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Faster, more affordable satellite communications spark new services

Broadband satellite attracts backup, mobile, continuity applications

By , Network World
September 10, 2009 01:13 PM ET

Network World - CIOs are giving satellite communications a second look, as providers deliver faster, more affordable services and as more government agencies and large corporations focus on keeping networks up and running.

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One sign of this trend: The U.S. government has announced a joint military/civilian agency purchase for commercial satellite communications services worth an estimated $5 billion over 10 years. The feds plan to request bids from satellite communications providers next year and to award contracts in 2011.

Related story: Feds to spend $5B on satellite services

"We see the need for commercial satcom service to continue and to increase over the next couple of years," says Kevin Gallo, program manager for satcom services at the U.S. General Services Administration.

The U.S. government is interested in commercial satellite services for traditional uses -- emergency response, remote locations, video broadcast and distance learning -- as well as the emerging area of continuity of operations (COOP).

"We think every organization should consider using satcom for their COOP needs," Gallo says, pointing out that satellite offers excellent redundancy for terrestrial networks and can be used for voice and data. "Satellite-provided backup can really be cost-effective insurance for when your terrestrial network goes down. It's available at a low cost, and you can surge when you need it."

Among the companies that are buying satellite services to back up terrestrial networks are Republic National Distributing Co. (RNDC), a wine and liquor distributor, and Roundtree Automotive, an Alabama car dealership.

Companies with remote locations such as BP, ConocoPhillips and other gas station chains have traditionally used satellite communications for low-bandwidth applications such as credit card authorizations and inventory updates. But as the satellite capacity over the United States increases, more enterprises are considering satellite for broadband and mobile applications.

"There's always been demand for higher bandwidth satellite solutions from enterprises… The problem has been the supply," says Christopher Baugh, president of NSR, a market research firm specializing in satellite and wireless services.

Baugh says that the newest satellites from Hughes, ViaSat and WildBlue will change how CIOs view satellite services for broadband applications, particularly COOP.

COOP is "a no-brainer for a lot of enterprises that need 100% or near 100% uptime," Baugh says. "This has been talked about since 2005, after Hurricane Katrina. That's when disaster recovery and business continuity propelled itself to the forefront."

The new economics of Satcom

Enterprises are interested in satellite communications because it has gotten faster, less expensive and more reliable over the last five years.

"The cost of satellite service has come way down, and it will continue to come down," says Lisa Scalpone, senior vice president for business development at WildBlue, a residential satellite broadband service that is available to enterprise customers through resellers. "The newest satellites offer 10 times the capacity of older models but at the same cost."

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