Thaicom to capitalise on the space economy
The firm is focusing on its new orbital slot licences and low-Earth orbit satellite services
published : 18 Mar 2023 at 06:22
newspaper section: Business
writer: Komsan Tortermvasana
SET-listed satellite service provider Thaicom has entered a new chapter as it won orbital slots in the January auction for geostationary satellites, explores developing businesses related to low-Earth orbit (LEO) satellites, and continues work on space tech innovation with partners.
The company plans to launch three geo-satellites, with two small satellites slated for late 2024 and a larger one in early 2027.
After 2027, the company's annual revenue stream is expected to be 300% higher than today, according to chief executive Patompob Suwansiri.
On Jan 15, the National Broadcasting and Telecommunications Commission (NBTC) held Thailand's first auction of satellite orbit slots offering five packages.
Mr Patompob says Thaicom aims to reach the top 10 in revenue for global satellite service providers by 2027, up from 13th.
The five packages comprised 50.5° East and 51°E orbital slots with a starting price of 374 million baht, 78.5°E with a reserve price of 360 million baht, 119.5°E and 120°E with a 397-million-baht reserve price, 126°E with a reserve of 8.6 million baht, and 142°E with a reserve of 189 million.
Thaicom's wholly-owned subsidiary Space Tech Innovation (STI) won the second package for 380 million baht and the third package for 417 million. The state enterprise National Telecom won the fourth package for 9.07 million baht.
Securing the two orbital slot packages ended uncertainty about the company's plan for long-term growth as the licences ensure its development path for the next 20 years, said Mr Patompob.
The new space economy is still a "blue ocean" for satellite service operators, in line with technology innovation development, he said.
Thaicom needs to adapt operations and management through synergy of its core value assets and partnerships to provide space-to-ground smart solutions and data communications in this new era, said Mr Patompob.
He took control of Thaicom on Jan 1 this year after three decades at the satellite operator, dating back to its first satellite Thaicom 1.
Mr Patompob's elevation to the leadership position came shortly after the company's 30-year satellite concession expired in September 2021.
He told the Bangkok Post potential demand exists for broadband internet service through satellites, although mobile service has a 95% global market share.
Even with satellite service at only 5% of the global broadband market, it is needed to serve growing broadband demand for digital transformation, especially in Southeast Asia, which comprises the bulk of Thaicom's business footprint.
Digital transformation is driving demand of satellite broadband service, including for communications, tele-health, e-learning, public safety and logistics, said Mr Patompob.
Thaicom's board recently approved a 15-billion-baht investment plan for the 119.5°E slot through the three planned satellites.
According to the board's resolution, Thaicom plans to construct three new satellites, with the first two slated to launch in late 2024 and the last one in early 2027.
The project comprises licence fees tallying 797 million baht for orbital slots at 119.5°E, 120°E, and 78.5°E, as well as the construction of three satellites at 119.5°E, as well as other related expenses worth roughly US$434 million.
Satellite construction must be completed before the end of the Thaicom 4 satellite's lifespan to ensure the company can continue providing services to customers.
As a result, the board approved STI investing in the construction of the satellites for 119.5°E before the other slots.
The project investment will ensure the company can keep serving its domestic and international clients, continuing to earn their trust, he said.
The first phase of satellite development concerns two small geostationary satellites, each with a capacity of 10 gigabit per second (Gbps).
They are expected to bridge the gap from Thaicom 4 as that satellite's engineering lifespan is set to expire by the end of 2024.
The two small satellites are scheduled to provide service from 2025 to 2032. Each satellite is valued at 2.18 billion baht.
Thaicom plans to invest another 2.1 billion baht for traffic management via a gateway station, as well as related expenses for the two satellites, said Mr Patompob.
The second phase covers the development of the large geostationary satellite worth 7.9 billion baht, slated to provide service from the third quarter of 2027 until the end of the licence term, or 15.5 years.
This larger satellite is projected to have a capacity of 100Gbps, or 10 times more than the two small satellites.
He said the larger geo-satellite will be the latest version of broadband satellites, known as a software-defined satellite (SDS).
Compared with traditional systems that are contained-designed and inflexible for configuration updates or space systems interconnections, an SDS network can rapidly deploy flexible and fine-grained network management strategies, reduce system costs, and improve collaboration between satellites and the compatibility of heterogeneous space systems, said Mr Patompob.
"The SDS network enables a satellite service provider to better manage the network capacity to adjust the capacity serving a targeted market with more flexibility, in line with demand and market strategy," he said.
Thaicom's geo-satellites will focus on South and Southeast Asian regions, especially in its areas of expertise, including Thailand and India, to maintain existing demand and cater to new demand from the state and private sectors, said Mr Patompob.
The company's target foreign satellite markets comprise seven countries: Japan, India, Indonesia, Myanmar, Laos, Cambodia and the Philippines.
Thaicom entered its first commercial partnership deal with satellite operator Globalstar for the narrow-band LEO satellite business last year.
The partnership is meant to cash in on the company's ground facilities in Thailand and regional service deployment. The deal aims to tap personnel safety and management solutions for the country's tourism and maritime industry.
The deal with Globalstar fits Thaicom's development roadmap as LEO satellite business is one part of the company's diversification strategy that should complement its existing satellite services portfolio, he said.
The NBTC already awarded Thaicom a landing licence related to foreign satellites.
LEO satellites operate between 500 and 2,000 kilometres above the Earth's surface, compared with an elevation of 36,000km for geostationary satellites.
The advantage of the lower orbit is lower latency, facilitating those with access to high-speed internet services via 5G technology, Internet of Things (IoT) devices, machine-to-machine technology, as well as drone technology and applications in areas that require high levels of accuracy, such as remote surgery.
The long-term partnership covers two categories. First, Globalstar vows to hire Thaicom to develop, equip and operate ground station facilities in Thailand at Thaicom's Teleport Centre, located in Pathum Thani province, for Globalstar's LEO satellite constellation.
The infrastructure and services of the ground station are expected to enable the deployment of commercial LEO satellite services by Globalstar in the region.
Second, Thaicom is an exclusive partner allowed to distribute the services of Globalstar's LEO satellites in Thailand.
Mr Patompob said the development of related infrastructure and the ground station was already finished.
Thaicom can now demonstrate IoT products and solutions that will be serviced via Globalstar's LEO satellites.
The first product, named "SPOT GEN4", is smaller than the palm of a hand and can enable assets or humans to be monitored remotely via the satellite network. This product is scheduled for launch in July.
Thaicom is also monitoring potential business related to the global development of LEO satellites, he said.
Mr Patompob recently said the company is eager to explore the potential of satellite-to-mobile phone service in Thailand through its partnership with Globalstar, aiming to capitalise on this emerging trend that he believes will become a game changer in the telecom sector.
Global mobile phone vendors are already capturing this trend, as iPhone 14 users can activate the Emergency SOS feature via satellite-to-text emergency services when they are out of cellular or WiFi coverage.
He said it is too early to elaborate on a business model for Thaicom's satellite-to-mobile phone service as it requires thorough consideration.
"The IoT solutions and services through LEO satellites will be an early step in the company's LEO business development," said Mr Patompob.
Satellites in space should focus not only on TV and telecom businesses, but also generate innovation such as aerial photography to synergise with unmanned flying vehicles connected via IoT solutions on the ground, he said.
Efficient utilisation of the space economy can help countries improve their competitiveness, said Mr Patompob.
He said the carbon credit business is one example of the global trend related to satellite solutions.
Thaicom has partners in the US that have LEO satellites taking images of targeted forest areas.
Combined with drone photography in areas that require a clear image, satellite solutions can be used for aerial photograph processing in combination with an artificial intelligence system to calculate forest area sizes and evaluate carbon credits for customer organisations, said Mr Patompob.
"Valuing carbon credits in forest areas is a specific science because each area uses different calculations and solutions," he said.
"The use of technology, from taking photographs to carbon analysis and estimation, is all essential as it gives faster and more accurate results."
Thaicom also provides a high-speed marine communications service, known as the NAVA platform. Currently 120 ships and 2-3 oil rigs use the company's NAVA platform.
The company partners with global satellite operators for satellite signal roaming, which enables it to provide the NAVA service worldwide and attract more customers.
The NAVA platform generates revenue of 60,000 baht per ship per month, and 300,000 baht for each oil rig per month.
"Our business potential will be derived from three core parts: geo-satellites, LEO satellites, and all digital solutions related to the space tech ecosystem," Mr Patompob said.
Space technology is seen as the most dynamic stream, in line with digital transformation and innovation development complementing satellite network infrastructure.
The space tech business includes aerial photographs, digital solutions, drone control towers and logistics.
Thaicom aims to be ranked among the top 10 global satellite service providers by 2027 in terms of revenue, building from its current ranking of 13th, he said.
- Patompob Suwansiri