Satellite backhaul, once seen as last resort, is finally taking off

satellite backhaul
Image by Prasha | Bigstockphoto

With only three countries in South East Asia having an internet penetration of around 80%, there is a high demand for fast, reliable connectivity within Asia. In this part of the world, many individuals are currently living in remote, rural areas that are unable to afford unlimited and stable internet services. 

As a result, satellite backhaul, which was often seen as a last resort, is once again becoming big business. Able to serve isolated communities, which require vital communication, innovation has made satellite backhaul a relatively low cost, risk-free way of providing critical connectivity. With Mobile Network Operators (MNOs) facing increasing saturation within their core markets, this new challenge is particularly appealing as a way of increasing revenue and boosting profitability.

Transformation takes place

It is technological innovation which is driving this popularity. Historically, backhaul has been viewed by operators as too unaffordable. With limitations including high installation costs for ground sites, and poor performance from craft which operated in high geosynchronous orbit, they did not see the point of satellites. It was only when regulations meant MNOs would be targeted with penalties for underserving certain areas, that satellite was used to meet service requirements. 

However, a decade of transformation has caused this to change. In the last ten years, the industry has seen the creation of high-throughput satellites (HTS) which boosted the amount of capacity per satellite by working at the higher frequencies. Next came the development of all-HTS spacecraft which saw the first competitive satellite broadband service develop.

Further innovation saw the development of highly specialized satellites which added even more capacity into the sky. Additionally, the latest creation of very high-throughput satellites by Hughes, Eutelsat and Viasat will see at least an extra three terabytes of capacity when launched later this year.

On the ground, it is now possible for operators to install sites with cost-effective antennas, and equipment, and have base stations that can be powered by batteries or solar panels reducing the cost further. Not only that, but issues regarding rain fade have been overcome so HTS satellites can operate with a higher performance in areas with moderate rainfall. 

An attractive prospect

With all these developments, it is no wonder the industry has taken notice and is starting to deploy satellite backhaul at a rapid pace, with a total revenue of USD 30 billion over the next decade. Research firm NSR predicts costs for large deployments have now fallen to an average of USD 3 per gigabyte, making the prospect a far more enticing one for MNOs, particularly in South East Asia where connectivity is needed now more than ever. 

Thanks to these innovations and improved economics, there are now a range of new business cases in which backhaul makes good business sense for MNOs and supplies the much-needed coverage and internet services. 

Network Extension

Over long distances, from mountains to forests, backhaul now makes it possible to extend service to communities in far-flung, remote locations. Satellite provides a cost-effective replacement for fiber or microwave connectivity. 

Roaming Revenues

Smaller MNOs in South East Asia can now deploy 4G infrastructure using satellite connectivity alongside their existing network. This will generate roaming revenues through deals with larger companies, negating the need for the high-cost traditional transition to 4G. 

Serving Peak Demand

A small capacity satellite solution can provide the necessary capacity to handle peak demand seen at rural population centers, such as train stations or bus stops. This is a far cheaper alternative than a microwave network. 

Edge Content Caching

With demand for video streaming putting a huge strain on core networks and on sites at the remote edge, MNOs and video streaming companies are downloading popular content to edge servers during off-peak hours. Satellite provides an ideal cost-effective solution for caching this content. 

The future of backhaul

As MNOs reassess satellite backhaul, the changing economics have created a field of new opportunities for those serving isolated areas of South East Asia with high quality connectivity. However, for operators to take full advantage they require solutions which allow for smart network management and can integrate satellite connectivity into mobile networks. 

With the arrival of 5G beckoning, satellites are set to play a major role moving forward. It is more important than ever that this integration is as seamless as possible to allow for the best performance. Solutions like the ones provided by Speedcast, can overcome the complex configurations of satellite, mobile, microwave and fiber and with remote management, can always ensure the most reliable connectivity. 

Related article: Satellite Industry Forum optimistic about growth and future opportunities

By Danny Lee, Vice President Sales Asia at Speedcast

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