tag=satellite
     satellite for satellite navigation codenamed
                                       “COMPASS”                                                                                                           IndoStar II/ProtoStar II replacing Indonesia's
                                                                                                                                                           Indostar-I satellite which will serve Internet, data,
                                                                                                                                                           voice, video and multimedia services across Indonesia,
                                                                                                                                                           India, the Philippines and Taiwan. Lockheed Martin
                                                                                                                                                           was recently awarded a multi-million dollar contract
                                                                                                                                                           by SKY Perfect JSAT Corporation of Japan to build its
                                                                                                                                                           JCSAT-13 which is to be launched in 2013. However,
                                                                                                                                                           some companies such ABS, has begun looking to
                                                                                                                                                           leasing capacity from other satellite operators (until
                                                                                                                                                           the launch of its ABS-2) as their capacity on ABS-1
                                                                                                                                                           remains extremely tight.


                                                                                                                                                           As consumers have become technology “agnostic",
                                                                                                                                                           caring only for fast and reliable service, satellites
                                                                                                                                                           technology serves as a complementary service to
                                                                                                                                                           other media though hybrid networks that extend
                                                    technological advances in the region. The short term                                                   terrestrial limits. This has resulted in a shift from
                                                    impact could be minimal, but potentially huge in the                                                   growing current satellite services towards new
                                                    long term.                                                                                             applications.


                                                    Both enterprises and government agencies are                                                           Satellite enabled digital cinema is ripe for the Asia
                                                    going mobile and are increasingly turning to satel-                                                    Pacific region with an estimated 30,000 cinema
                                                    lite services reach remote workers and forces on oil                                                   screens. It is the largest untapped market for satel-
                                                    rigs, military installations and first responders.                                                     lite enabled digital cinema from the old optical to
                                                    Applications such as two-way video and large file                                                      high definition digital projection. Now for US$5,000
                                                    transfers are expected to drive a lot of new invest-                                                   per cinema, they can be enabled to receive live
                                                    ment interest over the next several years.                                                             content from anyplace in the world for either live,
                                                                                                                                                           delayed live, recorded live, archival, special interest
                                                    However government policy choices on rural areas                                                       and even 3D content. 3-D technology has been
                                                    access to Internet connectivity through satellite                                                      around for a long time and in 2008, 3-D broadcasts
                                                    may be collide with the lobbying efforts of terres-                                                    of concerts like Madonna and even the Rose Bowl
                                                    trial wireless players for technologies such as                                                        were made available. 3-D broadcasts are still in a
                                                    WiMAX, which is positioned as an enabler for bridg-                                                    very early stage of development.
                                                    ing the digital divide. Although hybrid implemen-
                                                    tations of WiMAX and satellite are taking place,                                                       However GDC and RealD have partnered to deliver
                                                    fiber’s reduced per Mbps pricing has satellite rele-                                                   3D cinema to territories such as China, Hong Kong,
                                                    gated for more remote geographical locations.                                                          Taiwan, Thailand, Indonesia, and Singapore. Other
                                                                                                                                                           developments include the development of home
                                                    Meanwhile Asia’s lower transponder utilization rates                                                   grown content such as the Rural Digital Screen
                                                    over the past 2-3 years were expected to move                                                          Network (RDSN) and Hoyts’ initiative in Australia
                                                    operators into alliances before deciding to launch                                                     and New Zealand. Meanwhile proof of concept for
                                                    new capacity. However more capacity is still being                                                     satellite enabled digital cinemas are being tested


38    APSCC Quarterly Newsletter
out in India and China. However Asia Pacific’s                          As 2009 moves on Asia’s fiercely competitive
demographics lends to different languages, regula-                      landscape is expected to continue with the emer-
tions, cultures, and geographies which must be                          gence of new domestic operators and the entrance
addressed to successfully implement any digital                         of regional operators. Despite the worldwide eco-
cinema project.                                                         nomic downturn, the satellite industry should be
                                                                        well positioned to ride out the crisis and emerge
Another application is digital signage. Consumers                       from it as strong as before or even more, as it has
have begun to expect to see video in waiting areas,                     done in other downturns. Staple satellite services
transportation, retail and this demand for appli-                       like broadcasting and telecoms should not suffer
cations that deliver this service are expected to                       very much from the crisis and there are many new
continue to grow throughout 2009. Retailers are                         applications in the pipeline with great potential.
also looking to attract customers to make purchases
while through in store targeted video advertising                       Despite mounting evidence that the global economy
messages. Harris Corporation published that it was                      could be in for a long-term slump, executives and
about to begin a pilot program with McDonald's in                       analysts see the satellite sector as mostly immune
May that will launch the fast-food chain's unique,                      except for funding. An estimated $ 1 trillion of
branded TV channel powered by Harris Digital                            funding and $15 trillion in lending capacity has
Signage(TM) solutions.                                                  supposedly been wiped out. FSS operators are
                                                                        expected to feel the crunch as they replace their
Following this, Video on Demand was mentioned by                        satellites even without expanding their offerings.
research firm Strategy Analytics through a study                        With such uncertainties, operators who are finan-
that consumers were looking at video on demand                          cially strong with low debt should be well posi-
services as the most valuable feature of broadcast                      tioned to capture market.<
services. Regional operators such as Astro began                                                                                   Qantas new Airbus A380

their on-demand services in 2007.
                                                                          Source: www.qantas.com.au/info/a380Downloads




In-flight Broadband Service too has begun to literally
take off with regional airlines installing the service.
After Connexion by Boeing in-flight satellite service
failure in 2006, companies have slowly begun
revisiting this service with Qantas offering it on their
Airbus A380s and retrofitted 747-400s. Malaysia
Airlines has become the first airline in Asia to allow
the use of mobile phones in-flight provided by
AeroMobile. Passengers will also be able to send and
receive text messages, as well as emails via GPRS. The
service uses Inmarsat's Swift64 satellite system.




  Salim Abu Haniffa           is an Industry Analyst with the Frost & Sullivan Asia Pacific Space and Communication Practice. He
  focuses on monitoring and analyzing emerging trends, technologies and market dynamics in the commercial fixed and mobile
  satellite services markets in Asia Pacific. Salim graduated with a BSc. IT from Charles Sturt University in Australia.




                                                                                                                                           JULY 2009        39
                                   SATELLITE TRENDS




                                  Satellite Insurance Markets
                                  Recession Proof?
                                  John Munro, Global Head, Marsh Space Project




                                  Over the last six to eight months, companies, banks        tend to be long term (satellite life of 15 years) and the
                                  and other financial institutions which would               associated finance is usually sophisticated. The initial
                                  previously have been regarded as robust and                period between the decision to procure a satellite and
                                  unshakeable have collapsed as a result of a global         the time when the satellite is actually launched is
                                  economic downturn, the like of which, has never been       about 5 years, but can often be longer. Satellite
                                  seen before. The unprecedented financial turmoil           procurement contracts are usually signed about two
                                  which has played out since September 2008 has seen         and a half/three years prior to the anticipated launch
                                  blue chip companies fold, equities markets plummet,        date. For practical reasons the launch service
                                  and nation states teeter on the edge of bankruptcy.        agreement tends to be signed shortly afterwards.
                                  The reaction of governments around the globe has
                                  been to seek to introduce financial measures and           The involvement of complex financing structures and
                                  rescue packages involving unimag- inable sums of           the high risk nature of the business promote the
                                  money, in an attempt to prevent full scale global          external perception that the recent turmoil in the
                                  economic meltdown. In the current economic climate,        financial markets would have a substantial and
                                  one would be forgiven for assuming that the only           disproportionate impact on the space business
                                  business sector likely to be booming is that of the debt   sector. The true position appears to be somewhat
                                  recovery agents and insolvency practitioners!              different. Large fleet operators are still reporting
                                  However, space business appears to be thriving and         excellent financial results and a number of analysts
                                  the future looks reasonably bright for a number of         have highlighted the satellite sector as one that has
                                  years to come.                                             a positive future.


                                  The nature of space business is one of high cost and       The satellite insurance markets rely on a steady flow
                                  high risk. The typical cost to procure, launch and         of satellite risks to insure and there is a definite link
                                  insure a commercial communications satellite is in         with the strength of the satellite business sector. If
                                  the region of USD200-250m. With values this high, it       satellite business is good the chances are that this
                                  is little wonder that project finance plays such an        will lead to an increase in satellites being launched,
                                  important role. Insurance in turn, is an underlying        and if more satellites are launched this increases the
                                  requirement for those willing to lend.                     premium flowing into the market and to a greater
                                                                                             spread of risk. Insurers prefer to spread their risks
                                  In the current economic climate, access to credit has      widely because it reduces their susceptibility to
                                  been severely curtailed. Commercial satellite projects     losses. Such reliance may prompt the view that the


40   APSCC Quarterly Newsletter
“In the current market cycle underwriters are likely to find it difficult
to increase premium rates for space risks. However, it is possible that
some insurers may re-evaluate their continued participation in a class
of insurance where the outlook for continued profitability is clouded
by reducing premium volumes which at some point may be insuffi-
cient to cover more than two or three losses in any one year.”




satellite insurance market has parasitic tendencies,           boom period between 2007 and mid 2008 is also
but this is a misconception.                                   likely to have a lasting effect on the sector for the
                                                               forthcoming 3-5 years. Logic would suggest that
Satellite operators need the insurance markets to              insurers probably have at least 2 good years of
transfer risk. If a new project requires any degree of         business ahead of them before the deals struck
external capital funding or project finance, the               during the boom period find their way to fruition.
stakeholders or lenders will insist on insurance as a          However, regulatory activity suggests that the space
means of security for any advance. To this extent,             sector may have significant growth beyond 2011.
satellite insurance is a fundamental requirement those
seeking project finance. Take for example, the risks           In a report recently commissioned by the Interna-
associated with a launch. If the launch vehicle fails to       tional Telecommunications Union (ITU), it was stated
deliver its payload successfully, the chances are that the     that regulatory activity is on the increase and that
payload (satellite) will either be significantly impaired or   co-ordination requests submitted to ITU for the
completely destroyed. These are risks that financiers          2009-2011 period showed that there was contin-
cannot sustain without recourse and so the risks are           uing growth in demand for satellite services. It also
transferred to the insurance markets. To this extent,          stated that there was a steady rise in the number of
insurance of space risk goes far beyond desirable. It is a     satellite network notifications for services due to
fundamental requirement that needs to be addressed.            come on line between 2012-2015, all of which
The relationship between satellite business and the            points to a business sector that is unusually strong
satellite insurance market is symbiotic.                       in such challenging times.


Why is Space Business Thriving?                                The Insurance Markets
Satellite projects are long term. With a period of 3           The space insurance market is in good health at
or 4 years between financial close through to                  present. Cumulative gross underwriting profits are in
launch, most of the launches in the next 2 years will          excess of USD2.6 billion over the last 10 years,
have been funded and negotiated during 2006/                   notwithstanding the fact that the underwriting years
2007. With a period of about 2.5 years between the             between 1998 and 2001 saw unprecedented losses of
commencement of the procurement process and                    approximately USD4 billion (premium income during
the estimated launch date, the long lead times                 those years was approximately USD3.5 billion). In
involved serve to isolate the sector from the more             relation to the same period, the 2008 underwriting
immediate affects of the financial downturn. The               year ranks second highest in terms of gross annual


                                                                                                                       JULY 2009   41
                                  profits and third lowest in terms of the annual amount      insurers have to rely on their underwriting returns for
                                  payable for losses. The premium income for 2008 was         virtually all of their profits. At the start of 2009, the
                                  approximately USD900m compared to claims of                 question was whether this call for increased rates
                                  approximately USD354m leading to a gross annual             across the board would filter into the space insurance
                                  profit of approximately USD546m for satellite insurers.     markets      it hasn’t happened yet and in fact the
                                                                                              trend for satellite insurance rates is downward in both
                                  Given the profitability of 2008 and the profits             launch and in-orbit business.
                                  generated over the previous 10 years, it may come as a
                                  surprise to learn that the insurers have tried to           The primary drivers for changes in premium rates in
                                  increase space insurance rates during 2009. Space           the satellite insurance market are losses and the
                                  insurance is, for virtually all insurance companies, just   availability of insurance capacity for satellite risks.
                                  one small sector of their underwriting activities.          Losses create pressure to increase rates. The inverse
                                  Towards the end of 2008, a number of senior insurance       is also true. Capacity is the amount of money that
                                  industry executives were quoted in the financial press      an insurer could commit to a particular class of
                                  citing the economic downturn as the reason why              business or risk. If an insurer states that their
                                  insurance premium rates in all sectors should increase.     available capacity per launch is USD20m, they will
                                  They cited the drop in value of the equity markets, low     generally commit to insure up to USD20m if the
                                  interest rates and lack of investment opportunities as      terms and conditions of the policy are to their
                                  reasons why “double digit” increases were necessary         satisfaction. The insurance capacity for both launch
                                  across all classes of business. The reason why this is      and in-orbit insurance risks tends to be stated in
                                  relevant is because insurance companies tend to earn        terms of ‘Theoretical’ and ‘Actual’ capacity.
                                  their income in two ways.                                   Theoretical capacity is capacity that an insurer
                                                                                              claims to have available. Actual capacity is the
                                  Premiums that are paid to purchase insurance policies       capacity that an insurer will physically commit to
                                  are generally calculated on the frequency of the losses     any one risk. Actual capacity tends to be the
                                  for the insured event but are heavily influenced by         commercial capacity available and useable.
                                  market conditions. The premium charged includes the
                                  insurer’s cost of capital and an element for profit, but    The actual capacity for launch insurance for 2009
                                  until recently insurers also derive a significant return    increased over 2008 by approximately 10% to
                                  through investment income. A good example of this           USD590m. For virtually every launch there is a
                                  in the UK is motor insurance sector. For a number of        healthy surplus of available capacity ,enough to
                                  years motor insurance based on pure underwriting            provide full cover for two large communications
                                  results has been unprofitable yet the insurance             satellites (2 x USD250m) being carried by the same
                                  companies offering this product have continued to           launch vehicle. This is fortunate given the fact that
                                  offer competitive pricing often well below the              Arianespace provides capability for dual launches on
                                  underwriting threshold that returns a profit. Pricing is    the Ariane 5 launch vehicle. However, if a launch
                                  not based on underwriting activities alone. The reason      vehicle is only carrying one satellite, there is a very
                                  why insurers have been able to do so is because the         substantial over supply of capacity which can be
                                  insurance companies compete for market share and            used to generate competitive forces in the market
                                  use the high volume premium income to invest and            and drive rates down.
                                  achieve a positive return. In the current economic
                                  environment opportunities to derive significant             Launch insurance premium rates tend to fluctuate
                                  returns from secure investments are limited and now         over time and have generally been between 10%


42   APSCC Quarterly Newsletter
and 20%of the value insured. The actual rate for                   itability. In normal economic conditions this would
any given risk depends on its particular profile and               be the most probable cause of a fluctuation in the
the position within the satellite insurance market                 market, i.e. low pricing producing unacceptably low
cycle. In-orbit premium rates tend to range between                returns for investors causing them to exit the mar-
1% and 3% depending on the particular risk profile.                ket and capacity to reduce.
For in-orbit risks the actual rate is determined in
relation to the reliability of the satellite, its                  The relationship between losses, insurance capacity
pre-attachment performance and the reliability of                  and premium rates is clear. Losses lead to the with-
similar satellites or satellites with similar compo-               drawal of insurance capacity. However, historical
nents. At present, the insurance market is com-                    data shows that there is a time lag between the
petitive which means that the trend for premium                    peak of losses and the point at which capacity starts
rates in both classes are towards the lower end of                 to reduce. Insurers tend to fix their capacity for a
the respective ranges. The underlying reason for this              year at a time. The fact that losses can be reported
is that there is an excess of insurance capacity and               or declared after the underwriting year ends (sub-
there have been relatively few losses in recent times.             ject to standard policy limits) means that investors
The market is profitable which attracts investment.                may not exit the market immediately. The with-
As a consequence the problems in the financial                     drawal of insurance capacity reduces the excess
markets have had no visible impact on the satellite                capacity and therefore reduces the competitive
insurance markets in either class to date.                         influences resulting in pressure for price rises.


What Lies Ahead?                                                   Conclusion
It is a good time to be buying satellite insurance.                In the current market cycle underwriters are likely to
Premium rates are comparatively low and our prog-                  find it difficult to increase premium rates for space
nosis is that they will continue to decrease over                  risks. However, it is possible that some insurers may
time, albeit slowly, for both launch and in-orbit                  re-evaluate their continued participation in a class
risks. The market is stable but satellite operators                of insurance where the outlook for continued
should be cautious. The satellite insurance market is              profitability is clouded by reducing premium
notoriously volatile and can react quickly to losses.              volumes which at some point may be insufficient to
For the launch insurance sector, it only takes one or              cover more than two or three losses in any one year.
two launch losses and the market can very easily                   Losses will occur and as we have seen in the past,
turn. There is also the danger that if rates move too              the reaction can be swift. It is for this very reason
low solvent and profitable space insurers could be                 that it operators need to keep a close eye on market
forced to withdraw from the class as their capital is              developments as the impact of a 1% or 2% rise in
reallocated into other classes of insurance which                  premium rates can lead to a significant increase in
may have better medium term prospects for prof-                    their mission costs.<



  John Munro       joined the Marsh Group in 1980 having graduated from the University of London. He started his career in the
  Aviation practice, moving to Marsh Space Projects in 1982. John was appointed Managing Director of Marsh Space Projects,
  London in 1992 and a Managing Director of Marsh Ltd, the parent company, in 1996. John established the Marsh Space Projects
  representative office in Singapore in 1996 and made this his permanent base in order to more effectively service our rapidly
  expanding client base in this region. John is the Client Executive for all the group’s Asia Pacific based customers and is the
  Global Head of Marsh's Space Practice.




                                                                                                                                   JULY 2009   43
                                    SATELLITE TRENDS




                                   GSM Satellite Overview
                                   Gary Hatch, CEO, ATCi




                                   New Technologies Brings Costs below                        be monetized. This article is a result of input and
                                   3 Cents a Minute                                           network experience in cooperation with SES, Intelsat
                                   Due to the worldwide popularity of Global Systems          and Arabsat. Herein, satellite has advantages that
                                   for Mobile communications (GSM), operators have            allow operators to access traffic opportunities
                                   been driven to deploy their services to most urban         immediately and supplement fiber bandwidth with
                                   areas and more often into the smaller and more             unequaled redundancy.
                                   remote Designated Market Areas (DMA). GSM traffic
                                   accounts for 80 percent of the world’s cellular            Architecture Overview
                                   traffic. Satellite is the only viable solution to extend   A typical GSM network is shown in Diagram 1. Since
                                   services to many areas because of various terrestrial      this article will focus on the transmission of the voice
                                   infrastructure challenges and constraints.                 and signaling information, the network has been sim-
                                                                                              plified to focus on only the components of interest.
                                   GSM technology is commonly implemented using
                                   fiber, cable or microwave transmission           where     ATCi offers cellular backhaul solutions that overcome
                                   bandwidth is not normally a concern. However, a            and eliminate limitations associated with these
                                   GSM transmission is more bandwidth sensitive over          traditional backhaul connections, thereby providing
                                   satellite, economization of the bandwidth must be          operators with a scalable, flexible and cost-effective
                                   maximized so that operating costs of every KHz can         solution to address current and future requirements
     Diagram 1                                                                                in all three network segments:


                                                                                              For our purposes, the GSM network can be viewed as
                                                                                              consisting of three major parts: the Mobile Switching
                                                                                              Center (MSC), the Base Station Controller (BSC) and
                                                                                              the Base Transceiver Station (BTS). The Home and
                                                                                              Visitor Location Registers (HLR and VLR) and other
                                                                                              “back-office” subsystems are considered to be part of
                                                                                              the MSC since these links would not normally be
                                                                                              routed via satellite.


                                                                                                Domestic backhaul network : transmission between
                                                                                                base stations (BTS) and base station controllers (BSC)


44    APSCC Quarterly Newsletter
   Domestic backbone networks : transmissions
   between base station controllers and mobile
   switching center (MSC)
   International or domestic backbone networks :
   transmission between the MSC and the PSTN or
   between two MSCs.


In a typical network, there is a single MSC, a few
BSCs and many BTSs. The equipment cost also                                                                         Diagram 2

decreases from MSC to BSC to BTS. This distribution
is important when considering where to put the
satellite link


GSM Interfaces
All of the interfaces between the various components
are carried using standard E1 bearer trunks to allow
easier transmission over microwave, fiber or satellite.
Diagram 2 shows the different interfaces.
                                                          Diagram 3                                                 Diagram 4


The satellite link may be used to support any of
these interfaces. Since each interface is compatible
with satellite transmission, the issue then becomes
how efficiently the traffic can be transmitted by
satellite to minimize space segment size which is
necessary for transmitting traffic.


E Interface
As a standard E1, the E Interface is used to interface                                                              Diagram 5
between MSC and the PSTN, commonly used in the
PSTN for carrying data and telephone traffic. See         face in the GSM network because there are more BTS
Diagram 3.                                                in the network than any other components, thereby
                                                          making this the most often implemented by satellite.
A Interface
Containing a maximum of 30 uncompressed voice             The Abis interface contains compressed voice and
channels, the A Interface is identical to the E1          GSM information. A single Abis interface can be
format of the E interface, also the same transmis-        used to support up to eight GSM radio access
sion and compression options apply. It also includes      channels. Each radio channel supports eight GSM
a signaling channel for GSM call setup messages for       voice channels. See Diagram 4.
the BSC and Mobile Subscribers.
                                                          Ater Interface
Abis Interface                                            The voice compression is normally performed in the
The Abis interface is used to connect a BSC and a         BSC by a subsystem called a Transcoder Rate Adapter
BTS. The Abis interface is the most common inter-         Unit (TRAU). Sometimes the TRAU function is moved


                                                                                                                 JULY 2009      45
                                        from the BSC and located at the MSC to provide voice                   different GSM interfaces over satellite yielding
                                        compression on the link and reduce the required                        efficient transmission with significant operational
                                        bandwidth. This scenario is shown in Diagram 5.                        cost savings.


                                        GSM Interface Summary                                                  Time Slot Elimination/ Drop-and-Insert
                                        While the E, A, Abis and Ater interfaces are all                       As discussed previously, E1 interfaces often have
                                        carried on E1 bearers, there are considerable differ-                  unused timeslots, most often when the link is not
                                        ences between them, especially in terms of voice                       used to full capacity. Considerable gains can be
                                        channel capacity, see Table 1 for interface/voice                      made by not transmitting these timeslots over
                                        channel comparison.                                                    satellite (Drop-and-Insert). Diagram 6 shows empty
                                                                                                               timeslots are dropped at the transmitting side and
                                        Because each of these interfaces are carried on an                     then inserted at the receiving side (drop-and-insert).
                                        E1 bearer they all run at a rate of 2.048 Mbps allow-
                                        ing each interface to present different opportunities                  Voice Compression
                                        for optimization. The Ater interface is very efficient                 Compressed voice is normally transmitted on E1
                                        from a compression standpoint, it is often not fully                   bearers using 64 kbps PCM, which requires a full 64
                                        populated and therefore contains unused timeslots.                     kbps timeslot for each voice call. The most widely
                                        The A and E interfaces are often completely used                       used voice compression today is the G.729 family
                                        but the uncompressed voice traffic makes it highly                     which provides near toll quality compressed voice at
                                        desirable to use compression equipment allowing                        8 kbps, and is widely deployed and available in a
                                        improvement in the link utilization.                                   number of products providing E1 voice compression.
                                                                                                               Next generation compression further allows
                                                  INTERFACE                     VOICE CHANNELS
                                                                                                               operators to super-charge their business plans by
                                                        E                                 30
                                                                                                               creating incredible per minute offering.
                                                        A                                 30
                                                      Abis                                64
                                                      Ater                               120
                                                                                                               Signaling Channel Optimization
                                        Table 1. GSM Interfaces Compared – Voice Channels carried by a fully   The signaling and O&M channels carry packetized
                                        loaded E1 for each interface type.
                                                                                                               messages for call setup, monitor and control. The
                                                                                                               channels are not fully used and the unused portion
                                        Satellite Applications                                                 of the channel is typically filled with inactive frames
                                        There are many bandwidth reduction techniques                          to buffer the channel up to 64 kbps. Reducing
                                        and system designs that can be utilized to transmit                    bandwidth is easily accomplished without losing any




                            Diagram 6



46   APSCC Quarterly Newsletter
information by discarding the inactive frames while      deployed to support higher traffic loads and/or a
only transmitting actual messages over satellite         larger geographic area. This configuration has the
which is known as statistical multiplexing.              advantage that there is minimal expense required to
                                                         deploy the service. An existing MSC and BSC can be
Interface over Satellite                                 used, which could possibly support satellite connec-
E Interface over Satellite                               tions to several remote locations. The main disad-
The E interface can be transmitted via satellite for     vantage is that the remote location relies heavily on
two main applications:                                   the equipment located at the hub site so hand-offs
                                                         and subscriber-to-subscriber calls must go over the
  Connection of a GSM network with the PSTN,             satellite link.
  especially for international long distance calls.
  Interconnection of two GSM networks that allows        Satellite Link Bandwidth
  mobile to mobile calls between GSM networks or         The primary motivation for implementing good
  within a GSM network with multiple MSCs.               system design techniques for the satellite link is to
                                                         reduce the link bandwidth, moreover, the operational
A Interface over Satellite                               costs. Three cases are considered for each interface:
Since the BSC in the remote location can support         using a transparent E1 bearer, using drop and insert,
multiple BTSs, it is possible to cover a wide geo-       and using voice and/or signaling compression. The
graphic area. Roaming between the BTSs is also           calculations are based on increments of 8-channels
supported locally by the BSC, minimizing the num-        to correspond to an 8-channel GSM radio. An
ber of messages that are transmitted over the satel-     indication is also given for each case to show the
lite link. The main disadvantage is that subscriber to   number of mobile subscribers that can be supported
subscriber calls must go through the MSC which           depending on the traffic profile (Erlangs per sub-
requires a double satellite hop. The A interface car-    scriber). It is assumed that the satellite links are
ries uncompressed voice so voice compression             implemented using QPSK modulation with Rate 3/4
equipment should be used to reduce the required          FEC, with either Turbo or convolutional coding.
satellite bandwidth.
                                                         Cellular backhaul market :
Ater Interface over Satellite                            Industry trends and analysis
The Ater interface is simply a variation of the A        ATCi firmly believes that GSM over satellite is an
interface, so the same design considerations stated      important application today and will experience
above apply. The Ater link employs GSM voice             significant growth in the future as GSM networks
compression but there are normally unused timeslots      are pushed into more rural areas. The past decade
which provide a good opportunity to reduce the link      has seen basic 2G-network coverage spread rapidly
speed by using drop and insert to prevent trans-         across developed regions of the world          namely
mitting empty timeslots over the satellite.              North America and Europe        with most of today’s
                                                         expansion opportunities in emerging markets such
Abis Interface over Satellite                            as China, India, Africa and Latin America. Because of
Transmitting the Abis interface via satellite is the     wide geographic spread and relatively poor terres-
most common implementation and is often used to          trial connectivity, mobile operators are exploring
extend service to new locations with minimal infra-      options such as satellite-based backhaul links, which
structure costs. As the GSM traffic grows at the         has presented a challenge and an opportunity for
remote site, additional BTSs or a BSC may be             the satellite industry. The “challenge” arises from the


                                                                                                                   JULY 2009   47
                                                                                                                                    requirements. By understanding the technology and
      Source: Global Mobile 2006 (Informa Telecoms & Media)




                                                                                                                                    efficient techniques, more GSM operators will be
                                                                                                                                    able to take advantage of satellite as a means to
                                                                                                                                    extend their networks.


                                                                                                                                    ATCi’s broadband cellular service presents cellular
                                                                                                                                    operators with a compelling solution for addressing
                                                                                                                                    backhauling challenges in terms of price and perfor-
                                                                                                                                    mance. Practically maintenance-free, the ATCi
                                                                                                                                    cellular/mobile solution is able to handle all voice
     World’s 30 Largest Mobile Operating Groups                                                                                     and data backhaul traffic at a fraction of the cost of
                                                              fact that mobile operators rarely warm to satellite                   alternative solutions. ATCi employs the most up-to-
                                                              solutions because of associated latency and cost,                     date voice optimization technology combined with
                                                              while the “opportunity” stems from the expansion                      highly-efficient satellite space-segment modulation
                                                              potential offered by satellite-based cellular backhaul                and coding schemes in solutions for cellular oper-
                                                              links in emerging markets that lack terrestrial infra-                ators. This enables the Company to pack more voice
                                                              structure. A glance at top mobile operating group                     and data traffic within the valuable space segment
                                                              quarterly revenue figures in 2006 illustrates the                     resource, thereby significantly lowering operational
                                                              scope and potential of cellular backhaul markets in                   expenses associated with access and backhaul
                                                              these regions.                                                        transmission.


                                                              GSM over satellite is a common application in many                    Priced aggressively with systems well under compe-
                                                              regions of the world. Depending on the network                        tition, ATCi has already provided these cellular
                                                              topology and the specific requirements of the                         systems to customers worldwide reaffirming why
                                                              operator, the MSC, BSC and BTS may be located                         the Company is a leader in GSM Satellite Backhaul
                                                              either at the central site or at the remote location.                 Networking. ATCi takes these technologies and
                                                              This flexibility in network planning allows the oper-                 couples together leading edge amortization, com-
                                                              ator to tailor the satellite solution for the particular              pression, GSM Algorhythm economization, RF mod-
                                                              needs of each remote site in the mobile network. It                   ulation and network management to offer immedi-
                                                              is also clear that while transparent E1s may be used                  ate return on investment GSM backhaul wholesale
                                                              to transmit the E, A, Ater and Abis interfaces over                   rates below .03 a minute. With a billion cell phone
                                                              the satellite link, there are significant gains to be                 users today, the right satellite GSM backhaul is the
                                                              made by employing either compression or drop and                      clearly the path to provide GSM connectivity to the
                                                              insert equipment to reduce the satellite bandwidth                    next billion cell phone users.<



                                                                Gary Hatch       has served as President and CEO of ATCi and its predecessor company ATC, a satellite-engineering firm, from
                                                                1986 to the present. In 1997 he negotiated a buyout and became the Company's principal shareholder prior to a recent multi-
                                                                million-dollar equity investment he brought into ATCi. He has been retained as a consultant and resource for worldwide satellite
                                                                industry and related entertainment media related public and private offerings, strategic advisory assignments and advice on
                                                                mergers, acquisitions and divestitures. Mr. Hatch serves on the board of EastSat (an Asian satellite DTH entertainment network)
                                                                and Intersect, a Brazilian multi media company. Mr. Hatch is also a member the Enterprise Private Equity Group, the Society of
                                                                Broadcast Engineers, the Society Satellite Professionals, the Society of Cable TV Engineers and the IEEE.




48             APSCC Quarterly Newsletter
                                                  INSIDE APSCC




                                               APSCC Activities Update
                                               APSCC Supports its Members at AWF-6




                                               The 6th Meeting of the APT Wireless Forum (AWF-6)      however APSCC believes that the satellite industry
                                               was held from March 31st to April 3rd in Danang,       needs to keep our eyes on them consistently prior to
                                               Vietnam. The forum was organized by the Asia           WRC2011.
                                               Pacific Telecommunity (APT) and APSCC has
                                               attended this meeting to support its members in the    APSCC invited its members as well as Asia-Pacific
                                               Modern Satellite Applications Task Group (TG-SAT),     government officers to the APSCC dinner on April
                                               which purpose is to identify the service and tech-     1st during the AWF-6 meeting not only to provide a
                                               nical development as well as requirement of modern     platform for networking but also to offer an extend-
                                               satellite applications.                                ed place to demonstrate and discuss several hot
                                                                                                      issues in the satellite industry in APAC the region.
                                               Several issues regarding spectrum management,          This dinner was a moment to signify APAC adminis-
                                               IMT, convergence and satellite in the Asia-Pacific     trators from Pakistan, the Philippines, Nepal and
                                               region have been discussed by industrial leaders and   New Zealand on the APSCC as well as to emphasize
                                               APAC administrators through the various sessions       the importance of the satellite industry in the
                                               during the 4-day forum. There were no notable          region. APSCC expressed that the organization
                                               discussions during the forum regarding the use of      expects to build a close relation with the govern-
                                               the external C-band by the WiMAX industry;             ment in the region though its membership.

     APSCC hosts dinner at the AWF-6 meeting in Danang, Vietnam.
                                                                                                      At the TG-SAT sessions, APSCC members including
                                                                                                      SES NEW SKIES, KT Corporation, Thaicom, AsiaSat,
                                                                                                      ACeS, ETRI, Mabuhay etc. headed up to collect the
                                                                                                      most optimize survey questionnaire to verify the
                                                                                                      current and future satellite industry in the Asia-
                                                                                                      Pacific region and finally produced a great output.
                                                                                                      The survey questionnaire will be circulated to APT
                                                                                                      members as well as APSCC members to receive
                                                                                                      feedback on the members' thoughts regarding the
                                                                                                      status quo of the APAC satellite industry.


                                                                                                      APSCC will keep supporting its members through
                                                                                                      various activities throughout the year. Sponsorship
                                                                                                      opportunities to APSCC activities not only on the
                                                                                                      issue regarding spectrum protection but also
                                                                                                      extending to the whole satellite industry are opened
                                                                                                      to members & colleagues.<


50    APSCC Quarterly Newsletter
                                                                                               INSIDE APSCC




APSCC Yearbook 2009 Edition
Your step into the strongest satellite community




APSCC, in cooperation with its yearbook publishing       Satellite/Space Industry Index
partner, is preparing for the launch of the 2009         The APSCC Yearbook will be the point of reference
edition of the APSCC Yearbook at the APSCC 2009          for the global satellite and space-related industries.
Satellite Conference and Exhibition. In addition to      In particular, the Satellite/Space index of the APSCC
APSCC 2009 distribution, APSCC Members will also         Yearbook will include the list and background
receive complimentary copies of the yearbook by          information of industry-related entities as well as
post when published.                                     the key contact information.
                                                         http://www.satellite-evolution.com/apscc/index.htm <
Distribution
The 2009 APSCC Yearbook will be available in a                                     DS Air Publications is a B2B publisher that produces magazines such as

number of formats including print, CD-Rom, Web                                     SatelliteEvolution Asia, Satellite Evolution EMEA and Satellite Evolution
                                                                                   Global, which are available in both print and electronic format.
and E-zine formats. A total of 5,000 CD-Rom copies
of the yearbook will be produced, and these will be        Contact
distributed with the Satellite Evolution magazine.         DS Air Publications
                                                           Richard Hooper, Publisher
Also, 5,000 hard copies of the yearbook will be
                                                           I Langhurstwood Road, Horsham, West Sussex RH12 4QD, UK
printed and distributed to APSCC members and all
                                                           Tel: +44 1403 273 973 Fax: +44 1403 273 972
key decision makers as well as professionals in the        Email: richard@dsairpublications.com URL: www.satellite-evolution.com
satellite industry throughout the Asia-Pacific region.




                                                                                                                                 www.apscc.or.kr




            A Voice, A Vision for the                            Asia-Pacific



     Chloe Song, Membership & External Relations Tel: +82 31 783 6244 Fax: +82 31 783 6249 E-mail: info@apscc.or.kr



                                                                                                                                                      JULY 2009   51
                                        SATELLITE INDUSTRY NEWS




           Satellite Industry News
             Satellite Business                                                    Broadband and International Private Line. Under a separate
                                                                                   contract, KT Corporation became a distributor of Intelsat’s GXS
           Mitsubishi Electric Signs Contract with Integral Systems                Network Broadband Global Maritime service. KT Corporation
           March 19, 2009 - Mitsubishi Electric Corporation has selected           maritime customers are benefiting from Intelsat’s service that
           Integral Systems to support its DS2000 satellite platform. This         offers an always-on, true broadband connection, a global
           announcement marks Integral Systems' sixth commercial                   monitoring system and automatic beam switching technology.
           command and control contract signing in Asia in the last twelve
           months. Under this operational contract, Integral Systems will add      IPSTAR Officially Inaugurates the Japan Gateway
           capability to its EPOCH IPS to support the DS2000 satellite             April 20, 2009 - THAICOM Public Company Limited announced
           platform, including all required telemetry and command                  that its subsidiary, IPSTAR Company Limited (Japan Branch), has
           processing, memory management, and orbit analysis. Upon                 officially inaugurated the 14th IPSTAR Gateway located in
           completion of the effort, Integral Systems' EPOCH IPS will provide      Saitama Prefecture, Japan on April 17. The IPSTAR service has
           a highly precise, integrated environment for DS2000 satellite           commenced services since April 1. The Company is also planning
           operations and mission analysis.                                        to install free-trial IPSTAR terminals in 46 prefectures of Japan
                                                                                   with a 1Mbps/512 Kbps package for a period of one year. Earlier
           Gilat Broadband Satellite Network to Serve                              in the month, IPSTAR Japan Company provided intensive training
           a Government Organization in Southeast Asia                             courses for the Japanese installers.
           March 25, 2009 - Gilat Satellite Networks Ltd. has been chosen by
           Nera Telecommunications to provide a SkyEdge II network that will       Telekom Malaysia Berhad Renews
           be used to serve a government organization in South East Asia. The      Capacity Contract with MEASAT
           new network based on Gilat's SkyEdge II Access and Pro VSATs, will      May 10, 2009 - MEASAT Satellite Systems Sdn Bhd (MEASAT) has
           be deployed as part of NeraTel's comprehensive communications           announced Telekom Malaysia Berhad (TM) has renewed a contract
           system, to provide high-performance and advanced                        for the leasing of transponder capacity on the MEASAT-3 satellite.
           communications that meet the requirements of NeraTel's customer.        TM, an integrated information and communications group, offers
           The network carries end-to-end MPLS data. This includes converged       communication services and solutions in broadband, data and
           services such as broadband IP, voice, video and multicasting.           fixed-line. MEASAT has been supporting TM’s satellite requirements
                                                                                   since 2001. Under this agreement, TM will continue leasing
           Intelsat Expands GXS Network Broadband Service                          transponder capacity on MEASAT-3, for an additional three years.
           throughout the Asia-Pacific                                             MEASAT-3 will be joined with the soon to be launched MEASAT-3a
           March 26, 2009 - Intelsat, Ltd. announced that KT Corporation, a        at the 91.5 degrees East orbital location, providing redundant C-
           communications service provider for Korea and the Asia-Pacific          and Ku-Band satellite capacity to the Asia Pacific region.
           region, will host two new GXS Network Broadband hubs for
           Intelsat in the Asia-Pacific region. This provides Intelsat access to   GMV Opens Commercial Offices in Asia
           KT Corporation’s teleport facilities in South Korea. The Intelsat GXS   May 14, 2009 - GMV has opened two commercial offices in Asia_
           services include Intelsat’s GXS Internet Trunking Service, Network      one in Malaysia and the other in the Korean Republic. The new




52   APSCC Quarterly Newsletter
offices will enable GMV to provide broader services to clients in       launch seven satellites for broadcast and mobile communications
Asia and gain a better understanding of the markets on the              purposes in the next five years.
continent. GMV is building on a multi-year track record of success
in Asia, prompting the company to set up a permanent                    Inmarsat Completes Acquisition of Stratos Global
commercial presence in the area. In Malaysia, GMV has several           April 15, 2009 - Inmarsat has completed the acquisition of Stratos
projects underway. In 2007, GMV successfully set up focusGEO,           Global Corporation (Stratos). Following the closing, Stratos will
flight dynamics software for geostationary satellites, in the           become a wholly-owned operating division of the Inmarsat group.
Measat control center. For the last year, together with local           Stratos operations will continue to be managed by the existing
partner ATSB, GMV has also been setting up a coastal DGPS               Stratos management team, reporting directly to Inmarsat at a
network to give maritime navigation aid, a project won after            corporate level. Inmarsat has implemented a fair channel
taking part in an international tender. GMV also has a successful       management policy by a segregation of its wholesale and Stratos
track record in Korea. The Korean armed forces purchased the            operating divisions. Inmarsat remains committed to a primarily
EADS/CASA (now Airbus Military Transport), the flight training          indirect distribution model through its existing channels to
simulator for the CN-235 aircraft (KR-01 in the Korean version),        market. The acquisition of Stratos was funded in December 2007
in which GMV has been a partner.                                        and no additional financing was required to complete the
                                                                        transaction. Approvals from key regulators such as the Federal

 Mergers & Acquisitions                                                 Communications Commission and the Minister of Industry,
                                                                        Canada were received in connection with the transaction.
Chinese Government Merges CASC with China Satcom
April 14, 2009 - The Chinese government has merged China                  Space & Launch
Aerospace Science and Technology Corporation (CASC) with China
Satellite Communications Corp. (China Satcom). China Satcom,            ILS and SES Announce Three Proton Launches
with total assets worth 6.6 billion yuan ($965 million), will operate   March 18, 2009 - International Launch Services (ILS) and SES
as a wholly owned subsidiary of CASC. The merger will extend            announced three new launch assignments under the Multi Launch
CASC's researching and manufacturing services to include                Agreement that was signed in June 2007 between ILS and SES
operating satellite-based telecommunications. CASC plans to             Satellite Leasing Limited, SES’ satellite procurement and leasing




  The 11th International Space Radio Monitoring Meeting will be held on 27 ~ 29 October 2009 in Seoul, Korea by the Central Radio
  Management Office of the Korea Communications Commission. The objectives of this meeting are to encourage development of
  satellite radio monitoring technologies, exchange technologies related to the satellite and strengthen cooperation between the
  satellite industries and administrations. Communications regulators, satellite operators, satellite industry leaders and government
  representatives from over the world will be attending the meeting. For more information, visit
  www.crmo.go.kr/crmoweb/english/isrmm/overview_01.jsp or e-mail to srmc@kcc.go.kr.




                                                                                                                                      JULY 2009   53
                                                                                    APSCC Officers
                                                                                    President
                                                                                    Nongluck Phinainitisart, Ph.D.
                                                                                    Executive Director
                                                                                    Jeong Woo Park


           Satellite                                                                Advisory Board
                                                                                    Romain Bausch
                                                                                    SES


           Industry News                                                            Richard E. Butler
                                                                                    WorldSpace Asia
                                                                                    Seon J. Chung, Ph. D.
                                                                                    Information and Communications University
                                                                                    G. Madhavan Nair, Ph. D.
           company in the Isle of Man. Two of the primary missions will be          Indian Space Research Organisation
           NSS-14 for SES NEW SKIES and Sirius 5 for SES SIRIUS. These              Eui K. Koh, Ph.D.
                                                                                    ProtoStar Asia
           missions are scheduled respectively for late 2010 and 2011.
                                                                                    David W. Thompson
           Additionally, Proton has been designated to launch the OS-1              Orbital Sciences Corporation
           mission in early 2010, destined for the US domestic arc.                 Yasuo Otaki
                                                                                    Panasonic Systems Solutions Engineering Co., Ltd.
                                                                                    Patrick DeWitt
           SKY Perfect JSAT Awards Lockheed Martin Contract                         Space Systems/Loral
           to Build JCSAT-13 Satellite                                              Board of Directors
           April 16, 2009 - Lockheed Martin has been awarded a                      Yeong-Mo Kwon
                                                                                    KT Corporation
           multi-million dollar contract by SKY Perfect JSAT Corporation to
                                                                                    Cynthia Dickins
           build its next geostationary communications satellite. JCSAT-13          SES NEW SKIES
           will be launched by an Ariane 5 in 2013 from the Guiana Space            Richard Bowles
                                                                                    Arianespace
           Centre. Based on the A2100AX platform manufactured by
                                                                                    William Wade
           Lockheed Martin Commercial Space Systems (LMCSS), the satellite          Asia Satellite Telecommunications Co. Ltd.
           will feature an all Ku-band payload incorporating 44 fixed               Ramesh Ramaswamy
                                                                                    Hughes
           high-power communication channels that will provide uplink and
                                                                                    David Ball
           downlink coverage over Japan, Asia and Oceania. Additionally,            Intelsat
           two steerable antennas provide coverage for new and emerging             Thomas Carroll
           markets as well as quick response coverage, spanning the visible         International Launch Services, Inc.

           Earth from the orbital slot to cover a geographic area upon short        Titus Yong
                                                                                    Singapore Telecommunications Ltd.
           notice and, depending on capacity requirements, providing
                                                                                    Yutaka Nagai
           multiple transponders in each steerable beam.                            SKY Perfect JSAT Corporation
                                                                                    Anthony Colucci
                                                                                    Space Systems / Loral
           AsiaSat Selects Space Systems/Loral for AsiaSat 5C
                                                                                    Eddie Kato
           May 6, 2009 - Space Systems/Loral (SS/L) has been selected to            Thales Alenia Space
           provide AsiaSat 5C to Asia Satellite Telecommunications Company          Yousuf Al Sayed
                                                                                    Thuraya Satellite Communications Company
           Limited (AsiaSat). AsiaSat 5C will serve as a backup for AsiaSat 5,
                                                                                    Vice Presidents
           which is currently being built by SS/L and is scheduled for launch       Technical Research & Development
           in the third quarter of 2009. AsiaSat 5 will replace AsiaSat 2 at the    Pramook Chaiwongwutthikul
                                                                                    THAICOM Public Company Limited
           orbital location of 100.5 degrees East. The spacecraft is based on
                                                                                    Conference & Publications
           Space Systems/Loral’s 1300 satellite bus, with performance similar       Naoakira Kamiya
                                                                                    Satellite System Research Institute
           but not limited to that of AsiaSat 5 designed for the provision of
                                                                                    External Relations & Membership
           fixed satellite services for television broadcast, telephone networks,   Gregg Daffner
           and VSAT networks for broadband multimedia services across the           G3 Global Communications

           Asia Pacific.<                                                           Regulatory Affairs
                                                                                    Jorn Christensen
                                                                                    J. Christensen Consultants Ltd.



54   APSCC Quarterly Newsletter
               CALENDAR OF EVENTS


JUNE

         16      Satellite Communications Forum Singapore
                 www.communicasia.com/Satellite Communications Forum.htm

         16-19 CommunicAsia 2009 Singapore
               http://www.communicasia.com/main.htm

         22-26 APT Conference Preparatory Group Meeting for WRC-11 (APG2011-2) China
               http://www.aptsec.org


SEPTEMBER

         29-30 APSCC 2009 Satellite Conference & Exhibition Kuala Lumpur, Malaysia
               www.apscc.or.kr/event/apscc2009.asp


O C TO B E R

         1       APSCC 2009 Satellite Conference & Exhibition Kuala Lumpur, Malaysia
                 www.apscc.or.kr/event/apscc2009.asp

         5-9     ITU Telecom World 2009 Geneva, Switzerland
                 http://www.itu.int/WORLD2009/

         14-15 SATCON Conference & Expo New York, USA
               www.satconexpo.com

         27-29 11th International Space Radio Monitoring Meeting Seoul, Korea


NOVEMBER

         3-5     CASBAA Convention 2009 Hong Kong
                 www.casbaa.com

         10-11 Oil & Gas Communications SE Asia Kuala Lumpur, Malaysia
               www.uk-emp.co.uk
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                                                                                          Inside Back Cover Full Page                          US$ 1,900                        US$ 2,750
          CRMO                                               2
                                                                                          Inside Front Cover Full Page                         US$ 1,900                        US$ 2,750
          talkSatellite                                      9                            Inside Full Page                                     US$ 1,300                        US$ 1,800
                                                                                          Inside Half Page                                     US$      750                     US$ 1,100
          AAE Systems                                        14
                                                                                        An additional 20% discount off the advertising rates above will be given to an advertiser who reserves for one full
                                                                                        year (4 advertisements) or more.
          GMV                                                15

          ITU Telecom World 2009                             19                       Mechanical Specifications (APSCC accepts advertising material in only digital formats.)
                                                                                        Ad Dimensions
          Satellite Evolution Group                          21
                                                                                                  Size                             Bleed                       Trim                 Live Area
          Satellite News                                     25                           Full Page                               220    305                210     295               194 279
                                                                                          Half Page Vertical                      112 305                   102     295                96    279
          CASBAA 2009                                        35
                                                                                          Half Page Horizontal                  220 157.5                  210 147.5                 194 137.5
          APB                                                49                         All dimensions are listed as width by depth in millimeters (mm).
                                                                                        Build pages to trim size and if bleed, extend dimensions beyond page edge by 10mm. Keep live matter 6mm from
          APSCC                                              51                         trim size.
                                                                                        The reproduction of your ad may be inaccurate if files do not meet our specifications and APSCC will not accept
                                                                                        responsibility.
          SES NEW SKIES                             Inside back cover
                                                                                        Accepted Digital Formats
          KT                                            Back cover                      Preferred file formats are EPS, JPG or PDF.      Resolution should be a minimum of 300 dpi.
                                                                                        Please provide a digital proof in JPG format.    If you use non-Adobe Fonts, please create an outline EPS of text.
       * Cover photo courtesy of HUGHES.                                                Photos should be in CMYK format not RGB.         Include all fonts when creating the final file.




APSCC is a non-profit, international regional association representing all sectors of                                                      Editorials and Inquiries
satellite and space related industries. APSCC membership is open to any government body,
                                                                                                     Anna Kim, Editor
public and private organization, association, or corporation that is involved in satellite
                                                                                                     Asia-Pacific Satellite Communications Council
services, broadcasting, manufacturing, launch services, risk management or associate
                                                                                                     Suite T-1602, Poonglim Iwantplus
fields such as datacasting, informatics, multi-media, telecommunications, and other outer            255-1 Seohyun-dong, Bundang-gu
space-related activities with interests in the Asia-Pacific region.                                  Seongnam, Kyunggi-do, 463-862 Korea
                                                                                                     Tel: +82-31-783-6244 / Fax: +82-31-783-6249
APSCC aims to exchange views and ideas on technologies, systems, policies and outer
                                                                                                     E-mail: info@apscc.or.kr / Website: www.apscc.or.kr
space activities in general along with satellite communications including broadcasting for
the betterment of the Asia-Pacific region. Conferences, forums, workshops, summits,
                                                                                                     APSCC Newsletter is a publication of the Asia -Pacific Satellite Communications Council. It
symposiums, and exhibitions are organized through regional coordination in order to                  is published quarterly in January, April, July and October. The contents of this publication
discuss issues that affect the industries and to promote and accelerate the efficient                may not be reproduced, either in whole or in part without, prior written permission from
introduction of outer space activities, new services and businesses via satellites.                  the editor. The views and opinions expressed are those of the authors and are not
                                                                                                     necessarily supported by APSCC.
In order to disseminate industry related information, APSCC publishes a quarterly satellite
magazine as well as a monthly e-newsletter, which are distributed worldwide to members
                                                                                                     Design and Printing by Design CRETA
and others. The quarterly magazine and other publications are available on the Web at
                                                                                                     Tel: +82-2-454-2022 / Fax: +82-2-458-1331 / Website: www.designcreta.com
www.apscc.or.kr.
Koreasat-5 reaches out to Asia
delivering the best value with reliable and
high-quality services.


                                                                                                  EOC




                                                                                                    EOC



Koreasat-5 is a high-power, Ku-band
FSS satellite that is the top choice for
broadcasters, telecom operators, ISPs,
government agencies, and other
businesses from all over Asia.
From its orbital position at 113° East,
Koreasat-5 offers all kinds of satellite
services that are important to you.


                                             at-5
                                         easMap
                                     or rage
                                    K ove
                                      C                                                         Payload Specifications
                                                                                                Payload        Ku-band 24 X 36MHz
                                             Technical Characteristics                          Amp Type       N.E. Asian Beam 122 W TWTA
                                             Launch Date         August 22, 2006                               Korean Beam 48 W TWTA
                                             Orbital Location    113 E                          Frequencies    14.0~14.5 GHz uplink
                                             Launch Service      Sea Launch (Weight 4,550 kg)                  12.25~12.75 GHz downlink
                                             Spacecraft Design   Spacebus 4100 C1               Coverage       Korea, the Philippines, Japan,
                                             Polarization        Linear                                        Taiwan, East China




KT Corporation
                                           Mr. Jae-Ho Yoo | Deputy Director, CIT Department 2, Enterprise Customer BU 2
                                           8F, 100 Sejong-ro, Jongro-gu, Seoul 110-777, Korea
                                           Tel : +82-2-720-3668 | Fax : +82-2-720-2807 | E-mail : yjh@kt.com | URL : www.kt.com

				
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