CAMBRIDGE, MA -- (MARKET WIRE) -- 06/26/08 -- NSR LLC today released findings from itslatest report, "Wireless Backhaul via Satellite, 2nd Edition" that indicatesatellite links will represent a growing portion of rural wireless networkdeployments around the world over the next 10 years. The report providesan in-depth overview of demand trends for seven regions of the globe,focusing on mobile backhaul requirements of the globe's rural markets.The report concludes that, from an estimated $227.1 million in revenues for2007, revenues for both equipment sales and transponder leases are expectedto reach $572.9 million by 2017, yielding total revenues of $4.3 billionover an 11-year period. Mobile services globally have exhibited tremendousgrowth over the past decade, driven by increased usage in the world's topmetropolitan areas that has led to mobile subscriptions breaching the 3billion mark, or close to 50% of the world's population.
However, given the increased competitiveness of the top metro markets aswell as the regulatory impetus towards the fulfillment of Universal ServiceObligations (USO), rural areas are becoming more important for incumbent aswell as new service providers that are looking to enter the market. Andhere, satellite backhaul due to coverage and instant infrastructureadvantages become highly valuable in being part of the mobile ecosystem inmany of the globe's Greenfield markets.
Indeed, in key markets such as India and China where mobile growth hasoccurred at a blistering pace in recent years, rural areas have become keymarkets for many service providers for sustaining historical growth levels."But addressing rural demand is vastly different from urban demand,particularly in cost structures. For instance, equipment prices in ruralmarkets are very inexpensive, and monthly service costs or ARPU levels arejust a fraction of their urban counterparts," stated Jose Del Rosario,Senior Analyst of NSR and author of the report.
As such, service providers have to closely monitor CAPEX and OPEX inaddressing rural demand. And backhaul costs are key since these could be ashigh as 40% in some instances, which pose huge challenges to ROIconsiderations. For satellite space segment in particular, its relativehigh cost has been one of the biggest market restraints in adoptingsatellite backhaul solutions.
Moreover, satellite backhaul is not the only option for rural and remoteareas, and terrestrial technologies are constantly improving their reach inorder to expand coverage and enlarge market territory. Satellite backhaulsolutions will have to address these issues in order to improve its marketpositioning over the long term.
The good news is satellite technology is likewise improving its technicalcapability and improving its cost structure. "There is an evolution takingplace where satellite backhaul technologies are moving towards IP and dataplatforms that improve efficiency in space segment usage and thus lowertransponder or bandwidth costs for mobile service providers. Astechnological improvements and the evolution continues, satellite platformsshould at the very least maintain its niche and sustain its role in thewireless backhaul market over time," stated Del Rosario.
About the Report
"Wireless Backhaul via Satellite, 2nd Edition" is a multi-client report nowavailable from NSR. For additional information on this report, including afull table of contents, list of figures and executive summary, please visitwww.nsr.com or call NSR at 617-576-5771.
About NSR
NSR is an international market research and consulting firm specializing insatellite and wireless technology and applications. NSR primary areas ofexpertise include emerging technology, IP applications, and broadcastservices. With extensive expertise in all regions and a number ofbroadband sectors, NSR is a leading provider of in-depth market insight andanalyses.
