To give us an overview of Russia-based satellite operator Gazprom Space Systems (GSS) current position in the global marketplace, Satellite Markets and Research spoke with Igor Kot, Deputy Director General, Business Development, GSS just before the IBC2018 show in Amsterdam. Excerpts of the interview follows:
Can you give us an update on Gazprom Space Systems’ position in the satellite market today?
Nowadays, as always Gazprom Space Systems takes up positions of a well-known reliable international satellite operator providing Yamal satellites capacity all over the world. Although, hard times and new market realities forced us to concentrate our efforts on improvement of operational efficiency and cost saving, we looked for new approaches and mobilized strength and capabilities. The volume of satellite capacity sales has grown, but we are enforced to provide it at a slightly lower price than before.
This is the market today: on the one hand, the demand is growing, on the other hand, the overproduction of the satellite capacity and the expansion of operators owning fiber-optic infrastructure, put a strong pressure on prices. The client base of GSS was replenished with new companies, and some of our customers did not survive the difficult times and moved to the category of ex-clients. But, we don’t give up and continue finding of new solutions to satisfy our current customers and developing new projects aimed to extend our service portfolio and the customer base as well.
You have an upcoming satellite launch in the first quarter of 2019 with Yamal 601, can you give details on this satellite and what benefits it will provide the market and your potential clients?
Early next year we are going to replace Yamal-202 by new HTS Yamal-601. The coverage area of new satellite almost repeats its predecessor in C-band. All existing customers will move to new satellite getting some benefits: EIRP on a new satellite will be two decibels higher. It will allow customers to use more efficient coding modulation systems and use the bandwidth more cost-effectively. Yamal-601 is also equipped with Ka-band payload providing 32 beams covering the most populated regions of Russia. GSS is focused on growth with Yamal-601, the company intends to develop cost-effective wholesale services of broadband Internet access. The throughput of Yamal-601 is 30 Gbit/s. For Russia this is quite enough now. During the first five years of satellite operation, we intend to increase the customer base to 200-300 thousand user terminals, both for individual and collective usage.
Therefore, Yamal-601 is the very picture of our development strategy, combining traditional satellite capacity with operation in traditional bands in wide areas.
How do you see the current market for satellite services? What trends do you see and how is your company adopting to the changes in the market?
On the international market GSS acts only as a satellite operator providing the main service - satellite capacity. We do not develop a ground infrastructure and sales offices outside Russia for end customer support, but we cooperate with providers being strong and competent in different local markets outside Russia. This is our conscious position that allows us to minimize business expenses and avoid competition with our customers. Within the conditions of market transition and at a time when operators are seeking for new forms of doing business, this approach may seem rather old-fashioned, but it still works.
How do you see your company in the next few years? What are your targets?
In the near future, we are going to concentrate on Ka-band system development through extension of Ka-band service area to the east by planning new satellite Yamal-501. Ka-band services is a new business for us, but in general, the satellite broadband is already familiar to us, as we sell similar services in Ku-band. On this market we can play two roles. In the first instance, we provide services to end users. In the second, we provide satellite capacity to VNOs. Using this approach, we are going to realize up to 80% of the system capacity. Currently, there are dozens of such companies operating via GSS satellites. And then, they provide services to customers using our capacity and our technological platform. And they are willing to develop this business in Ka-band further.
