Making Your Idea Happen –

Creating a Viable Satellite Application

 

Bruce Elbert

President

Application Technology Strategy, Inc.

 

A powerful idea is a valuable thing – making it happen requires a great deal of planning and preparation. In satellite communications, the right idea properly implemented can create a new business, or even change an industry. DIRECTV’s digital DTH system, Wal-Mart’s VSAT network and Inmarsat’s Regional BGAN are examples of innovative ideas that gained prominence in our industry.

 

The Satellite Applications Technology Conference (SATCON Expo) in New York this November is a platform for exploring options for industrial-strength uses of space technology brought to earth. In our panel on The Cost of Benefits, we explore how one takes an idea and makes sense of it. Operations Research methodologies of the 1960s delved into a variety of measures at ends of this dichotomy. The simplest approach is to compute the total cost of a particular endeavor, measured according to capital and operating expenses. This is then divided by some measure of effectiveness of the solution – communications capacity obtained or number of users satisfied. The cost/effectiveness became the sine qua non for making major investment decisions in government circles. Today, the favorite in these and many industrial circles is “total cost of ownership” (TCO). While no one would argue the value of knowing the TCO, it still is virtually impossible to accurately predict in this complex world of technology, inflation and business uncertainty. Nevertheless, we must do everything we can to get our arms around the cost.

 

Moving to the denominator, benefit is even more difficult to asses than cost. What, precisely, are we trying to achieve with the new satellite application? Many expensive systems have turned from a field of dreams to a scorched landscape (at least for the original investors, who bought the benefit vision and paid most of the costs). Turning again to the US military, a policy of “fly before you buy” seemed to address the uncertainty of committing to a particular program before the benefits could be measured in actual service. This works for a “commercial, off the shelf” (COTS) system like a fully equipped Hum V containing the latest in quad-band satellite communications technology. Therefore, anyone who delves into a new technology platform would be well advised to run pilot tests. A completely new development like the original DIRECTV system is another matter – you basically bet the farm on the team you pick to run the show. Such successes require planning, teamwork and intelligence at all levels. There must also be a good mix of technical brilliance, marketing prowess, and business savvy. We suggest six guidelines later in this article.

 

Apart from cost/benefit, we need to address the variety of risks faced by the application. These fall into the following areas:

  • technical – inability of the system to meet its specifications
  • schedule – the impact of late delivery of the service, pushing revenues out and allowing competitors to gain ground
  • cost – the problem of the overrun
  • market – something all telecommunication and information services face

 

One of the tools we find effective is the old B-school SWOT analysis – e.g., strengths, weaknesses, opportunities and threats. Taking cost/benefit to the next level, SWOT forces us to look at the more critical dimensions that amplify the risks that are always there. If you have money and time, you can accomplish almost anything. Leading your own SWOT team can categorize and possibly anticipate the drivers.

 

Most organizations with a taste for satellite technology don’t have (or want to tie up) the resources of a DIRECTV or Inmarsat. Rather, they must understand the cost/benefit implications of putting some significant part of their business up in space. We offer the following six step process for the new user or network developer:

 

1.      What is the strategic objective in using satellite communications? This key question involves two aspects – (a) how the features of a broad area satellite service are tied uniquely to the application needs, and (b) the direct benefits to the business or mission that derive from this. Service to cities on a nationwide fiber loop is probably not that attractive, but reaching ships and airplanes over the oceans is something only satellite can accomplish.

2.      What kind of satellite is appropriate? While there are many satellites to choose from, selection of the most appropriate one is central to meeting the mission objectives cited above. A thorough analysis with a simple link budget tool like SatMaster Pro provides confidence in the rolling out the network to all locations.

3.      What are the interfaces and applications to be supported? This requires a lot of homework and can last a month to a year depending on the maturity of the user application or device. It will be difficult to get marketers and users to verbalize and quantify their desires, and interfaces are often ill-defined in the beginning. Effort in this area will benefit the cost, to turn a phrase.

4.      Who will evaluate the technology and economics? The timeline of activities from idea formation to implementation demands different skills at different each phase. The perfect organization does not and will never exist. What you’ll need to do is establish a core team of technical, business and operation folks who understand the organization and its mission. From there, resources must be added along the way, including consultants, vendors, contract staff and legal practitioners.

5.      What are the selection criteria? Many a new system is conceived by one group and implemented by another. Through the process of outsourcing all or part of the application, many barriers along with risks may be reduced. Selection of the right technology and suppliers should be based on criteria that are important to the organization. The previous four steps provide the basis of compiling such criteria in tabular form. Create a committee of stake holders to avoid bias in the selection and improve buy-in by all involved.

6.      How will this network be operated? This is not a trivial matter to be left for later. You have as many options here as with selection of application developers and implementers of the network. The operation phase may actually be the objective of your principle supplier (e.g., if it’s a teleport operator and network service provider).

 

Done right, a powerful satellite application can put a company in front of its competition and even change an industry forever. Wal-Mart probably did this with their innovative use of a star VSAT network emanating from their headquarters in Bentonville, Arkansas. Like American Airlines and its Saber reservation system, Wal-Mart pushed other retailers to incorporate VSATs into their telecommunications and business management strategies. The power of the two-way VSAT to deliver near-broadband interactive service to any location is the foundation of new services to remote locations.

 

Another innovation in satellite communications is the data broadcasting network, something that has been with us for a couple of decades. What is different today is the marriage of the Internet with the point-to-multipoint feature of GEO to create a content distribution network (CDN) with good cost/benefit properties. From the cost point of view, the hardware, software and necessary satellite capacity are affordable and in fact compare very well to traditional approaches like bicycling tapes and CD-ROMs and file delivery over broadband Internet connections. Strong benefits like centralized management with local control of display and ease of expansion and upgrade provide what I think could be part of a killer app for satellite. Several suppliers offer CDN technology and network solutions, such as SkyStream Networks and Gilat Spacenet.

 

Satellite communications isn’t as complicated as it was even ten years ago. If you can configure a Cisco enterprise router, you can manage a satellite network. Satellite infrastructure is straight forward once you understand its logic and nature. The US government is the largest single user, followed by the television networks and international telecommunications companies. Corporate users are limited, but those who have adopted it tend to stick with it for good reason. The only thing better than a good application idea is making it happen via a solid plan.