Global Satellite Industry Had Positive Overall 2011 Growth, But Planned Launches, Jobs Declined

Global satellite revenue grew 5 percent last year to about $177 billion, led by revenue increases in the satellite manufacturing and launch sectors, the Satellite Industry Association said in a report. While the rate of net job losses decreased from 2.7 percent in 2010 to less than 1 percent last year, employment in the industry continued to drop in the first three quarters of 2011. The State of the Satellite Industry Report (http://xrl.us/bm8ydw) was done by Futron Corp., SIA said. Futron surveyed more than 80 satellite companies and assessed performance in the satellite services, manufacturing, launch and ground equipment sectors.

Manufacturing revenue increased 9 percent worldwide to $11.9 billion, the report said. In the U.S., that amount grew from $5.6 billion in 2010 to $6.2 billion last year, a 10 percent jump, it said. The 2 percent revenue growth in ground equipment was driven by satellite TV, broadband, mobile satellite terminals and GPS devices. This sector reached $52.8 billion in revenue, with slower growth in consumer equipment terminal sales “but equally fast growth in network equipment compared to 2010,” it said.

The overall growth in the industry underscores the need for policies that support such progress, said Patricia Cooper, SIA president. The House passage of the National Defense Authorization Act (CD May 21 p3) with an amendment reforming satellite export controls is a step in the right direction, she said: It’s “great progress and a potential relief for the U.S. satellite manufacturing sectors.” Regulators and policymakers also must be mindful of the time frame needed to develop and deploy new satellite projects and systems and establish frameworks that won’t change before the projects are finished, Cooper said. For satellite services, innovation “requires a new space platform,” which also requires a longer time frame than for terrestrial-based systems, she said. Therefore, “the arc for a project may require a longer horizon for consistent regulatory policy.”

As the largest segment, satellite services growth is attributed to a steady increase in direct-to-home subscribers, “particularly in emerging markets,” the report said. Consumer satellite TV services make up more than 80 percent of all satellite services revenue. The number of U.S. subscribers grew 5 percent to 37 million and the number of HD channels grew from about 3,800 last year to more than 4,700 channels globally so far this year, SIA said. HD channels require more bandwidth, which increases the need for more transponders, Cooper added.

Mobile satellite services reached $2.4 billion in 2011, a 4 percent increase from the previous year, the report found. Last year, “mobile telephony services revenues grew faster than mobile data services,” mainly due to growth and innovation in asset tracking and overall messaging, Cooper said.

Last year, jobs were lost in satellite services, manufacturing and the launch industry, while the ground equipment segment gained about 1,400 jobs in the third quarter, the report said. SIA attributes the loss to the continuing effects of the economic downturn and “contraction in the more employment-intensive industries of satellite manufacturing and launch,” Cooper said. There also was a dip in planned commercial launch orders worldwide, SIA said. This number dropped from 49 in 2010 to 30 last year. For the U.S., launch orders dropped from 20 in 2010 to three in 2011. Launch providers in Russia, China and European countries had increases in launch orders last year, the report said.