New Revenue Opportunities in Growing Mobile Broadband Applications

Transcription

1 New Revenue Opportunities in Growing Mobile Broadband Applications EUROCONSULT FOR CONNECTIVITY 214 Prepared by Pacôme Revillon, CEO February 11 th, 214 1

2 EUROCONSULT 3 YEARS OF EXPERTISE What We Do First-class strategic consulting, development of comprehensive research reports and executivelevel events Mission to support decisionmaking for private and government organizations in the satellite industry Who We Are Euroconsult is a global expert in satellite market consulting & analysis Established in 1983, independently owned and operated Three offices: Paris (HQ), Montreal and Washington DC Over 56 customers in 5 countries Euroconsult is trusted by over 56 clients in 5 countries

3 RELATED RESEARCH REPORTS Maritime Telecom Solutions by Satellite Prospects to Edition* Comprehensive analysis & forecasts for maritime satellite communications - Merchant Shipping, Fishing, Passenger Ships, Leisure Vessels, Offshore *Release soon High Throughput Satellite Systems Prospects to Edition A vertical market analysis of major drivers, strategic issues and demand take-up for High Throughput Satellites Mobile Satellite Communications Markets Survey Prospects to Edition Comprehensive expert analysis & forecasts for the MSS sector Prospects for In-Flight Entertainment and Connectivity Prospects to Edition Sector dynamics, analysis and forecasts addressing the IFEC market for commercial airlines and business aviation

4 MOBILE BROADBAND OPPORTUNITY FOR MSS AND FSS Strong Growth for mobility in the last 1 years The mobile broadband has grown strongly in the last 1 years. 2,5 2, US$ in millions Total Mobility 5% CAGR Initially led by government and media users (event driven) 1,5 Mobile VSAT 76% CAGR Commercial maritime and aero as major drivers for sustainable growth 1, MSS 4% CAGR Broadband as the key driver for the mobility market: for , total MSS 4% CAGR, MSS Broadband 47% CAGR, mobile VSAT 76% CAGR in revenue (at satellite operator s level) FSS is playing an increasingly important role in mobile broadband Significant migration from legacy systems and installation in new markets VSAT VSAT VSAT The growth will continue with strong demand in IP mode data MSS BB MSS BB MSS BB

5 OCEANS STAND FOR KEY OPPORTUNITIES Coverage of ocean regions can address multiple market segments, notably maritime and aero markets Shipping In particular Northern Atlantic and Pacific Ocean regions are key market for shipping and aero Also coastal maritime regions highly attractive Airline Caribbean, Alaska and Mediterranean Sea, see growing demand driven by leisure and passenger ship, also strong growth in Asia 157 rigs rigs 5 rigs 3 units 84rigs Offshore & Yacht 23 units 1 rigs 17 units 28 rigs 1 rigs 3 units 6 units 3 rigs 1 rigs 16 rigs 4 units 27 rigs 9 rigs 25 units 23 rigs 83 rigs 83 rigs 37 rigs 7 units 7 units 8 rigs 6 rigs 12 units 15 units 8 rigs 31 units Represents <3 FPSO units *Active rigs fleet on February 212 **Active FPSO on August 212 Strong offshore activity in Northern Europe, Pacific region, Gulf of Mexico, Brazil as well as East and West of the coasts of Africa

6 THE IN-FLIGHT CONNECTIVITY MARKET $9.2 ARPU per session $5 Average price for live TV service 56 Airlines offering in-flight connectivity $3.5 Average price for live mobile service 5% take rate by passengers $12 Average price for Internet service An emerging market after its early failure a decade ago A large number of airlines are installing or seriously considering inflight connectivity All types of airlines (flagship, luxury, regional and low cost) have strong interests in connectivity 94 commercial aircraft connected by satellites The right business model is still to be found 2,6 commercial aircraft connected in total * All figures are for year end 212

7 THE MARITIME MARKET 121, Addressable vessels 68, Merchant ships 6,5 Passenger ships 8,5 Offshore rigs and support vessels A historic market for mobility Strong change in usage pattern. Broadband is now the key revenue generator 7+ VSAT service providers 12, VSAT terminals Legacy MSS terminals still stand for the bulk of installation 352, MSS terminals VSAT is becoming more popular especially for high end market segments MSS market is consolidating $76 million revenues for satellite operators VSAT market is fragmented leaving opportunities for M&A * All figures are for year end 213

8 INCREASING FSS CAPACITY IN OCEANS Intelsat Eutelsat Telesat Increases of regular C- and Ku band capacity over Ocean regions in recent years In particular large global operators see business opportunities from these regions now Intelsat has invested ~1 beams on seven satellites (IS-14, IS-18, IS-19, IS- 2, IS-21, IS-22, and IS-27) for global maritime and aeronautical mobility coverage. SES, Eutelsat and Telesat also have maritime beams on multiple satellites KVH Ku-band coverage is getting close to global in 213; gaps complemented by L- and C-band Panasonic

9 AND HTS IS COMING SOON Global Xpress Thor 7 O3b Between 213 and 216 a number of new HTS systems are being launched with Ocean coverage Inmarsat s Global Xpress will provide global Ka-band spotbeam coverage and >5Gbps of capacity EPIC O3b has steerable beams providing up to 1Gbps each that could provide capacity to off-shore rigs and cruise ships Intelsat EPIC will provide multispotbeam Ku- and C- band coverage; a total of 5 satellite is planned over Viasat 2 Viasat-2 planned for 216 will cover the Northern Atlantic with Ka-band

10 SATELLITE CAPACITY OVER OCEANS Estimated satellite capacity for maritime VSAT, Gbps 7 6 Pacific 5 4 Indian Ocean Mediterranean 3 2 Atlantic Gbps 7 6 HTS systems to increase capacity over oceans to over 65Gbps by 216 The Northern Atlantic and the Pacific Ocean with strongest capacity increase Ka-band to grow from ~1Gbps in 212 to over 4Gbps by 216 Ku-band to almost triple over the next 5 years Gbps Ka-band Ku-band others O3b Inmarsat Inmarsat (GX) and Intelsat (EPIC) leading operators, but lots of new entrants Due to multi-spotbeam approach there is however a difference between overall capacity and capacity at a given point in the ocean 1 Intelsat

11 MAJOR CONNECTED AIRLINES Number of aircraft 2, 1,8 1,6 1,4 1,2 1, Low cost airlines Traditional airlines Airlines in North America by far dominate the connectivity market Delta, AA and Southwest together stand for close to 6% market Traditional airlines stand for about three quarters of the installed aircraft Low cost airlines are proactive in connectivity; most of them do not have in-seat entertainment systems * All figures are for year end 212

12 A VARIETY OF INFRASTRUCTURES EXIST Number of aircraft 2, 1,8 1,6 1,4 1,2 1, Air-to-ground L-band VSAT Number of airlines ATG currently has the largest market share due to its relatively long existence The ATG coverage and throughput are however limited Ku-band (soon Ka- as well) VSAT are growing fast L-band solutions are chosen by a large number of airlines (mainly outside the US), but the installation base is limited

13 STRONG CAPACITY DEMAND IN NEXT DECADE Gbps Total Mobile VSAT 32% CAGR Aero 66% CAGR The availability of new generation HTS systems will significantly change market Higher bandwidth and more mission purposed coverage will allow a range of new applications Maritime 28% CAGR Passenger take rate in aero and broadband penetration in maritime are expected to grow strongly with anticipated decrease in capacity cost Narrowband system will still exist in large quantity while broadband will contribute the bulk of the revenue Consolidations are expected in both vertical and horizontal ways

14 CONTACTS Pacôme Revillon Paris Office 86 Blvd de Sébastopol 753 Paris - France T: +33 () F: +33 ()