The industry added 11,719 VSATs on the shared hub in FY 07, with a 22% growth over installed base at the end of FY 06. The total number of VSATs on the shared hub crossed 60,000 units. VSATs continued their expansion and growth in existing market segments of broking, banking, and manufacturing, and adoption in new market segments: distance education, tele-health, e-governance, retail, and SME.

Though VSATs were being used as a backup to MPLS, ISDN, or any wireless technology, volumes show that satellites are still there on the minds of CIOs. The unit price has crashed to an all time low, much beyond expectations, down to Rs 60,000-80,000 from around Rs 1 lakh the previous year. If industry sources are anything to go by, one vendor has sold units for as low as Rs 35,000.

Big Successes
One of the key achievements was the breakthrough in some sunrise segments that have been high on importance worldwide and are seeing big growth in India. The digital cinema initiative was one such in the entertainment industry. The next breakthrough is in the cellular backhaul segment, where satellite provides a backhaul to locations that are not reachable by microwave or fiber. The third one is in the retail sector, where VSAT provides connectivity for credit and debit card authorization servicemore cost-effective than the traditional dial-up connection, and quicker. The traditional segments that include government and defense, BFSI, oil and gas continued to be the growth drivers. Robust buying by the financial segment was another growth driver. High availability offering for business continuity witnessed good growth this year.

The Race
Voice&Data, Indias leading telecom magazine from CyberMedia (publishers of Dataquest), estimates that Hughes tops the VSAT list. Its revenue for FY 07 was Rs 120 crore, a 25% growth. Adding 5,428 units, it increased its count to 20,240 units. The growth drivers for Hughes Communications were e-learning, oil and gas, banking, digital cinema, retail, and telecom. The company now intends to be a complete managed network service provider. It has also supplied VSAT for backhaul to mobile service providers like Hutch, Idea, Reliance, and Aircel.

HCL Comnet garnered Rs 102 crore, a decline of 25%. But, it managed to get some good orders: from Orissa Treasury, Berger Paints, Mahindra & Mahindra, Lotte India, Air Deccan, and Simplex. This year too HCL Comnet managed to be in the good books of SBI, and got some deployment orders.

Bharti Airtel bagged orders for about 5,000 VSATs, and installed 1,500 on its shared hub services till March 31, 2007, totaling 13,500 installations across the country. It bagged a large order from ICICI Bank for 1,000 VSATs, 250 for Union Bank of India, and 250 terminals for the Sahara Group. Airtel has also managed to get large orders from the Indian Army for systems integration projects using VSAT technology.

Tata Indicom VSAT services registered a growth of 25% to the tune of Rs 75 crore. The growth area was mainly the enterprise sector. The company is now seeing backhaul connectivity as another area of growth.

Last fiscal, Essel Shyam generated revenues of Rs 73 crore up 35% over the previous fiscal. The company did projects for ONGC, broadcast service industry and stockbrokers networks. Its growth came mainly from increased usage. Essel Shyam has a market share of 60% in broadcast services.

New Growth Markets
VSAT services in urban India are on the point of saturation. The industry envisages only about 10-15% growth in these areas. However, new markets in semi-urban, rural and remote areas can propel and sustain healthy growth in the coming years.

Distance Education: This sector has been growing steadily over the last two years, and has great potential to grow further. More so because of the EduSat program of the Department of Space for distance education to schools and colleges with a projected VSAT base of 35,000 in the next three years.

Inventory Control of Consumables: Oil companies like BPCL and IOC are using VSATs to update their inventory for bulk storage and highway outlets. HLL is using VSATs in a big way to update inventories in the remote consumer markets.

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