Ground Segment at a Turning Point
The ground segment and user terminal market is going through significant expansion in terms of both capabilities and demand. 2018 has entailed a point of inflection in the ground segment industry with the preparation of the OneWeb ground network, the launch of additional HTS systems and the need for further ground stations to provide connectivity with EO constellations. After some years of market consolidation in the teleport industry for Satcom applications, the number of ground sites is tending to stabilize in mature markets and is expected to grow from 2019 driven by new installations in emerging regions. However, the average number of antennas per site is foreseen to increase in the coming years, accommodating new antennas from third party constellations and HTS systems. As per EO ground segment, the number of ground stations is steadily growing to serve the increasing demand for EO data and value-added services. The 2018 ground segment market (data & services, defense and intelligence, broadcast and EO) is estimated at more than $2,7B and is expected to experience a 7% growth in the next two years. On the user terminal side, there is both a growth in the number of new terminals shipped and market value, achieving more than $4 billion by 2028.
In the last five years, numerous companies have announced new Satcom and EO satellite solutions, largely based on constellation projects but also large HTS systems, aiming to capture new customers. Most of these solutions promise reducing service costs and/or providing added value. However, their feasibility and sustainability are usually focused on the space segment, whereas their business cases need to evaluate them as end-to-end systems, including the ground segment and user terminals that will be required. Their ground segment CAPEX and OPEX are not negligible and their user terminals, in particular, their performance and price, will have an impact on the market adoption of these solutions. Over the last three decades, there are some examples of satellite systems that underestimated the impact of the ground and user segments resulting in bankrupt or in a degradation of their expected revenue stream. Therefore, finding a sweet point between space segment performance, ground segment features and selection of terminals, along with service provided and the price will be key for the success of new EO and Satcom satellite systems.
Each satellite mission, being in a constellation or not, might have different communication needs (e.g. modcods, frequency bands, etc.) and so, the rationale for the use of the ground segment can vary. The amount of data to download, the regional distribution of end-users, connectivity with ground networks, meteorological constraints, etc. might also impact in the definition and use of the ground segment. For this reason, there are different types of ground stations and owners, such as satellite operators, service providers, etc.
As for terrestrial networks, satellite IP-based communication is a game-changer for end-users, bringing harmonization and communications efficiency. However, at the same time, the use of this protocol and associated complex architectures might increase the risk of different cyberattacks by increasing the entry points (e.g., denial of access, masquerade, backdoors, malware, spoofing, eavesdropping, etc.). The ground segment is, therefore, a key element in the end-to-end satellite system and eventually in its security, no matter if this is serving EO, Satcom or other applications. However, all systems can be vulnerable in principle. The success of service provision and trust from end-users will depend on the measures that are taken to minimize these types of attacks.
Regarding user terminals, their taxonomy, (i.e. fixed, mechanically steered and electronically steered antennas), size, weight and power (SWaP) and frequency bands are influenced by the different market verticals they serve. For example, consumer broadband antennas will be fixed (at least until the operation of broadband constellations), whereas in the mobility market (aero & maritime) they will be full motion. In terms of frequency bands, consumer broadband terminals will tend to use Ka-band, while video terminals will use notably Ku-band. Again, the quality of the service and the service price that will be provided to a given vertical market will impact the selection of these features among others (e.g. satellite EIRP, size of terminals, etc.).
As of today, the Satcom user terminal market is dominated by fixed terminals, representing 99.3% of the total. The mobile terminal market (i.e. full motion) is very small and mostly contain mechanically steered antennas. In 2017, Kymeta, an electronically steered antenna (ESA) manufacturer introduced an ESA for terrestrial as well as maritime market segments. Currently, there are tens of companies that are developing these solutions and in early operation. The demand for ESA units is still tiny but is expected to grow more rapidly from 2023 onwards (i.e. 74.3% CAGR in total over the next decade). This growth will be driven by the realization of NGSO constellations and the growth of the mobility market.
The space sector is pushing for substantially more productive satellite infrastructure and ground segment at a lower cost. This trend is expected to intensify over the next decade, coupled with an increasing push for standardization in satellite manufacturing and ground segment equipment. New technological developments (notably going to SaaS) seek a more productive infrastructure to provide lower-cost end-to-end services. The advent of new satellite systems usually calls for new terminals. Developing lower-cost ground terminals to serve mobility applications and connectivity with constellations is an important criterion for operators to overcome the “barrier of user terminals” and to increase the adaptability of data-centric applications.
SANTIAGO PEREZ | Position: Senior Consultant
Experience: 12 years
Santiago joined Euroconsult in 2014. As senior consultant, he is in charge of institutional and technical consulting missions, both in Satcom and EO domain, such as contributor of Euroconsult’s flagship reports as Satellite Communications & Broadcasting markets survey or SatCom for Defense & Security: Strategic Issues & Forecasts among others. Santiago is also the editor in chief of the Ground Segment Market Prospects report.
Before joining Euroconsult, he worked at the Instituto Nacional de Técnica Aeroespacial (INTA) in Madrid. His work focused on developing solutions for NASA’s Madrid Deep Space Communications Complex (MDSCC). He also was involved in the CESAR program, with ESA, and with CNES and JAXA with EUSO-BALLOON and JEM-EUSO projects. He also has supported the National Directorate of Armament, focused on Space programs in the Spanish Ministry of Defence.
Santiago holds an engineering degree in Telecommunications, Electrical and Electronic engineering from the Miguel Hernandez University of Elche and a Master in Space and Satellite Technology from the Polytechnic University of Madrid. He also holds an MBA, majoring in Management from ESDEN Business School in Madrid.