Non-GEO Procurement: The 660 Gbps Question for Gov & Mil Markets
As the U.S. Congress continues to move forward towards the next version of U.S. Defense spending, on the top of lawmakers minds are how exactly Gov & Mil end-users such as the U.S. DoD will engage and leverage commercial investments in Non-GEO HTS networks. The debate seems to be ‘over’ around if DoD will use COMSATCOM or MILSATCOM (the answer, both), but rather down to the exact process in which these commercial assets will be leveraged across the enterprise, purchased, and deployed.
According to NSR’s Government and Military Satellite Communications, 18th Edition study, that is a question which could see gov/mil Non-GEO HTS demand rise from 9.5 Gbps in 2020 to over 660 Gbps by 2030. This fundamentally reshapes the distribution of capacity demand over the next ten years. While overall demand across all frequencies, architectures, and orbits will grow, from 52 Gbps in 2020 to over 1 Tbps of demand by 2030, Non-GEO HTS will see the most profound growth.
Enabling all applications from Aeronautical to Land-Mobile to Maritime, the lower latency offered by these networks by themselves are ‘game changing’. Combined with significantly higher per-site provisioning, and potential for radically different pricing structures, it is easy to see why amongst all of the new technologies on the horizon, Non-GEO in Gov & Mil markets could truly take-off.
However, just as U.S. Congress is eager to ‘hear back’ on how these new capabilities will be brought into the network architecture, NSR continues to wonder these same questions. Already Gov & Mil Markets are a complex market structure compared with commercial markets – there are seldom ‘1 decision maker’ or the ability to ‘move quickly’. While there are niche segments of the Government markets such as Special Forces that can move quickly and ingest new technologies or capabilities rapidly – they do not represent the majority of the opportunity or customer set.
Beyond those differences, government customers are seldom ‘standardized’ from country to country – unlike segments such as Merchant Maritime or Enterprise. These markets can largely be thought of as a homogenous with many similar customers looking to acquire similar set of product or services. In Gov & Mil markets, customization is frequently the name of the game. Even worse, some customers do not even appreciate or recognize that their needs are unique and ask for ‘off the shelf’ solutions… for an n=1 market size. Overall, doing business for the government and military markets are a radically different business than commercial customers – even if the technology, companies, and hardware themselves are largely similar.
Moreover, there are few markets where the customer is also a satellite operator, service provider, and end-user simultaneously – which gets into the major challenge facing Non-GEO procurement. “Bulk Leasing” or “Transponded Capacity” had its origins in rapidly augmenting MILSATCOM capabilities during the initial surges of the Global War on Terror but has since taken on a life of their own as another key differentiator of Gov & Mil engagement with industry – where the end-user buys their own capacity to act as their own service provider. This push/pull of a more traditional/commercial ‘managed service’ vs. ‘bulk leasing’ is where NSR sees the largest dilemma for Gov & Mil buyers.
According to NSR’s latest outlook, the majority of Gbps demand in Gov & Mil Markets for Non-GEO HTS constellations will come under a Bulk Leased paradigm. Using the U.S. Government’s EMSS Contract with Iridium as a proxy model for engagement with LEO networks, NSR believes that transponded capacity for Non-GEO broadband connectivity will continue to grow over the next ten years. Under the EMSS contract, the U.S. DoD built its own teleport infrastructure and in essence acts as their own ‘service provider’ where Iridium intentionally has limited information around usage patterns, location, etc. Similar compartmentalization of information, infrastructure ownership, and other factors are likely to be key considerations in whatever acquisition paradigm/model is used for commercial Non-GEO HTS systems.
Bottom Line
Non-GEO HTS will be a key component of next-generation Government and Military networks – and the U.S. Congress appears to want a plan this time. However, the ‘details’ remain up in the air. More important than the details around Non-GEO HTS adoption will be how other NDAA language around military usage of 5G will impact the overall connectivity landscape. Overall, the connectivity landscape and business models are looking more complex than ever before.
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