VSAT Statistics

There are now a great variety of different star and mesh TDMA and DAMA systems from many vendors - The 10th Edition of the VSAT Report lists almost 30 different products - but currently the star data market is primarily contested by Hughes Network Systems (with its latest HughesNet 7000S & 7700S systems), Gilat Satellite Networks (with its new SkyEdge products), ViaSat (with the LinkStar and SurfBeam systems), iDirect (with the iNFINITI) and several standards-based DVB-RCS system vendors which include Advantech Satnet, STM Group, PentaMedia and Thales Alenia.  Others include several once-large players, including NEC and AT&T Tridom which have since exited the market.  The figure opposite shows the historical market share measured by the number of terminals shipped up to December 2004:

The regional market for VSAT systems is dominated by North America, especially in terms of volumes.  The lack of any effective penetration of the US is one of the reasons that DVB-RCS systems have fared so poorly in the market over the past few years, despite being backed by companies like Thales Alenia (previoualy Alcatel).  However, the other regions have been catching up since 1988 and have, until recently, been higher margin markets. Over the past two to three years Africa and the Middle East in particular have grown very strongly on the back of a high level of demand for broadband access services from small businesses in the two regions. The financial sector is a key customer in many developing countries.  Generally elsewhere, demand is primarily driven from large networks provided to large gas/convenience chains, automotive dealerships, retailers, casual dining and lottery systems.

The market was initially extremely volatile, with sales swinging wildly from year to year as a result of lumpiness caused by large, yet unpredictable network orders.  However, since 1995 sales have grown steadier with greater volumes and a more mature sales cycle.  To date over one million star TDMA sites have been sold to core enterprise customers, such as Ford, Mobil/Exxon, the US Postal Service, Rite Aid, Wal-Mart, McDonalds, Best Western and Safeway (see the user examples for more information).  2001 saw the initial growth of consumer internet access services, which are most successful in the US, although there are also services in Australia and the Middle East.  Internationally it has been managed broadband access services targeted at the SME that has provided the strongest area of new demand.

Consumer services in North America are expected to continue to grow strongly in volume as WildBlue and Telesat's Ka-band spot-beam satellite services establish themselves and Hughes brings its own Ka-band, onboard processing Spaceway satellite system into commercial service in early 2008 to take over from its Ku-band HughesNet services.

Sales of mesh/DAMA systems are of a different scale to star data platforms, but the average revenue (both in terms of service and hardware) is far higher.  We believe that this will change as a new generation of mesh-capable star data systems become increasingly common and gain in functionality.  Already two of the star data systems providers - iDirect and Advantech - offer the feature and Hughes, ViaSat, Shiron, STM and Thales Alenia are all known to be working on adding mesh to their current systems.  However, new orders have been relatively flat in the thick route, heavy traffic segment of the market over the past few years with highly specialised applications now driving limited demand, favouring the really specialised system vendors.  This has resulted in a fall-out in the number of products available or actively sold in the market.  The military has largely supported sales since 2003 and we believe that the centralised nature of most IT applications will increasingly lead the mesh DAMA market into other more specialised niches.