NSR’s new Satellite Capacity Pricing Index (SCPI Q4 2016) finds satellite capacity pricing in a prolonged freefall for most applications as more supply comes online and HTS offerings proliferate.
Data-centric applications saw the largest declines across all regions and frequency bands, while video-centric capacity remained slightly more resilient amidst challenging market conditions. Prices for Enterprise Data capacity have fallen by a dollar-denominated ~8-12% over the past 10 months. This compares to TV broadcasting prices dropping at lower rates in the 3-5% range, and commercial mobility seeing significant volatility.
“We have seen an apparent acceleration in pricing declines for data markets over the past year, with prices falling by ~10% during 2016,” notes Blaine Curcio, NSR Senior Analyst and report author.
“Overall, we’ve seen pricing reductions across all regions and frequency bands, with data prices seeing convergence between FSS and GEO-HTS somewhat faster than we expected.”
SCPI Q4 2016 finds that operator business models are evolving quickly, but there is also much disagreement over the best way to evolve. This has led to a higher degree of price volatility, particularly for GEO-HTS capacity, and has also led to more aggressive pricing in order to win market share. SCPI Q4 2016 creates a weighted average from these pricing inputs and provides the reader with a “rate card” price index for satellite capacity across regions, applications, and frequency bands.