Last week SATCOM Frontier spoke with Christopher Baugh, President of Northern Sky Research. We spoke with him on some of the most pressing issues facing the satellite communications market today.
SF: First off, please give our readers a snapshot of Northern Sky Research
CB: I founded the firm in 2000, and we’re headquartered in Cambridge, Massachusetts. We cover all aspects of the satellite communications market – from manufacturing to launch and analysis of customer usage. Our goal is to deliver clear, actionable intelligence for our clients.
We take a global perspective, not just North America. In fact the majority of our offices and staff are located outside the United States.
SF: The increased importance of ISR has been in the news a lot lately – what’s your view?
CB: Well, there’s no disputing the fact that increased UAV construction and use is a huge growth driver for the satellite communications industry. Interestingly, a withdrawal from theater doesn’t mean that reconnaissance needs decrease – in some cases they can even go up.
At the same time, civilian use of UAVs is on the rise as well. Finally, with the increased budget pressure for the U.S. federal government, other governments may become more interested in financing their own UAV efforts, which will be good for the market as a whole.
SF: In your view, what’s the proper role for commercial SATCOM in supporting DoD customers?
CB: There’s no question that in an ideal world the military would be able to service its own SATCOM bandwidth needs. In reality, commercial SATCOM is a required gap filler, and that won’t change for the foreseeable future.
Bandwidth needs are always increasing, fueled in particular by the increased UAV we were just discussing. The growth rate may eventually slow somewhat, and we see a trend of the military moving towards application specific bandwidth, rather than raw capacity.
While a severe downturn is certainly not foreseen, the nature of demand will unquestionably change, requiring commercial satcom providers to be more creative in how they support military entities. New U.S. military satellite capacity is indeed planned for the future; however, it will take some time for this capacity to fully come online, leaving the door open to commercial providers.
SF: What effects do you see from the new budgetary climate for space?
CB: Well, you can never predict the future for sure. And this year will almost be same from a funding perspective, with not much change.
What we do at Northern Sky is take a scenario based approach to market questions such as this one. What does the data indicate as a baseline projection? Then from there we construct a best case and a worst case scenario. When you’re talking about a budgetary question, you also need to weight the uncertainty inherent due to the political factors involved.
To this very question, we are conducting a free webinar this coming Wednesday, February 22 at 10:00 AM EST. Titled “ Military Budget Cuts and Troop Drawdowns: What's the Impact on Commercial SATCOMS” we will be sharing the results of a survey we conducted on how the budget climate will affect COTM, SATCOM spending by other countries and whether WGS 9 will positively or negatively affect commercial SATCOM.
Basically, the need for what SATCOM delivers will increase, even as budgets are expected to decrease. That’s the new reality everyone in the market is adjusting to, and we’ll be suggesting ways to successfully do so in this webinar.