The recent softness in the global telecommunications industry is turning around, and positive growth forecasts for worldwide telecom service spending are expected to surpass the $1 trillion level in 2004, according to IDC. While pressures remain to increase operational profitability, recent deployments of satellite-based broadband communications services are having a positive impact on both the top and bottom line of telcos’ financial balance sheets.
To understand why the satellite-based broadband services industry is experiencing this increased level of success, it is beneficial to understand the industry’s recent history. In the late 1990s, many of the large global telecom providers found satellite-delivered services to be a good addition to their total package offerings and important to their multinational client base.
To address those needs, they developed their own in-house satellite networks. However, once the telecom bust occurred in 2000, the telcos dropped most of the programs and projects that were outside of their core competencies. Satellite concerns were among these discarded internal programs, and many telcos wisely chose the economic advantages of service outsourcing.
A satellite service provider should be able to deliver a quality network extension that meets technical, operational and business requirements. In addition, the following characteristics are key:
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Today, U.S. satellite service providers often are reaping the benefits of this increase in outsourced business, and they’re making the most of it by supporting improvements in the technology. During the past four years, satellite-based broadband services have become more sophisticated and feature tightly integrated IT-centric service offerings and quality-of-service management that traverses end-to-end. These services now deliver a true seamless broadband user experience to remote locations and practically anywhere in the world. IP-based network extensions with integrated network security and automatic user authentication, IP user mobility, dynamic network capacity and load balancing management are being delivered today.
Telecom service providers are finding that these satellite-delivered wireless broadband services can augment existing wireline services and revenue in a number of ways. These services help to reach mobile or remote client locations not served by existing infrastructure. These locations include maritime vessels, newsgathering trucks and offshore drilling rigs, among others. Satellite services can be recovered or restored quickly following any natural or man-made disasters — there is little physical infrastructure to repair or replace. Remote clients requiring highly reliable end-to-end services also can receive true transport-path media diversity. In addition, satellite-delivered broadband services make possible quick-to-deploy interim services to client locations while more permanent facilities are built out. Ultimately, satellite-delivered broadband services enable telcos to differentiate themselves further within their respective markets as they enhance service revenue.
Satellite-based services are independent from telco local loops, which has significant advantages for high-reliability, redundant-path voice, video and critical data services. Disaster recovery communications service offerings are enabled for key clients with the mobility and rapid-deploy characteristics of satellite-based services. Additionally, the exceptionally large service footprint and uniformity of service coverage across a would-be client’s national or multinational network can be a significant differentiator.
The attractiveness of additional revenue for telcos is enhanced further by the ease of service implementation. By outsourcing satellite services to a knowledgeable and reputable satellite service provider, service provisioning and ongoing delivery are simplified greatly, and the costs of service can be reduced significantly when compared to inhouse implementation.
There are hundreds of satellite service providers around the world; however, there are very few that operate globally, are financially sound, and have the networking expertise and experience to deliver seamless network extensions for telcos or managed network service providers.
Errol Olivier is the president of satellite service provider CapRock Communications.
