I've spent the past two days at the Satellite 2009 trade show. Given the overwhelming negative news these days, I'm thankful to spend some time with individuals and companies that are doing well, making money and excited about the future. The industry seems to be in a much better place than 2001 and seems poised to motor through 2009.
Here are the main takeaways:
1. Satellite operators and services companies have multi-year contracts that buffer them from somewhat from quarter to quarter fluctuations in the economy.
2. By and large, most satellite companies have remained immune to the leverage mania of the past decade and are in reasonably good financial shape.
3. The government continues to buy a huge amount of commercial satellite capacity.
4. Satellite capacity is at 90% utilized and there isn't a big number of new satellites going up in the next few years so pricing power and margins will remain good. There is no glut, like in 2001.
5. With utilization so high, current issues are interference mitigation and squeezing every last drop of data through the pipe.
6. Communications on the move (COTM) is again a hot application for both the military and commercial customers. I particularly liked the AT&T CruiseCast in-car satellite TV.
As with the FOSE show, I interviewed a number of people about their take on the show, hot trends, etc. We'll be polishing those up over the next few days and releasing them out into the wild...
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