Broadband satellite services provider Hughes Communications expects to continue a 15-20% year-on-year growth in India. The company, which has a service distributor agreement with Bharti-owned Eutelsat OneWeb, is banking on the launch of satellite internet broadband services, satellite internet of things (IoT) solutions and capacity additions with upcoming GSAT-20 satellite launch by the Indian Space Research Organisation arm NewSpace India. In an interview with FE, Hughes Communications India CEO, president and managing director Shivaji Chatterjee talks about the opportunities in the satcom (satellite communications) space, spectrum charges for satcom players and the potential in B2B satellite space.
What is your view on the current debate on administrative vs auction of satellite spectrum?
There are two elements to it. One is technical – satcom as a shared frequency is something which by nature cannot be auctioned because it is a shared resource. However, If any satcom operator, be it foreign or domestic, wants to be an alternate direct service provider of consumer mobile services using IMT (international mobile telecommunications) frequencies, just like a mobile operator anywhere in India, it should follow the norms and buy that spectrum like mobile operators.
What are the growth areas for Hughes now?
India has GSAT-20, which is scheduled for launch very soon. It will bring 50 Gbps bandwidth capacity to the country in the Ka satellite spectrum band. We have various LEO (low-earth orbit) constellations which are coming up. Kuiper and Starlink are likely to follow OneWeb in India. So, that by default brings capacity into the country. Also, we have our satellite IoT solutions coming up for launch in this quarter. So, we will be able to put small terminals, which need less power and will be used to provide an IoT solution where there is no cellular coverage. These are exciting paths for growth of satcom.
How are you seeing the demand for satcom services?
The mobility demand is coming from unmanned drones, domestic airlines, ships and defence. Whether it is in the air or water or on the move, satellite solutions can be mainstreamed in such specialised areas, besides serving areas where there is no connectivity. The biggest user that is waiting for companies like OneWeb to launch the services is the defence sector because of the terrain they operate in and the mission-criticality nature of the connectivity.
How has the growth so far been for Hughes in India?
We are scheduled to grow by over 20% this calendar year. A lot of government programmes are taking place. So far, we have grown a lot through system integration projects. I feel with OneWeb and GSAT-20 coming up as capacities, the bandwidth service growth will come in for us. Our SD-WAN (software defined wide area network) portfolio is also doing very well, but the focus to grow is certainly on the services side.
Satcom is definitely here for B2B services in terms of performance, giving a strong solution that meets all the needs of users. Yes, economically it is more expensive than terrestrial, but much cheaper than before and the performance is right up there.
How big is the opportunity for Hughes in the next two-three years?
I hope that we can continue to grow 15-20% year-on-year. Today, we are a B2B player, mainly satcom, and some part is managed services. That’s our mandate and with that we can double in five years. Inorganic growth which will give us a boost may come from the B2C broadband and in direct-to-device through telco partnerships. Today, our mandate is very much B2B as a satcom and managed services player. In the next two years, India’s satellite bandwidth capacity available will be close to 500-1000 Gbps.
What should be the right pricing model for satcom spectrum?
We have suggested that the spectrum pricing model should be based as a percentage of adjusted gross revenue (AGR), like it is currently for B2B services (fixed and mobility). Spectrum charges should be sufficient to cover administrative costs of spectrum which amount to a fraction of revenues for commercial satcom services. Accordingly, we recommend that the percentage be kept at 0.3-0.4%, with a ceiling/cap of 1% of the AGR.
From: financialexpress
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