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Satellite Capacity Pricing Index (Q3 2017), 3rd Edition

Coming: July 2017

Available Licenses:

  • Standard: $4,295  
  • Enterprise: $8,295

NSR Report Deliverables

NSR delivers clarity and critical market insight.

NSR’s Satellite Capacity Pricing Index, 3rd Edition (Q3 2017) addresses the critical question: how much does satellite capacity really cost? With detailed pricing information gathered from both global and regional satellite operators, as well as Service Providers, NSR’s Satellite Capacity Pricing Index, 3rd Edition (Q3 2017) offers a comprehensive & unbiased understanding of why satellite capacity pricing is evolving as it is, and where it may go in the future.

The satellite industry is at an inflexion point, with operators adopting managed service business models and service providers looking to consolidate assets to curb capacity cost and build economies of scale. Technological innovation continues to drive higher throughput from existing capacity, while the accelerating addition of HTS has started to sound the death knell for traditional data markets. With this dynamic and with shorter contract terms, capacity pricing is the single most important data point in a crowded market. NSR’s Satellite Capacity Pricing Index, 3rd Edition (SCPI3) analyzes this price influenced inflexion point by modelling market dynamics through inter-dependence between various supply and demand factors, and answer questions such as:

  • How has capacity pricing evolved over the last year, and what will be the forecast for the future? As well, which regions will feel the greatest impact from HTS pricing?
  • What are the pricing differences between DTH, Distribution, Mobility, Enterprise Data, Trunking, and how do major geographical regions impact the base price?
  • How can operators compete with the “race to the bottom” pricing strategy and maintain margin?
  • If all capacity is not created equal, then how to differentiate price in accordance with the Quality of Service (QoS) obtained?
  • What are the perspectives from the value chain (satellite operators, service providers and financial institutions) on the impact of pricing towards top-line market strategy?
  • How pricing, is not absolute, and with the input of 12 factors, does pricing vary according to various application types, regions, and QoS?

NSR’s SCPI3 combines base price and factor-based inputs from regional operators, Big Four operators, and service providers, to provide an even, balanced and well-rounded view of pricing within the industry. Expanding on NSR’s Q4, 2016 edition of this study, this most recent edition provides a range in pricing, for both rate card and estimated negotiable pricing through a combination factors.

SCPI3 includes pricing matrices on traditional FSS C-band, FSS Ku-band, and GEO-HTS capacity for Q3 2017, segmented regionally across 5 regions, and by application across Video, Data, and Mobility. Beyond this, NSR quantifies a range of pricing with appropriate standard deviation backed by anchor criteria, thus providing bound estimates for various combinations of factors such as contract duration, amount of capacity (small/large customer), fill rates, and customer retention discounts. In addition to pricing ranges, NSR also includes significant qualitative analysis on both existing prices and the market expectations one year into the future.

At its core, the proprietary model built within SCPI3 untangles various market facing factors influencing pricing and sensitize appropriate parameters on the lookout in the future. The pricing index along with the range of pricing reflects the industry state of change and enables perspective on different pricing strategies of incumbents or upcoming players. This is made possible through inputs from many NSR reports including, but not limited to Global Satellite Capacity Supply & Demand, Satellite Operator Financial Analysis, and more. The analysis from pricing tool used for the study allows users to understand the pricing dynamics of the satcom industry, how sensitive prices are to market facing factors, how prices and elasticity of demand correlate, and provides an insight into scenario thinking for tweaking the model to derive a consequent pricing strategy hypothesis for a client’s organization. 

NSR’s Satellite Capacity Pricing Index, 3rd Edition (Q3 2017)- Report Segmentation

  

Primary Questions/Issues Addressed in This Report Include:

  • To what extent have the prices changed during the past year, and how can operators differentiate for the price to stabilize?
  • Which operators are most/least insulated from pricing pressures based on their core markets? What is the effect of bulk deals on base capacity pricing, and which regions/players are affected the most?
  • Which market factors will play the most important role moving forward by region and application, and how does one quantify the inter-dependence to incorporate necessary market dynamics and build a pricing forecast?
  • How to interpret and quantify price influencing factors through sensitivity studies with respect to a region, application, and inherent value chain.

Executive Summary

1. Introduction
   Satellite Industry Financial Overview
   3-year Historical Trends to Present Day Observed Pricing Scenario
   3-year Historical Supply/Demand Fill Rates and Market Share

2. Current “Spot Price” Pricing Analysis
   Introduction to 12 Factors Influencing Price and Associated Anchor Criteria
   Factor inter-Relation Matrix
   Introduction to Pricing Model with Price Baseline
   Current “Spot Price Index and Range” for Capacity Segmented by:
      • C-, Ku-band, GEO-HTS
      • NAM, LAM, EU, MEA, Asia
      • Video Broadcast, Data Networks, Mobility
   Bottom Line

3. Market Dynamics and Pricing Forecast
   Description of Video/Enterprise/Mobility Value Chains including Major Customers
   1-year Pricing Forecast Based on 12 Factors and per Application/Region.
      • Including Sensitivity Analysis of Factors
      • Standard Deviation and Anticipated Bounds
   Analysis of High Growth Applications and Subsequent Impact on Pricing
   Scenario Analysis using NSR Pricing Tool
   Bottom Line

Appendix: Methodology