Euroconsult, a leading global consulting firm specialising in satellite-enabled markets, has released the latest edition of its FSS Capacity Pricing Trends report which unveils continued shifts in the capacity pricing landscape.

Satellite capacity pricing is experiencing rapid declines in an increasingly disruptive market, supported by rise of next-generation geostationary (GEO) and non-geostationary orbit (NGSO) high-throughput satellite (HTS) systems.

Massive influx of supply in the market has ultimately contributed to a commoditisation effect on connectivity, due to which the industry is witnessing a shift towards managed service offerings with attractive $/GB economics, primarily driven by Starlink.

Over the past five years, global average capacity pricing in video and data markets has dropped by approximately -16% (-3% CAGR) and -77%, (-26% CAGR) respectively.

This decline is more pronounced in data markets due to abundant supply from NGSO (primarily Starlink) and HTS systems, while video markets have seen a lesser decline, largely due to stagnated regular supply and market stickiness to long-term contracted prices.

The report also notes that the decreasing cost base of capacity (indicating efficiency of capex invested in satellite manufacturing considering sellable capacity and expected lifetime), initiated with the advent of Starlink, is expected to stabilise over the next 2-3 years leading to a potentially slower capacity price erosion compared to previous years.

“Starlink’s pocket-friendly pricing and higher availability of service plans have triggered a structural shift in the industry away from wholesale capacity leasing to more managed solutions setting a wave of strategy re-alignment across players,” said Senior Consultant Grace Khanuja.

“Operators are choosing to directly serve end customers with managed service plans giving them greater control of capacity prices while service providers are moving away from capacity management, focusing on value add-ons.”
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