SATELLITE NUMBERS SHOW BOTH GROWTH AND DECLINE FOR INDUSTRY
Satellite industry has rebounded from slow growth in 1999 and expects strong gains this year, but satellite manufacturing in U.S. isn’t keeping pace with worldwide industry due in part to satellite export controls, Futron Corp. said in 5th annual survey released by Satellite Industry Assn. (SIA) Tues. Survey reported actual numbers from 2000 and projected 2001 totals. SIA Exec. Dir. Clayton Mowry said spectrum battle between satellite and terrestrial services, chances of Berman-Rohrabacher satellite export bill (HR-1707) and priorities of new FCC Comrs. Abernathy and Copps on industry also could have impact on industry.
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U.S. satellite manufacturing revenue hasn’t kept pace with worldwide totals, as latter showed 8% increase in total revenue, including subcontractor payments, to $17.2 billion, while U.S. industry numbers dropped 11% to $8.9 billion, decrease that Mowry partly blamed on satellite export controls. “Satellite manufacturing worldwide is starting to come back,” he said, and European companies are “getting better at building satellites.” While export controls are not only reason for U.S. decline, Mowry said, “we think the export controls are another layer” on top of problems for U.S.
Launch industry bounced back in 2000 from “tough years” in 1998 and 1999, Mowry said, as worldwide revenue jumped to $8.5 billion from $7 billion in 1998 and $6.6 billion in 1999, and U.S. improved from $3.5 billion both years to $4.1 billion in 2000. Survey said all 44 geostationary earth orbit (GEO) satellites were launched successfully last year, making it first time since 1989 that all launch attempts were successful. Mowry blamed failures in 1998 and 1999 on problems with launch industry. “Every major U.S. vehicle had to stand down at some point,” he said. Delays in deliveries of satellites and manufacturers examining component problems and in-orbit failures also led to drop, he said. Saturation in market, with 5 providers competing for limited share of launches, could lead to industry consolidation, Mowry said.
Survey said worldwide revenue for satellite industry had averaged 17% growth over last 5 years and industry estimated 14.8% gain to $97.7 billion in 2001. Satellite services produced 49.8% of industry’s numbers in 2000, with $41.7 billion, up from 1999’s $30.6 billion and 44.3%. Transponder leasing revenue has nearly doubled in last 5 years, from $5.2 billion in 1996 to $10.2 billion in 2000 survey said, not including transponder resales. However, direct-to-home retail, including wireless telephony, mobile and fixed data and remote sensing business almost tripled, to $31.5 billion in 2000 from $10.6 billion in 1996.
Mowry said decline in satellite manufacturing showed need for HR-1707. “We are convinced the export control issue is having a dampening effect,” on industry, he said. Survey said U.S. manufacturing revenue declined while world’s increased, he said: “These numbers are telling us the industry needs help to become more competitive.
CTIA petition for 2 GHz spectrum is example of other industries’ saying satellite companies “haven’t lived up” to promises, Mowry said. However, “we can serve everybody and we do it at the same price” as terrestrial service providers, he said. “We think we have a compelling argument” to keep FCC-allocated spectrum, he said.