Global Scada, M2M and

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1 Thought Leadership The foundation of NSR s business is the ability to continually help clients stay ahead of the curve and anticipate trends before it is too late to react. Whether it is a market research report covering a new application area or a unique consulting service tailored specifically for you, NSR prides itself in leading the industry with new, innovative offerings. Global Scada, M2M and LDR via satellite Markets 2 nd Edition This first-to-market approach has enabled NSR to successfully anticipate market direction for a range of services and applications in all regions of the globe. Never content to only provide analyses on legacy markets, NSR has routinely broken new ground by analyzing and forecasting a range of up-andcoming applications and services across a wide range of coverage areas. Mixing technical expertise with business acumen, NSR s forward-looking thought leadership is a critical element of our client s decision making in all regions. Satellite Communications Northern Sky Research, LLC One Mifflin Place 119 Mount Auburn Street Suite 400 Cambridge, MA USA Phone: Fax: info@nsr.com Broadcasting & Digital Media Hybrid & Emerging Applications Commercial Space

2 Report Description Report Specifics Demand for supervisory, control & data acquisition (SCADA), machine-to-machine (M2M) and low-data-rate (LDR) services are on the rise given the needs of key vertical markets. VSATs and MSS platforms that support sub 64 Kbps data rates are used for both asymmetric and symmetric systems, while higher throughput broadband systems act as relay stations as well as address specialized needs. Elements Analyzed per Region For low data rate systems, although the space segment costs are relatively minimal in many solutions available today, service revenues have exhibited high margins. Applications that include Blue Force Tracking (BFT) for the military, asset monitoring for the transportation industry as well as pipeline monitoring for the oil & gas industry are but a few examples that have provided healthy revenue streams. The main value proposition rests with network reliability, ubiquity of service and high levels of security in support of mission-critical requirements. Regions Covered North America Latin America Europe Asia Middle East & Africa Today, however, broadband systems and new technologies are being contracted for needs that are currently LDR in nature, but applications such as CCTV for security purposes are being bundled to upscale for future requirements. The smart grid, digitization of oil fields, and automation across verticals are only a few examples of market developments taking place that are leading to higher levels of throughput. Moreover, on the horizon are existing and upcoming programs, specifically high throughput satellites (HTS), which could potentially tap the market and perhaps cannibalize the market share of legacy offerings. Inmarsat s upcoming Global Express, Iridium NEXT and other companies that have traditionally played key roles in the SCADA/M2M/LDR market are upping the ante, which could lead to the entrance of other HTS players. Going forward therefore, the evolution of bandwidth needs as well as the solution mix is becoming more complex. With opportunities come threats, and the challenge is to navigate the emerging landscape and determine where each technology provides the best fit. This NSR study analyzes key elements in terms of integration, competition, cost and preference in light of user requirements and ROI considerations. The frequency mix is evaluated and scrutinized in order to determine whether cannibalization or complementary solutions are in the offing for current and future solutions. Oil & Gas Vertical Market Utility Industry Transportation/Cargo Industry Military Emerging Markets Green Energy Environmental Market Others Pricing Strategies Evolution or Shift in Vertical Requirements NSR Coverage Areas S atell i te C ommun i cat i ons From spacecraft manufacturing and launching to the applications Forecast per Region In-Service Units Service Revenues Breakout by Frequency Band L-band Ku-band HTS Forecast by Vertical Market Primary Elements, Key Issues and Specific Questions to be Answered in this Report Include: What is the current state of the industry? What s new in the market? How will the market evolve? What is the effect of the market s changing requirements on revenue prospects? Which technology solutions will be preferred over time? Does the availability of broadband systems as well as the entrance of HTS mean the end of LDR systems? Will HTS cannibalize market share and the business prospects of legacy LDR systems? If so, how fast is the pace? If not, what is the key to LDR s success? With tight budgets and verticals favoring reliance over increased performance, will new technologies gain substantial market acceptance? In each vertical or industry being targeted, what emerging landscape is beginning to takehold? What is the effect on satellite companies offering LDR? What is the opportunity for new programs such as HTS? Is there an interplay or partnership opportunity for both? How does NSR expect the entire satellite SCADA/M2M/LDR market to play out over the next 10 years? that drive capacity supply and demand B roadcast i n g & D i g i tal M ed i a Video is the core and foundation of the industry, typically accounting for 60% or more of total revenues H y br i d & E mer g i n g A ppl i cat i ons NSR s leading edge coverage has shown that satellite is more than ever intertwined with the fabric of terrestrial networks A Complete Analytical Perspective Elements of this study include: Complete report document segmented by analysis on all regions, frequencies, verticals and technologies Application and strategic analysis An Excel file containing extensive data and charts so the client can easily use this work as a basis for their own internal market projections C ommerc i al S pace Beyond telecommunictions services, Commercial Space presents promising opportunities for the space industry

3 Executive Summary Introduction By way of definition, supervisory, control & data acquisition (SCADA), machine-to-machine (M2M) and low-data-rate (LDR) services fall within a wide range of data rates given the applications they support. The chart provides a summary of platforms and corresponding applications and functions as well as estimated data rates. It should be noted that applications and functions are not mutually exclusive for SCADA, M2M and LDR, and in many instances, applications and functions overlap. The table is meant to provide a sample of functions and data rates that are typical in the satellite industry. Demand for SCADA, M2M and LDR services are on the rise given the needs of key vertical markets. VSATs and MSS platforms that support sub 64 Kbps data rates are used for both asymmetric and symmetric systems, while higher throughput broadband systems act as relay stations as well as address specialized needs. For low data rate systems, although the space segment costs are relatively minimal in many solutions available today, service revenues have exhibited high margins. Applications that include Blue Force Tracking (BFT) for the military, asset monitoring for the transportation industry as well as pipeline monitoring for the oil & gas industry are but a few examples that have provided healthy revenue streams. The main value proposition rests with network reliability, ubiquity of service and high levels of security in support of mission-critical requirements. Broadband systems and new technologies are likewise being contracted for needs that are currently LDR in nature, but applications such as CCTV for security purposes are being bundled to upscale for future requirements. The smart grid, digitization of oil fields, and automation across verticals are only a few examples of market developments taking place that are leading to higher levels of throughput. Moreover, on the horizon are existing and upcoming programs, specifically high throughput satellites (HTS), which could potentially tap the market. Inmarsat s upcoming Global Express, Iridium NEXT and other companies that have traditionally played key roles in the SCADA/M2M/LDR market are upping the ante, which is leading to a complex mix of solutions in the marketplace.

4 Overall Market Findings The transportation/cargo vertical continues to dominate the SCADA/M2M/LDR market, and this trend is expected to persist within the forecast period both in terms of in-service units and revenues. However, although growth of in-service units is expected to be sustainable, revenue growth is expected to decline due to lower ARPU levels brought about by competition from within the satellite industry as well as from terrestrial technology offerings. The utility industry and the oil & gas sector are expected to account for steady demand and thus revenue streams within the forecast. These traditional markets should continue to use satellite technology both for the new deployments of assets as well as for upgrades in existing networks. Military markets, driven by Blue Force Tracking (BFT) and Movement Tracking System (MTS), are expected to grow until 2015 but decline beginning in 2016, which reflects the planned troop drawdown in Afghanistan. Unless plans from the U.S. and its allies change, BFT/MTS implementations should experience steady decreases until the end of the forecast period. Finally, emerging markets are beginning to incorporate greater numbers of in-service units due in part to market demand but also to market push by key service providers. Requirements by this vertical, which include renewable energy sources, Tsunami warning systems, earthquake monitoring (to name a few) may be moving towards broadband implementations that include video services such as CCTV used for security and other purposes. Regionally, the market is expected to be dominated by North America, accounting for 40% of cumulative revenues, driven largely by the Transportation/Cargo vertical. The Middle East/Africa region is expected to come in a distant second, driven by the Military and Emerging Markets verticals, while Europe is closely behind at third in terms of revenue shares. Other land regions are expected to be at single digit levels, while the ocean regions should account for relatively minor shares of the market. Conclusions The satellite SCADA/M2M/LDR market is expected to be healthy within the forecast period with opportunities abundant for traditional verticals as well as emerging markets. Mobile solutions have been and will continue to be one of the key elements in the satellite SCADA/M2M/LDR market, given the importance of the transportation/cargo vertical. Military markets, which currently use mobile satellite services (MSS) for mission-critical applications, are where the most pronounced market shift is expected to take place given policy thrusts towards in the Middle East/Africa region. SCADA/M2M/LDR is inherently narrowband where bandwidth requirements and packages will continue to reflect these needs over the long term. However, the availability of High Throughput Satellites (HTS) will change the solution mix where broadband platforms are being delivered and installed to serve narrowband needs. The key lies in attractive service and equipment packages as well as the ability to upgrade or seamlessly tap broadband applications such as CCTV as a bundle should requirements such as security prove beneficial for future needs. In a sense, the main missions for SCADA/M2M/ LDR are narrowband, yet a broadband platform with competitive cost structures enable end users the flexibility to upgrade and adopt applications seamlessly over current IP VSAT and HTS solutions.

5 Our goal is to help manager s worldwide plan for growth based on unbiased, actionable intelligence and analysis About NSR NSR is a leading international telecom market research and consulting firm with a mission to provide unique insights & assist organizations in strategic decision making. With an experienced group of analysts located in all regions, NSR is a premier global market research and consulting company. Broadcasting & Digital Media Video is the core and foundation of the industry, typically accounting for 60% or more of total revenues, while other digital media applications show some of the industry s fastest growth rates. NSR s extensive coverage of this important market leverages its geographically diverse analyst pool to capture the regional differences of video traffic and digital media applications around the world. By analyzing growth in video channels and feeds, in addition to location of emerging video platforms and applications in each region, NSR is able to provide detailed market insight for our customers. Research Report Topics Gov t and Military Satellite Communications Broadband Satellite Markets Machine to Machine (M2M) and SCADA Mobile Satellite Services Wireless Backhaul via Satellite Satellite Capacity Supply & Demand IPTV via Satellite Advanced Satellite Coding and Modulation Direct-to-Home (DTH) Digital Signage Mobile TV and Mobile Video Earth Observation High Throughput Satellites (HTS) Remote Sensing Video Broadcasting and more... Place your order for the Research Reports on above topics at NSR s products and services cover all analytical aspects of each market, including both business and technical issues. 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