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Even though it has a huge potential, the use of VSAT has not yet picked up. Across the world, VSAT has been used as a 'technology of last resort' even when it has the potential to beat any of its counterparts in terms of reliability and service. VSATs are easy to install, can be deployed fast, and serve even the most remote locations. In the recent times, with the hardware and services cost going down, they have become more affordable and enterprises should make them their first choice.

From an industry perspective, the de-regulation of the sector has spurred enterprises to achieve greater heights. Regulatory reforms, which allow smaller customer terminals, higher bandwidth transmission, and use of foreign satellites for uplinking, have made this technology market-friendly. Further, the industry has benefited greatly from increased adoption of IT by non-IT companies, favorable regulations and the overall macro-economic business confidence. Along with de-regulation and reform in the policy framework, the technology has also matured with the provisioning of more high-powered satellites over India. This increases the bandwidth availability, which leads to lower bandwidth costs. Some key positive regulatory reforms have been: one, the change in the licensing model from a fixed license fee to a revenue-sharing model, making VSAT more affordable; and two, the decision to use the Ku-band from foreign satellites, bringing down cost of ownership of equipment for the consumer.

The result of these technical developments and regulatory reforms is reduced costs and increased efficiency for customers. Moreover, the broadband platform now supports an increased number of applications, which deliver greater value for customers.

Market Trends
In the past year, the VSAT technology has successfully re-positioned itself from a thin route technology to a thick route technology. Many organizations are beginning to adopt VSAT as a VPN technology for their back-office applications. Additionally, many enterprises are moving to a fully managed service model in which the service provider manages the entire network end-to-end, including fault, performance and security management.

Over the years, segments like retail, banking, e-learning, stock broking were the key drivers for growth. The VSAT industry has conventionally grown in the banking, broking, and manufacturing segments for their core enterprise networking requirements. This trend will continue along with new areas like extended enterprise (dealer network, C&F agents, etc) Some new, noticeable trends will be providing mission-critical backup connectivity for primary mediums such as leased lines and MPLS, the rising demand for higher-speed services for new value-added applications like two-way videoconferencing, VoIP telephone services and other real-time applications that require higher bitrates and faster links.

What the Future Holds
There is a robust demand for both Ku as well as Ext-C band services from various industry verticals. The key industry segments that are expected to contribute strongly in FY '08 are banking, e-governance, stock/commodity trading, defense, distance education, and retail. There is a higher acceptance of VSATs as a broadband access medium by a much larger, addressable market of SMEs, which will provide additional growth compared to the traditional enterprise and government segments. The industry aims to touch 85,000 VSAT units on the shared hub in FY '08, and 1,000,000 in three years' time.

VSAT service providers will continue to address the same sunrise segments that have been important markets worldwide and are seeing tremendous growth in India. Digital cinema, a huge part of the entertainment industry, is one such area. The next breakthrough is in the cellular backhaul segment, where satellite provides a backhaul to locations that are not reachable by microwave or fiber. The third is in the retail sector, where VSAT provides connectivity for credit card and debit card authorization service. This is more cost-effective than the traditional dial-up connection and saves significant amount of delay. The traditional segments that include government and defense, BFSI, oil and gas, among others, and continue to be the growth drivers. Large spending by the finance segment is also boosting VSAT growth. High availability offering for business continuity was one key application that witnessed exemplary growth this year.

Buying Tips
Before buying VSATs, an enterprise has to consider many factors. Though cost has remained the main discussion point for enterprises, the importance of factors like feasibility, bandwidth capacity and reliability should not be underestimated.

Feasibility: A feasibility check is a must before going the VSAT way. Connectivity options should be taken into account before making decisions because while in some areas a limited range or even single connectivity is feasible, in others multiple connectivity options might be available. VSAT may be the most suitable connectivity option for remote rural villages with no terrestrial telecommunications network. Urban areas though may have a good fiber or other terrestrial telecommunications network.

Bandwidth Capacity: Bandwidth capacity of a particular technology is one of the most important factors in selecting the connectivity option. You should determine the bandwidth capacity depending on the applications you run or intend to run in the future. For example, high capacity applications such as videoconferencing may preclude the use of low capacity options such as dial-up Internet connections. It is important to keep future requirements in mind, otherwise, you may find yourself having to buy a new system when your bandwidth needs increase.

Reliability: Reliability consists of multiple factors such as latency, availability, mean time between failure (MTBF) and mean time to restore (MTR). For example, for real-time or VPN applications under certain conditions, VSATs as well as some other technologies have high latency, making them unsuitable to deploy.

Cost: Cost has always remained the decisive factor in selecting from connectivity options that fulfill the other criteria outlined above. One should consider both initial investment as well as recurring costs throughout the useful life of the technology selected.

Frequency Band: Selecting frequency band is also an important factor that can play an important role in taking a decision. It should be decided which frequency band is most suitable. Alternatively, you can ask your service provider to decide the band for you after specifying your preferred service availability level year around or in the worst month. The latter is the recommended approach to take.

Beam Coverage: If you are installing VSATs in more than one location, you should specify the beam coverage required. If all VSATs in the network use the same beam, sharing central hub facilities is an option. Use of a single beam is necessary to avoid double hops, if opting for a mesh network. Additionally, you should ask the service provider to provide you with footprints or contour maps of the satellite they intend to use.

Dedicated vs Shared Bandwidth: Depending on your business requirements you should decide the bandwidth type dedicated, shared, or burstable. Your choice of bandwidth type also has a bearing on what access scheme you choose, as some access schemes only support shared bandwidth approaches.

Access Technologies: Access technologies should be specified based on your business and functional requirements. Different access schemes have different maximum information throughput rates, which also have a bearing on scalability and future growth. Alternatively, you can ask your service provider to propose alternative schemes if they can justify them on technical, efficiency, and economic grounds. This is especially important for the inbound route.

Topology: Users should select the topology depending on the applications they intend to run. Real-time applications such as telephony or videoconferencing may require a mesh topology, whereas simple Internet access for Web browsing and email is most economically served by a star network. Access schemes and topologies are the major cost drives for VSATs as they influence the size and capacities of the remote equipment, efficiency of bandwidth usage, and the type of hub infrastructure required. You should ask the provider for a detailed technical and economical justification for their proposed access scheme and topology.

Gyana Ranjan Swain
gyanas@cybermedia.co.in