Complementarity of terrestrial and satellite networks - The Role of Satellite in a Converged European Broadcast Landscape
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Complementarity of terrestrial and satellite networks The Role of Satellite in a Converged European Broadcast Landscape Presented by Steve Bisenius Vice President Sales Engineering, SES Presented on 15 Sept 2016 SES Proprietary and Confidential
Introduction 1. Who is SES 2. Trends 3. Complementarity of terrestrial and satellite networks in Media 4. Opportunities for hybrid solutions
1. SES overview
World Leading Satellite Operator and Dynamic
Market Leader
Owns and operates one of the world’s largest
commercial satellite fleets
• Over 50 satellites covering 99% of the globe
Partner of choice serving over 700 broadcasters, telcos,
enterprises, governments in over 130 countries
• Technical reach of 317 million households in 2015
• Over 7,400 TV channels, generating over 1 Zettabyte of
broadcast video annually
• Largest HD channel line up (over 2,400 channels) in Q2’ 16
Over 1,970 employees in 21 locations worldwide
2015 contract backlog: EUR 7.4 Billion
4
Providing Connectivity with Integrated Offerings of
GEO and MEO Satellites
5
2. Trends
Market Outlook: Video
Consumers want a higher quality Linear vs. non-linear consumption 2014(1)
experience Minutes
• HD growing in developed markets: HD
channels in Europe expected to increase by
75% between 2015 and 2019*
• +53% Growth in HD TV across Europe and
North America (2015-2019)*
• Ultra HD now a reality: 51 UHD channels on
air via satellite in Q1 2016
Significant growth in TV homes across
emerging markets
• ~6,500 TV channels added in emerging
markets (2015-2019)*
Linear TV remains the main viewing
platform
Consumers increasingly want combination
of high quality linear experience
(HD, Ultra HD), complemented by OTT
* Source: Euroconsult 1) Source: Eurodata TV, IHS
7
Market Outlook: Enterprise
Proliferation of global data usage/applications: +32% Growth in global data traffic (2015-2019)*
Users want higher speeds and uninterrupted coverage
HTS enables higher throughput and lower cost per bit
Projected global IP traffic demand(1) Data traffic by region(1,2)
Gigabytes per capita per month worldwide Exabytes per month
* NSR
1) Cisco VNI
2) One exabyte equals one billion gigabytes
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Market Outlook: Mobility
Airlines and maritime responding to growing ‘bring your own device’ usage
Growing demand for connectivity anytime and anywhere
10,000 connected airplanes expected by 2020, which represents a 400% increase
The number of maritime vessels adopting VSAT technology is expected to increase
from 14,200 units in 2014 to 25,500 units by 2019
Maritime connectivity(1) Aeronautical connectivity(1)
FSS in-service units (ships equipped) FSS in-service units (planes equipped)
60.000 25.000
50.000
20.000
40.000
15.000
30.000
10.000
20.000
5.000
10.000
0 0
2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2014 2016 2018 2020 2022 2024
1) Source: NSR
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3. Complementarity of Terrestrial and
Satellite networks in Media
10Connect the Household - Hybrid DTH
Global Trends in the TV and Video Market
End consumer perspective Broadcaster / operator perspective
▲ … increasingly want value for money in terms of ▲ Content owners and new aggregators bypass
content, quality and convenience in accessing traditional value chain, competing with
video content broadcasters and pay TV operators
▲ … expect higher quality resolution, making HD the ▲ HD broadcasting will become the norm with UHD at
de-facto standard in the future the horizon
▲ … want multi-screen, non-linear convenience ▲ High Efficiency Video Coding (HEVC) creates
anytime, anywhere opportunity to start new / improved satellite TV
platforms with reduced distribution cost
▲ … continue to watch linear TV, complemented
increasingly by OTT ▲ Multi-access channels and multi-device
consumption become integral to pay TV operators’
▲ … increasingly demand VOD services; the DVD/Blu- strategy. Therefore, technical platforms need to
Ray is gradually being replaced by OTT on demand manage multi-screen and non-linear video
services integrated with linear TV
Consumers become more demanding regarding quality of TV and convenience of video usage
Platform operators to respond to these trends including with SES enabled solutions
SES Proprietary and Confidential 12A consumer driven evolution SES Proprietary and Confidential 13
Terrestrial broadband not able to deliver new TV experience to all HH’s
Making the new video experience available to all consumers creates several challenges – the toughest being distribution,
both from a cost and reach perspective
Case: Individualized HD-quality full OTT video consumption in the EU
Ultra HD
requires 700 Gbytes per month /HH,
35x (1)
where EU’s current average consumption is ~20 Gbytes /HH 100x
2.2TB / month (4)
requires a sustainable peak-time 20Mbit/s access /HH,
4x (2)
where EU’s current observed average speed is 4.6Mbit/s 10x
50Mbit/s (5)
would hence theoretically only reach 54% HHs currently
54% (3) passed for NGA, creating another divide 20%
(6)
Notes:
(1) 2.3 persons/HH, 140h/month/person, 30% family viewing, mixing HD in H.265 (4) 2.3 persons/HH, 140h/month/person, 30% family viewing, 20Mbit/s Ultra-HD
at 3.5 Mbit/s and H.264 at 7Mbit/s stream in H.265
(2) Mixing H.264 and H.265 , up to 3 concurrent streams + regular Internet access (5) Up to 2 concurrent Ultra-HD streams at 20Mbit/s HEVC + regular Internet browsing
(3) Current advertised NGA reach (6) SES interpolation
Sources: IDATE, Sandvine, Cisco VNI, Akamai, Analysis Mason, Nielsen, EC, SES
Dramatic infrastructure upgrades would be required to deliver new TV experience to all HH’s terrestrial
only
SES Proprietary and Confidential 14Satellite vs. Terrestrial
Availability / Ressources
Terrestrial
Satellite Reach Broadband
Satellite covers virtually 100% of households with broadcast video
capability delivering flawless SD / HD and UHD media content
In comparison, only 81% of Developed HHs, 34% of Emerging Market
100% HHs and less than 7% of LDC HHs have broadband access; 81% Developed
Land / Sea / Air Only 68% of EU homes exceed 30 Mbps, and only 5% have Ultra-fast* 34% Emerging
broadband; As G.fast is only effective for loop lengths under 200 m, it
coverage via can never attain 100% coverage, and will most likely be effective for
5% >100 Mbps*
satellite substantially less % 0% (Mobility)
Satellite remains the only architecture capable of delivering broadband to
mobile ( aeronautical and maritime ) platforms
Quality Variable
99.99% Extremely high availability compares favourably with end-to-end
terrestrial network availability in many emerging markets ( due to poor Average end-to-
Satellite
peering/outages) end network
Availability Delivers uninterrupted, consistent bandwidth uniformly – enabling high
quality viewing experience that is unaffected by simultaneous viewing /
availability
audience size.
Satellites regularly broadcast directly to >100 M audiences in perfect HD
[4-5] Gbps/Sat quality; versus 8 M (SD) viewers which is the largest simultaneous
5.1 Mbps
Consistent audience attained and sustained over the terrestrial internet (Global average
To deliver a Live HD broadcast experience average terrestrial bandwidth broadband
Broadcast requires sustained > 20 Mbps to millions of homes, significantly higher
Bandwidth than both today’s average terrestrial broadband speed and its reach
speed)
Satellite has essential role in any communication network and provides superior reach and quality
compared to any terrestrial network
SES Proprietary and Confidential 153.1 Feed / Connect the HH - Hybrid DTH
TCO considerations - Full HD channel (DTH, linear)
Satellite distribution - Assumptions Threshold analysis applying to the
1 HD channel following scenario
10 Mbps, HD channel data rate VoD scenario where CDN service
40 Mbps on a 36 MHz txp is procured from 3rd part service
3,500,000 EUR million average revenue per Txp per provider (such as Akamai, Level3,
year in EU etc.)
CDN infrastructure is not owned
875,000 EUR total cost for an operator by VoD provider
Pan-European approach with
relatively low number of users per
local cache (i.e. high number of
Terrestrial distribution - Assumptions caches required to reach end-
1 HD movie users
10 Mbps, HD channel data rate Excludes equipment costs to
112 Average Movie Length (Min) receiving the satellite signal (i.e.
234 Minutes average viewing time per day in satellite dish, LNB, Cabling, LNB
EU (min) and installation)
8.4 Gbytes per HD movie
17.6 Gbytes per day in HD
Resulting threshold, where
0.02 USD per Gbyte CDN cost for an operator
satellite distribution becomes
0.018 EUR per Gbyte CDN cost for an operator
more cost effective for an
3.90 HD content watched per day (hours)
operator:
32.76 Gbytes per day
11957.4 Gbytes per year
4,065 Users
215.23 EUR annual cost per user for an
operator Calculation: divide EUR 875k by
EUR 215.23
Especially for Full HD content, the distribution via OTT is not economically viable if you assume CDN
costs of $0.02 per GB (per end-user)
SES Proprietary and Confidential 16Feed / Connect the HH - Hybrid DTH
Satellite Solutions complementing Terrestrial Solutions
Regions with
Insufficient
internet
connectivity
Broadcasting efficiency
using satellite
Fibre/Internet/CDN
Telcos, MNOs
Regions with
satisfying
internet
connectivity
Transparent boundle
offering for consumers
Satellite solutions complete telcos‘ and MNOs‘ service portfolio to provide linear and
VoD TV services even in regions with insufficient internet bandwidths
SES Proprietary and Confidential 17Convergence: Sat>IP
Satellite Solutions complementing Terrestrial Solutions
• Free-To-Air / Free-To-View / Pay-TV
• Broadcast Channels in SD/HD/UHD
• VoD (NVOD, Push VoD, LIQUID)
3G / LTE or
fixed Network
Telephony
Linear TV,
& Internet,
VoD
OTT
In-home and multi-screen distribution to the home
with satellite 3G / LTE Wireless or Wired Router
Two ways to access the multiple screens in-home: SAT>IP STB
• Using satellite for the bandwidth intense video
content
WiFi
• Using terrestrial infrastructure for telephony and lower HDMI/YCBCR WiFi
bandwidth internet data
PRO’s:
• High spectrum efficiency
Smartphone
• Energy saving Tablet
TV
SES Proprietary and Confidential 18Convergence: Sky Q
Example: Sky Q - Illustrating Hybrid DTH Solutions
New premium product offer from Sky
Provides fluid viewing across different devices and different rooms in the house
Seamlessly integrates broadcast and broadband (OTT) content
Attractive and fast user interface with touch remote control
Master PVR records up to 4 programs in parallel
Content can be watched on main STB or 2 additional mini-STBs or 2 tablets
Content can be downloaded onto tablets for on-the-road consumption
All SkyQ devices become premium wireless Access Points for Sky Broadband subscribers thanks to the new
Sky Hub
SES Proprietary and Confidential 19Connect the HH - Hybrid DTH
Summary
Key Findings
Major pay-TV operator strategies already building on hybrid DTH solutions
• i.e. broadcast industry is reference case (e.g. Sky Q)
DTH would allow telco’s / MNO’s to distribute video content to a larger audience in a cost effective manner; DTAG /
Vodafone (Germany) and Orange (France, Romania) already doing so
Nevertheless, Hybrid DTH strategy may be relevant for telco’s / MNO’s serving underdeveloped (European) markets
Satellite’s strength and weakness
+ Ubiquitous coverage for flawless SD / HD and UHD
+ High availability, uninterrupted, consistent bandwidth
+ Large, existing neighborhood
+ With growing audience sizes progressively more cost efficient for video distribution (scalability)
+ Capex investment fixed regardless of number of homes
- Less cost efficient for small audiences
- For telco / MNO’s requires set up of additional technology ecosystem
- Hybrid CPE’s expensive (compared to fixed line router) and not available in mass market
Key messages to the industry and EU
Telco’s and MNO’s should follow the path of broadcasters, who already apply strategies building on hybrid solutions
taking advantage of satellite’s bandwidth efficiency for addressing large (spread) audiences and …
• … use hybrid DTH in particular in remote geographic areas for linear TV (in HD) and also for VOD (e.g LIQUID)
Satellite and telco / MNO industries shall combine efforts to bring solution to the market e.g. by joint pilot in Eastern
Europe and jointly developing CPE specifications and
EU to recognize and support DTH as effective means for video distribution as an alternative or complement to broadband
and support R&D for hybrid CPE’s
Broadcast industry is successfully applying strategies building on satellite hybrid solutions.
Telco’s and MNO’s should follow the example in particular in remote geographic areas
SES Proprietary and Confidential 204. Opportunities for hybrid solutions
Developping & Emerging Markets Example: African continent
Television landscape
The future of broadcasting in Africa
TV households will continue to grow in Africa TV households growth
TV penetration to reach 50% by 2015
DTT will be key growth driver
DTH is another key growth driver as satellite is 86 123
unrivalled for quality, choice and reach million million
Strong demand for HD channels is expected in the
close future 2009 2015
TV reception modes in Sub-Sahara Africa in 2015
(in millions)
TV penetration forecasts
DTT Satellite
+100m +62m
Cable Terrestial
+1m – 86m Penetration increase
Source: Dataxis, 2014 > 50%
► Africa is turning to satellite to prepare ► SES has experience and a proven
for the analogue switch-off to bridge the approach in transitioning from
digital divide on the continent
SES Proprietary and Confidential
analogue to digital broadcasting 23Telecommunications landscape
Internet users today and in 2025
16%
Internet Penetration in Africa today
~50%
Internet Penetration in Africa in 2025
167m 600m
Internet Users Internet Users
67m 360m
Smart phones Smart phones
over 51m over $75 billion
Facebook Users In annual e-commerce sales
More than 50% More than $300 billion
Of urban residents are online Productivity gains in key sectors
More than 400m $300 billion
Beyond the reach of terrestrial fiber node Internet contribution to GDP
Source: McKinsey & Company, Barriers to Internet adoption
SES Proprietary and Confidential 24Supporting Africa growth with satellites
Undersea cables only serve the coasts
Snapshot of African undersea cables 300 million people are over 50 km from fibre or
cable broadband connection
The greater the distance the worse the connection quality.
400 million people have no internet access at all
10% more broadband connectivity equals 1.38% increase in
GDP for developing nations.
In 20 years the number of cities with over
10 million inhabitants will double
Strong and growing demand is expected for broadband and
rural connectivity, data and voice services for Telco's,
mobile operators, enterprises and government services is
expected (education, health).
Broadband cables are expensive to install
Fibre bridges the digital divide between the Western World
and Africa, but does not bridge the digital divide within
Africa between urban and non-urban areas.
Satellite provides efficient way of connecting
the majority of the 700 million unconnected
people
► Latest estimate total capacity in 2016: Satellite also has the advantage of reach, providing an
efficient way of connecting the majority of the poorly
>73 TB/s
SES Proprietary and Confidential
connected people.
25Supporting Africa growth with satellites
Bridging the digital divide into the continent
African population density Satellite bridges the digital divide enabling
Broadband Broadcasting WiFi hotspot
e-Education e-Health e-Government
Source: African Undersea Cables
► SES satellites covering Africa support the growing demand for modern
telecommunications and bridge the digital divide in the continent:
e-Health, e-Education, Digitalization, Ground equipment, …
SES Proprietary and Confidential 26Why is satellite the ideal infrastructure to support the
growth in Africa?
Satellite brings immediate full size country
and region coverage
Faster time to market and explore the
full potential
Synergies beyond country borders
Reach, the ultimate business driver
Unmatched cost effectiveness of the satellite
broadcast solution
Overcome last mile and remote area
connectivity challenges
Complementing and enhancing networks
Enabling smarter networks by combining
terrestrial and satellite strengths, delivering
connectivity and content in the most cost and
quality effective ways to the largest number
of households and users
Network offloading, “do what you do best”
SES Proprietary and Confidential 27Telecommunications landscape
SES Broadband for Kiosks and Wifi Hotspots
Process Applications
DTH Broadband Wifi Mini Hotspot
SME
SolarKiosk (Ethiopia)
Households Mobile/ Roaming users
A shared satellite antenna & WiFi
or other wireless in the last mile
► Satellite delivers internet connectivity to rural communities which can enable
e-commerce, e-school, e-health and e-government initiatives
SES Proprietary and Confidential 28Emergency.lu, Occasional/Event use,
Event Broadcasting, Occasional Use+ concept
Data Platform Broadcaster
New applications:
• Crossmedia workflow for broadcasters
• WiFi Hotspots on an occasional use
basis, e.g. concerts / special events
• Connectivity for emergency events such
aus energy industry, search and rescue
services independent from terrestrial
infrastructure
SES Proprietary and ConfidentialNew applications
Telco operators
• WiFi hotspots on an OU basis at unconnected sites
e.g. concerts, special events
Emergency management
• A local version of emergency.lu in cooperation with SNG providers
Energy industry
• Connecting power plants and distribution stations independent
from terrestrial infrastructure and self sustaining
SES Proprietary and ConfidentialEmergency.lu SES Proprietary and Confidential
Conclusion
Fill the gap…..
using the efficiency of complementary
hybrid network infrastructures
SES Proprietary and Confidential 33THANK YOU
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