Over the past three years, global satellite capacity has expanded eightfold, reaching approximately 27 Tbps in 2023, with Starlink accounting for over 80% of this total. Much of this dominance is due to delays from other constellation projects and software-defined satellites. However, the introduction of new Low Earth Orbit (LEO) constellations, including Telesat Lightspeed and Amazon Kuiper, along with second-generation constellations for Starlink and Eutelsat OneWeb, and Very High Throughput Satellites (VHTS) like Viasat-3, is expected to push capacity growth to 260 Tbps by 2029.
The increasing prominence of Non-Geostationary Satellite Orbit (NGSO) systems has led to a decline in Geostationary Earth Orbit (GEO) satellite orders, as operators take a "wait and see" approach. Despite this, GEO capacity still generated about 85% of satellite capacity revenues in 2023. NGSO capacity revenues, however, are forecasted to grow at a Compound Annual Growth Rate (CAGR) of 27%, overtaking GEO revenues by 2028 and reaching $18 billion by 2033.
GEO-High Throughput Satellite (GEO-HTS) systems continue to play an important role in premium segments such as aeronautical connectivity, military satellite communications, and fixed broadband services that require high uptime or Service Level Agreements (SLAs) based on Committed Information Rates (CIR). Starlink, however, accounted for 70% of total HTS traffic in 2023, increasing competition in sectors like consumer broadband and maritime, putting additional pressure on traditional GEO operators.
"Facing a shifting landscape marked by declining demand for video broadcasting, fluctuating mobility market patterns, and an influx of capacity from NGSO constellations, satcom operators have been exploring different strategies to survive," said Dimitri Buchs, Manager at Novaspace and lead author of the 'Satellite Connectivity and Video Market' report.
To diversify their service offerings and build business resilience, satellite capacity providers have increasingly sought "multi-orbit" partnerships to expand their market presence. Segments with lower price sensitivity, like aero In-Flight Connectivity (IFC) and military communications, are expected to drive demand for these multi-orbit solutions. The report projects that multi-orbit service revenues will approach $5 billion by 2033.
In addition to forming partnerships, satellite operators have pursued both vertical and horizontal integration. Significant mergers and acquisitions in 2023 included Viasat's purchase of Inmarsat and Eutelsat's merger with OneWeb. Additionally, SES announced its plans to acquire Intelsat in 2024, with regulatory approval expected by 2025.
This intensifying competition is expected to push the Average Revenue Per Unit (ARPU) for satellite capacity below $100 per Mbps per month across most segments by 2033. This reduction in prices will likely unlock new opportunities, particularly in underserved areas such as rural regions, remote locations, and areas near urban centers and oceans, with global capacity demand projected to rise to 73 Tbps by 2033, representing a 27% CAGR.
Overall, total service revenues for the satellite industry are projected to reach approximately $117 billion by 2033. However, the report notes that the return to revenue growth may be delayed due to continued declines in video services in mature digital markets, as well as slower-than-expected growth in previously expanding markets like South Asia. Deployment delays of NGSO constellations and VHTS capacity have also slowed revenue growth in key data segments such as Enterprise Networks.
Research Report:Satellite Connectivity and Video Market, 31st edition
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