Faced with the game-changing advent of vertically integrated Low-Earth Orbit (LEO) megaconstellations like Starlink and Amazon Leo, ground segment hardware and service providers are having to rethink both their technology and their business model, a panel of ground segment CEOs told SATShow last week.<\/p>\n
\u201cWe\u2019ve never been in a more exciting time, honestly, in terms of dollars invested in capabilities in space,\u201d said Per Nor\u00e9n, the CEO of Ovzon<\/strong>, which started out making user terminals but now provides high-end Geostationary Earth Orbit (GEO) satcom-as-a-service capabilities to national security and defense customers.<\/p>\n With investment capital pouring into the space sector writ large, Nor\u00e9n is optimistic. \u201cIt\u2019s a fantastic time to be here, right now,\u201d he said.<\/p>\n Calling the new LEO constellations \u201ca formidable capability for general connectivity,\u201d he said they have changed the game.<\/p>\n But Nor\u00e9n added there is still \u201croom for GEO, absolutely,\u201d because of its unique characteristics, though more driven by defense, national security, and public safety customers, for whom a system which you can rely on \u201calmost all the time\u201d just isn\u2019t good enough. \u201cAlmost is not a good thing for mission critical,\u201d said Nor\u00e9n.<\/p>\n David Gelerman, CEO of SpaceBridg<\/strong>e, which designs, manufactures, and supplies advanced satellite ground networking equipment, was more blunt about the impact of Starlink, which he pointed out had vertically integrated to make their own user terminals and employed massive economies of scale. \u201cThey have reduced costs to a bare minimum and passed the savings to the consumer,\u201d he said, \u201cBut where it leaves us [ground segment companies] is, it takes us out of the equation.\u201d<\/p>\n Starlink manufactures and sells its own user terminals and operates its own ground stations.<\/p>\n Gelerman agreed that there was a market for GEO, but argued that GEO and other traditional providers \u2014 including ground tech purveyors \u2014 have basically been evicted from the price-sensitive consumer market segment.<\/p>\n \u201cGeostationary business is far from dead, but it\u2019s geopolitically driven now. If you look at consumer, it\u2019s all gone. There are no broadband customers left. It\u2019s economy of scale again: Starlink kills everybody with prices and performance too. Look what happened to Intelsat and SES. We cannot survive anymore.\u201d<\/p>\n Nor\u00e9n pushed back against that idea, saying the ground segment will still have customers, even among the more price sensitive enterprises, because they are able to offer multi-orbit, multi-frequency devices and services and put them together to build capabilities that users wanted.<\/p>\n End users need to know \u201cWhat is your use case? What are you going to use it for? And what are your requirements for that? We need to work with the customer side to find the right solution, right for their technology, for their use cases,\u201d Nor\u00e9n said.<\/p>\n Nowadays, that means choosing between orbits, but Ovzon isn\u2019t \u201cobsessed with orbits,\u201d it\u2019s just another choice customers have to make.<\/p>\n \u201cI think we should be more obsessed about how you actually build capabilities and how you do orchestration of all these things. Service orchestration will be the core [of ground segment business] for the future,\u201d Nor\u00e9n said.<\/p>\n Orchestration is \u201ca very hard problem to solve,\u201d he added. \u201cIt\u2019s hard for a government to have all of that in house, [because] it needs to come from where the technology evolves, where the integration capabilities are developed,\u201d he pointed out, predicting the emergence of specialist systems and service orchestrators. \u201cSome of us already do it today because the customers want that,\u201d Nor\u00e9n concluded.<\/p>\n The exhibit floor at SATShow was a good illustration of how the industry was changing, said Daniel Gizinski, president of Comtech<\/strong>\u2019s Satellite & Space Communications Segment.<\/p>\n \u201cThere\u2019s a lot of new faces relative to who was here six or seven years ago,\u201d he said, adding, \u201cThere\u2019s a lot of innovation, and that\u2019s the right thing that we need.\u201d<\/p>\n Ground segment companies needed to find their niche in the new multi-orbit world, he said.<\/p>\n \u201cWhat makes a business successful is understanding who your customer is, understanding the problem that they have to solve, and then running relentlessly to go solve that,\u201d Gizinski said.<\/p>\n Historically, the ground segment had focused on consumer-grade, direct-to-home connections, because that was the largest market, \u201cBut the average value per user is much lower than some of the other markets,\u201d he pointed out.<\/p>\n \u201cThe companies that are successful in the future are not going to be the ones that look at the market as one single thing, one size fits all. It\u2019s the folks that understand this is my niche. This is my segment,\u201d that will flourish by solving problems for their slice of the marketplace better than anyone else, Gizinski predicted.<\/p>\n \u201cOne of the great benefits of not having to serve that large, consumer grade market is you\u2019re able to run very fast and very focused for special customers,\u201d he said.<\/p>\n The coming direct-to-device revolution is another new market, like LEO, where ground providers would be shut out of the mass market user equipment segment by economies of scale, Gizinski said. Mobile phone manufacturers are already offering 5G handsets with non-terrestrial network (NTN) connectivity \u201cthat cost less than a legacy satellite ground station manufacturer could probably ship an empty box for. And I think that\u2019s a reality that we have to face as an industry.\u201d<\/p>\n But there are openings, niches, for ground segment providers, Gizinski argued. \u201cThere will be cases for high end user terminals in the direct-to-device world,\u201d he predicted. More importantly, the backend connection between the satellite and the ground station, \u201cThat\u2019s very high throughput, typically a higher frequency band, very broad band processing. That\u2019s an area that we excel. That\u2019s something that we\u2019ve done for a long time. That\u2019s our real market,\u201d he said.<\/p>\n","protected":false},"excerpt":{"rendered":" Faced with the game-changing advent of vertically integrated Low-Earth Orbit (LEO) megaconstellations like Starlink and Amazon Leo, ground segment hardware and service providers are having to rethink both their technology and their business model, a panel of ground segment CEOs told SATShow last week. \u201cWe\u2019ve never been in a more exciting time, honestly, in terms […]<\/p>\n","protected":false},"author":1,"featured_media":47266,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"inline_featured_image":false,"footnotes":"","_links_to":"","_links_to_target":""},"categories":[2],"tags":[],"class_list":["post-47265","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-news"],"acf":[],"_links":{"self":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/47265"}],"collection":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/comments?post=47265"}],"version-history":[{"count":0,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/posts\/47265\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media\/47266"}],"wp:attachment":[{"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/media?parent=47265"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/categories?post=47265"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/starpath.global\/blog\/wp-json\/wp\/v2\/tags?post=47265"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}