The industry added 11,719 VSATs on the shared hub in FY '06-07, with a 22% growth over installed base at the end of FY '05-06. The total number of VSATs on the shared hub crossed 60,000 VSATs in FY '06-07. VSATs continued its expansion and growth in existing market segments of broking, banking, and manufacturing, and adoption of VSATs in new market segments of distance education, tele-health, e-Governance, retail, and SME.

Though VSATs were being used as a backup to MPLS, ISDN, or any wireless technology, volumes show the satellites are still there on the minds of CIOs. The unit price has crashed to an all time low, much beyond the expectations. The unit price has come down to Rs 60,000-80,000 from around Rs 1 lakh last year. If industry sources are anything to go by, one vendor has sold units for as low as Rs 35,000.

The key achievement of service providers last year was the breakthrough in some sunrise segments that have been high on importance worldwide, and are seeing tremendous growth in India. The digital cinema initiative was one such in the entertainment industry. 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 one is in the retail sector, where VSAT provides connectivity for credit 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, and other enterprises continued to be the growth drivers for VSAT service providers. Robust buying by the financial segment was also the key drivers of growth. High availability offering for business continuity was one of the key applications that witnessed exemplary growth this year.

The Race
As per V&D100 survey, Hughes tops the list of VSAT services industry. Its revenue for FY 2006-07 was at Rs 120 crore which is 25% growth over the previous fiscal. It has added 5,428 VSATs to its kitty, totalling 20,240. The growth drivers for Hughes Communications were e-learning, oil and gas, banking, digital cinema, retail, and telecom.

The company did projects for Indian Railways, ISRO, and Reliance Petroleum. It has also got orders from various banking organizations that include UTI, ICICI, and Indian bank. The company now intends to be a complete managed network service provider. Hughes has also supplied VSAT for backhaul to mobile service providers like Hutch, Idea, Reliance, and Aircel.

In FY '06-07, HCL Comnet registered revenue of Rs 102 crore showing negative growth of 25% and is placed at second position. The company's revenue for the FY '05-06 was at Rs 136 crore. But, the company has managed to get some good orders from various sectors. It has got orders from Orissa Treasury, Berger Paints, Mahindra & Mahindra, Lotte India, Air Deccan, and Simplex. This year also HCL Comnet managed to be in the good books of SBI, and got some deployment orders. The company implemented VSAT based networks for SBI for its core banking projects.

In FY '06-07, Bharti Airtel bagged orders for about 5,000 VSATs, and installed 1,500 VSATs on its shared hub services till March 31, 2007, totaling 13,500 VSAT installations across the country. In FY '06-07 Airtel bagged a large order from ICICI Bank for 1,000 VSATs, which will be deployed for ICICI Web Trade, and ICICI Bank in different phases, 250 VSATs for Union Bank of India, and 250 terminals for Sahara Group. Also, Sahara group has asked Airtel to upgrade its 1,450 VSATs. Airtel has also managed to get large orders from Indian Army for system integration projects using VSAT technology.

Similarly, Tata Indicom VSAT services registered a growth of 25% to the tune of Rs 75 crore. The growth area was mainly the enterprise sector. It has added more than 1500 VSATs this year and its total VSAT base reached 4,100. The company provided services in segments such as stock broking, extended enterprise, and banking. The major clients included Karnataka Bank, ACC, and Tata motors. The company is now seeing backhaul connectivity as another area of growth.

In this fiscal Essel Shyam generated revenue of Rs 73 crore which is a growth of 35% over the previous fiscal. The company did projects for ONGC, broadcast service industry and stockbrokers' networks. Its revenue for this financial year mainly came from the increase of services usage. They have market share of 60% in broadcast services industry. It has got some good orders from MCCL (Star News) teleport&DSNG Network, ONGC (MFTDMA Network), LKP Stockbrokers, and CSB TV (Bangladesh).

New Growth Markets
The market share of VSAT services in the urbanized fraternity of customers is on the point of saturation. The industry envisages only about 10-15% growth in these areas. However, new markets in semi-urban, rural and remote areas can propel and sustain a healthy growth in the coming years.

Distance Education: This sector has been growing steadily over the last two years, and has great potential to grow further. More so because of the EduSat program of the Department of Space which envisages providing distance education to schools and colleges with a projected VSAT base of 35,000 in the next three years.