The group discuss the implications of the merger and how a GEO/MEO champion can compete with Starlink and find their own niche in the space (pun intended)
The guests for this episode are:
Lluc Palerm Serra, research director at NSR, an Analysys Mason Company
Christof Kern, Business Development Lead – Satellite & Space, TTP
“It's clearly a very important deal for the satellite industry,” Palerm Serra begins the podcast by saying.
SES and Intelsat have been exploring a tie up for a while, but there are a lot of synergies between the two companies that meant a deal was bound to happen at some point. Palerm Serra believes.
“Over the last 12 to 18 months, industry pressure has increased, which probably helped get the transaction over the line,” Kern agrees.
What industry pressures exist?
“Starlink is an obvious one,” Kern explains.
Kern says that Starlink addresses a new market, opening up a credible consumer broadband product, which classic GEO satellite operators have failed to deliver on.
“Starlink’s value proposition beats the promise that the GEO satellite industry can make to its million or so consumer broadband customers,” he says.
“Where professional solutions for mobile network operators are concerned, a GEO/MEO solution can still deliver superior results. But if you try to sell an mpower terminal to a cruise ship, they have the option to buy 10 Starlink terminals instead. That's also solution and it also works right?”
“I think the industry in general has been playing a waiting game the last two years and saying, OK, what's going to happen?”
“Now they are starting to feel the pain, so smaller to medium satellite operators are starting to think about what they can do. But two of the big ones, Intelsat and SES, chose the easy way out creating an industry giant they think is too big to fail.”
“I think that the combination of SES and Intelsat will probably capture market share around 30% of the traditional GEO FSS business,” Palerm Serra said.
“LEO satellite operators will have challenges serving high concentration demand for capacity in specific spots. This is somewhere a combined SES/Intelsat fleet, with its multi-orbit offering, can differentiate from the pure LEO and GEO operators.”
Listen to the full episode for more.
