Satellite services will offer a big pay-off for telecoms operators in 2024

2024 will be a year of pay-off for telecoms operators integrating satellite into their networks.  

The huge increase in satellite capacity is feeding a growing array of telecoms partnerships, and contributes to a turning point for telecoms operators: while terrestrial business expenditure on fixed connectivity is falling, satellite connectivity is one of the few areas of growth. It is set to grow by USD5 billion between 2022 and 2027. 

Recent technological developments have transformed the satellite market – which has emerged as a greenfield strategic opportunity for telecoms operators seeking to reverse declines in revenue from legacy voice and connectivity services by diversifying their service portfolio.  

Early movement is already apparent in partnerships such as Deutsche Telekom/ViaSat for aeronautical connectivity, Orange using satellite to transform its rural coverage, and Amazon Kuiper partnering with NTT/SkyPERFECT JSAT for remote and back-up connectivity. All represent concrete revenue-generating deals. 

Apple’s satellite direct-to-device service is operational (albeit with no associated revenues), and provides a stepping stone for the deployment of new capabilities by the likes of AST, Lynk and Starlink in 2024. These will unlock new revenue streams from IoT, allow users to roam outside of terrestrial coverage, and solve coverage blackspots for those without coverage today.

Early movers in satellite will have an advantage. For more insight see Satellite Strategies for Telcos.