The main objective of the study is to provide the European industry with pragmatic information and guidelines for the implementation of DVB-RCS services in the two target regions, Latin America and Africa. In order to serve these objectives the study will place a particular emphasis on:
- The business market, which will mostly trigger investment decisions,
- The institutionally-driven market, when clear sources of finances are identified for funding corresponding programmes.
The emphasis will also be placed on the computation of realistic and conservative market penetration figures, to obtain figures which can constitute a credible basis for investment and implementation decisions.
The main challenge is to obtain reliable information to provide the most pragmatic "cook book" for the European industry willing to implement DVB-RCS projects in these two areas.
Promotion of DVB-RCS standard and successful system implementation in target regions.
The project has five subsequent tasks, to be performed in eight months between the 1st of January and 31st of August 2006:
- Country selection,
- Services analysis,
- Commercial and Technical scenarios definition,
- Implementation process including regulatory issues,
- Financial assessment.
The project started on January 1, 2006 and ended on September 30, 2006. Final Presentation of the results will take place at ESA, ESTEC premises on October 26, 2006 at 2 PM.
All 5 tasks are achieved.
Five African countries have been selected and will be studied in detail : Nigeria, Kenya, Tanzania, Egypt and Angola. In Latin America the three following countries have been selected: Brazil, Argentina and Chile.
A detailed market study has been performed for the 8 selected countries. DVB-RCS service's requirements have been characterized. Market figures were computed in terms of number of terminals sold and satellite capacity usage, taking into account competition from terrestrial and satellite services.
On the basis of the service analysis and market figures, 3 commercial and technical scenarios have been elaborated for the most promising countries in Africa and in Latin America:
- the East African scenario is based on a service in Kenya and Tanzania, using NSS-8 satellite
- the West African scenario is based on a service in Nigeria, using the NSS-7 satellite
- the Latin America scenario is based on a service in Brazil and Argentina, using NSS-7 satellite
The optimal business value chain and hub location are described for each scenario.
The typical network topology for a DVB-RCS system consists of a central hub station and several remotes VSATs. Space segment configuration of a DVB-RCS system consists of several forward carriers and their associated return carriers using a MF-TDMA mechanism. The total number of transponders needed has been compilated and the link budget calculated.
The implementation processes in Africa and Latin America have been detailed, taking into account specific regulatory, commercial and technical constraints, for each scenario.
A financial model has been built for the key actors in the value chain, for each scenario, in order to assess their profitability, and a sensitivity analysis has been performed.
The Financial Assessment has been achieved bearing in mind 2 key objectives:
- To keep end-user prices competitive
- To balance the Network Operator and Service Provider profitability in a Win-Win situation.
NPV, IRR and Payback period are the parameters used for investment decision.
There is today a window of opportunity for offering a qualitative DVB-RCS service in selected countries in Africa and Latin America, assuming that such a business would start in 2007/2008. Both East and West African scenarios are viable and therefore offer an opportunity for European companies to launch a profitable DVB-RCS business in Africa and Latin America. The present study provides inputs for conservative business plans to be prepared by European companies willing to invest in such new business. Once their business plan is completed, it is recommended to launch a pilot project, with the potential support of ESA ARTES programme, in order to promote and demonstrate the technical and commercial viability of the DVB-RCS service in Africa and Latin America.