1 S I A M E M B E R C O M P A N I E S State of The Satellite Industry David Cavossa, Executive Director, SIA.

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S I A M E M B E R C O M P A N I E S

State of The Satellite Industry

David Cavossa, Executive Director, SIA

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Satellite Industry Overview

Launch Industry•Launch Services •Vehicle Manufacturing

•Component and Subsystem Manufacturing

Satellite Manufacturing•Satellite Manufacturing•Component and Subsystem Manufacturing

•Transponder Agreements

•Mobile Satellite Services•Mobile Phone•Mobile Data

Ground Equipment• Mobile Terminals• Gateways• Control Stations• VSATs• DBS Dishes• Handheld Phones• DARS Equipment

Satellite Services•DBS/DARS•Fixed Satellite Services

•Voice, Video, Data•VSATs•Remote Sensing

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World Satellite Industry Revenues

World satellite industry revenues had average annual growth of 6.7% for the period 2000-2005

2000 2001 2002 2003 2004 2005

$0

$10

$20

$30

$40

$50

$60

$70

$80

$90

$64.2 $64.4

$71.3$74.3

$82.7

$88.8

Rev

enue

(in

Bill

ions

)

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World Satellite Services Revenue

2000 2001 2002 2003 2004 2005

FSS $9.1 $9.0 $8.8 $9.5 $9.3 $9.8 FSS=VSAT services, remote sensing, and transponder agreements

DBS $18.3 $22.0 $25.5 $28.8 $35.8 $41.3 DBS/DARS=DTH TV, DARS, and Broadband

MSS $1.5 $1.3 $1.3 $1.6 $1.8 $1.7 MSS=Mobile telephone and mobile data

Total $28.9 $32.3 $35.6 $39.8 $46.9 $52.8

2000 2001 2002 2003 2004 2005

$0

$10

$20

$30

$40

$50

$60

$18.3$22.0

$25.5

$28.8

$35.8

$41.3

$1.5 $1.3 $1.3 $1.6 $1.8 $1.7

$9.1 $9.0 $8.8 $9.5 $9.3 $9.82000 2001 2002 2003 2004 2005

$0

$10

$20

$30

$40

$50

$60

DBSMSSFSS

Rev

enue

(in

Bill

ions

)

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Fixed Satellite Services

• Diverse market-baseDiverse market-base• Media DistributionMedia Distribution• Telecom InfrastructureTelecom Infrastructure• Enterprise NetworksEnterprise Networks• Government Networks & AppsGovernment Networks & Apps

• Geosynchronous SpacecraftGeosynchronous Spacecraft• ~~22,000 miles in orbit22,000 miles in orbit

• C, Ku and Ka FrequenciesC, Ku and Ka Frequencies

• Terrestrial InfrastructuresTerrestrial Infrastructures• TeleportsTeleports• TT&C CentersTT&C Centers• Service PlatformsService Platforms• Fiber InterconnectsFiber Interconnects

• ~ 250 operational commercial GEO satellites in use today • 59 to be launched over next 3 years

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Mobile Satellite Industry

• Function like terrestrial wireless system with ubiquitous reach Function like terrestrial wireless system with ubiquitous reach

• Use a mix of orbit typesUse a mix of orbit types

• Geosynchronous (GEO) Geosynchronous (GEO)

• Non-geosynchronous (LEO and MEO) Non-geosynchronous (LEO and MEO)

• System sizes range from (1) GEO satellite to (66) LEO SatellitesSystem sizes range from (1) GEO satellite to (66) LEO Satellites

• Use a mix of frequenciesUse a mix of frequencies

• Mostly L-Band / Some S-Band, UHF/VHFMostly L-Band / Some S-Band, UHF/VHF

• Feeder links and some services use C, Ka, and Ku-BandFeeder links and some services use C, Ka, and Ku-Band

• ApplicationsApplications

• Aeronautical Aeronautical

• Maritime Maritime

• Land Land

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Satellite Manufacturing Revenues

N.B. – Satellite Manufacturing revenues are recorded in the year the satellite is delivered/launched, not when contract is awarded. World revenue includes the US revenue

2000 2001 2002 2003 2004 2005

U.S. Revenue$0

$2

$4

$6

$8

$10

$12

Re

ve

nu

e (

in B

illi

on

s)

$11.5

$9.5

$11.0

$9.8$10.2

$7.8

$6.0

$3.8$4.4 $4.6

$3.9

$3.2

2000 2001 2002 2003 2004 2005

U.S. Revenue$0

$2

$4

$6

$8

$10

$12

U.S. Revenue World Revenue

Rev

enue

(in

Bill

ions

)

US Revenue

World Revenue

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Launch Industry Revenues

N.B. - Launch Industry revenues are recorded in the year the launch occurs, not when contract is awarded.

Rev

enue

(in

Bill

ions

)

2000 2001 2002 2003 2004 2005

U.S. Revenue$0

$1

$2

$3

$4

$5

$6

Re

ve

nu

e (

in B

illi

on

s)

$5.3

$3.0

$3.7

$3.2

$2.8$3.0

$2.7

$1.1$1.0

$2.1

$1.5 $1.5

US Revenue

World Revenue

2000 2001 2002 2003 2004 2005

U.S. Revenue$0

$2

$4

$6

$8

$10

$12

U.S. Revenue World Revenue

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Satellite Industry Trends

• After a few difficult years, the satellite industry has begun to rebound.– New technologies are being funded – New applications are driving services demand – New markets are opening worldwide as regulations

change

• The key factors are:– Consumer demand – especially video– Government demand and investment in technology– Financial market interest and investment in both existing

and new businesses– Consolidation and rationalization of capacity

• These factors flow through the industry as new user solutions drive demand for more innovative satellites.

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Satellite Industry Response to Katrina

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Satellite Is Part of the Solution

• First Responders and Public Safety need a non-terrestrial back-up communications infrastructure that is;– Independent of the Public Infrastructure– Pre-positioned– Included in First Responder Training Programs

• The Department of Homeland Security is currently examining a range of emergency communication proposals, including proposals to ensure interoperability. Satellite systems should be emphasized and included in the early planning of these initiatives.

• The required capacity and equipment is available today from commercial satellite operators to corporations, first responders, and consumers across the globe.

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Recommendations

• Satellites must be included in emergency response communications to ensure redundancy.

• Satellite capacity and equipment must be pre-purchased and pre-positioned.

• Satellite operators and personnel must be credentialed as first responders.

• Satellite must be included in education and training programs for first responders.

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14

15

16

17

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Critical To National Security“Network Centric Warfare”

80%

20%

Commercial Satellite B/W

Military Satellite B/W

(2002)(1991) (1999)ENDURING FREEDOMDESERT STORM KOSOVO IRAQI FREEDOM

(2003)

Commercial Satellite ServicesDeployed Forces

51K 250 736

54K

99

542K

0

100

200

300

400

500

600

700

800

FORCES

0

500

1000

1500

2000

2500

3000

3500

MBPS

132K

3,200

Source: Defense Information Systems Agency (DISA)

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Projected DoD Wideband Needs

0

5

10

15

20

25

30

On-

orb

it C

apa

city

(Gbp

s) WGS5

WGS4

WGS3

WGS2

WGS1

GBS3

GBS2

GBS1

DSCS10

DSCS9

DSCS8

DSCS7

DSCS6

DSCS5

DSCS4

DSCS3

DSCS2

DSCS1

Wideband Require

ments

(non-TSAT related)

~6 Gbps

~11 Gbps

~18 Gbps

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What the DoD Wants

• Information sharing and analysis• Open dialogue on vulnerability, protection and operational issues

• Terrestrial physical security• Site backup, protection posture and contingency plans

• Personnel security• Background investigations and access controls

• Cyber/Network security• Detect and respond to intrusions; guarantee secure connectivity

• TT&C information assurance• Encrypted connectivity

• Space situational awareness• System baseline, location, TT&C and mission status

• RFI incident management• Timely detection, notification, characterization and response

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What We Want:Long Term Relationship

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Version 3.0

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Operationally Responsive Space

• The goals of ORS to produce satellites that are less costly, at a faster rate, and in greater numbers; and provide niche capabilities, new technologies, and surge capacity; are not restricted to just small satellites and quick launch technologies.

• The DoD, industry, and Congress should embrace the operationally responsive space movement as an obvious next step toward transformation.

• Next step that includes, not only small satellites and cheap launch vehicles, but also encourages; • Shared Payloads/Hosted Payloads• Multiyear Commercial Transponder Leases• Pre-Positioned Capacity and Transponder Portability • Repositionable Spot Beams and/or Satellites

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US National Space PolicyReleased August 31, 2006

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National COMSATCOM Policy Needed

• To maintain and expand our capabilities, we recommend that the US Government develop a national commercial satellite communications policy that:– Relies to the maximum extent possible, on commercial

satellite systems to meet the unclassified, non-sensitive communications needs of the US Government;

– Maintains robust satellite technology development programs, such as the Transformational Communication Architecture and Operationally Responsive Space programs;

– Takes maximum advantage of the flexibility of current procurements laws which allow multiyear procurement and the aggregation of government demand to build long-term stable relationships with the commercial industry;

– Improves current satellite export control regime;– Maintains a strong national technological leadership

through sponsorship of satellite education programs, career opportunities, and the education of key Government personnel;

– Preserves and protects satellite spectrum from harmful interference;