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.

Top
VSAT Service Providers (1999-00)
Rank

Company

No. of VSATs Installed

Revenue
 (Rs Cr)

1HECL1265104
2Comsat Max56143.8
3Telstra V-Comm13039.43
4HCL Comnet34131.94
5Bharti BT45025
6Essel Shyam8024.6
7HFCL Satcom11021
8RPG Satcom5.53

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)>>>>

Top
VSAT Equipment Providers (1999-00)
RankCompanyNo. of VSATsRevenue (Rs Cr)TDMADAMAMCPC
1HNS126559.351155110NA
HFCL11014.6NA110NA
Bharti BT45021.8335793NA
Telstra V-Comm13017.5713117NA
2Scientific Atlanta74054370370NA
NSE5007.5500NANA
NIC + NICSI40014400NANA
Comsat Max56118.7421140NA
HCL Comnet34111.93341NANA
3Gilat180252.131662140NA
4India Satcom7117.2631NA40
5Nortel DASA4012.8NA40NA
HFCL806.4NA80NA
Essel Shyam8064040NA
6STM Wireless16012.440120NA
HCL Comnet495.39NA49NA
7Viasat495.39NA49NA

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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.

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