It was an unfavorable year for the VSAT industry, as the growth in revenue terms was not even one percent. The total market size was estimated at Rs 214.74 crore. On the number front, i.e., the number of VSATs installed, the industry registered an average growth of around 39 percent. This was far below the 49 percent registered in 1999-00.

The decline in revenue was due to an inapt growth in the DAMA terminals, as it registered a negative growth of around 17 percent. This slow growth can be attributed to lack of transponder capacity in the first half, large government tenders put on hold and e-commerce business like Skumars.com and many others could not takeoff. Other reasons were VSAT for village telephony was not allowed due to policy, corporates adopted a wait-and-watch policy and Internet via VSAT was very slow because of unclear regulatory policies.

It seems that the much-awaited VSAT policy based on revenue sharing is still awaiting government clearance and is expected soon. The policy will help in reducing the Total Cost of Ownership (TCO) of VSAT and make it more affordable. Along with the lifting up of the 64 Kbps ban for 512 Kbps, this will help the industry to grow at a faster rate in this fiscal. And it is expected that the industry will grow at around 50 percent if the policy gets a go ahead within the first quarter of 2001. Allowing Ku-band along with extended C-band will provide more opportunities for the industry. HECL has already set Ku-band hub and is testing it. HCL Comnet has also gone for Ku-band hub to be operational in June.

The total tally of VSAT installation in the country moved to 17,545 of which 4,928 were contributed in 2000-01. The country added 4,238 TDMA terminals and 686 DAMA terminals during the same period. DAMA accounted for 14 percent of the total VSAT sales in the country.

In terms of revenue, Hughes Network System was the No. 1 player leading the race with Rs 82.54 crore. Viasat, which also had Scientific Atlanta under its fold, for the first time, was unable to make a breakthrough and paved way to Gilat which stood at No. 2 with revenue of Rs 65 crore. Viasat’s performance was not up to the mark and the company made a revenue of Rs 40.07 crore. The company had a face saving grace through the sale of VSAT hub in the country. Nortel DASA and India Satcom had a bad year. Radyne was a new entrant in the Indian market through Comsat Max.

Banking and finance still dominated the scene followed by manufacturing, stocks and security, and distance education. Media was also a bulk buyer, as it helped them in providing faster information to their viewers.

This year the retail segment will dominate the scene. The foundation of distance education will be strengthened in this fiscal, as one will see many institutes opting for it. Even hospitals and medical institutes will go for tele-medicine applications, once the new policy is operational. VSAT service providers like HECL, HCL Comnet and Comsat Max have started providing value-added services, and would be more aggressive this year with their VPN and IDC products.

They will also provide Internet access via VSATs. Moreover, e-governance will also drive VSAT demand in the country.