presented to: alaska broadband task force
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Presented to: Alaska Broadband Task Force
Open Skies Program - Next Generation by SpacenetAugust 01, 2012
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Agenda
• Spacenet Overview • Satellite Broadband for Rural America
– StarBand Open Skies Overview– StarBand Presence and Experience in Alaska
• Open Skies Program – Next Generation• Next Steps and Q&A
2
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Our Passion• Managed Network Services Provider
– Design, Implement and Manage Data, Voice and Video Networks
• Tailored Managed Network Services to Meet Customer’s Precise Needs – Access, Security– Full Lifecycle Solutions– Value-Added Services
• Technology-Neutral Approach– Satellite, Broadband, MPLS, DSL/Cable, 3G/4G
• Serve 4 Primary Markets– Enterprise (Large, Multi-site Business
Networks)– Government (Public Safety, Emergency
Management Agencies) – Industrial (Oil & Gas, Utilities)– Small Office/Home Office (StarBand High-speed
Internet)3
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Our Network
• Nationwide MPLS & Satellite Network
• 130,000+ managed sites
• 1.5Gbps of B/W across multiple satellites
• 60,000+ Broadband circuits provisioned
• On-Site Field Services
4
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Satellite Broadband
• Ubiquitous Communications Delivers Broadband Virtually Everywhere, Irrespective of Distance
• Established Technology that Can Deliver Broadband Instantaneously (No need for build-out)
• Measurable Commodity (i.e.: TRUE Cost of Delivery is Exactly Known)
• Scalable and Reconfigurable• New Generation Satellite can
deliver 10x the speed of current technology5
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
StarBand Open Skies Alaska• $100M Set Aside for
Satellite in Broadband Initiative Program (BIP)– Funded by American
Recovery and Reinvestment Act
– Administered by Rural Utility Service (RUS) of USA
– Spacenet Awarded $6.2M for Alaska – handled by StarBand
– Allows for ~4200 Households in Alaska
– Grant Expires September 2013
6
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
StarBand Presence in Alaska• History
– StarBand was the First Company to Offer 2-way Broadband Satellite Internet Solution in 2000
– First Customer Installed in Alaska in 2001– 3,028 Active Sites in Alaska– 198 Alaskan Communities Currently Served– Over 40 Dealers and Installers
• Open Skies Accomplishments To Date– 2,074 Open Skies Sites in Alaska To Date – 141 Alaskan Communities – ~$1M Contributed to State Economy through June 30, 2012
• Installation, Commissions, Shipping, Advertising
7
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
StarBand Experience in Alaska
8
Presented to: Alaska Broadband Commission
Open Skies Program - Next Generation by SpacenetAugust 01, 2012
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Technology Approach for 100% Broadband Coverage• Tiered Strategy
– Terrestrial (Fiber/DSL) Coverage for ~70% of Alaska Population– Wireless - Last Mile to Reach Additional 10-20%– Satellite-Only Economic Option to Reach last 10-20%
• 20K Households in Villages with Density of < 300 Households
• Estimated 30K households (10%) in Areas Covered by Terrestrial, but Beyond the Last Mile Reach
• Similar Model to Australian Next Generation Broadband Network Strategy– Alaska Has Significantly Higher Percentage of Isolated
Population, but Similar Tiers of Cost Analysis Would Apply
10
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Technology Approach for 100% Broadband Coverage
11
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Satellite Economic Models and Considerations (ROM)• High-Throughput Satellites (HTS) Typically Provide 100Gbps
Capacity– Via Multiple Spot Beams and Earth Station Gateways – Typical Spot Beam Capacity ~ 250Mbps – 1Gbps:
• Approx. Number of Spot Beams for Alaska = 8-16• Approx. Number of Gateways for Alaska = 1 – 2• Total Capacity for Alaska= 4Gbps – 8Gbps• Support 10/3 Mbps Service to 50K Subscribers
– ~$400M per HTA Satellite to Serve 500k subs = $800 Satellite Capital Cost per Subscriber
• For 50k Alaska Subscribers, Est. Cost is $40M– Alaska Gateways Estimate: $10M– ~$500 CPE Cost
• For 50k Alaska Subscribers, Est. Cost is $25M– TOTAL for 50k Subscribers Capital Cost Estimate:
• $75M Capital Cost• $1500/Subscriber Capital Cost
– New Technology Designed to Allow for Self-installation and Maintenance12
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Satellite Economic Model (Cont.)• User Populations: Different Needs and Abilities to Pay
(Overall Solution Can be Profitable)– Alaskan Rural Residents
• Need Coverage to Bridge Digital Divide, but Cost is Significant Factor
– Alaskan Tourism Industry• Remote Lodges and Destinations Need Coverage to Satisfy
High- end Customers– Commercial Interests
• Mining/Oil & Gas/Pipeline Customers Require High Reliability, 100% Coverage
– First Responders• Significant Bandwidth Available for Critical Situations with
No Restrictions on Location
(13)
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Satellite Economic Model (Cont.)
• Ownership/Division Models– State Could Purchase Partial Satellite
• Partnering with Another Party Interested in CONUS Coverage
– State Could Agree to Long-term Lease on Partial Satellite– State Could Purchase Entire Satellite
• Distribution Options– State Could Provide Service Directly to Residents and
Commercial Interests– State Could Wholesale Service to Multiple Providers (Australia
Model)
(14)
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Satellite Economic Model (cont.)• ROI for the State:
– Assume a wholesale model of $15/sub/month charged to the ISP
– Assume the ISP charges market rates of $40-$50/sub/month– Assume 50k subscribers
• Total Revenue/Month to the State– $750k/month
• ROI for a $75M investment: 8.33 years, IRR 9%
• Typical life of a Satellite: 15 years
(15)
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Conclusions• Goal of High Speed Broadband to ALL Residents in Alaska is an
Absolute Paradigm Shift
• Tiered Approach is Most Practical Way to Achieve Goal– Fiber to the Home in Densely populated Areas– Fiber to the City mixed with DSL/Cable/Wireless for the Last Mile– Next Gen. Satellite for Rural, Last Mile Fill-in, and Emergency Response
• Next Generation Satellite Costs will Allow for 8-10x the User Experience at Lower Costs than Current Satellite Technology
• Commercial Satellite Providers have not seen Alaska as economically viable and will not focus on it without the influence of the State
• Spacenet, and it’s parent Gilat, are Uniquely Qualified to Provide Alaska the Experience and Technology to Realize the Next Generation Satellite Option
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Appendix
© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
Starband Open Skies Alaska Promotion: In Print
Newspaper Ads, Inserts and Direct Mail
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© 2012 Spacenet Inc. Not for redistribution without permission. www.spacenet.com
StarBand Case Study: Northwest Arctic Borough
• Centered out of Kotzebue (not eligible)– Significant Penetration: 50-60 % Considered
Saturated• Keys to Success
– In Region Support• Long-time Dealer has Mentored Village
Specialists– Positive Word-of-Mouth
• Impacts– Facilitates Small Businesses
• Inventory Management, Sales– Enables Inter-village Communication
• Via Facebook, email– Teacher Satisfaction
19
StarBand UnitsHousing Units (2010 Census) Penetration
Ambler 23 75 31%Buckland 38 98 39%Deering 14 44 32%Kiana 27 101 27%Kivalina 24 85 28%Kobuk 5 36 14%Noatak 37 114 32%Noorvik 35 153 23%Selawik 68 186 37%Shungnak 3 62 5%Total 274 954 29%
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