NSR: Satellite VSAT & broadband market remains resilient, on path to $217 billion through 2029

NSR’s VSAT and Broadband Satellite Markets 19th Edition report, released today, finds a resilient market, despite near term COVID-19 challenges and changing Key Performance Indicators. Limited growth is underway in 2020, and the market remains poised to emerge from the pandemic on a heightened growth path. Cumulative service revenue will grow at 15% CAGR, with $198 Billion in total revenues by 2029, whereas equipment revenue is estimated to grow at 14% CAGR with $20 Billion in revenues, during 2019-2029.

“Clearly, the VSAT & Broadband segment has faced challenges with delays in new installations due to ongoing travel restrictions, cancellation/postponements of some contracts, few end-users/enterprises exiting the market due to COVID-19, and falling capacity prices. However, trends remain mixed across different use-cases and applications – keeping the overall market resistant to COVID-19 and ensures restricted, but overall revenue growth for 2020,” according to Vivek Suresh Prasad, NSR Senior Analyst and report author.

What ensured the overall positive trajectory for the market in 2020? “In a sentence – service revenues at existing sites countered all market restraints. The industry witnessed a significant ramp-up in bandwidth demand from existing sites and subscribers – especially from Consumer Broadband and Backhaul segments. In some cases, the ramp-up has been up to 10%-15% of the bandwidth demand. The trend is evident from quarterly results of stakeholders, as most witnessed declines in equipment revenues, but had healthy growth in service revenues and average ARPUs,” adds Vivek.

In the long term, the market curves are expected to transition from restricted growth to accelerated growth post 2021 – owing to the reduced impact of COVID-19, incoming capacity flux (both GEO and non-GEO), increased bandwidth usage per site, along with an infusion of technologies in the satellite network- such as Cloud, SD-WAN, Edge Computing, Private LTE, etc. “The top two segments accelerating growth during 2019-2029 are Consumer Broadband – owing to the massive addressable market, and Backhaul – owing to the network upgrades 2G, 3G, 4G & 5G. The total HTS capacity demand is expected to grow by 26x to greater than 22 Tbps throughput demand– with HTS capacity pricing dropping to nearly $50/Mbps/month by 2029.

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