VSAT

A growth of 49 percent and the number of installed VSATs

crossing the five-figure mark. These two landmark achievements of the VSAT

industry in the very first year of the new millenium are no mean achievement.

And that too when the VSAT industry in India has been crippled with lack of

transponders-the major infrastructure for the industry.

The total tally of installed VSATs in the country rose to

12,617. In 1999-2000, an additional 4,127 VSATs were installed in the country of

which TDMA VSATs accounted for 78.9 percent. Its DAMA brethren accounted for 829

units. In 1999-00, all the VSAT service providers have collectively done a

turnover of Rs 295.3 crore and the total VSAT market in India was estimated at

Rs 316.8 crore, an increase of 26.3 percent from 1998-99.

In terms of revenue, Hughes Network System netted a turnover

of Rs 59.35 crore and bagged the #1 position. Scientific Atlanta emerged in the

second spot with Rs 54 crore followed close on heels by Gilat, which registered

a turnover of Rs 52.13 crore. The Indian player, India Satcom, completed the

year with a decent Rs 17.26 crore.

Gilat Satellite Networks performed extremely well in the

captive and shared hub segments and was #1 player in the TDMA area. It bagged

902 VSATs in the shared hub segment while on the captive network the number

stood at 900. Out of this, 500 were supplied to National Stock Exchange and 400

collectively to NIC and NICSI.

The DAMA turf belonged to Scientific Atlanta. It emerged as

the clear winner with 370 VSATs under its fold as both HFCL and Telstra V-COMM,

the Scientific Atlanta partners in India, crossed the 100-mark barrier.

The total VSAT equipment market in India was pegged at Rs

213.33 crore. This includes only the VSAT component and excludes the service

component.

Top VSAT Equipment Providers (1999-00)>>>>

Next>>>>

In terms of vertical segments, the major revenue earner for

the VSAT industry is still banking and financial institutions which contributed

40 percent of the revenue. The anywhere, anytime banking has a given boost to

the VSAT industry. Corporates went for VSATs in a big way to automate their

operations and connect the different offices spread in different locations

geographically.

With Kargil war exposing India's weakness, a lot of

emphasis was given on the communication aspect and a number of projects were

installed and commissioned on the VSAT front to make the Indian Army more

efficient. With e-commerce starting in bits and pieces and planning to go in a

big way, most of the manufacturing industries started to automate their

operations so that they can move in to e-enablement of their organization to

successfully start e-commerce.

All the major players had a stake in the Indian market.

Hughes Escorts Communications Ltd (HECL) represented Hughes Network Systems;

Comsat Max and HCL Comnet represented a new-look Gilat Satellite Network; HFCL

Satcom, Bharti BT, and Telstra V-Comm represented Scientific Atlanta; HFCL

Satcom and Essel Shyam represented STM Wireless; and HCL Comnet represented

Viasat. Nortel DASA was still scouting for partners and India Satcom was the

major Indian name in the list.

Last year saw the merger of GE Spacenet with Gilat. This year

it was Scientific Atlanta-Viasat merger that hogged the limelight. The

acquisition is complete. Viasat, which was represented in India only through HCL

Comnet, will now have a significant presence. It will be able to leverage on the

VSAT base established by Scientific Atlanta via service providers like Telstra

V-Comm, Bharti BT, and HFCL. Viasat's strength in SCPC DAMA and mobile

satellite system will be coupled with Scientific Atlanta's strength in

broadband and broadcasting.

Both Hughes Escorts Communications Ltd (HECL) and Comsat Max

are consolidating and are growing much faster than their competitors.

In the coming fiscal the focus will be on Bharti BT and

Scientific Atlanta as there is a change of guard there. K Ganesh, CEO of Bharti

BT has joined a dotcom and is replaced by Sanjiv Mital. Manoj Chugh of

Scientific Atlanta has joined as Cisco's chief in India. Things are still not

clear about the India operations of Scientific Atlanta (to be called Viasat)

ever since its takeover by the Viasat. It has been a negative growth for Bharti

BT, but for Viasat it will be an added advantage to have HFCL, Bharti BT,

Telstra V-Comm, and HCL Comnet under its belt. But it will be some time before

both can make their balance books look impressive. RPG Satcom hardly has a

presence and will be the first company to exit from the VSAT market.

The year closed on a promising note with the successful launch of the INSAT

3B solving the much awaited transponder crunch problem. Developments like use of

foreign satellites and opening up of Ku-band will also bring cheer to the VSAT

industry as it provides the flexibility and will help the industry to move at a

faster pace. With Saran's announcement in VSAT & Internet India 2000 that

in a weeks time the VSAT industry will get 6 transponders in the Extended C-band

will help the industry to grow by 60-70 percent for 2000-2001. The pace for

Ku-band transponders' allotment will take two more months according to PS

Saran and industry will feel happy with the announcement as things are moving at

a faster pace than it was earlier. Thus VSAT service providers will be able to

buy transponders at will and expand their services, taking the industry to

greater heights.