IP OVER SATELLITE
Research Seminar on Telecommunications Business II
Jarkko Viinamäki
Helsinki University of Technology
April 6th 2004
Agenda
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Introduction
Satellite IP Technology
Current Market Status
Future Prospects
Case Study: TiscaliSat
Conclusion
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Introduction
• The number of Internet users is growing rapidly (~720
million in March 2004)
• Need for broadband connections
• Many areas do not have high speed terrestrial networks
• Satellites can be used to route Internet traffic without
expensive infrastructure
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Satellite IP Technology
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Satellite access equipment
Positioning
Operating frequencies
Service models
Standards
Pros & cons
Comparision to other technologies
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Satellite Access Equipment
• Spacecraft (Satellite)
– multiple transponders (20-80 x 40-155Mbps)
– separate frequencies for uplink/downlink
– most common: C, Ku, Ka-bands
• Service Provider Ground Station
– ODU (large dish), IDU, NMS, NCC
– connected to backbone Internet
• Subscriber Side Ground Terminal
– ODU (dish), IDO (satellite modem/DVB-card)
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Positioning
• GEO (Geosynchronous Earth Orbit, altitude 35786km,
>250ms 1-way delay, 33% footprint)
• MEO (Medium Earth Orbit, altitude 8000-20000km, 50150ms 1-way delay, ILS)
• LEO (Low Earth Orbit, altitude 350-2000km, 10-30ms 1way delay, ILS)
• Higher altitude means higher
– round-trip-delay
– launching cost
– satellite lifetime and size
– footprint/coverage
– bit-error-rate (BER) and signal attenuation
– need for transmission power
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Operating Frequencies
• S, L, X, C, Ku, Ka and V-band
• Allocation controlled by IRFB (International Radio
Frequencies Board)
• C and Ku-band becoming congested
• Ka-band suffers from high BER in rain
• New satellites utilize the Ka-band
• V-band is reserved for future use
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Service Models
• Hybrid unidirectional (high bandwidth downlink via
satellite, uplink via ISDN/Modem/GPRS)
• Bidirectional (pure asymmetric down/uplink via satellite)
• Push/Broadcast mode (only downlink via satellite)
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Standards
• DVB-RCS (Digital Video Broadcast, Receive Channel via
Satellite)
– FEC
– MF-TDMA
– ATM Adaptation Layer 5 (AAL-5) or MPEG-2
transport
• DOCSIS (Data Over Cable Service Interface Specification)
• Proprietary protocols (DSS by Hughes Network Systems)
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Pros
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Practically global coverage
No need for expensive infrastructure
Single-hop transmission
Efficient broadcasting
Bandwidth-on-Demand (BOD)
Demand Assignment Multiple Access (DAMA)
Excellent reliability (up to 99,97%)
Same satellite dish can be used for IP and as
television/radio channel receiver
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Cons
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high latency especially with GEO satellites
weather-related outages
solar-related outages
required Line-of-Sight (LOS) to the satellite
Ku-band is heavily degraded by atmosphere attenuation
high usage and equipment costs
high Bit-Error-Rate (BER)
usually lower bandwidth for end-users than with
xDSL/Cable
• TCP performs poorly in satellite links
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Comparison to Other
Technologies
Satellite vs. terrestrial networks
- very high latency (500ms vs. 10-50ms)
- usage much more expensive (up to 100%)
- higher equipment and installation costs
- data transfer based billing vs. flat rate
- possibility for almost unlimited BOD vs. fixed
bandwidth/limited BOD
- available anywhere vs. available only in dense residental
areas
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Satellite IP Markets
Drivers
 Demand for high-speed Internet in areas with poor or non-existent
terrestrial infrastructure
 Decreasing component costs
 Standardization for increased vendor interoperability
Challenges
 still expensive satellite equipment and usage costs
 latency issues
 line-of-sight issues
 better utilization of bandwidth
 over supply and competition
 delays: planned broadband systems have not materialized
 business failures: satellite mobile systems have not achieved
expected demand
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Satellite Market Segments
• Fixed Satellite Services (FSS)
– trunk telephony, IP networks / Internet backbone, corporate VSAT,
BOD, contribution services
• Direct-to-Home Broadcasting (DTH)
– analogue/digital satellite DTH
– dominant market segment with around 66% share by 2012 ($85
billion revenue) (ESYS estimation)
– North America and Western Europe current hot areas - markets in
Asia look very promising
• Digital Audio Radio Services (DARS)
• Broadband Access Services (BBA)
• Mobile Satellite Services (MSS)
– maritime, auronautical, personal mobile, messaging & paging
• Navigation (NAV)
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– road, maritime, aviation, personal
Market Viewpoints
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Satellite operator view
– risky market, satellite fleets cost up to 7 billion dollars
– wide range of services (tv, radio, IP)
– satellite lifetime is short
– terrestrial networks steal practically all broadband customers in dense
residental areas
– lots of competition, over supply, big players
ISP view
– no need for expensive infrastructure
– co-operation with satellite operators and equipment vendors
– BOD offers an ideal service model
– very dynamic setups
– currently approximately 7-10% of ISPs in the world use satellites
Customer view
– choose satellite IP if you have no choice
– broadcasting, distance-learning, high bandwidth requirements
– use as backup for terrestrial links
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Customer Segments
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Small to Medium-sized Enterprises (SME)
Small Office/Home Office (SOHO)
Business Multi-Tenant Units (MTU)
Multi-Dwelling Units (MDU)
Hotspots
Rural communities
Aviation
Maritime
Military
Media & entertainment
Carriers & ISPs
Corporate networks
Public sector/government
Business (Point-of-Sale credit card processing)
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Current Market Status
• currently satellite systems only have 1.5% of the
broadband market and may ultimately gain 6-7% of the
global market according to guru Dr. J. Pelton
• lots of competition, over supply, hype
• complex pricing models, not enough focus
• clear customer segments where customers have no other
choice than satellite IP
• satellite IP market growth has been radically overestimated
• projects fail, plans are changed
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ISP Satellite Usage
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Pricing Models
• Per month pricing (flat rate)
– rare, expensive
• Transfer based billing
• Hybrid models
– limited transfer amount
– monthly fee + transfer limit + extra cost/Mb
– lowered bandwidth when limits exceeded
– priority traffic with extra cost
– unlimited BOD
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Future Estimations
• Most satellite ventures delayed (global recession,
investments down)
• European broadcast market near saturation
• Terrestrial network usage prices going down
• DVB-RCS equipment prices must fall by 50-60% to gain
momentum
• Pioneer Consulting expects global broadband satellite
market to grow from $1 billion (2001) to $27 billion
(2008)!
• Northern Sky Research expects enterprise installed satellite
base to grow from 76000 (2002) to 420000 (2007) and
customer base from 71000 (2002) to 701000 (2007) in
Europe
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Future Estimations (cont.)
• figures may be radical overestimates according to some
gurus
• affecting factors: rollout of new Ka-band satellites,
improvements on technology, pricing, improvement of
business models
• connection price and latency issues are the most critical
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Case Study: TiscaliSat
• TiscaliSat offers satellite Internet connections in Finland using
EUTELSAT satellites
• Covers entire Finland – for remote areas a slightly larger dish is
required
• Two service models: 1-way hybrid, 2-way pure satellite
• Customer needs a small satellite dish (150EUR) and a DVB PC-card
(150EUR)
• 1-way hybrid model:
– 400-2000kbps downlink with 800Mb limit for 40 EUR per month.
Customer needs ISDN/Modem for uplink
– 40 EUR/month, installation 50 EUR + uplink costs
• 2-way model:
– 400/150kbps (downlink/uplink) bandwidth with 1,3Gb limit (after
limit 64-200kbps)
– 79 EUR/month, installation 1170EUR
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Conclusion
• There is a clear need and market niche for satellite IP
connectivity. The customers are there, the money is there.
• Customers are mainly those who can’t use terrestrial
broadband networks, need high BOD or high level
broadcasting ability
• Prices are high
• Some critical technological problems
• Market hype, over supply
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Thank you for your attention!
Q&A