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State of the Satellite Industry Report October 2013
Sponsored by the
Prepared by
The Satellite Industry Association:
18 Years as the Voice of the U.S. Satellite
Industry
2
SIA MEMBER COMPANIES
Study Overview
• This is an update to the June 2013 version of SIA’s 16th annual comprehensive study of satellite industry data
• Performed by The Tauri Group
• Over 80 key companies were surveyed worldwide, including all SIA members, augmented by market analysis and financial reporting
• Based on year-end 2012 data from major players, representing four satellite industry segments
• All data reflect global revenues, unless otherwise noted
• Based on unclassified sources
• Revenue is expressed as then-year U.S. dollars (not adjusted for inflation)
3
Global Satellite Industry Revenues
• Global satellite industry grew 7% in 2012, outpacing both worldwide economic growth rate (2.3%) and U.S. growth (2.2%)
4
7%
2011 – 2012
Global
Growth
$121.7
$144.4 $160.8
$168.0 $177.4
$189.5
$0
$50
$100
$150
$200
2007 2008 2009 2010 2011 2012
Bill
ion
s o
f U
.S. d
olla
rs
Global Satellite Industry Revenue ($ Billions)
Growth rate 15% 19% 11% 5% 6% 7%
U.S. Portion of Global Satellite Industry
Revenues
5
Average
yearly U.S.
market
share:
44% of global
industry
$70.1 $79.5 $88.3 $94.3 $101.2 $107.5
$51.6
$64.8
$72.4 $73.8
$76.2 $81.9
$0
$50
$100
$150
$200
2007 2008 2009 2010 2011 2012
$ b
illio
ns
U.S.SatelliteIndustry
Non-U.S.SatelliteIndustry
Global Satellite Industry Growth 15% 19% 11% 5% 6% 7%
U.S. Growth N/A 26% 12% 2% 3% 8%
Non-U.S. Growth N/A 13% 11% 7% 7% 6%
Total:
$121.7
Total:
$144.4
Total:
$160.8
Total:
$168.0
Total:
$177.4
Total:
$189.5
The Satellite Industry in Context
• The global satellite industry is a subset of both the global telecommunications and space industries » Satellite industry = 62% of space
revenues (remainder primarily governmental space budgets)
» Satellite industry = 4% of telecommunications revenues
• Satellite industry growth tracks with both the telecommunications and space industries in 2012 » Telecommunications revenue growth
= 14%
» Space revenue = 5%
» Satellite industry = 7%
6 Sources: SIA “State of the Satellite Industry Report 2013”; Telecommunications Industry Association “2013 Playbook”; Space Foundation “The Space Report 2012.”
All industry revenue figures are for 2012.
Telecommunications
Industry
$4.9 Trillion
R&D 9%
Space Science
9%
Navigation 7%
Meteorology 3% Military
Surveillance 8%
Remote Sensing
10%
Commercial Communications
38%
Government Communications
16%
The Satellite Network in Context
Operational Satellites by Function
(as of 2012)
7
• Over 1,000 operating
satellites as of year-end 2012 » More than half are
communications satellites
» More than one third are
commercial
communications satellites
• More than 50 countries
operate at least one satellite
(some as part of regional
consortia)
Source: Tauri Group database of spacecraft and launch activities.
Top-Level Global Satellite Industry
Findings
• Satellite industry revenue was $189.5 billion in 2012
» Growth of 7% worldwide in 2012, surpassing 6% in 2011
• All four satellite industry segments surveyed posted growth in 2012
» Satellite services, the largest segment, grew by 5%
» Satellite manufacturing revenues grew by 23%
» Launch industry revenues rose by 35% in 2012
» Ground equipment revenues increased by 4% in 2012
8
Satellite Manufacturing
8% Launch Industry
3%
Satellite Services 60%
Ground Equipment
29%
World Satellite Industry Revenues By
Segment: Long-Term Review
9
Satellite Manufacturing
15% Launch Industry
5%
Satellite Services
50%
Ground Equipment
30%
2001
$64.4B
Global satellite industry revenues have nearly tripled since 2001, with an average 10% growth per year
3X
2001 – 2012
Global Industry
Growth
2012
$189.5B
10
Satellite Industry Segments
Satellite Services
• Consumer Services
» Satellite Television
» Satellite Radio
» Satellite Broadband
• Fixed Satellite Services
» Transponder
Agreements
» Managed Network Services
(including spaceflight management
services)
• Mobile Satellite Services
» Mobile Data
» Mobile Voice
• Remote Sensing/Imaging Services
Global Satellite Services Revenue
11 Notes: Numbers may not sum exactly due to rounding. 1) Includes capacity for DTH satellite TV platforms. 2) Includes VSAT networks;
Space Flight Management services included in Managed Services beginning in 2010
5%
2011 – 2012
Global
Growth
2007 2008 2009 2010 2011 2012
TOTAL $72.6 $84.0 $92.9 $101.3 $107.8 $113.5
Consumer $57.9 $68.1 $75.3 $83.1 $88.6 $93.3
Satellite TV (DBS/DTH) $55.4 $64.9 $71.8 $79.1 $84.4 $88.4
Satellite Radio (DARS) $2.1 $2.5 $2.5 $2.8 $3.0 $3.4
Satellite Broadband $0.4 $0.8 $1.1 $1.2 $1.2 $1.5
Fixed $12.2 $13.0 $14.5 $15.0 $15.7 $16.4
Transponder Agreements (1) $9.6 $10.2 $11.1 $11.1 $11.4 $11.8
Managed Services (2) $2.6 $2.8 $3.4 $3.9 $4.3 $4.6
Mobile $2.1 $2.2 $2.2 $2.3 $2.4 $2.4
Voice $0.9 $0.9 $0.7 $0.7 $0.7 $0.7
Data $1.2 $1.3 $1.5 $1.6 $1.7 $1.8
Remote Sensing $0.4 $0.7 $1.0 $1.0 $1.1 $1.3
$0
$20
$40
$60
$80
$100
$120
$ b
illio
ns
Remote Sensing
Mobile
Fixed
Consumer
Growth rate 17% 16% 11% 9% 6% 5% The U.S.
share of
satellite
services
revenues in
2012 was
42%
Satellite Services Findings:
Consumer Services Highlights
• Satellite services revenues grew 5% worldwide in 2012 (slightly lower than the 6% growth in
2011) to $93.3 billion
• The consumer services segment was the largest contributor to overall satellite services
revenues and consists of satellite television, radio, and broadband
12
» Satellite television services (DBS/DTH) account for more than 80% of all satellite services revenues, and 95% of consumer revenues
» Satellite pay TV subscribers up 4%, driven by growth in emerging markets
» Over 160 million subscribers worldwide
» 40% of global revenues attributed to the U.S.
Satellite TV
$88.4
Satellite Radio $3.4
Broadband
$1.5 » Satellite radio (DARS) revenues
grew by 13% in 2012
» Satellite radio subscribers grew
9% in 2012 to nearly 24 million
» Primarily U.S. customer base
» Satellite broadband service revenues increased from $1.2 billion in 2011 to $1.5 billion in 2012
» Subscribers grew 10% in 2012, with over 1 million subscribers (mostly in the U.S.)
» Subscriptions grew for established services, and several new services entered operations in 2012
Satellite Services Findings
• Fixed satellite services grew 4% » Transponder agreements revenues grew 3%, continuing the steady trend of recent
years
» Managed services revenues grew 7%, slightly slower than last year’s 10% growth
• Mobile satellite services grew 3% » Mobile satellite voice revenues were flat, same as 2011
» Mobile satellite data revenues grew 5%, compared to 4% in 2011
• Remote sensing revenues grew 20% » U.S. government spending drove growth in 2012, along with better-than-expected
performance from industry leaders
13
Case Study: Impact of HDTV on the
Satellite Industry
• Increasing numbers of High Definition Television (HDTV) and cable distribution channels continued to drive revenues for satellite pay TV
• HDTV contributes to retail and wholesale services revenue by increasing transponder agreement revenues and consumer satellite TV revenues
• HDTV also drives ground equipment purchases
• Nearly 60% of HDTV channels serve the Americas, with emerging growth in Europe and Asia
14 0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
May 2008 May 2009 May 2010 May 2011 May 2012 May 2013
Nu
mb
er
of
HD
TV C
han
ne
ls
31%
2011 – 2012
Growth
Source: LyngSat database.
15
Satellite Industry Segments
Satellite Manufacturing
$4.8 $3.1
$7.6 $5.6 $6.3
$8.2
$6.8
$7.4
$5.8
$5.1 $5.6
$6.4
$0
$2
$4
$6
$8
$10
$12
$14
$16
2007 2008 2009 2010 2011 2012
$ b
illio
ns
Non-United States
United States
Satellite Manufacturing Revenues
16 Note: Satellite manufacturing revenues are recorded by this study in the year the satellite is launched.
23%
2011 – 2012
Global
Growth
• Worldwide 2012 revenues totaled $14.6 billion
• U.S. market share neared 60% of global revenues
Growth rate -3% -10% 28% -20% 11% 23%
Avg: $12.1
* Does not include government-built, university-built, and/or research satellites
Satellite Manufacturing Findings
• While revenue grew, fewer satellites were
launched in 2012 (81) than in 2011 (90)
• Revenue growth was driven by a greater
number of higher value satellites
17 Based on unclassified sources
• Looking at the value of satellites launched in
2012 presents a different picture than the
number of satellites – by value,
communications satellites represented 67%
of satellites launched last year
Commercial Communications
30%
Civil/Military Communications
20%
R&D7%Military
Surveillance6%
Meteorological4%
Navigation11%
Remote Sensing15%
Scientific7%
Number of Spacecraft Launched by Mission Type (2012)*
Commercial Communications
37%
Civil/Military Communications
30%
R&D0.5%
Military Surveillance
6%
Meteorological10%
Navigation6%
Remote Sensing5%
Scientific6%
Value of Spacecraft Launched by Mission Type (2012)*
Europe, 22%
Russia, 16%
China, 23% Japan, 2%
USA, 32%
All other, 4%
Spacecraft Launched by Country/Region of Manufacturer (2012)
Satellite Manufacturing Findings
18
Based on unclassified sources
• U.S. satellite manufacturing revenues increased 31%
• U.S. firms built one third of the spacecraft launched in 2012, and earned nearly 60% of global satellite manufacturing revenues
• 61% of U.S. satellite manufacturing revenues from U.S. government
Future Indicator: Commercial
Satellite Manufacturing Orders
19
U.S., 12 (67%)
Europe, 3 (17%)
China, 2 (11%)
Israel, 1 (5%)
2012 GEO
orders:
18
• Orders for 18 commercial GEO
satellites were announced in 2012
• 12 orders were won by U.S.
manufacturers
• This represents the largest share of
announced orders won by U.S.
manufacturers in over a decade
3 1 2
9 6 6
3
12
9 5
12
6 6
3
11
11 12
18
16
9
12
0%
10%
20%
30%
40%
50%
60%
70%
80%
0
5
10
15
20
25
30
35
40
45
2006 2007 2008 2009 2010 2011 2012
Num
ber
of s
atel
lites
ord
ered
U.S. GEO orders
Europe GEO orders
All other GEO orders
U.S. share announced (%)
Case Study: Manufacturing Trends -
Innovation in Spacecraft
• High throughput satellites (HTS) combine the use of several technologies for far greater efficiency, including frequency re-use, spot beams, and on-board processing to maximize available spectrum; primarily in Ku- and Ka-band
» 23 HTS ordered and/or being manufactured
» 20 currently on orbit
• All-electric propulsion provides a significant reduction in satellite weight, but requires more transit time to reach final orbit
» For the first time, orders were placed for all-electric propulsion commercial GEO communications satellites in 2012
20
21
Satellite Industry Segments
Launch Industry • Launch Services
• Launch Vehicles
$1.0 $1.1 $2.0
$1.2 $1.4 $2.2
$2.2 $2.8
$2.7
$3.2 $3.4
$4.3
$0
$1
$2
$3
$4
$5
$6
$7
2007 2008 2009 2010 2011 2012
Bill
ions
of U
.S. d
olla
rs
All Other
UnitedStates
Satellite Launch Industry Revenues
• $6.5 billion global revenues in 2012 from commercially-procured satellite launches
• U.S. market share was 35% of global revenues; derived almost entirely from launches of U.S. government satellites
22 Note: Launch industry revenues are recorded by this study in the year the launch is conducted.
35%
2011 – 2012
Global
Growth
Growth rate 19% 21% 17% -2% 9% 35%
Avg: $4.5
GEO 58%
LEO 34%
MEO 8%
Satellite Launch Industry Findings
• Satellite launch industry revenues increased by 35% globally in 2012, compared
with 10% in 2011 » Despite fewer satellite launches in 2012, revenues grew due to more launches of larger
and more expensive vehicles
» Government customers remained the major satellite launch revenue driver in 2012,
accounting for 64% of commercially-procured satellite launch revenues
» This marked a slight increase from the 59% government share in 2011
• The U.S. had the largest share of all commercially-procured launches, nearly all
from launching U.S. government satellites
• The number of commercially-procured satellite launches remained relatively stable.
52 launches occurred in 2012, compared to 56 launches in 2011
23
2012 commercially-
procured satellite
launches by orbit
Future Indicator: Commercial
Satellite Launch Orders
24
U.S. 8
Europe 11
Russia 2
China 2
Multi 1
India 1
2012
orders:
25
• Orders to launch 25 commercial
satellites were placed in 2012
• 8 satellite launch orders were won by
U.S. companies, up from 3 ordered in
2011
• Europe retained the largest share of
commercial launch orders
14 21
13 13 15 13 6
12
21
13 13 14
14
11
9
6 31
15
20
3
8
0%
10%
20%
30%
40%
50%
60%
0
10
20
30
40
50
60
2006 2007 2008 2009 2010 2011 2012
Nu
mb
er o
f la
un
ches
ord
ered
U.S. commercial launch orders
Europe commercial launch orders
All other commercial launch orders
U.S. announced share (%)
25
Ground Equipment • Network Equipment
» Gateways
» Control stations
» Very small aperture
terminals (VSATs)
• Consumer Equipment
» Satellite TV dishes
» Satellite radio equipment
» Satellite broadband dishes
» Satellite phones and mobile satellite
terminals
» Satellite navigation stand-alone
hardware
Satellite Industry Segments
Global Satellite Ground Equipment
Revenues
26
Includes:
Network Equipment — Gateways, Network Operations Centers (NOCs), Satellite News Gathering (SNG) equipment, flyaway antennas, and Very
Small Aperture Terminals (VSATs)
Consumer Equipment — Satellite TV, radio, and broadband equipment, mobile satellite terminals, and stand-alone satellite navigation devices, not
including chipsets integrated into devices (such as smartphones) whose primary use is not satellite navigation
4%
2011 – 2012
Global
Growth
$7.6 $9.9 $11.9 $12.2 $12.2 $12.8
$20.8
$29.4 $31.1 $31.9 $32.2 $32.2
$5.9
$6.7
$6.9 $7.5 $8.4 $9.8
$0
$10
$20
$30
$40
$50
$60
2007 2008 2009 2010 2011 2012
Bill
ion
s o
f U
.S. d
olla
rs
Network Equipment
Satellite navigationequipment
Satellite TV, radio,broadband, and mobileequipment
Growth rate 19% 34% 8% 3% 2% 4%
The U.S.
share of
ground
equipment
revenues in
2012 was
44%
Ground Equipment Findings
• Global satellite ground equipment revenues increased 4% overall in 2012
• Network equipment revenues grew 17%, driven by VSAT sales
• Satellite TV, broadband, radio, and mobile voice and data equipment revenues grew 5%, and the number of terminals in service grew across all segments in 2012
• Satellite navigation equipment represents nearly 60% of overall ground equipment revenue; this proportion remains steady this year, reflecting a migration away from stand-alone devices (included in this study) towards embedded chipsets (not included in this study)
27
Satellite TV 160.2
Broadband 1.4
Satellite Radio 23.9
Mobile Voice and Data 2.6
Te
rmin
als
in
Se
rvic
e
(millio
ns)
U.S. Employment Estimates
(Private Sector Employment Only)
• Satellite industry employment in the U.S. decreased by 1% in 2012, compared to a 2% loss
in 2011
• U.S. satellite companies shed a little over 20,000 jobs between 2007 and 2012, an 8% loss
• Three of the four satellite industry segments experienced job losses in 2012 » Satellite Services added 3,313 jobs, or +4% (2011: -2.4%)
» Satellite Manufacturing employment declined by 1,033 jobs, or -4% (2011: -3%)
» Launch Industry employment declined by 1,201 jobs, or -2.4% (2011: -2.2%)
» Ground Equipment employment decreased by 3,647 jobs, or -4% (2011: -0.7%)
28
0
50,000
100,000
150,000
200,000
250,000
300,000
2007 2008 2009 2010 2011 2012
Nu
mb
er o
f jo
bs
Satellite Services
Satellite Manufacturing
Launch Industry
Ground Equipment
Source: U.S. Bureau of Labor Statistics (BLS).
Consumer $93.3
Fixed $16.4
Mobile $2.4
Remote Sensing, $1.3
2012 Satellite Industry Indicators
Summary
29
$189.5B 2012 Global Revenues
7%
Growth 2011 – 2012
Satellite
Manufacturing
$14.6B
Launch
$6.5B
Ground
Equipment
$54.9B
Satellite
Services
$113.5B 5%
23%
4%
35%
Satellite
Services
$113.5
Ground
Equipment
$54.9
Satellite
Manufacturing
$14.6
Launch
Industry
$6.5 Consumer
(GNSS)
$32.2
Consumer
(Non-GNSS)
$12.8
Network
$9.8
U.S.
$8.2
U.S.
$2.2
Non-U.S.
$4.3
Non-U.S.
$6.4
• Satellite industry revenue was $189.5 billion in 2012
» Growth of 7% worldwide in 2012
» Surpassed 6% growth rate in 2011
» The satellite industry fares well with tracking industries
• All four satellite industry segments surveyed posted growth in 2012
» Satellite services, the largest segment, grew by 5% - consumer services continues to be a key driver for the overall satellite industry
» Satellite manufacturing revenues grew by 23%, due to proportionally more expensive commercial GEO and government satellites in 2012
» Launch industry revenues rose by 35% in 2012, even with fewer overall launches, but with more commercial launches and more expensive heavy government launches than 2011
» Ground equipment revenues increased by 4% in 2012, with slowing growth in consumer equipment and increasing growth in network equipment
$121.7
$144.4
$160.8 $168.0
$177.4 $189.5
$0
$50
$100
$150
$200
2007 2008 2009 2010 2011 2012
$ b
illio
ns
Global Satellite Industry Revenue ($ Billions)
Summary: Top-Level Global Satellite
Industry Findings
30 2011 – 2012 Global Growth
7%
Contact
Previous reports are available at www.sia.org
For more information on the satellite industry, please contact [email protected]
Satellite Industry Association
1200 18th Street, NW
Suite 1001
Washington, DC 20036
202-503-1560
The Tauri Group
space.taurigroup.com
31