Northern Sky Research

The Bottom Line

Author: Gagan Agrawal (X)

  • Much has been commented about the current state of the industry: capacity oversupply, declining capacity prices, a shift to service businesses to strengthen top-line revenue, partnerships with end-customers, and consolidation necessity to future-proof. After a careful study of the past few years, it is certain that most trends are true - reflecting operator strategies as 2017 financial results show. Though, less quantified is the effect on the FSS industry due to these unanticipated…

  • The satellite industry has witnessed a meltdown over the past few years with capacity prices falling over 30-60% across most verticals. This decline doesn’t just stem from increased supply and competition, but also from critical intertwined factors: increased bargaining power of service providers (SPs) as operators dilute their market positions for aggressive selling and a correction for high-throughput capacity to account for CapEx/Gbps cost proportionate to end-lease price. These…

  • Satellite business models have traditionally relied on incumbent technology and DTH demand. The advent of satellite broadband demand, rush for acquiring market share in aero and backhaul verticals and instances of rapid price deterioration of satellite capacity - indicate a shift in these business models. Today’s growth model signifies a fluidity between the lease and service economies, where capacity building leads to a strenuous pricing environment, paving the way for bulk wholesale…