Réf : FM / BB/ 11 Edition : 2.0 Rév. : Date : 29/08/11 Page : 1
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1 Edition 2.0 Rév. Date 29/08/11 Page 1! Astrium, an EADS company, is a leading satellite manufacturer established in several European countries, with commercial and public customers all around the world. We have delivered 50 Eurostar telecommunications satellites so far including missions operating in Ka band and used for broadband applications. We are contemplating today the rapid growth of broadband satellites market demand. Our customers, satellite operators, expressed the concern that it is very difficult to include broadband satellite solutions in the frame of current European State Aids programmes. The European Satellite Operators Association s (ESOA) answer to the present consultation is likely to elaborate on the obstacles experienced and this is not discussed hereafter. Intention here is more to support with some technical background and European satellite manufacturer industrial interest. In 2010, the Commission issued the Digital Agenda with two targets 2013 objective bring basic broadband to all Europeans 2020 objective (i) all Europeans access to higher speeds of above 30 Mbps and (ii) 50% or more of European households have access to internet connections above 100 Mbps. The internet has quickly modified our way of life and today the situation is significantly more influenced by broadband applications than it was when the guidelines were issued in September Even if the penetration have not yet fully materialised, regulators have to handle both the basic broadband market on the one hand and the NGA market on the other hand in relation with the other. National Plans for Ultrafast Broadband are already in place in Europe and rest of the world and it is a common public objective to achieve extended coverage in the mid term. The deployment of fibre infrastructure is started in densely populated areas while ISPs are not yet observing an effective migration from copper network to NGA infrastructure when basic broadband is already available. Indeed there is more a duplication at terrestrial level of BB and NGA (suggesting later potential of substitution) than an extension of coverage of both wired technologies A significant share of the population is neither served by traditional broadband nor targeted for fibre. In other words, the ultrafast digital divide may substitute and exacerbate the basic broadband one. For several years, first generation Ku band satellite solutions have been the only way to reach underserved areas and to provide there broadband service for consumers and SMEs. These are today complemented by new systems using Ka band with multiple beams and high frequency reuse High Throughput Satellites (HTS) are able to provide larger
2 Edition 2.0 Rév. Date 29/08/11 Page 2 bandwidth to citizens with cheap terminals and lower cost. Satellite is now recognised by the EC as a part of the mix of solutions required to meet the Digital Agenda objectives issued by the DG INFSO. In most of Europe, satellite allows to fulfil today 2013 Digital Agenda target. Video applications are considered to form the lion s share of the growth in demand, for bandwidth and this growth is a driver for the boundary (or the transition) between broadband and ultrafast broadband/nga. It is worth to note that the TV/video applications are supported today by satellites in a very green carbon friendly manner. The satellite broadband capacity could then be fully devoted to Internet access applications without reserving capacity to TV. Bundled offers to customers already enjoying satellite TV reception will certainly encourage broadband penetration. Regarding the second Digital Agenda objective for 2020 (NGA and ultra fast broadband), current developments will allow satellite to provide as well a solution for the digital divide in the range of several tens of downstream Mbps. European satellite manufacturers have plans to increase further the capacity of HTS satellites. Broadband and NGA markets are clearly interconnected and substitutable and need both to be regulated in a technology neutrality manner. It is important to keep in mind that deployment of current satellite infrastructure was solely based on private funding initiatives. Whether this will be the case for future ultrafast systems is a debatable issue but, in any case, existing infrastructures should not suffer from unfair competition. In the same time period, the satellite offer has considerably evolved (see figure 1) and new HTS satellites have recently been deployed in Europe. Specificities of Satellite solutions As for all wireless systems, spectrum availability limits system capacity. Like cellular systems, the capacity increase is achieved thanks to improved frequency reuse with smaller cells (smaller beams in the case of satellites). Compared to the initial satellite offer using Ku over a European beam (to which most of public awareness is focussed on) the throughput has been multiplied by 35 by using multiple Ka Band beams such as done for Ka-Sat which was build by Astrium and launched in December 2010 (see figure 1). Developments have been initiated to increase it further using larger satellite antennas to further decrease cell size. On top of beam size reduction, spectrum allocation to satellite services including the feeder link is a strategic decision for which a common pan European approach is also a key for satellite solution. Relaying signal from km altitude, the satellite covers a wide area with homogeneous performance, allowing an ubiquitous coverage at uniform cost, with one shot infrastructure deployment. This is clearly adapted to digital divide issue allowing a democratic access to underserved areas for which the cost of terrestrial systems is prohibitive in excess of several
3 Edition 2.0 Rév. Date 29/08/11 Page 3 thousands of euros. An example of the French deployment is given on figure 2 (extracted from Tactis report for DATAR). Thanks also to its wide coverage, the satellite infrastructure can encompass both the access function and the backhaul network. It avoids the need to upgrade the middle route trunking as it interconnects directly at the gateway locations. There is no doubt that deployment of terrestrial NGA in low density areas will take a long time (longer than the 3 years plan mention in current text anyway). Ease of reallocation of satellite resources may also then be part of the solution providing immediately broadband services even if there is some existing plan to deploy terrestrial systems in the future. By the way, substitution is intrinsic to satellite an upgrade of service in terms of data rate is basically a matter of number of supported customers. Increased data rates are already offered to SMEs. From a value chain perspective, separation between carrier role and service provision as effectively done for TV broadcasting service is straightforward for satellites. In the hypothesis where some infrastructure or part of the capacity is supported by public aid funding it would easily cope with the competition guidelines expressed for state aids rules because the infrastructure sharing will basically be a matter of sharing resources on the feeder link through adequate multiple access protocols. Last but not least, the large upfront satellite investment needs to be based on a decision to enter and stay in a market based that can be made on stable assumptions. In this respect the three years period mentioned in the guidelines are comparable to a satellite development schedule and a satellite offer could easily be accounted for by public stakeholders with little risk. On the contrary terrestrial infrastructures could play with much more flexible updates of their deployment plans. Ka-Sat and other High Throughput Satellites are now deployed over the globe offering a satellite solution competing with terrestrial offers. However public awareness of the potential of satellite solution need still to be improved in taking into account the breakthrough of Ka band multiple beams architectures. Public bodies may use and promote satellite solution in aggregating individual demand (see figure 3 from ESOA presentation during the Digital Agenda Assembly and the Auvergne as an example). It should be pointed out that satellite capacity is also very easy to reallocate in order to cope with an evolving market situation. Because there is no need for civil works, a satellite offer could be provided immediately to meet a demand which will have to wait for several years before being reached by FTTH this is of particular interest for SMEs located in remote areas. Considerations on existing text NGA definition in the guidelines is expressed as a mix of technology and supported applications "NGA networks are wired access networks which consist wholly or in part of optical elements and which are capable of delivering broadband access services with
4 Edition 2.0 Rév. Date 29/08/11 Page 4 enhanced characteristics (such as higher throughput) as compared to those provided over existing copper networks." This definition already orients the technology towards a fibre solution as supposed to be the only mean to achieve enhanced characteristics compared to copper. Under this definition, satellite is not providing such service. This is no longer the case considering today s HTS performance, which achieves both access and backhaul without requiring a fibre component. The Guidelines expressed the benefit of reuse of existing infrastructures. We trust that use of existing and future satellite infrastructure will be favoured as it is the most efficient use of public funds to connect isolated sites and to meet Digital Agenda objectives. Figure 1 Evolution of satellites solutions (from L internet par satellite /Carvea-Eutelsat, pp 39, 41) FTTH * Satellite (Foyers) (*) Source DATAR 02/2010 Figure 2 Investment cost per subscriber to achieve full French coverage
5 Réf Edition Date Page FM / BB/ Rév. 29/08/11 5 Figure 3 Extract from Digital Agenda Assembly Auvergne example Figure 4 Ka-Sat satellite build by Astrium
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