According to Novaspace's findings, nearly three-quarters of the over 50 active satellite operators have already invested in HTS systems, with most HTS satellites currently positioned in Geostationary Orbit (GEO). However, despite the potential offered by NGSO systems, the high capital expenditure required remains a significant barrier, with typical investments ranging from $2 to $4 billion, and exceeding $10 billion for larger mega-constellations. Consequently, only a select number of leading satellite operators are moving forward with full NGSO constellations, with three major systems-SpaceX's Starlink, Eutelsat's OneWeb, and SES's O3b mPOWER-expected to be operational by the end of 2024.
The recent surge in NGSO activity has been largely driven by SpaceX's aggressive launch schedule for its Starlink LEO constellation. Between 2021 and 2023, total HTS supply tripled to reach 27 Tbps, with Starlink alone contributing 90% of the new supply. This expansion in capacity has been matched by significant growth in Starlink's customer base, with the company reporting over 2.7 million global subscribers as of April 2024.
As NGSO constellations rise, traditional HTS operators have been compelled to adjust their strategies. Recent years have seen an increase in partnerships, particularly among operators incorporating NGSO elements into their offerings. This has led to a trend of 'multi-orbit' collaborations, where companies work together across different orbital regimes to enhance service delivery and reach, showcasing the industry's ability to adapt to shifting demands and new technologies.
The report predicts an extraordinary nine-fold increase in HTS capacity from 2023 to 2028, with NGSO constellations accounting for 97% of this growth. In 2023, HTS demand doubled to 6 Tbps, with NGSO contributing nearly 90% of the increase and surpassing GEO in total demand. Key demand drivers are expected to remain consumer broadband, corporate networks, and civil government sectors.
Dimitri Buchs, Managing Consultant at Novaspace, remarked, "The HTS market is undergoing unprecedented shifts driven by the rapid expansion of NGSO constellations and evolving consumer demands. Interestingly, the influx of subscribers across a variety of verticals for Starlink has led to HTS market expansion, not pure cannibalization, which is a positive indicator for the industry, as it shows that the improved economics enabled by lower HTS capacity pricing should unlock new opportunities both for GEO and NGSO in coming years, as they will allow for better services."
He further added, "The influx of NGSO constellations has not only expanded market supply but has also fostered market competition. This has pushed GEO HTS operators to adapt their strategies and, in response, there has been a limited number of GEO HTS orders in recent years as operators adopt a cautious 'wait and see' approach or opt for fully software-defined satellites."
Small GEO HTS satellites have also gained popularity, accounting for half of the eight GEO HTS orders placed in 2023. These smaller satellites are favored due to their lower capital expenditure, which eases financing challenges and improves the chances of recouping investments.
In addition to examining supply and demand trends, the report also provides revenue projections, forecasting a fourfold increase in HTS capacity revenue, reaching $22 billion by 2032. While mega-constellations are expected to dominate, growth is anticipated across various market sectors, with the fastest-expanding segments including land mobility, corporate networks, and civil government services, all projected to see substantial growth over the forecast period.
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