AVANTI: Overall build and launch costs are in the region of £100m, the satellite is insured in case of launch failure.

6. Avanti’s Chief Executive, David Williams, recently said that he expected the government (Lord Carters Digital Britain report) to recommend the use of satellite to help address the 10% of UK population that does not have access to a minimum broadband speed (USO) of 2Mbps via terrestrial (earth based) means.

A price point of £15 per month was hinted at by one newspaper, though it is not clear whether this was in reference to a one-way (download only) or two-way (download and upload) satellite service. Can the new HYLAS satellite really deliver on the government’s promise to offer an affordable rural broadband service capable of 2Mbps?

AVANTI: HYLAS can deliver speeds of up to 8Mbps download/2Mbps upload.  However, recent estimates suggest that 1.5 million consumers will not be able to access the Internet at the UK Government’s committed speed.  HYLAS can address part of the gap, but we would need to build additional satellite capacity to address the gap.  This would take about 18 months from satellite design to launch. 

Prices depend on a number of factors, the size of the market, the speed of services offered and download limits.

7. Typically affordability isn’t just about the service rental fees, there are other aspects such as hardware and installation costs to consider; satellite isn’t something that just anybody can plug-in by themselves. Eutelsat’s new Tooway service is a good example, which claims to offer a 2Mbps two-way satellite broadband package for £29.99 per month.

Unfortunately its affordability credentials were quickly called into question when it was revealed that the hardware and installation/connection costs could reach upwards of £400. This is unlikely to be affordable for rural residents, many of which exist on lower incomes than those in urban areas. Will the new HYLAS service be able to address this shortcoming?

AVANTI: This is an issue for any satellite provider, we expect hardware prices for Ka-Band customer premises equipment to be significantly lower than existing systems; but the most significant factor is the size of the market.  The higher the volume of customers, the lower we will be able to offer installation and CPE.  The Scottish Government’s Broadband Reach project subsidised the installation costs, which made the service affordable to over 50% of people and businesses which expressed an interest in getting broadband.  We think that this is a model other regions should follow to deliver service to populations that live and work in rural areas.