NSR: satellite broadband streaming requires fall in capacity prices

Satellite broadband capacity prices need to decline below US$100 (€88) per Mbps per month if satellite is to capture a broader consumer base that demands the ability to stream high-quality video, according to an analysis by research outfit Northern Sky Research (NSR).

According to NSR analyst Lluc Palerm-Serra, high satellite capacity costs currently mean that subscribers are bound by traffic allowances that do not permit multiple hours of streaming a day.

Palerm-Serra calculates that at capacity prices of US$200 per Mbps per month, a plan for a mid-tier US$50 a month subscriber would be capped at 10GB, not sufficient to support most consumers’ expectations.

The analyst says that capacity prices would need to fall below the US$100 threshold to enable data allowances to grow significantly.

While some satellite broadband providers are trying to boost streaming time allowance without incurring higher capacity costs by, for example, limiting video quality to 720p or lower, the growing popularity of viewing streaming content on larger TV screens means that this may not be sustainable.

While he admits that such a fall in capacity prices “is easier said than done”, Palerm-Serra says that more supply will ultimately cause prices to fall.