Arianespace sees 20pc rise in satellite demand

PUBLISHED : Thursday, 05 November, 2009, 12:00am
UPDATED : Thursday, 05 November, 2009, 12:00am

Demand for satellite launches from customers in the Asia-Pacific would increase 20 per cent as high-definition broadcasting became more popular, said Arianespace, the biggest satellite launch provider for the area.

'High-definition broadcasting needs four to five times the capacity [in bandwidth] as ordinary television,' said Philip Balaam, the regional sales and marketing director for Arianespace, a satellite launch company backed by several European governments. 'The evolution of high-definition television will boost the demand for satellites by 20 per cent.'

Arianespace owns a launch facility in French Guiana and provides the launch vehicle but does not produce the satellites themselves.

There are about 250 satellites circulating in geostatic orbit, where they appear to remain stationary over one place on the Earth's surface with each able to transmit signals for 500 channels. However, the same satellite can only transmit about 100 channels of high-definition broadcasting.

Television broadcasting is the major driver for the commercial satellite business, outstripping demand from 3G mobile devices or internet services, which mainly rely on cable connections rather than satellite transmission.

The number of households in the region subscribing to pay television reached 326 million this year, up by 26 million, according to data from the Cable & Satellite Broadcasting Association of Asia. More than 115 million homes subscribe to digital pay-television.

Subscribers from the region's two largest countries, China and India, make up 90 per cent of all digital pay-television subscribers in the region.

Arianespace accounts for 70 per cent of commercial satellite launches in the Asia-Pacific. But it was currently unable to tap the mainland market because of Beijing's ban on foreign companies launching satellites for both governmental and commercial users on the mainland, said Balaam.

Still, Arianespace sees market potential from Hong Kong, Japan, South Korea, Singapore, Taiwan and other countries in the region, which already contributes up to 40 per cent of company sales.

The economic crisis prompted many banks to temporarily cut lending to some small satellite companies and derailed launches. The launch fee per satellite is about Euro100 million (HK$1.14 billion) while the satellite building cost is Euro200 million, plus 12 to 15 per cent for insurance. Banks have begun extending credit to the industry again, according to Balaam.

Sky high

Cost of building a satellite to provide high-definition television broadcasting: Euro200m