The potential exists and yet…
Mahdi Nazari, CTO and Managing Director (APAC) of North Telecom talks about the on-going challenges in the satellite industry and the future within APAC
The major challenge
We are witnessing an era of huge transformations – there is a huge rise in new types of technology such as NGSOs (Non Geostationary satellites) and HTS satellites. And while this is a great thing for the industry, constant improvements only in the satellites leave the rest of the industry behind. We have so much investment and development in satellites but nobody is investing in the supply chain and that is leading to the big problem of excess capacity and less applications. As an industry, our investment in satellites is leading to more and more capacity, but a rather neglected supply chain hampers the corresponding growth in demand that would be fulfilled by this capacity.
As an industry, our investment in satellites is leading to more and more capacity, but a rather neglected supply chain hampers the corresponding growth in demand that would be fulfilled by this capacity.
Satellite application today is limited to some verticals such as Oil & Gas or maritime with only a few emerging segments such as Aviation. The problem with dependency on limited verticals is the exposure to risk. For example, the Oil industry has been our biggest customer for many years, especially in this part of the region – when the oil industry took a hit, the entire satellite industry is this region took a hit.
In my opinion, our main problem is that we have a very weak supply chain which is failing at creating new avenues, applications and opportunities for the highly increasing capacity that exists. Over 3 billion people remain unconnected, especially in the African region and under-developed markets – the potential exists and yet we fail to capitalize on it.
Bypassing the supply chain
As competition increases, each company begins fighting for margins and that has led to a difficult situation in the industry, which needs partnerships to thrive. In many situations, the suppliers initially work with the partners (solution providers) for some customers, but eventually end up approaching customers directly from their end. The problem with bypassing the solution providers is that you undermine the supply chain in the process. For example, a satellite operator’s first and foremost priority is the satellite and they will invest with their time and resources in the satellite more than anything, and similarly, for a solutions provider, the biggest priority is to improve the supply chain, achieve on-ground efficiency and use the experience from working on-ground. The optimum result is achieved if we only do what we can do best. If the suppliers try to bypass the on-ground partners, the focus on the supply chain is lost. It is important to understand here that customers in our industry are very complicated, sometimes only having an idea of what they want to achieve but no idea of how to get there. An on-ground partner is always the best solution to make that happen. The ground reality is that the on-ground partner is always willing to sit down with the engineers and personnel on-site to achieve what is desired by the customer by creating the perfect solution, because that is the job of the solution provider.
I think the problem and its solution both are quite clear. With time many industry players have realized this and have tried to adopt a more partner-centric approach – which has helped both the suppliers and the partners through achieving complete customer satisfaction.
Setting an example
We have done a very big project with Yahlive that involves 200+ television channels. We have worked together for two years, and after our efforts, it has turned out to be a very successful project, not just in financial terms, but in terms of bringing a new concept to the market. Now, we ourselves, could try to buy capacity and buy all the necessary resources, bring them in-house and try to sell it to customers, but we did not. We have always been a very partnership oriented company. We did not try to bring everything in house but instead made partnerships – we made a joint venture with about 4 companies and acted as the Project Management Office and eventually it turned out to be great for everyone. This is the kind of approach we need throughout the industry for it to thrive. We need more and more partnerships because today one company alone cannot do it all, firstly because of the focus always remains on your primary role and secondly, because of lack of experience in the other areas. We have outsourced many things in our project and it has benefited us both in terms of quality and cost. I think we need to see more of this approach elsewhere within the industry because if done right, it is a guaranteed win-win situation.
I think we need to see more of a partnership-oriented approach in the industry because if done right, it is a guaranteed win-win situation.
North Telecom going forward in APAC
We see a very huge potential in the Asia Pacific Market. I think the geography plays a major role here – there are a lot of Islands and many companies are requiring off-shore connectivity. There is a great demand for multiple verticals such as Maritime, Oil & Gas, GSM Backhauling on small rural islands, mining companies and so on. Statistically, there is a huge demand for satellite services in this region. There are a lot of operators already present and active in this region, but the gap in the supply chain also exists – that is where we come in. There is great direct demand, and there are also many players on the ground over here that want to serve many customers but there is a big gap between them and the operators. What we are trying to do is to reduce that gap and try to act as an enabler of solutions deployment for the customers. We have a huge experience dealing with satellite connectivity and we have a huge on-ground experience.
What we are trying to do is to reduce that gap and try to act as an enabler of solutions deployment for the customers.
Therefore, we see a great opportunity in helping operators achieve the desired results and providing an assurance of reliability and sustainability on ground. Overall, I think the future looks very bright for North Telecom, globally as well as this part of the region.