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Regional satellite operators investigate data demand and partner with LEO constellations

Regional operators around the world are examining satellites’ place in the new world order, particularly the importance of data and how low-Earth orbit (LEO) constellations may affect their businesses.

Arabsat, which currently operates 10 geostationary (GEO) satellites and has three others in the pipeline, is looking at how its business will grow further. Speaking Tuesday at World Satellite Business Week in Paris, Abdulhadi Alhasani, Arabsat’s vice president and chief strategy officer, said he believes software-defined satellites are the future and the company’s secret weapon against constellations, and that Data has “huge” potential to drive revenue.

Alhasani said that in some cases, Arabsat is not able to serve some non-broadcast customers because it does not have the capacity right now. He cited the recent example of a potential customer who wanted to connect 2,000 schools in rural, remote areas within six months for e-learning. Arabsat was not in a position to meet the requirement. “That’s what we need to change,” he said.

However, Alhasani is optimistic about the future and software-defined satellites. The operator is also looking at building closer relationships with LEO players.

“Are the constellations a threat to our business?” Alhasani asked. “No. We don’t have $800 million to bet on the Constellation slot machine. Are we talking to them? Yes. We need standards, technical solutions. But, we certainly see a future there. [in terms of partnership], Arabsat’s business is split 50/50 between video and data. Although video hasn’t disappeared, partly due to slow over-the-top (OTT) adoption in some markets, Alhasani says growth for Arabsat will come from data.

“Data is getting monetized more and more,” he said. “That is why we need to move down the value chain and become closer to the customers. We are now focusing more on vertical integration and becoming closer to customers. We will unlock many new use cases. We want to provide capacity to all. We are moving away from the traditional way of doing business.”

Katie SatoThe sole satellite operator in Korea has five GEO satellites and on Monday placed an order with Thales Alenia Space for KoreaSat 6A. The operator provides direct-to-home broadcasting in Korea, and focuses primarily on markets around Southeast Asia. It derives about 50% of its revenue from broadband distribution. The company also recently launched a space data business and invested in startup Mangata Networks.

Kyungmin David Song, CEO of Katie Sait, explained the investment as well as possible collaborations with LEO players. “We Invested” [in Mangata] as a minor shareholder. We are the sole strategic investor. It is a MEO/HEO constellation with creative designs that are very competitive. We need capabilities other than GEO. We want NGSOs to have potential. We also want to have LEO capability. We are in separate discussions with LEO operators about offering LEO services in Korea.”

Like Arabsat, operators need more capacity to serve their data customers. Song continued, “There is a lot of need in SE Asia for universal service. The need continues to grow. Users are asking for capacity from us. USO is one of the major data needs we have. You also have data communication in mobility. We offer a marine service. Marine customers need more capacity. We are sold on marine. We have limited coverage, but there is a strong demand.”

Hispasato, another regional operator, now generates about 70% of its revenue from Latin America. It also recently acquired service provider AXESS Networks. Miguel ngel Panduro, CEO of Hispasat, said that the recent COVID pandemic has made the gap between rural and urban communities even stronger when it comes to digital services.

“We are developing several government initiatives to bridge the digital divide” [in Latin America], I think we have a responsibility here,” Panduro said.

Hispasat previously invested in the now-defunct LionSo its relationship with LEO has been poor, though Panduro said the operator still wants to partner with LEO players going forward.

Turksat, the national satellite operator for Turkey, expects to see a significant growth of revenue over the next five years. The operator currently has five satellites. On its satellite business, it generates 75% from broadcast and 25% from data.

CEO Hassan Hussein Ertok believes that the revenue share of video and data will grow 50/50 over the next five years, and TurkSat wants to make a greater impact in international markets. Its new satellites 5A/5B are focused on opportunities outside Turkey.

Ertok said of the possibility of LEO services in Turkey, “we can’t say we don’t care” [about LEOs], We are not going to invest in LEO constellations. But, we would like to build business relationship with them. They will complement our satellites. We want to provide that capability to our customers. We have discussions with OneWeb and Starlink, but nothing has been finalized. But, we would like to build relationships with LEO operators. We would like to do some collaboration.” Premiere News

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