The greatest long-term benefits of using satellite communications technology will be with the understanding that satellite networks are not necessarily competitive with -- but are complementary to -- terrestrial infrastructures.
Satellite Applications
Communications satellites bring the Internet to computer screens everywhere from 36,000 kilometers above the Earth. Satellite is a “transport” for communications applications of various kinds, including Internet, television, telephony, government services and corporate data networks. According to Frost & Sullivan, six of the regional satellite opera tors providing service to the Latin American market provide 80 percent of the region's available capacity. Internet Protocol over Satellite (IPoS) carries with it most, if not all, currently used applications carried on the terrestrial Internet. With the popularization of Voice over Internet Protocol (VoIP), Internet Protocol Television (IPTV), Cellular Backhaul, Wireless Fidelity (Wi-Fi), Wireless Metropolitan Access Networks (Wi-Max or Wi-MAN) and other developing applications, it is foreseeable that the demand for communications capacity can potentially surpass that of the current terrestrial infrastructure. Thus it is essential that satellite be used as a complement to land-based communications transport mediums.
One of the greater benefits of satellite communications is the cost savings realized when they are used in areas where the population is widely dispersed or the geographical terrain is not conducive to establishing and maintaining land-based communications infrastructures. This is the case in many regions in Latin America , including the jungles of the Amazon, the islands of the Caribbean , and the interiors of Mexico , Brazil , Argentina and the Andean region.
Internet in Latin America
Although there has been considerable growth in the Latin American Internet subscriber base over the past five years, it is estimated b y Aon Explorer th at there were only about 61.3 million users at the end of 2004. This means only 11 people out of every 100 have access to an Internet connection in the region. Aon Explorer also reports that Internet expansion is hindered by a low fixed teledensity of 17%. The number of users per Internet account has been growing over time as telecenters, cybercafés and other public sites are equipped for Internet access. In countries where Internet usage is more developed, such as Argentina , the ratio of users per Internet subscription is lower than in other countries, such as Venezuela or Peru , given the higher proportion of residential subscriptions. Frost & Sullivan reports that Argentina , Brazil , Chile , Mexico and Venezuela represented approximately 80% of Internet subscriptions at the end of 2004.
In all of Latin America , broadband accounts represent around 23% of Internet accounts, primarily t hrough Asymmetric Digital Subscriber Line (ADSL) techn ology. Chile is the most broadband-oriented country, with more than 56% of its Internet subscribers connecting via ADSL. In most Latin American countries, broadband access remains restricted to major cities where fiber has been deployed extensively in recent years and where teledensity is highest. This creates a good opportunity for satellite technology, as the economies of scale allow companies providing connectivity over satellite to offer it in less populated areas.
The rate of growth of the Internet market in Latin America will depend greatly on regulatory issues and government commitment toward the implementation of satellite-based services. Today, the Internet is considered by many in Latin America to be a “value added” service and not the indispensable tool that it is in other world regions. There are numerous government initiatives to convince telecommunications operators to commit to universal service fulfillment and to the financing of the deployment of distance learning and access centers in remote areas. Local and international funds have been raised to finance the expansion of communications networks to rural and under resourced areas.
Cost Benefits of Satellite
It is widely accepted that satellite is the most cost-effective method of delivering broadband Internet connectivity to remote areas. With the creation of new applications and content growing exponentially, the demand for Internet connectivity is expected to continually increase. And while there exists a terrestrial infrastructure in the more heavily populated regions, that infrastructure can sometimes be costly and time consuming to build out. Satellite connectivity can be economically and expeditiously deployed to Latin American regions where it is cost prohibitive to install fiber or cable. These last-mile region consumers and enterprises can, via satellite, receive the same broadband connections and content as their urban counterparts.
Satellite capacity pricing, as with most other communications applications, varies according to numerous contractual options, including: frequency band, beam coverage area and power, orbital location and orbit inclination. Other price considerations include the amount of capacity leased, the degree to which the market is regulated (often, open markets allow for increased competition) and the type and length of the contract.
Delivering Video Programming Outside Latin America
Video traffic accounts for, in Latin America as well as is in some other world reg ions, the largest portion of utilized satellite capacity. With the increasing popularity of IPTV, vid eo programming may reach users via IPoS.
Spanish is the third most popular language in the world, behind only Cantonese and English, making it obvious that Spanish programming will be of considerable interest in many countries and communities, including to many consumers whose native tongue is not Spanish. As these communities continue to disperse among various world regions, cost effective distribution of Latin programming to these locations leads to the logical conclusion that the most flexible and economical delivery vehicle is satellite.
Coincidentally, programming from these regions and other non-Spanish speaking world regions is expected to contribute to an increase in satellite transponder capacity leases.
Future Satellite Considerations
The 2001 collapse of the telecommunications and Internet industries, as well as the successful launch of multiple communications satellites, resulted in over-capacity in Latin America . Additionally, in the same time period, certain areas were subject to a high amount of fiber installation. While television is expected to account for nearly half of satellite transponder demand in the near future, it is expected that Internet demand will also grow, particularly in non-fibered areas, with the offer of broadband access to areas without a terrestrial communications infrastructure.
Wi-Max is well on its way to becoming an application of choice in wide area communications signal delivery. Coupled with the strong advantages of satellite communications (point-to-multipoint signal delivery, rapid deployment and flexible growth options), Wi-Max makes sense even in larger cities, where 75% of Latin America 's population lives and works.
Drivers for increasing satellite capacity demand in these urban areas will most certainly include videoconferencing capabilities, telemedicine, e-learning and distance learning.
Finally, the implementation and synergizing of operations between satellite operators and terrestrial-based communications providers, in the form of managed solutions, will further decrease the overall cost for satellite-based communications products and services.
As the demand for Internet and Internet-based applications grows around the world, and specifically in Latin America , it will be necessary for satellite operators to adapt to constantly changing market trends and varying customer requirements. Satellite operators offering services to Latin America understand that they may be required, and many are poised as such, to incubate and nurture satellite-based communications applications in order to encourage capacity demand in the coming years
