Satcom is not trying to replace telecom networks: Nelco CEO

With satellite communications (satcom) services set to gain traction in near future, Nelco, a leading VSAT solutions provider in the country, has put to rest concerns around such services replacing or competing with terrestrial networks. “We believe satellite communication is complementing the terrestrial network and not trying to replace the terrestrial or telecom network,” PJ Nath, MD & CEO of Nelco, a Tata Group company, told FE. Without commenting specifically about allocation method for space spectrum in the country, Nath said as per global practice, satellite spectrum is never auctioned.

Satcom services are set to gain traction in near future with major global tech majors like SpaceX, Amazon evincing interest in the Indian market. Bharti Enterprises backed satellite communications company OneWeb too plans to launch pan-India services by May next year. But the issue for spectrum allocation for satcom has divided the industry with telecom operators like Reliance Jio and Vodafone Idea wanting auction for allocation of airwaves while Bharti Enterprises taking an opposite view.

On the back of low earth orbit (LEO) satellites, the satcom services market is set to grow over four times in the coming five years. Commenting on the issue of spectrum allocation, Nath said space spectrum is shared, reused as against terrestrial networks, where the airwaves are allocated exclusively to one company. He, however, said there are competent authorities in the country like the government and Telecom Regulatory Authority of India (Trai) — who will take a final call on the issue about what is realistic and what should be done. “Government is very clear that India has to be big player in space sector. This message has come right from the top. At the same time, everybody respects the amount of investments made by telecom industry, which also has to flourish. Eventually, we have enough mechanism within the country to arrive at what is more realistic and reasonable for both the sectors,” Nath said.

He said satcom will complement the telecom network in reaching out to remote areas. For instance, currently not even 50% of all the base tower stations (BTS) in the country are connected through fibre. In such a scenario, if the telcos want to reach out to the more remote parts of country, the best medium to connect the BTS network is satellite. “That will let the telecom operators to roll out the network much faster and reach out to the remotest parts of the country,” Nath said.

Further, satcom services are not likely to replace fibre or telecom services in metros or big cities because of the cost. At places where telecom or fibre connectivity is already present, offering satcom services does not make good business case because of high cost involved for setting up terminals etc. But in remote areas, satcom is preferred as the cost of laying fibre is too high and time consuming.

“Overall, the satellite communication industry has got a huge opportunity for the country, particularly with two major things happening. One, is that newer technologies are coming in and particularly the LEO satellites, which are much near to Earth. The kind of latency that you get in LEO satellites is significantly better compared to what we have in conventional satellites. Number two is that because of the technology and construct of satellite constellations, overall capacities that you get is much larger than what you get on any one satellite of a GEO,” Nath said.

He further said all technologies can co-exist and nobody is going to replace each other.

“We are also a B2B (business to business) player. We believe that the best value comes when you are complementing each other rather than try to cut each other because each of us have got our own strength,” he added.

Today most of the ATMs that are deployed in the remote parts of the country, and even in not so remote areas, are connected on VSAT. Close to 50,000 petrol pumps across the country are connected on VSAT. There are multiple factors for the uptake of satellite communications services.