Satellite connectivity is finding many new use cases, from agriculture to retail and mining to maritime. If an enterprise’s operations include remote sites, satellite can be a real benefit to its business. And alongside new use cases, a new business model is gaining momentum to make satellite more affordable to all: Ground Segment as a Service (GSaaS).
Low-earth orbit (LEO) is transforming satellite connectivity. LEO satellites operate at altitudes of around 500 to 2000 kilometers which is close enough to Earth to deliver fast, high-powered data communications services with low latency. This is far closer than geostationary satellites, which are in orbit around 36000km above earth.
However, unlike GEO satellites, which follow the earth’s rotation, LEO satellites orbit the earth faster, meaning they need a global network of ground stations to receive data. So, although satellite deployment costs have decreased in recent years, a big network of ground stations to connect a LEO constellation requires significant capital expenditure (CAPEX).
While LEO satellite operating companies have focused their investment on the satellite end of the network, they often rely on partners to provide the other key elements of their end-to-end satellite connectivity offering, including the ground stations and associated equipment representing the ground segment. Indeed, as Northern Sky Research reported in 2022, “With the majority of investors focused on the high CAPEX space segment, finances will be relatively limited for ground infrastructure development, which will require lower cost ground solutions.”
These financial challenges have seen infrastructure sharing and pay-as-you-go (PAYG) models emerging for satellite. Like in cloud computing, owning infrastructure is no longer necessarily viewed as a strategic advantage. Large enterprises use public clouds to store non-critical data, or run non-critical applications, rather than trying to manage everything in-house on their own infrastructure. And in telecoms, many operators are now separating infrastructure from services, sharing infrastructure and reducing costs, enabling them to focus investments on other, more business-critical elements of the value chain.
In satellite terms, ground segment investment requirements can grow dramatically as satellite operations are scaled up. In CAPEX terms, the initial costs of putting a ground segment site in place can be influenced by basic real estate costs and demand for that geographical location. The next cost is the antenna itself, the prices of which are influenced by frequency and gain. Then there are also the costs for physical antenna co-location within the network.
This need for financial flexibility in satellite infrastructure has encouraged providers to offer new services. There are now companies providing pieces of the satellite ground infrastructure puzzle, such as:
According to the Satellite Industry Association, the ground segment of satellite connectivity provision – the critical link between Earth and satellites – represents around one-third of the Global Space Economy market, at $142 billion.
GSaaS aims to overcome the financial challenges and make LEO satellite more accessible to more operators. It drives cost savings through mutual usage of physical infrastructure by several different users. The PAYG model enables more agility and flexibility and it’s ideally suited to satellite operators who use ground stations sporadically, for limited data volumes, or who choose not to own the ground infrastructure.
GSaaS addresses a variety of use cases, including:
And GSaaS offers further potential business benefits for satellite operators. It can enable “bring your own satellite”, where satellites are owned, leased or rented by telecom operators directly, in the knowledge that GSaaS service will be ready and waiting for them when they need it. It also, as with cloud, carries no long-term commitment and the highly-attractive OPEX model.
As the need grows for higher bandwidth, antennas must support different, higher frequencies. Some satellites still operate in X frequency, but this is typically reserved for government and military use. The majority of GEO and LEO satellites operate in frequencies of KU and above. But these higher frequencies need more powerful antennas, more expensive equipment, and different technical expertise.
Another antenna challenge is that they must deal with handovers between multiple satellites in multiple orbital planes and to multiple ground stations, as they are not stationary like GEO satellites. They need to be able to track satellites as they move and as the antenna itself moves. They also need to handle the different frequency bands needed for different constellations, and to channel and manage high volumes of data. Providing these capabilities is not cheap.
So, while developing expertise in these new types of antennas and frequencies can be a natural evolution for large telecommunications and satellite experts who have been providing satellite communications for some time – companies like Orange and its subsidiary Globecast – it can be a challenge for newcomers.
Building dedicated ground infrastructure is highly regulated and requires licenses for both space and ground segments. Licensing ensures that radio frequency interference doesn’t negatively impact satellite operators. So, satellite operators have to obtain a space segment license from the International Telecommunication Union (ITU), the body responsible for spectrum allocation, and acquire a ground segment license from the country where they want to build and operate their ground station. Getting and managing these licenses is costly, time-consuming, and disruptive to overall business operations.
According to Samy Nicolas Bouchalat, Head of Space network solutions at Orange Wholesale International “Antennas might be the most visible part of the infrastructure, but other critical elements are the datacenter connectivity and capabilities. Meeting datacenter requirements means having rack space available for all the incoming equipment, and the power and cooling needed to support it. This can demand significant upgrades to power and cooling, which can involve substantial investment.”
Under a PAYG business model, ground segment providers will likely need to secure a decent number of customers who use the service regularly to drive profitability. GSaaS is a good option for companies with the financial and infrastructure resources to make the shift into it.
The satellite market is flourishing - Northern Sky Research forecasts that satellite data traffic will grow around tenfold between 2020 and 2030 – and new players are emerging all the time who need more agile, more cost-effective solutions for the earth-based element of the satellite value chain.
As bandwidth requirements increase, so too do the complexity and costs involved in the ground segment. Telecoms operators have the potential to offer many of the services required for GSaaS, including licenses, cloud, connectivity, and end-to-end support that can ensure QoS and customer service. It could be an interesting time for telecom operators to demonstrate some key strengths and assets and become major players in this booming market.
