With the satcom industry moving to network applications and integrated service business models, the price-demand equation has changed considerably over the last 5 years.
The satcom industry today relies on five major elements – Pricing (competition), Supply (indicating Asset worth), Demand (Growth), Break-even pricing (manufacturing innovation) and Ground System (efficiencies). While the economics of demand growth and ground system efficiencies have been proven to be more linear in the last several years, the same cannot be said for Supply.
Satellite Capacity Pricing: Is the Retail Era Just Getting Started-Another year, another pricing decline. It’s imperative to ask how the market has changed?
Satellite capacity prices slid 18 percent over the past 12 months, with data services like backhaul and fixed broadband driving the steepest declines, according to Northern Sky Research. An abundance of cheap high-throughput satellite capacity is the most significant influencer of new pricing structures, rendering older satellites increasingly obsolete.
NSR’s Satellite Capacity Pricing Index, 5th Edition (2019), released today, finds accelerated pricing decline across operator segments, with a global average decline of 18% over the past 12 months.