LONG CYCLES BUILDING RESISTANCE DURING ECONOMIC DOWNTURN

In 2008, Fixed Satellite Services represented a global market of 9.8 billion dollars. Despite the economic crisis, and because this business is characterised by longterm contracts that smooth the effects of the economic environment, the global demand for capacity has recorded its strongest annual growth in a decade (9%).

While the economic downturn is likely to reduce this growth rate to between 4% and 6%, trends in the coming years remain favourable, driven by the continuous development worldwide of telecom and broadcast services.

At the end of 2008, the total leased capacity of commercial satellites operating in geostationary orbit was 5 780 transponders, compared with 5 300 at the end of 2007. At 76%, the average fill rate of satellites in operation grew for the fifth consecutive year. This high fill rate limits pressure from competition, allowing operators to increase their revenues with increased capacity without any negative impact on their margins.

Emerging countries are now the strongest contributors to this dynamic, with double-digit growth, particularly Central Europe (+15.5%), Sub-Saharan Africa (+13.5%), Russia and Central Asia (+12.9%) and the Middle East and North Africa (+12%). North America and Europe, growing respectively by 7% and 4.4%, continue to represent two thirds of global demand (38%).

With 36 satellite operators at the end of 2008, four leading players, including Eutelsat, cumulatively represent more than two thirds of the global market. Operating large fleets that give them potential for growth, flexibility, security and economies of scale, these leading operators benefit from the advantage of major barriers to entry to the market. After several waves of consolidation, the market share of the leading players has remained stable, essentially supported by organic growth with investment in new satellites to enlarge in-orbit fleets.

One out of five satellite channels worldwide
will be broadcasting in
High-Definition in 10 years.

Transport of television content continues to dominate the satellite services market, representing almost 60% of satellite capacity worldwide. Excluding professional news-gathering and programme exchanges between broadcasters, Direct-to-Home (DTH) broadcasting alone represents 43.5% of demand.

Driven by the development of pay TV, this sector has experienced uninterrupted growth over the last 15 years. A total of 18 platforms were launched in 2008, bringing the number of pay-TV platforms worldwide to 109. The number of channels broadcasting at the end of 2008 was 24 000, compared to 21 000 at the end of 2007. Here again, growth is driven by emerging countries including Russia where pay-TV has progressed by 53%.

The expansion of demand for satellite capacity goes hand in hand with the increased bandwidth required by HDTV.

This format, which requires 2.5 times more bandwidth than Standard Digital television, places satellites in a more favourable position for reaching audiences spread out over a wide area than more expensive terrestrial platforms. In one year, the number of satellite-delivered HD channels has grown by 72%, exceeding 1,000 channels worldwide, of which 200 in extended Europe. This penetration of HD in the television sector is forecast continue. 39 200 TV channels are expected to be broadcast by satellite in the world in 2018 of which HD should represent 19% compared with 4% today, confirming significant growth potential for satellite services.

Growing by 30% worldwide, there were 1.2 million homes equipped for satellite Internet access at the end of 2008. North America represents 76% of this market, confirming the economic efficiency of multi-beam Ka band satellites which have been available since 2005. With the entry into service in 2011 of multi-beam satellites optimised for broadband applications, Europe and the Middle East should experience a similar dynamic, stimulated by public policy to make access to broadband a priority in economic recovery plans.

The efficiency of multi-beam Ka-band satellites will enable more than 10 million homes worldwide to benefit from satellite broadband compared to 1.2 million today.

< previous