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Bargaining for satellite communications services.

How satellite-savvy are you? Satellite communications is an important option for telecomm professionals. It can be used as a primary facility or as backup for other services. It is flexible, relatively easy to deploy and widely available.

To help us with this column, we spoke with Susan Cecala, Eastern regional sales manager with Global Access Telecommunications Services, Fairfax, Va., which provides satellite-based transmission facilities.

Satellite services today support voice, data and video applications. According to Cecala, most applications today are for video transmission. "Service can be provided in typical broadcast fashion," she says, "and it can also be established in various multipoint configurations, such as point-to-multipoint and multipoint-to-multipoint." Satellites also support point-to-point voice and data private line applications.

They also are handy in temporary situations, such as a regional disaster. "Service can often be set up more quickly by satellite than with terrestrial lines," she says, "especially in remote regions or areas that have had their access blocked."

The actual satellite owner, such as GTE Spacenet or Hughes Communications, will build and launch the satellite; they also own the satellite and its transponders.

Next, they sell transponder usage either directly to customers or indirectly through resellers or brokers, like Global Access. Resellers buy up blocks of time on several transponders in different satellites, and then market access to customers for either full-time or occasional usage. By obtaining transponder space in bulk, according to Cecala, savings can be passed on to subscribers.

Brokers add value to the equation by providing technical support and turnkey service packages.

Companies that want around-the-clock access to a transponder, such as a television network, can obtain that service either from the carrier or a reseller/broker.

Users who only require occasional access typically go through a reseller, because the pricing structure is usually more favorable.

Satellite facilities are typically used as part of a private network (e.g., voice, data and video conferences), or for special broadcasting applications like packaging of special events, e.g., sports programs, and distributing them via satellite to subscribers.

Rates for transponders are based on several factors. These include the frequency band, e.g., C and Ku bands; prime-time or non-prime-time hours; and full-time or occasional usage. Cecala provided the following price ranges. For occasional usage, C Band, prime time, look to pay $250-$350 per hour; non-prime time, $150-$250 per hour.

For occasional usage on Ku Band, prime time is $450-$550, and non-prime is $250-$350. When looking at full-time usage, another factor is whether or not the satellite is used for cable TV programming. In the C Band, non-CATV usage ranges from about $50,000 to $100,000 per month. But the price jumps quickly to $160,000 to $230,000 when the satellite is for CATV usage. Ku pricing generally starts at $130,000 per month and goes up from there.

"Check into the type of communications you need, the time frames, dates and frequency of usage," she advises. "Then, shop around among providers, get referrals from other companies you know, and check with industry trade magazines for names of providers."

A "good deal" in satellite service is actually a combination of product and price, she says. "We see a lot of emphasis on price because satellite service is really a commodity product."

Investigate the firm's service and support capabilities and its responsiveness to problems.

From a technical perspective, determine your uplink and downlink requirements, number of locations with respect to the satellite's "foot-print," requirements for Alaska and Hawaii coverage, and the power required at the earth station for services. Newer satellites have 48 transponders, rather than the traditional 24 of current and older satellites. In newer birds, transponders are usually divided into 24 C Band and 24 Ku Band. Transponders are usually more powerful in the newer satellites, as well.

When it's time to make a decision, consider using a contract for service. "Most people don't really get into contracts, at least for occasional usage needs," according to Cecala. "They do it more on an ad hoc basis." Cecala recommends using a contract because it can help keep prices stable, even though market pricing can get volatile.

Customers with occasional requirements can obtain some protection against preemption, especially from the full-time users who generally have priority. Users can also define the satellite resources required, and the minimum acceptable level of performance. Two to three year contracts can also help lower prices.
COPYRIGHT 1993 Nelson Publishing
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Copyright 1993 Gale, Cengage Learning. All rights reserved.

Article Details
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Author:Kirvan, Paul
Publication:Communications News
Article Type:Column
Date:Apr 1, 1993
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