483 EESOR Final Report Astrolink
June 6, 1997 The CAT:
Dendy Harjanto Armand Hartono Sherman Lo Mahar Sembiring Kalaya Uahwatanasakul Melinda Wiria
OBJECTIVE ........................................................................................................................................................ 1 LOCKHEED MARTIN COMMERCIAL SPACE & MISSILES ......................................................................................... 1 ASTROLINK......................................................................................................................................................... 2 MARKET OVERVIEW......................................................................................................................................... 2 REGIONAL MARKET SEGMENTS ........................................................................................................................... 7 COMPETITIVE STRATEGY ANALYSIS ............................................................................................................ 8 COMPETITIVE STRATEGY ..................................................................................................................................... 8 COMPETITIVE ADVANTAGE ................................................................................................................................. 9 COMPETITIVE SCOPE ......................................................................................................................................... 10 ESTABLISHING/MAINTAINING COMPETITIVE ADVANTAGE .................................................................................. 10 THE SPACE CAT MODEL ................................................................................................................................. 11 REVENUE CALCULATION ................................................................................................................................... 11 TABLE 3: EQUATION FOR QUARTERLY DEMAND OF EACH SEGMENT.................................................. 12 COST CALCULATION ......................................................................................................................................... 13 NPV CALCULATION .......................................................................................................................................... 13 MODEL RESULTS............................................................................................................................................... 15 INTERPRETING THE MODEL RESULTS ................................................................................................................. 15 CAVEAT............................................................................................................................................................ 16 SCENARIO ANALYSIS...................................................................................................................................... 17 CURRENT SITUATION: ....................................................................................................................................... 17 SCENARIO #1: CATASTROPHIC OVERLOAD ......................................................................................................... 18 SCENARIO #2: ECONOMIC DOWNTURN............................................................................................................... 20 SCENARIO #3: THE MIDDLE ROAD ..................................................................................................................... 21 SCENARIO #4: HIGH THROUGHPUT/LITTLE TRAFFIC ........................................................................................... 22 CONCLUSION.................................................................................................................................................... 23 APPENDIX A...................................................................................................................................................... 25 NARROWBAND VS. BROADBAND........................................................................................................................ 26 EXISTING FREQUENCY BANDS ........................................................................................................................... 26 ADVANTAGES AND DISADVANTAGES OF KA BAND ............................................................................................. 27 TYPES OF SATELLITES ....................................................................................................................................... 27 APPENDIX B...................................................................................................................................................... 30 APPENDIX C..................................................................................................................................................... 32 DETERMINATION OF VALUES ............................................................................................................................. 33 BIBLIOGRAPHY .............................................................................................................................................. 36
Objective
Our goal is to help Lockheed Martin determine how it can enter and strategically position itself in the broadband telecommunications market through the Astrolink project. They need to determine the market segments they want to capture with Astrolink and find the optimal launching strategy for its nine satellites to accomplish that.
Introduction
Lockheed Martin Commercial Space & Missiles Up to the 1980s, Lockheed Martin was the dominant supplier of space and missile systems for the US government. They focused on serving large system operators such as NASA and the US military. As their revenue depended mostly on government spending, Lockheed Martin was not primarily concerned with cost efficiency or competitiveness. However, due to several political events in the 1990s such as the dismantling of the Berlin Wall and the collapse of the USSR, US defense budgets were significantly reduced. This forced Lockheed Martin to reexamine its business practices to adapt to market changes, which include switching their target market from military to commercial space and telecommunication segment. With the change of situation, Lockheed Martin can no longer enjoy the advantages of designing custom products using the bottoms up costing approach; instead it has to design standard products which meet cost constraints in order to remain competitive. In addition, Lockheed has to adapt to the competitive market for commercial space and telecommunications for survival. Their new approach to business can be summarized by their mission statement: [to be] The global leader of system and technology solutions for the commercial and government space and strategic missile marketplace.
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Astrolink The Astrolink venture is an initiative of Lockheed Martin Telecommunications. It is an independent company jointly owned by Lockheed Martin and international network operators. The intent of Astrolink is to develop a global broadband satellite communications network. The Astrolink system consists of a constellation of nine geostationary (GEO) satellites that will provide a broad array of digital communication services ranging from voice and data to multimedia transmissions globally. Astrolink satellites will use spot beams for more focused data transmission. Bandwidth on demand capability will allow Astrolink satellites to flexibly change bandwidths based on demand needed. Astrolink aims at providing a GEO satellite-based broadband global communication network that offer bandwidth on demand capability with seamless connectivity. It plans to operate by the year 2000 with multimedia and Internet access as its main applications, serving both FSS1 and DTH2 markets. For background information on satellite telecommunications please refer to Appendix A.
Market Overview
The satellite communications market includes three segments: fixed satellite services (FSS), mobile satellite services (MSS), and direct-to-home (DTH). Each segment targets its instant infrastructure capability to different users. FSS provides service to broadcasters, Fortune 500 companies, and telephone companies. The highest growth area in this market is the rapidly developing high-speed multimedia services and Internet access. MSS covers the transmission of voice and/or data to and from mobile terminals. The current applications are telephony to ships and aircraft; however, the highest-growth segments in the future will be providing services to land-based users, such as dual-mode cellular/satellite phones, mobile data terminals, and fixed
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Fixed Satellite Services Direct To Home 2
application, such as remote locations and village phones. DTH refers broadly to the broadcasting of television, radio, and multimedia entertainment services directly to viewers and listeners. The number of customers subscribing to the service drives the growth in this segment. Astrolinks market can be segmented in two ways: regionally and application wise. Regionally, there are three continental regions that should be of particular interest to Astrolink: North America, Asia, and Europe. Application wise, the market can be segmented into small and medium businesses, telecommuters/workers, telemedicine and Internet/home market. Other potential market segments include remote manufacturing and teleteaching, but their size can be considered insignificant. Table 1: Astrolinks Application Areas
Telecommuting High Speed Internet Access Desktop Video Conferencing Groupwork: Collaborative Whiteboard Electronic Commerce Corporate Training Video Conferencing Virtual Private Network Remote Manufacturing Software Distribution / Update High Speed Data: LAN to LAN Telemedicine Medical Imaging (MRI, USG) Training and Disaster Recovery Remote Health Care Cross Medical Records and Billings Home Use High Speed Internet Access Electronic Product Distribution Home Banking
Distance Learning
World Wide Interactive Gaming
A study of 502 companies done by the Business Research Group (BRG) showed the need to improve efficiency, accessibility, and service drives most vertical telecommunication markets to wireless data communications. Bear Stearns projects an excess demand growth of 20% per year through year 2000 in the global data communication market, including both satellite- and land-based services. Many major companies rely upon mission-critical data networks. As these
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companies expand into the emerging market regions where telecommunication infrastructures are inadequate, they are likely to seek end-to-end providers to tie these sites to their corporate network. Moreover, many corporations increasingly call for bandwidth-on-demand applications, such as videoconferencing, which is experiencing high rates of growth and represents a significant source of demand for satellite services. As satellite services can tie locations that do not have access to advanced land-based communications facilities, the ability to link Internet Service Providers (ISPs) to web access points, coupled with Internet access, is a value-added service that corporate networking customers are demanding. After 2000, the growth in the FSS market is expected to accelerate with the development of new Ka-band satellite systems. Next generation Ka-band services such as Astrolinks will take high-speed Internet access to the next level by driving earth station cost below $1,000 and offering mass-marketoriented service pricing. We found that the major initial markets for Astrolink will be heavily business and elite clienteles oriented. Applications such as remote manufacturing, high-speed data transfer (financial, marketing, home Internet, etc.), corporate networks, business applications (telecommuting) are the target. Since Astrolink will place one satellite at a time, the operation will initially be regional, becoming global only when the five satellites in the different positions have been launched. Furthermore, some market segments are in their nascent stage of development. This brings up the problem of determining growth and potential market size. Regardless of the possible benefits it promises, even up until now broadband communication is a new technology venture that remains unknown in terms of how people would respond to it. Nevertheless, the opportunity of capturing the large global market and reaping huge amount of profit does exist. Hence, it is necessary for Astrolink to create demand and to be the first to capture the market. Demand prediction within identified market segments
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both application-wise (business application, telecommuting, Internet/home market) and regionally (North America, Europe, Asia) is a crucial task. In doing the analysis, we took into account the uncertainties. They include the issues of competition, market growth, market share, market size, regulations, product adoption/market penetration, technology evolution, launch failure, and financing difficulties. Intense competition can negatively affect pricing, and in turn, cash flows and margins. In addition, indirect competitors such as terrestrial network operators can pose threat as they extend their coverage to areas previously unserved and update capabilities of existing, older networks. Many of these competitors have deep pocket and communication expertise. Due to the nascent nature of the Ka band network, projection of market size and market growth is difficult to do, if not impossible. Consequently, it is less likely that an accurate projection of market share and product adoption (how customers will react to the product) can be obtained. In terms of regulations, Astrolink needs to deal with extensive international, national, and local regulation. Specifically, they need to obtain orbital and frequency assignments, secure landing rights in each country of operation, interconnect with local networks on favorable economic terms, and comply with transmission content restrictions. The inability to receive required approvals could dramatically impair Astrolinks financial viability. Astrolink can either create their own local, land-based distribution and marketing channels or develop effective relationships with reliable service partners to perform the services to them. The FCC deregulation in telecommunication market adds another complexity into the problem as it allows for potentially more intense competition for Astrolink in the near future. Astrolink must show their skill at creating platforms that can evolve with developments in technology, as well as respond to shifts in market demands due to technological obsolescence. The risk pertains to the entire network structure, from orbiting satellites to handheld receivers. Industry statistics reveal that about one in ten satellite launches fails due to launch vehicle
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malfunction. While satellite providers such as Astrolink are usually insured against launch failure, construction and launch of replacement satellites can take a year or longer, resulting in revenue delays, potential foregone customer contracts, and potential weakening of competitive positioning. Finally, due to the large, often multistage financing requirements to achieve cash flow breakeven, financing difficulties at any stage of a company development may result in delay or cancellation of its projects. To succeed in the mass market, Lockheed Martin must be able to leverage their traditional space technology prowess (the Space Game) with down-to-earth marketing savvy (the Ground Game) by building recognized service brands and capturing key distribution channels. Specifically, the Space Game refers to the attributes related to the launch and operation of satellites while the Ground Game refers to the ability to sell mass market services that will drive industry growth into the next century. However, since Astrolink does not have the experience of dealing with the end customers, to succeed in the Ground Game Astrolink should work through strategic alliances/partnerships with local entities. These local entities may be local telecommunication companies, satellite service providers, or mass market equipment manufacturers. There are several reasons why strategic alliance is important. First, Astrolink can tap into the partners distribution and customer service functions in countries where they have an established presence. Second, local licensing takes political savvy or well-connected partners. As Astrolink needs to obtain a range of operating licenses for each country they intend to provide service, they can best handle this considerable administrative and logistical task of coordinating the licensing process by tapping the talents of well-connected local partners.
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Regional Market Segments Our analysis focuses on the major application areas that contribute to demand for broadband satellite services. For each market regions (North America, Europe and Asia), we analyzed factors contributing to demand for such services and gave their growth projections We found that the following four areas make up the bulk of the demand. These major application areas are: Telecommuters, Telemedicine, Electronic Commerce and Home Use. Telecommuters: The end users in this segment includes home businesses, full time and part time home workers, and after hour workers. Their needs range from interactive databases, teleconferencing capabilities and fax, to email and video mail. Telemedicine: The potential users of telemedicine services include fixed location facilities such as hospitals, mobile facilities including ambulance and commercial liners, as well as for training and disaster recovery activities. Typical traffic will consist of computer tomography (CT) documents, different imaging results (MRI, USI, and NMI), X-rays, medical records, and billings. Electronic Commerce: This segment includes remote manufacturing. Home users: This segment includes internet data access, newsletters and other publication distributions, videophones, home education, interactive games, and telecommuting. Home use: Home users include high speed internet access, home banking, distant learning and world wide gaming. The number of telecommuters in North America is projected to be 41.8 million in the year 2000. In Europe, it is about 38 million and in Asia, 19 million. The number of telemedicine operators in North America is estimated at 5.5 million. In Europe and Asia, they are approximately 5 million each. The number of companies involved in electronic commerce in North America and Asia by the year 2000 is projected to be 152,250. In Europe it is about 130,500. By the year 2000 Home users in North America is approximately 38.28 million. The number is 16.5 million for Europe and 9.9 million for Asia.
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Since the demand for broadband telecommunication services in North America is the highest, Astrolink should first establish a strong presence there. Realizing that the demand
growth in Europe and Asia are relatively high compared to North America, Astrolink should also establish their presence in these regions soon. The growth rate for the four application areas in the three regions is also important factors we looked at. Annual growth rate estimates are given in the table below:
Table 2: Projected Annual Growth Rate for the Four Main Application Areas
N. Am 5% 4% 10% 10% Europe 10% 5% 10% 8% Asia 15% 8% 15% 12%
Telecommuters Telemedicine Electronic Commerce Home Use
Source: Appendix C
Growth rate for Asia dominates all major application areas since these areas have the largest population in the world, and economic growth experienced is highest. Our projection shows that as a percent of US total demand, Asia is only13.1% in 2000 Q1 and by end of 2007, it is 67.69%. This tremendous growth trend is expected to continue.
Competitive Strategy Analysis
Competitive Strategy Astrolinks entrance into the global satellite telecommunications market must be accompanied by an appropriate positioning within the industry that embodies the overall goals of Astrolink and allows it to compete effectively. One means to examine the positioning is via Michael Porters five forces and competitive advantage analysis. While this is not the only mean by which we can proceed, the analysis will begin with an initial examination using Porters theories. In determining positioning within an industry, one must examine competitive advantage, competitive scope, and positioning strategy.
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Competitive Advantage Astrolinks competitive advantage over current systems is its higher bandwidth. Current constellations operate either as DTH or MSS or FSS. Systems such as Iridium and Globalstar will have an established their position by the time Astrolink is ready and available. These constellations will have both a price advantage and a market distribution advantage over Astrolink. Furthermore, they do not have Astrolinks latency problems. It should be clear that it is the product differentiation (higher bandwidth transmission) that will make Astrolink attractive to potential customers. Thus Astrolinks niche is clearly to compete in a different market segment one that is not currently served by existing systems. There is no current system available for global broadband transmission. Broadband competition will come from terrestrial sources. Astrolink is competing against ground base systems on both lower costs and superior performance and ease of installation. Terrestrial networks such as fiber optic cable are expensive, such that the installation has been limited to areas with the most heavily used data highways. Rural installation of high bandwidth cabling is negligible and would not be cost effective in the future. Studies have shown that the satellite infrastructure is one of the most cost-effective and time-efficient means of establishing networks. With the launch of other systems such as Spaceway and Teledesic, other systems will have achieved a similar, if not better, rate of transmission. Astrolinks advantage over these systems is lower overall system costs. Spaceway is a more costly constellation with 20 satellites. There are also differences in its product in terms of the spot beams they use leading to a divergent market focus from that of Astrolink. Unlike Spaceway whose spot beams will be mostly focused on populated areas, Astrolinks ability to cover both rural and highly populated areas and its focus on business applications rather than the home entertainment industry will enable Astrolink to develop a niche whereby it offers a price advantage over Spaceways.
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Teledesics ambitious system will be expensive but it will offer real time communications link with less latency. Teledesic also provides uniform rural/urban coverage. As a result, Astrolink will need to find a niche where it is the cost leader over these two systems. The bottom line is that since we expect a proliferation of broadband transponders in orbit, Astrolink will not be able to compete solely on the basis of a better product. Its product may be better for certain market segments but it is clear that if the other constellations are built, Astrolink will have to emphasize its costs per performance capability.
Competitive Scope The basic decision is to choose between a broad scope and a narrow scope. Astrolink has the ability to compete in all currently foreseeable segments of the satellite telecommunications industry. However, it cannot be priced effectively vis a vis dedicated systems for DTH or narrowband communications. And so it should be clear that a narrow scope should be the emphasis of Astrolink in particular focusing on those market segments where it has at least technological parity an a cost advantage. In terms of Porters strategy, the preferred strategy is that of cost focus. Astrolink needs to be focused on a lower cost in its selected market segment.
Establishing/Maintaining Competitive Advantage Inherent in establishing a competitive advantage is heterogeneity of products. Each of the current broadband satellite systems has a specific focus market segment, though each also has the ability to compete in most market segments. In order to establish an advantage, Astrolinks costs and overall value should be emphasized. In addition, establishing a value chain through strategic alliances can further enhance product advantages. Part of the value to customers may be the flexibility of the service. Services, distribution, marketing, and overall
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infrastructure provided affiliated international network operators could also help increase the overall value of the system. Please refer to Appendix B for Astrolinks decision hierarchy.
The Space Cat Model
The objective of the Space Cat Model is to help Astrolink determine the optimal launching strategy. Each launching strategy is evaluated by the discounted profit predicted over seven years. We projected the profit per quarter because as Astrolink wants the whole system up within two years so there will be a satellite launched in every quarter. Profit per quarter is calculated as revenue minus cost.
Revenue Calculation
Let us first examine the revenue side. The formula we used to calculate the revenue in $
M is (Total Astrolink demand in which it can meet in TBits) x (price per MBit). The price Astrolink will charge per Mb is estimated to be 0.54 cents (Appendix C). To estimate Astrolinkss total demand we segmented the market into three regions and four application areas. We included only North America, Europe, and Asia in our analysis for these are the regions from which the satellite communication industry can extract most (approximately 93% according to Communications Center) of its revenue. In each of the regions we looked closely at four key markets: telecommuters, telemedicine, electronic commerce, and home use. In each of these market segments we found the total data transmission required in TBits. Multiplying that by Astrolinks market share in that segment gave us Astrolinks quarterly demand. Specifically, below are the formulas we used.
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Table 3: Equation for Quarterly Demand of Each Segment
Astrolinks quarterly demand (inTBits) for the telecommuter segment = (# Telecommuters in million) x (# Mbits per Telecommuter per quarter) x (Penetration Rate) x (Market Share). Astrolinks quarterly demand (inTBits) for the telemedicine segment = (# Operations per quarter in million) x (# Mbits per Operation) x (Penetration Rate) x (Market Share). Astrolinks quarterly demand (in TBits) for the electronic commerce segment = (# Companies) x (# Mbits per Company per quarter) x (Penetration Rate) x (Market Share). Astrolinks quarterly demand (in TBits) for the home use segment = (# Households with Computers in million) x (# Mbits per Household per quarter) x (Penetration Rate) x (Market Share).
Astrolinks total demand per quarter for a region is the sum of the above four values. Each satellite has a capacity of 19,678 Mbits/sec. This number takes into account the reduction of Astrolink data transfer volume due to peak hour overloading and header/maintenance information. The capacity is calculated from the number of spot beams per satellite (64) and the number of channels per beam. This is scaled down by a factor of 0.3 to account for fluctuating peak and off peak demand. The demand that Astrolink can meet per region depends on the number of satellites it has launched in that region and is therefore, the minimum of regional capacity and total demand. We will call this Total Use. The sum of Total Use in each of the three regions times the price per Mbits gives us their revenue for that quarter. For simplicity of the model we did not include the increase in demand to the Astrolink system resulting from global or multi-regional networking. Since the launches are only three months apart the additional revenue from synergy due to global networking is insignificant enough to be excluded from the model. Please refer to Appendix C for further details of the model.
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Cost Calculation The cost in each quarter can be broken up into building cost and operating/launching cost. Building of the first unit is approximated to be $ 128 million. Based on the Koelle Method the costs of building subsequent units reduce by 95% of the prior unit due to the learning curve. This reduction affects only the first four satellites built, after which the cost per satellite remains constant. The non-recurring cost of $ 144 million is added to the building cost of the first satellite. The building cost is estimated by Communications Center. The operating/launching cost includes the costs of ground stations, operators and personnel, launching and insurance costs. This cost is projected by MIT Research to be $ 5.3 billion over the system life cycle. We approximated the life cycle to be 12 years. To calculate the yearly cost of operation we assumed an inflation rate of 3%. We found C, the operation cost in the first year, which satisfy the equation C + (1.03)1C + + (1.03)1C = 5.3 to be $ 337.65 million. We divided this number by 4 to get the quarterly operation cost for the first year. (1.03)(k-1)C is the operation cost for year k.
NPV Calculation We calculated the risk adjusted expected net present value of the quarterly profit. We believe that Astrolinks market share is the most uncertain and the most influential of all the sources of uncertainties. With that in mind, we took all the uncertainties as deterministic and modeled how the randomness of the market share would affect Astrolinks cashflows and therefore their launching decision. For each launching alternative we looked at Astrolinks projected quarterly profits and discounted them back to the year 1997 to get the NPV. It is not enough to compare the NPV of the launching strategies because we need to incorporate the affect of the uncertainty in market share on Astrolinks decision. We used an exponential utility function to reflect on their risk tolerance. To model the uncertainty in market share we simulated
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the market share using Crystal Ball. In each run we calculated the u-value of the NPV using the utility function U(x) = -exp(-x/rho) where x = NPV and rho = risk tolerance. From interviews with Lockheed Martin we assessed their risk tolerance to be $ 100 million. We ran 1000 simulation trials and found the expected value of the u-values by averaging the 1000 u-values generated. We converted it to the certain equivalent using the formula CE= rho*ln(-U). The CE is the risk adjusted expected NPV for that launching strategy. The launching strategy with the highest risk adjusted expected NPV is the optimal strategy. The discount rate used in this model is 8% per annum. We are using a rate that is quite high for we would like to be conservative in our estimation. In calculating the Net Present Value we discounted the quarterly cashflows using the discount factor quarters since first quarter of 1997. We made the assumption that market shares are normally distributed. We simulated Astrolinks yearly market share for each region and key application markets. The simulation was not done quarterly because the per quarter variation is not big enough to make a significant impact on the NPV. Astrolinks market share in general is highest in Asia due to fewer competitors. We believe that there is a correlation between the growth (or decrease) in market share across the regions and application areas. To reflect this we simulated a base market share for each year and set the market share for each region and application area to be a multiple of that. For example, Astrolinks market share in telemedicine sector is taken to be 1.25 times the base market share. This multiple is used for all seven years of projection. Each application area of each region has a different multiples based on the data we have gathered. In general, the market share in 2001 is lower than in 2000 because many new players such as Hughes Spaceway and Lorals CyberStar are entering the Ka band market at that time. Since Astrolink is the first to enter the market and first to complete a global network, its market share
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1 where k is the number if (102) k .
is expected to grow over the next three years. There is a drastic drop in their expected market share in the year 2005 with the birth Teledesic. We have assumed serial correlation except between the years 2004 and 2005 when Teledesic enters the market. The mean, standard deviation, and correlation are summarized in Appendix C. Model Results We ran four launching strategies through the Space Cat Model and the results are summarized in Appendix C. The optimal strategy is to launch in North America in 2000 Q1, Europe in 2000 Q2, Asia in 2000 Q3, North America in 2000 Q4, Europe in 2001 Q1, and Asia in 2001 Q2.
Interpreting the Model Results We feel reasonably comfortable with our simulation results, and it can best be explained by 2 main factors: 1) Demand for broadband services in each region and 2) growth in demand for broadband services in the different regions. Since we believe North America has the highest number of telecommuters and market penetration rate among three regions, our simulation results are in line with Lockheed Martins desire to build a strong presence in the North America Satellite communications market early; and also to compete with Hughs Spaceway System. Furthermore, our results show that if we launched in North America in 2000 Q3 instead of Q1, our risk adjusted expected NPV is the lowest among our four scenarios. Also, it is not optimal to launch the second satellite in North America since demand for the first 2 quarters in the year 2000 can be met with the presence of just one satellite. We launch our second satellite in Europe instead of Asia, as demand for broadband services is higher in Europe than in Asia, at least in the first 2 quarters of year 2000. Growth in
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demand is not high enough to justify launching the third satellite in Europe given that the second satellite is launched in Europe. We recommend launching the fourth satellite in North America since want a back up unit in case our first satellite malfunctioned, and we may end up losing our biggest market. Another reason why we did not launch the fourth satellite in either the Atlantic region or the Oceania since our simplified model does not include these regions as potential markets in at least the first two years after the first launch. We realize that we could have included launching our fourth satellite in the Atlantic region to generate additional revenues. However, due to the low demand in these regions, Astrolink should take a wait-and-see approach for at least another three quarters. Furthermore, if Astrolink launches the fourth satellite in one of these two regions, they may face the possibility of incurring unnecessary costs from satellite maintenance and other related operating costs when demand is still low. With the optimal launching strategy, we project that Astrolink will break even in 4.5 years, which is in line with their requirement of between four to six years. This break-even point is possible only if our projected high capacity usage of our satellites is realized. Also, the accuracy of our assumption about penetration level, market share for Astrolink and demand for broadband services is necessary for this model to be valid. Caveat In our model, we did not account for the additional costs and revenues associated with the two proposed two launches in the Atlantic and from the one in Oceania. We did this for two main reasons: 1) revenues from these regions are much lower (estimated combined demand of 7%) compared to the other three regions, 2) it is hard to estimate demand and growth rates for broadband services in these 2 regions due to lack of data. We omit them to simplify our analysis.
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We also did not account for the synergy from forming a global network earlier since we feel the synergy created, at least in the next two years following the first launch, would not have a significant effect on our projected profit. Due to our time constraint and lack of data, we were unable to do a sensitivity analysis on factors in our model. A suggestion to improving our analysis could be doing sensitivity analysis on Lockheeds risk tolerance, rho. In doing a sensitivity analysis of the model on risk tolerance, we need to simulate a thousand runs for each level of risk tolerance over a wide enough range, and compute the associated risk adjusted expected NPV.
Scenario Analysis
One method to examine the industry and market is through scenario analysis. The key uncertainties that underly our expected revenue is the size of the market, the adoption rate (market penetration), the amount of competition, market entry (including launches, timing, etc.) and the general economic outlook. To keep matters simple, three or four scenarios will be examined.
Current Situation: The FCC has recently approved filings for 73 GEO Ka Band satellites. Teledesic has contracted Boeing as its satellite manufacturer. The economic outlook for the United States in the next two years is still positive. This is important since the financing necessary for the satellite systems will come primarily from the United States. There is strong growth of consumer electronics, PC, and the Internet with little signs of slow down. The other economies of the world are relatively stable and with the deregulation of telecommunications prescribed by the EC, there will be more openness (and more competition) in the European telecommunications market. The first Iridium and Globalstar satellites have been launched and
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the success of those systems will be a key barometer of future Ka satellite system development and success.
Scenario #1: Catastrophic Overload Competition Economic growth remains stable throughout much of the industrial nations. The narrowband voice satellite constellation (Iridium, etc.) receives enough revenue to justify their existence along with additional investments in Ka Band satellites. Thus most of the planned Ka band satellites received adequate financing and developmental support to go ahead with installation. The load puts significant pressure on satellite manufacturers to keep the supply chain moving promptly and on launch vehicles to launch the satellites on time. Launch failure thus can become a significant setback - delaying system implementation by at least 3 months.
Demand and Economic Climate After the initial financing of the satellite system and continued slow economic growth, consumers and businesses (from industrial nations) become a little wary fearing a future downturn. They become more value conscience. Thus, the projected demand is not as great as anticipated, though in a thriving economy, the demand is not too significantly lower. Furthermore, demand is lower because a lower than expected growth rate of computer products, internet services, etc. due to disillusionment with the anticipated promise of such items.
Regulations Entry into the Asian and European markets are hampered by regulations. The European Commissions Satellite Directive has stated that they would like to liberalize and harmonize satellite services in the future. However, that does not occur and problems obtaining licenses
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and permission to use radio spectrum still exists. Astrolink has difficulties obtaining these licenses resulting in delays and a European market share that is lower than projected. In an attempt to protect their market and foster domestic and regional telecommunication providers, Japan issues new regulations limiting the number of foreign operators. In addition, China wants to regulate information coming in and out of the country making it difficult for a foreign company such as Astrolink to serve that area.
The Bottom Line The market has a glut of telecommunications providers and channels and not enough demand from the consumer and business side to fulfill those requirements. Consumers are hesitant about engaging new unproven technology and they are also unsure about the merits of the technology. Proposed Action Astrolink would want to establish itself as having a competitive edge over other ventures in selected applications. These will be the bread and butter markets for Astrolink. It should focus on establishing itself as providing a cost-effective service in market segments where Astrolinks system characteristics provide it with an inherent advantage. This may include examining/developing new markets for Astrolinks services. Thus Astrolink can assuage consumer fears and foster growth of those markets thereby ensuring its economic survival and prosperity. One must remember that the market is not poor, it is just uncertain that it should spend its resources on Astrolinks services. Thus, a better market focus and the establishment of a better more cost effective product can be tremendous in signing on reluctant customers.
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Scenario #2: Economic Downturn Competition The economic growth in the Americas and Europe has resulted in an overheating of the economies. The consequence is a downturn in the economic cycle and a recession that has global impact. There is not enough capital to support all the proposed and existing global satellite networks and therefore many of them are cancelled or downsized. Only a few systems such as Spaceway, CyberStar, and Astrolink are being developed and Teledesic is being downscaled (with an accompanying push back in its operation date so as to catch the global economy when it rebounds). Therefore, there are fewer competitors. Demand and Economic Climate The recession however impacts demand. Consumers and business are increasingly unwilling to spend money on services that they consider to be unnecessary or perhaps frivolous and so the demand is considerably less than anticipated. Regulations Regulations and entry into foreign markets has become stricter due to a perceived need to foster home industries. The need stems from the desire of national governments to bring the local economy out of its current doldrums. Furthermore, partnerships are also more difficult to secure since few companies are willing to take the risks necessary to support the new technology and to market a product to a public which they perceive as having little interest in the service. Bottom Line Despite the fact that there is less competition than anticipated, Astrolink faces many difficulties in meeting its milestone for capacity usage, global market penetration, and revenue generation. This is due to lower demand, tremendous difficulties entering foreign markets, difficulties securing alliances, and a general perception of weakness in the market.
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Proposed Actions Economic downturn and decrease demand may merit either a delay or cancellation of launch.. Astrolink would thereby only focus on the most potentially profitable markets or wait for the demand to develop in those markets. Furthermore, it could engage in strategic alliances to mitigate the risks and to aid in marketing. Strategic alliances may help bring the service to the customers who desire it the most or it could augment the services provided by Astrolink (thereby making the product more attractive). Targeting the markets with the highest potential growth and profitability is important.
Scenario #3: The Middle Road Competition The current economic/financial climate cannot finance every single proposed Ka band satellite. In fact, competitors such as AT & T have already pulled out. Suppose the trend continues as is with only about half of the constellations being built. The most likely candidates are Hughes Spaceway, Loral CyberStar, LMs Astrolink, perhaps a few others. It is foreseen that Teledesic will be built, though it may not end up as ambitious a system as initially proposed. Teledesic will also become operational around 2005-6(even though their press release claims a service date of 2002); a few years after Astrolink is in place. There will be competition for major urban areas though each system will eventually develop their own niche in the broadband market. Demand and Economic Climate Economic growth proceeds at a steady pace with the Asian economies growing most rapidly. Consumers are encouraged by continued economic growth and low inflation (in industrial countries) and are able to stimulate growth in products such as PC, Internet services/equipment, etc. Because of increase commerce and increased access to the Internet, businesses are moving towards more electronic transactions both internal accounting and management and for external
21
commerce. The development and use of EDI (electronic Data Interchange) format helps businesses move towards making much of their transactions electronic. Entry into foreign markets such as Indonesia is difficult but alliances with local partners can be secured to facilitate entry.
Scenario #4: High Throughput/Little Traffic Competition The market for global satellite telecommunication grows as expected or slightly better. Implementation of Astrolinks system went as planned. Well-financed systems such as Spaceway are also launched while more marginal systems are not developed. Teledesic, however, faces considerable technical, financial, and organizational problems. These problems lead to a considerably smaller version of the original system or a serious delay in implementation of its planned network. Therefore, Astrolink has a considerable lead in capturing the market and limited competition. Furthermore, Astrolink can establish their customer base and can basically guarantee further growth. Demand and Economic Climate The Pacific Rim booming economy has turn out to be even better than expected. The main reason for this is the growing commitment of the Chinese government to open and free trading. Implementation of AFTA (Asia Pacific Free Trade Agreement) encourages companies to continue their globalization effort at even a faster rate than the current one, on both sides of the Pacific. The East European nations experience a phenomenal economic growth, one like the Asia is experiencing right now and this growth enables West European economic to expand. Overall, the global economy is expanding. In addition, the bandwidth technologies are able to penetrate the market considerably, creating a considerable market and demand growth. Network security technologies have improved and have fueled electronic commercial activities.
22
Entry to Asian markets continues to be difficult, however a larger number of local companies are interested to establish alliances with industry expert such as Lockheed Martin. Regulation The boom in the Pacific Rim has stimulated desired deregulation. This is due to a lessening fear of foreign competition and increased interest in high technology. Furthermore, deregulation proscribed by the EC has made entry and alliance making into Europe much easier. The Bottom Line So there plenty of demand for Astrolink and entry into markets is not a serious problem. Astrolink has its choice of markets and must limit their obligations. Astrolink capacity is fully utilized. The question that faces Astrolink is how to meet the demand and prevent (eventual) competitors from chipping away at Astrolinks market. Proposed Action Astrolink has many alternatives. Clearly it is important to remain focused on its key markets. But furthermore, Astrolink could augment its satellite constellation with additional satellites at its FCC licensed locations or it can enter into an alliance with another satellite telecommunication company or buy out an existing licensed location from a system developer that lacks the capital to develop their system. The key here is to use Lockheed Martins expertise in satellite building to quickly meet market demand and establish oneself as a leader in the satellite telecommunications industry.
Conclusion
In our analysis, we studied the market for broadband satellite telecommunications and focused on three geographical regions: North America, Europe, and Asia. For each of this region, we evaluate the demand in four application areas: telecommuting, telemedicine, electronic commerce, and home use.
23
We examined Astrolinks competitive positioning with respect to its competitors in the telecommunication market. We found that product differentiation is a key to Astrolinks success. This pertains to focusing its marketing effort to provide wide coverage for specific market segments. In particular, Astrolinks spot beams cover both rural and highly populated areas, allowing them to better serve the business applications. The Space Cat Model that we developed aims at helping Astrolink determine its optimal launching strategy. We looked at four different launching strategies and ran simulations to pick the best alternative. Our simulation results indicate that the optimal launching strategy would be launching one satellite per quarter starting in the year 2000.
24
APPENDIX A
25
Technology Background
Narrowband vs. Broadband Different kinds of information and media have distinct bandwidth requirements. Text has the lowest bandwidth requirement while high-resolution video has the highest. Many of the proposed satellite networks will use broadband technology. Broadband technology is defined as a networking technique for transmitting large amounts of voice, data, image, and multimedia digital signals over long distances at 45 Mbps (Mega-bits-per-second) or higher rate, as opposed to narrowband, which only transmits at 64 Kbps (Kilo-bits-per-second). Broadband technology also provide users with bandwidth on demand. This refers to a Existing Frequency Bands Band Mobile C Frequency (GHz) 1.6-2.5 4 Primary uses Handheld telephones (LEO) Entertainment (CATV and yard) International telephone Ku Ka 12 20 Business and retailers (VSAT)3 Two way data to home and office PCs
3
Very Small Aperture Terminals 26
Advantages and Disadvantages of Ka Band Advantages Wide bandwidths Higher bit rates possible Lower earth station costs and complexity Intersatellite links possible Bandwidth on demand Smaller antenna which leads to lower power requirement Disadvantages Rain attenuation Complex on-board processing Reliability unknown Manufacturing complexity
transmission service that can provide varying amounts of transmission capacity on a dynamic basis. It is particularly suited for multimedia transmissions that involve a varying combination of these types of transmissions. Other advantages along with its disadvantages are summarized in the above table. Types of Satellites There are four types of satellite systems: geostationary-earth-orbit (GEO), highly elliptical orbit (HEO), medium-earth-orbit / intermediate-circular-orbit (MEO/ICO), and low-Earth-orbit (LEO). Geostationary satellite systems orbit at an altitude of 22,300 miles above the Equator, the only orbit that allows the satellite to maintain a fixed position in a relation to Earth. At this height, communications through a GEO entail a transmission latency of at least one-half second. Traditionally, all satellite services have been delivered by GEO satellites. Recently, a number of projects have proposed the use of LEO satellites that orbit less than a thousand miles above the earth. These satellites virtually have no signal delays and require lower power than that of GEO
27
satellites. However, LEO networks cost more than GEO because they have larger number of satellites. However, because LEOs are much closer to the Earth than GEOs, their frequencyreuse areas (coverage area) are much smaller. This in turn results in a much higher number of satellites required for LEO-based network system to cover the whole Earth as compared to the GEO satellite network. For example, Lockheed Martins proposed constellation, Astrolink, consists of only nine GEO satellites, while Teledesic network uses a constellation of 288 inter-linked LEO satellites. Currently, terrestrial network is still the dominant system in the telecommunication market. Terrestrial network consists of: telephone cable, TV cable, fiber optic, and wireless communications such as cellular and laser data transfer. There are four key advantages of satellite networks over land-based fixed line systems: (1) the costs are independent of distance; (2) the signal is ubiquitous, traveling from one point to multiple points; (3) satellites offer easy access to remote areas, allowing an instant infrastructure; and (4) reception/transmission equipment may be transportable or mobile. The instant infrastructure theme focuses on the cost-efficiency and first-to-market advantages of satellitebased telecommunications services over terrestrial, or land-based, transmission media. Satellite providers such as Astrolink can offer ubiquitous, high quality coverage to entire continents virtually instantaneously with limited investment in ground-based facilities. They can also deliver services ranging from basic fixed and mobile telephony to broadband Internet access and 200-channel digital television more rapidly and less costly than terrestrial providers, which must
28
build or upgrade the infrastructure region by region. Satellite transmission costs do not vary with distance traveled or with the number of receiving terminals, making satellite the low-cost alternative for point-to-multipoint transmissions, such as the distribution of CNN cable television programming all over the world. Furthermore, it also provides the lowest cost for thin route communications over long distances, such as telephone and data communications for rural or remote locations. The combination of low fixed operating costs and large coverage areas (footprints) gives them the potential to breakeven in cash flow with only modest penetration. Thus, unlike cellular telephony or cable television, a narrowly targeted service such as mobile satellite telephony in Asia can produce attractive returns, even while signing only a small fraction of potential subscribers. Bear Stearns reports that once satellite providers have achieved cash breakeven, they typically generate cash flow margins of 40% to 70% for retail and 60% to 90% for wholesale services.
29
APPENDIX B
30
Decision Hierarchy
Policy
Lockheed Martin Space & Missiles FCC deregulation
Strategy
Strategic alliance/partnership Market focus Optimal launching order
Tactics
Anticipate competitors Explore new technology
31
Appendix C
32
Determination of Values The values used in the model were developed in various methods. Some data could not be arrived at directly. For example, market penetration of satellite telecommunications in the telecommuting, business transfer, home/personal use, and telemedicine markets are figures that are unavailable since the market is non-existent. Thus we had to develop a model based on our knowledge of wireless telecommunication (cellular) which had a 13% penetration rate by 1995. Since cellular has many other competitors while Astrolinks target market has fewer terrestrial competitors, one would expect the market penetration for Astrolink applications to have higher adoption rate. We could also use the Bass model: F (0) = 0 F (t ) = [1 e bt ] /[1 + ae bt ] p where a = and b = p + q q F(t) is the penetration rate at time t p = coefficien t of innovation q = coefficien t of imitation We can then guess a value for p and q based on our knowledge of current adoption rate of high technology devices such as the internet, cellular communications, etc. and factor in a scaling value that represents the degree of terrestrial competition for the market. Market growth rates were determined from actual data when available. For example, we have data for the U.S. for the number of telecommuters in 1994 and 1996 along with a projection for the year 2000. We used those values to project forward in time. For telemedicine, we scaled up a projection of population growth. For home and business use we used values for growth of personal computers (with Internet connection) and the growth of businesses engaging in electronic data transfer.
33
Market size was estimated for projections and survey data. For example, data was available for the number of households with internet connections in 1996 and 2000 (projection). There was data for a number of worldwide businesses engaging in electronic interbusiness transactions. The number was divided up accordingly to the three regions we examined. We assumed that each business engaged in 1000 such transactions daily at a rate of 38.4 Kb/s
34
Price per Mbits We decided on using bits and having Astrolink charge on a per bit basis. Astrolink would charge $.25 a minute for a 384 Kb/s connection. We then assumed that the connection was operating for the entire time and thus we arrived at a cost per bit In actuality we dont expect a per bit basis charge and this is just an estimate. The price per Mb is ($ 0.25/min)/(384*60 Kb/min)*1000*0.5 = 0.54 cents. The 0.5 term is due to our assumption that the revenue was divided in half - half to Astrolink and the rest to suppliers and distributors.
35
Entry Barriers Economies of Scale Proprietary product differences Switching costs Capital requirements Absolute cost advantages Proprietary learning curve Access to necessary inputs Proprietary low-cost product design Government policy Expected retaliation Bargaining power of supplier
New Entrants
Rivalry Determinants Industry growth Fixed costs/value added Diversity of competitors Corporate stakes Exit barriers Bargaining power of buyers
Threat of new entrants
Industry Competitors
Suppliers
Buyers
Intensity of Rivalry
Determinants of Buyer Power Threat of substitutes Bargaining Leverage Buyer concentration vs. firm concentration Buyer volume Buyer switching costs relative to firm switching costs Buyer information Ability to backward integrate Subsitute products Price Sensitivity Product differences Price/total purchases Impact on quality Buyer profits Decision makers' incentives
Substitutes
Determinants of Substitution Threat Relative price performance of substitutes Switching costs Buyer propensity to substitute
Teleworkers/Telecommuters Application Audio Conferencing Video Telephony Video Conferencing Data (10 MB/ day) Fax (30 pages/ week) Other Total Data Rate (kb/s) 16 192 4000 Various 96 128 Hours Total Data Rate (Million bits) 288 691.2 2400 409.6 0.02 5.76 1 460.8 4255.36 0.007035979 3.80E+07 2.67E+05 1.44378E+12 3.80E+04 Note 1 Mb = 1024 Kb <- very poor quality <- MPEG-2 Low <- 25.6 KBytes per page roughly <- Mbits/week <- Mb/s <- in 1996 <- Mb/s <- Mb per Quarter <- Mb per Quarter per Telecommuter
5 1 0.1667
Total Telecommunters
Note - everything is in terms of Kb
Telemedicine Resolution (2048x2048) Bits/Pixel Compression (15:1) Subtotal Overhead data (10%) Bits per image Price at $.25 per unit per min Operations per year Assume 1% penetration Scans per Operation Total Images Images sent per operation Bits per Image (above) Total Bits per operation Total Bits per operation Total Bits per operation 4194304 pixels 10 0.0667 high quality JPEG does 10 to 20 :1 2796202.67 bits 3075822.93 2.9333 0.19 20 1% 20 4 2 average of 2 other locations 2.9333 23.4667 Million bits/year 1.9556 Million bits/month 5.867
$
Electronic Commerce (Per Transaction)
Application Transaction Trans per day per company Total (Mb) Total per quarter
Data Rate (kb/s) 384
Seconds 0.1
Total Data Rate (Million bits) 0.0384 1000 38.4 3504
Home Requirement Budget
Per Houshold per week Adult use Work Related Personal Children use WWW Interactive Games Class, research Total Mb/week/household Mb/quarter/household Households with PC (2001) PC with Data Connection Satellite Pentration
Data Transfer per Week (MB) 1 3
Time Spent 3.5 4
Average bit rate (kbs) 0.6349 1.6667
Scale by 60 38.095 100
4 9 1 18 144 1877.1429 0.5 0.25
4 5 4
2.2222 4 0.5556
133.333 240 33.333
7.00E+07 3.50E+07 8.75E+06
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
North America US Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce HomeUse 5% 4% 10% 10% 1.012 1.010 1.024 1.024 NA Scale Scale numbers from US to North America 1.1
41.8 42.3 42.8 43.4 43.9 44.4 45.0 45.5 46.1 46.7 47.2 47.8 48.4 49.0 49.6 50.2 50.8 51.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.055 0.055 0.055 0.055 0.05 0.05 0.05 0.05 0.09 0.09 0.09 0.09 0.11 0.11 0.11 0.11 0.13 0.13 0.052392 0.052392 0.0523918 0.052392 0.039605 0.039605 0.039605 0.039605 0.064195 0.064195 0.064195 0.064195 0.06616 0.06616 0.06616 0.06616 0.077358 0.077358 4576 4633 4689 4747 3302 3343 3384 3425 10116 10240 10366 10493 13380 13544 13710 13878 19413 19652
5.5 5.554194 5.6089215 5.664188 5.72 5.776361 5.833278 5.890756 5.9488 6.007416 6.066609 6.126386 6.186752 6.247713 6.309274 6.371442 6.434222 6.497621 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 0.042263 0.042679 0.0430997 0.043524 0.049839 0.05033 0.050826 0.051326 0.140024 0.141404 0.142797 0.144204 0.240132 0.242498 0.244887 0.2473 0.40151 0.405466
152250 155921.3 159681.15 163531.6 167475 171513.4 175649.3 179884.8 184222.5 188664.8 193214.2 197873.3 202644.8 207531.3 212535.6 217660.6 222909.2 228284.4 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.025 0.025 0.025 0.025 0.08 0.1 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 873.4435 894.5055 916.07531 938.1653 2324.134 2975.222 2437.573 2496.351 5179.865 5304.77 5432.688 5563.69 7046.701 7216.623 7390.642 7568.858 11329.21 11602.4
(4) Home Use # Housholds w. Computers (Millions) w. Internet 38.28 39.20307 40.148403 41.11653 42.108 43.12338 44.16324 45.22818 46.3188 47.43572 48.57957 49.751 50.95068 52.17929 53.43752 54.7261 56.04575 57.39722 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.025 0.025 0.025 0.025 0.08 0.08 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 Astrolink Market Share 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.031186 Astrolink Demand (Tb/quarter) 117.6475 120.4844 123.38974 126.3651 313.0466 320.5954 328.3261 336.2432 697.6961 714.5201 731.7498 749.395 949.1475 972.0349 995.4743 1019.479 1525.976 504.0105 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 5567 19678 5567 5648 39357 5648 5729 39357 5729 5812 39357 5812 5939 39357 5939 6639 39357 6639 6150 39357 6150 6258 39357 6258 15994 39357 15994 16260 39357 16260 16531 39357 16531 16806 39357 16806 21376 39357 21376 21733 39357 21733 22097 39357 22097 22467 39357 22467 32269 39357 32269 31758 39357 31758
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
North America
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
52.1 52.7 53.3 54.0 54.7 55.3 56.0 56.7 57.4 58.1 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.13 0.13 0.15 0.15 0.15 0.15 0.16 0.16 0.16 0.16 0.077358 0.077358 0.024949 0.024949 0.024949 0.024949 0.029615 0.029615 0.029615 0.029615 19893 20137 7585 7679 7773 7868 10085 10208 10334 10460
58.8 37994.29 0.17 0.019618 7453
59.5 37994.29 0.17 0.019618 7544
60.3 37994.29 0.17 0.019618 7637
61.0 37994.29 0.17 0.019618 7731
6.561645 6.626299 6.691591 6.757526 6.824111 6.891351 6.959255 7.027827 7.097075 7.167005 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.11 0.11 0.13 0.13 0.13 0.13 0.14 0.14 0.14 0.14 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 0.409462 0.413496 0.159156 0.160725 0.162308 0.163908 0.211593 0.213678 0.215783 0.21791
7.237625 5.87 0.14 0.024523 0.145775
7.30894 5.87 0.14 0.024523 0.147211
7.380958 5.87 0.14 0.024523 0.148662
7.453686 5.87 0.14 0.024523 0.150126
233789.2 239426.7 245200.1 251112.8 257168.1 263369.4 269720.2 276224.1 282884.9 289706.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 11882.18 12168.7 4823.002 4939.303 5058.407 5180.384 6647.379 6807.672 6971.83 7139.947
296692.2 3504 0.2 0.024523 5098.787
303846.5 3504 0.2 0.024523 5221.738
311173.4 3504 0.2 0.024523 5347.653
318676.9 3504 0.2 0.024523 5476.605
(4) Home Use # Housholds w. Computers (Millions) w. Internet 58.78128 60.19871 61.65032 63.13694 64.6594 66.21858 67.81536 69.45063 71.12534 72.84044 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 Astrolink Market Share 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 Astrolink Demand (Tb/quarter) 1600.457 1639.05 649.6289 665.2938 681.3365 697.766 895.3613 916.9518 939.0629 961.7071 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 33376 39357 33376 33945 39357 33945 13058 39357 13058 13283 39357 13283 13513 39357 13513 13746 39357 13746 17628 39357 17628 17933 39357 17933 18245 39357 18245 18562 39357 18562
74.59689 1877.1 0.2 0.024523 686.7754 13239 39357 13239
76.3957 1877.1 0.2 0.024523 703.3361 13470 39357 13470
78.23788 1877.1 0.2 0.024523 720.2961 13705 39357 13705
80.12448 1877.1 0.2 0.024523 737.6651 13945 39357 13945
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Europe Europe Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 10% 5% 10% 8% 1.024 1.012 1.024 1.019
38.0 38.9 39.9 40.8 41.8 42.8 43.8 44.9 46.0 47.1 48.2 49.4 50.6 51.8 53.0 54.3 55.6 57.0 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.06 0.06 0.06 0.06 0.08 0.08 0.08 0.08 0.11 0.11 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 2042 2092 2142 2194 1698 5638 1781 1824 1868 6202 6352 6505 9154 9375 9601 9832 16189 16579
5 5.061361 5.1234754 5.186352 5.25 5.314429 5.379649 5.445669 5.5125 5.580151 5.648632 5.717953 5.788125 5.859158 5.931063 6.003851 6.077531 6.152116 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 0.016905 0.017113 0.0173226 0.017535 0.026836 0.027166 0.027499 0.027836 0.06851 0.069351 0.070202 0.071064 0.123563 0.125079 0.126614 0.128168 0.182041 0.184275
130500 133646.8 136869.55 140170 143550 147011.5 150556.5 154187 157905 161712.7 165612.2 169605.7 173695.5 177883.9 182173.4 186566.2 191065.1 195672.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.08 0.08 0.08 0.08 0.12 0.06549 0.12 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 598.9327 613.3752 628.16593 643.3133 498.0288 510.0381 522.337 534.9324 1775.954 1818.778 1862.636 1907.551 4026.686 4123.785 4223.224 4325.062 7768.604 7955.934
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.5 16.82054 17.147303 17.48042 17.82 18.16618 18.51909 18.87885 19.2456 19.61948 20.00061 20.38916 20.78525 21.18903 21.60066 22.02029 22.44807 22.88416 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.11 0.11 0.14 0.14 Astrolink Market Share 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 Astrolink Demand (Tb/quarter) 43.81355 44.6647 45.532377 46.41691 59.61625 60.77439 61.95502 63.1586 166.9794 170.2232 173.5301 176.9012 255.5541 260.5186 265.5796 270.7389 410.727 418.706 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 2685 0 0 2750 0 0 2816 19678 2816 2883 19678 2883 2256 39357 2256 6209 39357 6209 2365 39357 2365 2422 39357 2422 3811 39357 3811 8191 39357 8191 8388 39357 8388 8589 39357 8589 13436 39357 13436 13759 39357 13759 14090 39357 14090 14428 39357 14428 24368 39357 24368 24954 39357 24954
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Europe
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
58.4 59.8 61.2 62.7 64.2 65.7 67.3 68.9 70.6 72.3 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.11 0.11 0.13 0.13 0.13 0.13 0.15 0.15 0.15 0.15 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 16979 17388 6787 6951 7119 7290 10226 10472 10725 10984
74.1 37994.29 0.15 0.017656 7451
75.8 37994.29 0.15 0.017656 7631
77.7 37994.29 0.15 0.017656 7815
79.5 37994.29 0.15 0.017656 8004
6.227616 6.304043 6.381408 6.459722 6.538997 6.619245 6.700478 6.782708 6.865947 6.950208 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 0.186536 0.188826 0.07192 0.072802 0.073696 0.0746 0.11525 0.116665 0.118096 0.119546
7.035502 5.87 0.1 0.02158 0.089071
7.121843 5.87 0.1 0.02158 0.090164
7.209244 5.87 0.1 0.02158 0.091271
7.297718 5.87 0.1 0.02158 0.092391
200390.7 205222.9 210171.6 215239.6 220429.8 225745.2 231188.7 236763.5 242472.8 248319.7 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.12 0.12 0.15 0.15 0.15 0.15 0.17 0.17 0.17 0.17 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 8147.781 8344.254 3445.002 3998.483 3613.148 3700.274 4498.227 5220.922 5346.817 5475.749
254307.6 3504 0.18 0.024523 3933.35
260439.9 3504 0.18 0.024523 4028.198
266720 3504 0.18 0.024523 4125.332
273151.6 3504 0.18 0.024523 4224.809
(4) Home Use # Housholds w. Computers (Millions) w. Internet 23.32872 23.78191 24.24391 24.71489 25.19501 25.68447 26.18343 26.69208 27.21061 27.73922 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.14 0.14 0.16 0.16 0.16 0.16 0.18 0.18 0.18 0.18 Astrolink Market Share 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 Astrolink Demand (Tb/quarter) 426.84 435.132 163.4981 166.6743 169.9122 173.213 235.8024 240.3832 245.053 249.8135 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 25554 39357 25554 26168 39357 26168 10396 39357 10396 11116 39357 11116 10902 39357 10902 11164 39357 11164 14960 39357 14960 15934 39357 15934 16317 39357 16317 16709 39357 16709
28.2781 1877.1 0.19 0.017656 178.0739 11563 39357 11563
28.82745 1877.1 0.19 0.017656 181.5333 11841 39357 11841
29.38746 1877.1 0.19 0.017656 185.0599 12126 39357 12126
29.95836 1877.1 0.19 0.017656 188.6549 12417 39357 12417
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Asia Asia Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 15% 8% 15% 12% 1.036 1.019 1.036 1.029
19.0 19.7 20.4 21.1 21.9 22.6 23.4 24.3 25.1 26.0 26.9 27.9 28.9 29.9 31.0 32.1 33.2 34.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.08 0.08 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 416 431 446 462 723 749 776 803 2697 2793 2892 2995 4794 4965 5141 5324 8595 8901
5 5.097133 5.1961524 5.297096 5.4 5.504903 5.611845 5.720863 5.832 5.945296 6.060792 6.178532 6.29856 6.420919 6.545656 6.672815 6.802445 6.934593 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 0.016137 0.01645 0.0167697 0.017096 0.026348 0.02686 0.027382 0.027914 0.069186 0.070531 0.071901 0.073297 0.128347 0.130841 0.133383 0.135974 0.194493 0.198271
152250 157663.7 163269.94 169075.5 175087.5 181313.3 187760.4 194436.8 201350.6 208510.3 215924.5 223602.3 231553.2 239786.8 248313.2 257142.7 266286.2 275754.8 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 293.477 303.9125 314.71905 325.9099 510.2531 528.3967 547.1855 566.6423 1426.689 1477.419 1529.953 1584.356 2818.184 2918.393 3022.166 3129.628 4547.364 4709.059
(4) Home Use # Housholds w. Computers (Millions) w. Internet 9.9 10.1845 10.477175 10.77826 11.088 11.40664 11.73444 12.07165 12.41856 12.77544 13.14257 13.52025 13.90879 14.30849 14.71968 15.14268 15.57784 16.02551 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.017 0.017 0.017 0.017 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.09 0.09 0.09 0.09 0.12 0.12 Astrolink Market Share 0.06287 0.06287 0.0628702 0.06287 0.047526 0.047526 0.047526 0.047526 0.077034 0.077034 0.077034 0.077034 0.079392 0.079392 0.079392 0.079392 0.09283 0.09283 Astrolink Demand (Tb/quarter) 19.86214 20.43293 21.020116 21.62418 39.56753 40.70459 41.87433 43.07769 107.7464 110.8427 114.0281 117.3049 186.5544 191.9155 197.4306 203.1042 325.7418 335.1027 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 729 0 0 755 0 0 782 0 0 810 19678 810 1273 19678 1273 1318 39357 1318 1365 39357 1365 1413 39357 1413 4231 39357 4231 4381 39357 4381 4536 39357 4536 4696 39357 4696 7799 39357 7799 8075 39357 8075 8361 39357 8361 8657 39357 8657 13468 39357 13468 13945 39357 13945
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Asia
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
35.6 36.9 38.2 39.6 41.0 42.4 43.9 45.5 47.1 48.8 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 9217 9545 3985 4126 4273 4425 6527 6760 7000 7249
50.5 37994.29 0.13 0.02158 5387
52.3 37994.29 0.13 0.02158 5579
54.2 37994.29 0.13 0.02158 5777
56.1 37994.29 0.13 0.02158 5982
7.069308 7.20664 7.34664 7.48936 7.634853 7.783171 7.934372 8.088509 8.245641 8.405825 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 0.202123 0.206049 0.079035 0.08057 0.082135 0.083731 0.13027 0.132801 0.135381 0.138011
8.569121 5.87 0.1 0.020599 0.103556
8.73559 5.87 0.1 0.020599 0.105567
8.905292 5.87 0.1 0.020599 0.107618
9.078291 5.87 0.1 0.020599 0.109709
285560.1 295714.1 306229.1 317118.1 328394.2 340071.2 352163.5 364685.8 377653.3 391081.9 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 4876.504 5049.903 1967.651 2037.617 2110.071 2185.101 3453.422 3576.219 3703.382 3835.067
404988 3504 0.1 0.020599 2923.158
419388.6 3504 0.1 0.020599 3027.1
434301.3 3504 0.1 0.020599 3134.737
449744.2 3504 0.1 0.020599 3246.203
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.48604 16.9598 17.44718 17.94857 18.46436 18.99498 19.54084 20.1024 20.68009 21.27438 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.12 0.12 0.14 0.14 0.14 0.14 0.18 0.18 0.18 0.18 Astrolink Market Share 0.09283 0.09283 0.029939 0.029939 0.029939 0.029939 0.035538 0.035538 0.035538 0.035538 Astrolink Demand (Tb/quarter) 344.7327 354.6394 137.272 141.2169 145.2751 149.4499 234.6409 241.3839 248.3206 255.4567 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 14439 39357 14439 14950 39357 14950 6090 39357 6090 6305 39357 6305 6529 39357 6529 6760 39357 6760 10216 39357 10216 10577 39357 10577 10952 39357 10952 11339 39357 11339
21.88575 1877.1 0.2 0.023542 193.4312 8504 39357 8504
22.51468 1877.1 0.2 0.023542 198.9899 8805 39357 8805
23.1617 1877.1 0.2 0.023542 204.7084 9117 39357 9117
23.8273 1877.1 0.2 0.023542 210.5911 9439 39357 9439
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
5567 1 19678 28%
5648 2 39357 14%
8545 3 59035 14%
9504 4 78714 12%
9469 5 98392 10%
14166 6 118071 12%
9880 6 118071 8%
10093 6 118071 9%
24036 6 118071 20%
28832 6 118071 24%
29454 6 118071 25%
30092 6 118071 25%
42611 6 118071 36%
43567 6 118071 37%
44547 6 118071 38%
45552 6 118071 39%
272 121.6 115.52 110 110 110 0 0 0 0 0 0 0 0 0 0 84.41315 84.41315 84.41315 84.41315 86.94554 86.94554 86.94554 86.94554 89.55391 89.55391 89.55391 89.55391 92.24053 92.24053 92.24053 92.24053 30 31 46 52 51 77 54 55 130 156 160 163 231 236 242 247 -326 -175 -154 -143 -146 -120 -33 -32 41 67 70 74 139 144 149 155 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 -257.2124 -135.5692 -116.39108 -106.1382 -106.0438 -85.76474 -23.34575 -22.09396 27.49117 44.1179 45.43759 46.74108 86.3818 87.84896 89.30385 90.74697 -257.2124 -392.7816 -509.17266 -615.3108 -721.3547 -807.1194 -830.4652 -852.5591 -825.0679 -780.95 -735.5125 -688.7714 -602.3896 -514.5406 -425.2368 -334.4898
Year
2004.1
2004.2
2004.3
2004.4
2005.1
2005.2
2005.3
2005.4
2006.1
2006.2
2006.3
2006.4
2007.1
2007.2
2007.3
2007.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
70106 6 118071 59%
70658 6 118071 60%
73368 6 118071 62%
75063 6 118071 64%
29544 6 118071 25%
30705 6 118071 26%
30943 6 118071 26%
31670 6 118071 27%
42803 6 118071 36%
44444 6 118071 38%
45513 6 118071 39%
46611 6 118071 39%
33305 6 118071 28%
34115 6 118071 29%
34947 6 118071 30%
35802 6 118071 30%
95.00774 95.00774 95.007744 95.00774 97.85798 97.85798 97.85798 97.85798 100.7937 100.7937 100.7937 100.7937 103.8175 103.8175 103.8175 103.8175 380 383 398 407 160 167 168 172 232 241 247 253 181 185 190 194 285 288 303 312 62 69 70 74 131 140 146 152 77 81 86 90 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 163.8921 162.3644 167.29995 168.9954 33.12656 35.75381 35.71172 36.98381 64.42938 67.44534 68.85589 70.25666 34.81608 36.08468 37.34173 38.58764 -170.5977 -8.233282 159.06667 328.062 361.1886 396.9424 432.6541 469.6379 534.0673 601.5127 670.3685 740.6252 775.4413 811.526 848.8677 887.4553
Total ($M) U value
887.4553 -0.00014 Spot beams Channel/Beam Channel per Reduction Factor beam Quarter Mb/s 19678 64 1 130 0.3 7.884 0.0054
satellite capacity price ($/ Mb)
LAUNCHING STRATEGY USA 1 USA 2 EUR 1 EUR 2 ASIA 1 ASIA 2 Tot Cost
2000.1 2000.2 2000.3 2001.1 2000.4 2001.2 3841.6
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
North America US Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce HomeUse 5% 4% 10% 10% 1.012 1.010 1.024 1.024 NA Scale Scale numbers from US to North America 1.1
41.8 42.3 42.8 43.4 43.9 44.4 45.0 45.5 46.1 46.7 47.2 47.8 48.4 49.0 49.6 50.2 50.8 51.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.055 0.055 0.055 0.055 0.05 0.05 0.05 0.05 0.09 0.09 0.09 0.09 0.11 0.11 0.11 0.11 0.13 0.13 0.052392 0.052392 0.0523918 0.052392 0.039605 0.039605 0.039605 0.039605 0.064195 0.064195 0.064195 0.064195 0.06616 0.06616 0.06616 0.06616 0.077358 0.077358 4576 4633 4689 4747 3302 3343 3384 3425 10116 10240 10366 10493 13380 13544 13710 13878 19413 19652
5.5 5.554194 5.6089215 5.664188 5.72 5.776361 5.833278 5.890756 5.9488 6.007416 6.066609 6.126386 6.186752 6.247713 6.309274 6.371442 6.434222 6.497621 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 0.042263 0.042679 0.0430997 0.043524 0.049839 0.05033 0.050826 0.051326 0.140024 0.141404 0.142797 0.144204 0.240132 0.242498 0.244887 0.2473 0.40151 0.405466
152250 155921.3 159681.15 163531.6 167475 171513.4 175649.3 179884.8 184222.5 188664.8 193214.2 197873.3 202644.8 207531.3 212535.6 217660.6 222909.2 228284.4 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.025 0.025 0.025 0.025 0.08 0.1 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 873.4435 894.5055 916.07531 938.1653 2324.134 2975.222 2437.573 2496.351 5179.865 5304.77 5432.688 5563.69 7046.701 7216.623 7390.642 7568.858 11329.21 11602.4
(4) Home Use # Housholds w. Computers (Millions) w. Internet 38.28 39.20307 40.148403 41.11653 42.108 43.12338 44.16324 45.22818 46.3188 47.43572 48.57957 49.751 50.95068 52.17929 53.43752 54.7261 56.04575 57.39722 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.025 0.025 0.025 0.025 0.08 0.08 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 Astrolink Market Share 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.031186 Astrolink Demand (Tb/quarter) 117.6475 120.4844 123.38974 126.3651 313.0466 320.5954 328.3261 336.2432 697.6961 714.5201 731.7498 749.395 949.1475 972.0349 995.4743 1019.479 1525.976 504.0105 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 5567 19678 5567 5648 19678 5648 5729 19678 5729 5812 39357 5812 5939 39357 5939 6639 39357 6639 6150 39357 6150 6258 39357 6258 15994 39357 15994 16260 39357 16260 16531 39357 16531 16806 39357 16806 21376 39357 21376 21733 39357 21733 22097 39357 22097 22467 39357 22467 32269 39357 32269 31758 39357 31758
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
North America
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
52.1 52.7 53.3 54.0 54.7 55.3 56.0 56.7 57.4 58.1 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.13 0.13 0.15 0.15 0.15 0.15 0.16 0.16 0.16 0.16 0.077358 0.077358 0.024949 0.024949 0.024949 0.024949 0.029615 0.029615 0.029615 0.029615 19893 20137 7585 7679 7773 7868 10085 10208 10334 10460
58.8 37994.29 0.17 0.019618 7453
59.5 37994.29 0.17 0.019618 7544
60.3 37994.29 0.17 0.019618 7637
61.0 37994.29 0.17 0.019618 7731
6.561645 6.626299 6.691591 6.757526 6.824111 6.891351 6.959255 7.027827 7.097075 7.167005 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.11 0.11 0.13 0.13 0.13 0.13 0.14 0.14 0.14 0.14 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 0.409462 0.413496 0.159156 0.160725 0.162308 0.163908 0.211593 0.213678 0.215783 0.21791
7.237625 5.87 0.14 0.024523 0.145775
7.30894 5.87 0.14 0.024523 0.147211
7.380958 5.87 0.14 0.024523 0.148662
7.453686 5.87 0.14 0.024523 0.150126
233789.2 239426.7 245200.1 251112.8 257168.1 263369.4 269720.2 276224.1 282884.9 289706.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 11882.18 12168.7 4823.002 4939.303 5058.407 5180.384 6647.379 6807.672 6971.83 7139.947
296692.2 3504 0.2 0.024523 5098.787
303846.5 3504 0.2 0.024523 5221.738
311173.4 3504 0.2 0.024523 5347.653
318676.9 3504 0.2 0.024523 5476.605
(4) Home Use # Housholds w. Computers (Millions) w. Internet 58.78128 60.19871 61.65032 63.13694 64.6594 66.21858 67.81536 69.45063 71.12534 72.84044 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 Astrolink Market Share 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 Astrolink Demand (Tb/quarter) 1600.457 1639.05 649.6289 665.2938 681.3365 697.766 895.3613 916.9518 939.0629 961.7071 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 33376 39357 33376 33945 39357 33945 13058 39357 13058 13283 39357 13283 13513 39357 13513 13746 39357 13746 17628 39357 17628 17933 39357 17933 18245 39357 18245 18562 39357 18562
74.59689 1877.1 0.2 0.024523 686.7754 13239 39357 13239
76.3957 1877.1 0.2 0.024523 703.3361 13470 39357 13470
78.23788 1877.1 0.2 0.024523 720.2961 13705 39357 13705
80.12448 1877.1 0.2 0.024523 737.6651 13945 39357 13945
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Europe Europe Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 10% 5% 10% 8% 1.024 1.012 1.024 1.019
38.0 38.9 39.9 40.8 41.8 42.8 43.8 44.9 46.0 47.1 48.2 49.4 50.6 51.8 53.0 54.3 55.6 57.0 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.06 0.06 0.06 0.06 0.08 0.08 0.08 0.08 0.11 0.11 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 2042 2092 2142 2194 1698 5638 1781 1824 1868 6202 6352 6505 9154 9375 9601 9832 16189 16579
5 5.061361 5.1234754 5.186352 5.25 5.314429 5.379649 5.445669 5.5125 5.580151 5.648632 5.717953 5.788125 5.859158 5.931063 6.003851 6.077531 6.152116 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 0.016905 0.017113 0.0173226 0.017535 0.026836 0.027166 0.027499 0.027836 0.06851 0.069351 0.070202 0.071064 0.123563 0.125079 0.126614 0.128168 0.182041 0.184275
130500 133646.8 136869.55 140170 143550 147011.5 150556.5 154187 157905 161712.7 165612.2 169605.7 173695.5 177883.9 182173.4 186566.2 191065.1 195672.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.08 0.08 0.08 0.08 0.12 0.12 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 598.9327 613.3752 628.16593 643.3133 498.0288 510.0381 522.337 534.9324 1775.954 1818.778 1862.636 1907.551 4026.686 4123.785 4223.224 4325.062 7768.604 7955.934
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.5 16.82054 17.147303 17.48042 17.82 18.16618 18.51909 18.87885 19.2456 19.61948 20.00061 20.38916 20.78525 21.18903 21.60066 22.02029 22.44807 22.88416 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.11 0.11 0.14 0.14 Astrolink Market Share 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 Astrolink Demand (Tb/quarter) 43.81355 44.6647 45.532377 46.41691 59.61625 60.77439 61.95502 63.1586 166.9794 170.2232 173.5301 176.9012 255.5541 260.5186 265.5796 270.7389 410.727 418.706 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 2685 0 0 2750 19678 2750 2816 19678 2816 2883 19678 2883 2256 39357 2256 6209 39357 6209 2365 39357 2365 2422 39357 2422 3811 39357 3811 8191 39357 8191 8388 39357 8388 8589 39357 8589 13436 39357 13436 13759 39357 13759 14090 39357 14090 14428 39357 14428 24368 39357 24368 24954 39357 24954
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Europe
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
58.4 59.8 61.2 62.7 64.2 65.7 67.3 68.9 70.6 72.3 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.11 0.11 0.13 0.13 0.13 0.13 0.15 0.15 0.15 0.15 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 16979 17388 6787 6951 7119 7290 10226 10472 10725 10984
74.1 37994.29 0.15 0.017656 7451
75.8 37994.29 0.15 0.017656 7631
77.7 37994.29 0.15 0.017656 7815
79.5 37994.29 0.15 0.017656 8004
6.227616 6.304043 6.381408 6.459722 6.538997 6.619245 6.700478 6.782708 6.865947 6.950208 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 0.186536 0.188826 0.07192 0.072802 0.073696 0.0746 0.11525 0.116665 0.118096 0.119546
7.035502 5.87 0.1 0.02158 0.089071
7.121843 5.87 0.1 0.02158 0.090164
7.209244 5.87 0.1 0.02158 0.091271
7.297718 5.87 0.1 0.02158 0.092391
200390.7 205222.9 210171.6 215239.6 220429.8 225745.2 231188.7 236763.5 242472.8 248319.7 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.12 0.12 0.15 0.15 0.15 0.15 0.17 0.17 0.17 0.17 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 8147.781 8344.254 3445.002 3998.483 3613.148 3700.274 4498.227 5220.922 5346.817 5475.749
254307.6 3504 0.18 0.024523 3933.35
260439.9 3504 0.18 0.024523 4028.198
266720 3504 0.18 0.024523 4125.332
273151.6 3504 0.18 0.024523 4224.809
(4) Home Use # Housholds w. Computers (Millions) w. Internet 23.32872 23.78191 24.24391 24.71489 25.19501 25.68447 26.18343 26.69208 27.21061 27.73922 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.14 0.14 0.16 0.16 0.16 0.16 0.18 0.18 0.18 0.18 Astrolink Market Share 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 Astrolink Demand (Tb/quarter) 426.84 435.132 163.4981 166.6743 169.9122 173.213 235.8024 240.3832 245.053 249.8135 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 25554 39357 25554 26168 39357 26168 10396 39357 10396 11116 39357 11116 10902 39357 10902 11164 39357 11164 14960 39357 14960 15934 39357 15934 16317 39357 16317 16709 39357 16709
28.2781 1877.1 0.19 0.017656 178.0739 11563 39357 11563
28.82745 1877.1 0.19 0.017656 181.5333 11841 39357 11841
29.38746 1877.1 0.19 0.017656 185.0599 12126 39357 12126
29.95836 1877.1 0.19 0.017656 188.6549 12417 39357 12417
Alternative 1 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Asia Asia Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 15% 8% 15% 12% 1.036 1.019 1.036 1.029
19.0 19.7 20.4 21.1 21.9 22.6 23.4 24.3 25.1 26.0 26.9 27.9 28.9 29.9 31.0 32.1 33.2 34.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.08 0.08 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 416 431 446 462 723 749 776 803 2697 2793 2892 2995 4794 4965 5141 5324 8595 8901
5 5.097133 5.1961524 5.297096 5.4 5.504903 5.611845 5.720863 5.832 5.945296 6.060792 6.178532 6.29856 6.420919 6.545656 6.672815 6.802445 6.934593 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 0.016137 0.01645 0.0167697 0.017096 0.026348 0.02686 0.027382 0.027914 0.069186 0.070531 0.071901 0.073297 0.128347 0.130841 0.133383 0.135974 0.194493 0.198271
152250 157663.7 163269.94 169075.5 175087.5 181313.3 187760.4 194436.8 201350.6 208510.3 215924.5 223602.3 231553.2 239786.8 248313.2 257142.7 266286.2 275754.8 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 293.477 303.9125 314.71905 325.9099 510.2531 528.3967 547.1855 566.6423 1426.689 1477.419 1529.953 1584.356 2818.184 2918.393 3022.166 3129.628 4547.364 4709.059
(4) Home Use # Housholds w. Computers (Millions) w. Internet 9.9 10.1845 10.477175 10.77826 11.088 11.40664 11.73444 12.07165 12.41856 12.77544 13.14257 13.52025 13.90879 14.30849 14.71968 15.14268 15.57784 16.02551 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.017 0.017 0.017 0.017 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.09 0.09 0.09 0.09 0.12 0.12 Astrolink Market Share 0.06287 0.06287 0.0628702 0.06287 0.047526 0.047526 0.047526 0.047526 0.077034 0.077034 0.077034 0.077034 0.079392 0.079392 0.079392 0.079392 0.09283 0.09283 Astrolink Demand (Tb/quarter) 19.86214 20.43293 21.020116 21.62418 39.56753 40.70459 41.87433 43.07769 107.7464 110.8427 114.0281 117.3049 186.5544 191.9155 197.4306 203.1042 325.7418 335.1027 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 729 0 0 755 0 0 782 19678 782 810 19678 810 1273 19678 1273 1318 39357 1318 1365 39357 1365 1413 39357 1413 4231 39357 4231 4381 39357 4381 4536 39357 4536 4696 39357 4696 7799 39357 7799 8075 39357 8075 8361 39357 8361 8657 39357 8657 13468 39357 13468 13945 39357 13945
Alternative 1 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Asia
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
35.6 36.9 38.2 39.6 41.0 42.4 43.9 45.5 47.1 48.8 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 9217 9545 3985 4126 4273 4425 6527 6760 7000 7249
50.5 37994.29 0.13 0.02158 5387
52.3 37994.29 0.13 0.02158 5579
54.2 37994.29 0.13 0.02158 5777
56.1 37994.29 0.13 0.02158 5982
7.069308 7.20664 7.34664 7.48936 7.634853 7.783171 7.934372 8.088509 8.245641 8.405825 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 0.202123 0.206049 0.079035 0.08057 0.082135 0.083731 0.13027 0.132801 0.135381 0.138011
8.569121 5.87 0.1 0.020599 0.103556
8.73559 5.87 0.1 0.020599 0.105567
8.905292 5.87 0.1 0.020599 0.107618
9.078291 5.87 0.1 0.020599 0.109709
285560.1 295714.1 306229.1 317118.1 328394.2 340071.2 352163.5 364685.8 377653.3 391081.9 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 4876.504 5049.903 1967.651 2037.617 2110.071 2185.101 3453.422 3576.219 3703.382 3835.067
404988 3504 0.1 0.020599 2923.158
419388.6 3504 0.1 0.020599 3027.1
434301.3 3504 0.1 0.020599 3134.737
449744.2 3504 0.1 0.020599 3246.203
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.48604 16.9598 17.44718 17.94857 18.46436 18.99498 19.54084 20.1024 20.68009 21.27438 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.12 0.12 0.14 0.14 0.14 0.14 0.18 0.18 0.18 0.18 Astrolink Market Share 0.09283 0.09283 0.029939 0.029939 0.029939 0.029939 0.035538 0.035538 0.035538 0.035538 Astrolink Demand (Tb/quarter) 344.7327 354.6394 137.272 141.2169 145.2751 149.4499 234.6409 241.3839 248.3206 255.4567 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 14439 39357 14439 14950 39357 14950 6090 39357 6090 6305 39357 6305 6529 39357 6529 6760 39357 6760 10216 39357 10216 10577 39357 10577 10952 39357 10952 11339 39357 11339
21.88575 1877.1 0.2 0.023542 193.4312 8504 39357 8504
22.51468 1877.1 0.2 0.023542 198.9899 8805 39357 8805
23.1617 1877.1 0.2 0.023542 204.7084 9117 39357 9117
23.8273 1877.1 0.2 0.023542 210.5911 9439 39357 9439
Alternative 2 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
5567 1 19678 28%
8397 2 39357 21%
9327 3 59035 16%
9504 4 78714 12%
9469 5 98392 10%
14166 6 118071 12%
9880 6 118071 8%
10093 6 118071 9%
24036 6 118071 20%
28832 6 118071 24%
29454 6 118071 25%
30092 6 118071 25%
42611 6 118071 36%
43567 6 118071 37%
44547 6 118071 38%
45552 6 118071 39%
272 121.6 115.52 110 110 110 0 0 0 0 0 0 0 0 0 0 84.41315 84.41315 84.41315 84.41315 86.94554 86.94554 86.94554 86.94554 89.55391 89.55391 89.55391 89.55391 92.24053 92.24053 92.24053 92.24053 30 46 51 52 51 77 54 55 130 156 160 163 231 236 242 247 -326 -160 -149 -143 -146 -120 -33 -32 41 67 70 74 139 144 149 155 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 -257.2124 -124.0372 -113.1761 -106.1382 -106.0438 -85.76474 -23.34575 -22.09396 27.49117 44.1179 45.43759 46.74108 86.3818 87.84896 89.30385 90.74697 -257.2124 -381.2496 -494.42574 -600.5639 -706.6077 -792.3725 -815.7182 -837.8122 -810.321 -766.2031 -720.7655 -674.0244 -587.6426 -499.7937 -410.4898 -319.7429
Year
2004.1
2004.2
2004.3
2004.4
2005.1
2005.2
2005.3
2005.4
2006.1
2006.2
2006.3
2006.4
2007.1
2007.2
2007.3
2007.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
70106 6 118071 59%
70658 6 118071 60%
73368 6 118071 62%
75063 6 118071 64%
29544 6 118071 25%
30705 6 118071 26%
30943 6 118071 26%
31670 6 118071 27%
42803 6 118071 36%
44444 6 118071 38%
45513 6 118071 39%
46611 6 118071 39%
33305 6 118071 28%
34115 6 118071 29%
34947 6 118071 30%
35802 6 118071 30%
0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 0 95.00774 95.00774 95.007744 95.00774 97.85798 97.85798 97.85798 97.85798 100.7937 100.7937 100.7937 100.7937 103.8175 103.8175 103.8175 103.8175 380 383 398 407 160 167 168 172 232 241 247 253 181 185 190 194 285 288 303 312 62 69 70 74 131 140 146 152 77 81 86 90 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 163.8921 162.3644 167.29995 168.9954 33.12656 35.75381 35.71172 36.98381 64.42938 67.44534 68.85589 70.25666 34.81608 36.08468 37.34173 38.58764 -155.8508 6.513642 173.81359 342.809 375.9355 411.6893 447.4011 484.3849 548.8142 616.2596 685.1155 755.3721 790.1882 826.2729 863.6146 902.2023
Total ($M) U value
902.2023 -0.000121 Spot beams Channel/Beam Channel per Reduction Factor beam Quarter Mb/s 19678 64 1 130 0.3 7.884 0.0054
satellite capacity price ($/ Mb)
LAUNCHING STRATEGY USA 1 USA 2 EUR 1 EUR 2 ASIA 1 ASIA 2 Tot Cost
2000.1 2000.4 2000.2 2001.1 2000.3 2001.2 3841.6
Alternative 4 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
North America US Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce HomeUse 5% 4% 10% 10% 1.012 1.010 1.024 1.024 NA Scale Scale numbers from US to North America 1.1
41.8 42.3 42.8 43.4 43.9 44.4 45.0 45.5 46.1 46.7 47.2 47.8 48.4 49.0 49.6 50.2 50.8 51.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.055 0.055 0.055 0.055 0.05 0.05 0.05 0.05 0.09 0.09 0.09 0.09 0.11 0.11 0.11 0.11 0.13 0.13 0.052392 0.052392 0.0523918 0.052392 0.039605 0.039605 0.039605 0.039605 0.064195 0.064195 0.064195 0.064195 0.06616 0.06616 0.06616 0.06616 0.077358 0.077358 4576 4633 4689 4747 3302 3343 3384 3425 10116 10240 10366 10493 13380 13544 13710 13878 19413 19652
5.5 5.554194 5.6089215 5.664188 5.72 5.776361 5.833278 5.890756 5.9488 6.007416 6.066609 6.126386 6.186752 6.247713 6.309274 6.371442 6.434222 6.497621 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 0.042263 0.042679 0.0430997 0.043524 0.049839 0.05033 0.050826 0.051326 0.140024 0.141404 0.142797 0.144204 0.240132 0.242498 0.244887 0.2473 0.40151 0.405466
152250 155921.3 159681.15 163531.6 167475 171513.4 175649.3 179884.8 184222.5 188664.8 193214.2 197873.3 202644.8 207531.3 212535.6 217660.6 222909.2 228284.4 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.025 0.025 0.025 0.025 0.08 0.1 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 873.4435 894.5055 916.07531 938.1653 2324.134 2975.222 2437.573 2496.351 5179.865 5304.77 5432.688 5563.69 7046.701 7216.623 7390.642 7568.858 11329.21 11602.4
(4) Home Use # Housholds w. Computers (Millions) w. Internet 38.28 39.20307 40.148403 41.11653 42.108 43.12338 44.16324 45.22818 46.3188 47.43572 48.57957 49.751 50.95068 52.17929 53.43752 54.7261 56.04575 57.39722 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.025 0.025 0.025 0.025 0.08 0.08 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.15 0.15 Astrolink Market Share 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.031186 Astrolink Demand (Tb/quarter) 117.6475 120.4844 123.38974 126.3651 313.0466 320.5954 328.3261 336.2432 697.6961 714.5201 731.7498 749.395 949.1475 972.0349 995.4743 1019.479 1525.976 504.0105 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 5567 19678 5567 5648 19678 5648 5729 19678 5729 5812 39357 5812 5939 39357 5939 6639 39357 6639 6150 39357 6150 6258 39357 6258 15994 39357 15994 16260 39357 16260 16531 39357 16531 16806 39357 16806 21376 39357 21376 21733 39357 21733 22097 39357 22097 22467 39357 22467 32269 39357 32269 31758 39357 31758
Alternative 4 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
North America
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
52.1 52.7 53.3 54.0 54.7 55.3 56.0 56.7 57.4 58.1 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.13 0.13 0.15 0.15 0.15 0.15 0.16 0.16 0.16 0.16 0.077358 0.077358 0.024949 0.024949 0.024949 0.024949 0.029615 0.029615 0.029615 0.029615 19893 20137 7585 7679 7773 7868 10085 10208 10334 10460
58.8 37994.29 0.17 0.019618 7453
59.5 37994.29 0.17 0.019618 7544
60.3 37994.29 0.17 0.019618 7637
61.0 37994.29 0.17 0.019618 7731
6.561645 6.626299 6.691591 6.757526 6.824111 6.891351 6.959255 7.027827 7.097075 7.167005 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.11 0.11 0.13 0.13 0.13 0.13 0.14 0.14 0.14 0.14 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 0.409462 0.413496 0.159156 0.160725 0.162308 0.163908 0.211593 0.213678 0.215783 0.21791
7.237625 5.87 0.14 0.024523 0.145775
7.30894 5.87 0.14 0.024523 0.147211
7.380958 5.87 0.14 0.024523 0.148662
7.453686 5.87 0.14 0.024523 0.150126
233789.2 239426.7 245200.1 251112.8 257168.1 263369.4 269720.2 276224.1 282884.9 289706.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 11882.18 12168.7 4823.002 4939.303 5058.407 5180.384 6647.379 6807.672 6971.83 7139.947
296692.2 3504 0.2 0.024523 5098.787
303846.5 3504 0.2 0.024523 5221.738
311173.4 3504 0.2 0.024523 5347.653
318676.9 3504 0.2 0.024523 5476.605
(4) Home Use # Housholds w. Computers (Millions) w. Internet 58.78128 60.19871 61.65032 63.13694 64.6594 66.21858 67.81536 69.45063 71.12534 72.84044 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.15 0.15 0.18 0.18 0.18 0.18 0.19 0.19 0.19 0.19 Astrolink Market Share 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 Astrolink Demand (Tb/quarter) 1600.457 1639.05 649.6289 665.2938 681.3365 697.766 895.3613 916.9518 939.0629 961.7071 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 33376 39357 33376 33945 39357 33945 13058 39357 13058 13283 39357 13283 13513 39357 13513 13746 39357 13746 17628 39357 17628 17933 39357 17933 18245 39357 18245 18562 39357 18562
74.59689 1877.1 0.2 0.024523 686.7754 13239 39357 13239
76.3957 1877.1 0.2 0.024523 703.3361 13470 39357 13470
78.23788 1877.1 0.2 0.024523 720.2961 13705 39357 13705
80.12448 1877.1 0.2 0.024523 737.6651 13945 39357 13945
Alternative 4 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Europe Europe Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 10% 5% 10% 8% 1.024 1.012 1.024 1.019
38.0 38.9 39.9 40.8 41.8 42.8 43.8 44.9 46.0 47.1 48.2 49.4 50.6 51.8 53.0 54.3 55.6 57.0 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.03 0.06 0.06 0.06 0.06 0.08 0.08 0.08 0.08 0.11 0.11 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 2042 2092 2142 2194 1698 5638 1781 1824 1868 6202 6352 6505 9154 9375 9601 9832 16189 16579
5 5.061361 5.1234754 5.186352 5.25 5.314429 5.379649 5.445669 5.5125 5.580151 5.648632 5.717953 5.788125 5.859158 5.931063 6.003851 6.077531 6.152116 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 0.016905 0.017113 0.0173226 0.017535 0.026836 0.027166 0.027499 0.027836 0.06851 0.069351 0.070202 0.071064 0.123563 0.125079 0.126614 0.128168 0.182041 0.184275
130500 133646.8 136869.55 140170 143550 147011.5 150556.5 154187 157905 161712.7 165612.2 169605.7 173695.5 177883.9 182173.4 186566.2 191065.1 195672.3 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.08 0.08 0.08 0.08 0.12 0.12 0.06549 0.06549 0.0654898 0.06549 0.049506 0.049506 0.049506 0.049506 0.080244 0.080244 0.080244 0.080244 0.0827 0.0827 0.0827 0.0827 0.096698 0.096698 598.9327 613.3752 628.16593 643.3133 498.0288 510.0381 522.337 534.9324 1775.954 1818.778 1862.636 1907.551 4026.686 4123.785 4223.224 4325.062 7768.604 7955.934
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.5 16.82054 17.147303 17.48042 17.82 18.16618 18.51909 18.87885 19.2456 19.61948 20.00061 20.38916 20.78525 21.18903 21.60066 22.02029 22.44807 22.88416 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.08 0.08 0.08 0.08 0.11 0.11 0.11 0.11 0.14 0.14 Astrolink Market Share 0.047153 0.047153 0.0471526 0.047153 0.035644 0.035644 0.035644 0.035644 0.057776 0.057776 0.057776 0.057776 0.059544 0.059544 0.059544 0.059544 0.069622 0.069622 Astrolink Demand (Tb/quarter) 43.81355 44.6647 45.532377 46.41691 59.61625 60.77439 61.95502 63.1586 166.9794 170.2232 173.5301 176.9012 255.5541 260.5186 265.5796 270.7389 410.727 418.706 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 2685 0 0 2750 0 0 2816 19678 2816 2883 19678 2883 2256 19678 2256 6209 39357 6209 2365 39357 2365 2422 39357 2422 3811 39357 3811 8191 39357 8191 8388 39357 8388 8589 39357 8589 13436 39357 13436 13759 39357 13759 14090 39357 14090 14428 39357 14428 24368 39357 24368 24954 39357 24954
Alternative 4 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Europe
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
58.4 59.8 61.2 62.7 64.2 65.7 67.3 68.9 70.6 72.3 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.11 0.11 0.13 0.13 0.13 0.13 0.15 0.15 0.15 0.15 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 16979 17388 6787 6951 7119 7290 10226 10472 10725 10984
74.1 37994.29 0.15 0.017656 7451
75.8 37994.29 0.15 0.017656 7631
77.7 37994.29 0.15 0.017656 7815
79.5 37994.29 0.15 0.017656 8004
6.227616 6.304043 6.381408 6.459722 6.538997 6.619245 6.700478 6.782708 6.865947 6.950208 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 0.186536 0.188826 0.07192 0.072802 0.073696 0.0746 0.11525 0.116665 0.118096 0.119546
7.035502 5.87 0.1 0.02158 0.089071
7.121843 5.87 0.1 0.02158 0.090164
7.209244 5.87 0.1 0.02158 0.091271
7.297718 5.87 0.1 0.02158 0.092391
200390.7 205222.9 210171.6 215239.6 220429.8 225745.2 231188.7 236763.5 242472.8 248319.7 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.12 0.12 0.15 0.15 0.15 0.15 0.17 0.17 0.17 0.17 0.096698 0.096698 0.031186 0.031186 0.031186 0.031186 0.037019 0.037019 0.037019 0.037019 8147.781 8344.254 3445.002 3998.483 3613.148 3700.274 4498.227 5220.922 5346.817 5475.749
254307.6 3504 0.18 0.024523 3933.35
260439.9 3504 0.18 0.024523 4028.198
266720 3504 0.18 0.024523 4125.332
273151.6 3504 0.18 0.024523 4224.809
(4) Home Use # Housholds w. Computers (Millions) w. Internet 23.32872 23.78191 24.24391 24.71489 25.19501 25.68447 26.18343 26.69208 27.21061 27.73922 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.14 0.14 0.16 0.16 0.16 0.16 0.18 0.18 0.18 0.18 Astrolink Market Share 0.069622 0.069622 0.022454 0.022454 0.022454 0.022454 0.026653 0.026653 0.026653 0.026653 Astrolink Demand (Tb/quarter) 426.84 435.132 163.4981 166.6743 169.9122 173.213 235.8024 240.3832 245.053 249.8135 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 25554 39357 25554 26168 39357 26168 10396 39357 10396 11116 39357 11116 10902 39357 10902 11164 39357 11164 14960 39357 14960 15934 39357 15934 16317 39357 16317 16709 39357 16709
28.2781 1877.1 0.19 0.017656 178.0739 11563 39357 11563
28.82745 1877.1 0.19 0.017656 181.5333 11841 39357 11841
29.38746 1877.1 0.19 0.017656 185.0599 12126 39357 12126
29.95836 1877.1 0.19 0.017656 188.6549 12417 39357 12417
Alternative 4 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4 2004.1 2004.2
Asia Asia Growth Rate Yearly Quarterly (1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) Telecommuter Telemedicine Ecommerce Home Use 15% 8% 15% 12% 1.036 1.019 1.036 1.029
19.0 19.7 20.4 21.1 21.9 22.6 23.4 24.3 25.1 26.0 26.9 27.9 28.9 29.9 31.0 32.1 33.2 34.4 37994.29 37994.29 37994.286 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.08 0.08 0.057631 0.057631 0.057631 0.057631 0.043565 0.043565 0.043565 0.043565 0.070615 0.070615 0.070615 0.070615 0.072776 0.072776 0.072776 0.072776 0.085094 0.085094 416 431 446 462 723 749 776 803 2697 2793 2892 2995 4794 4965 5141 5324 8595 8901
5 5.097133 5.1961524 5.297096 5.4 5.504903 5.611845 5.720863 5.832 5.945296 6.060792 6.178532 6.29856 6.420919 6.545656 6.672815 6.802445 6.934593 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 0.016137 0.01645 0.0167697 0.017096 0.026348 0.02686 0.027382 0.027914 0.069186 0.070531 0.071901 0.073297 0.128347 0.130841 0.133383 0.135974 0.194493 0.198271
152250 157663.7 163269.94 169075.5 175087.5 181313.3 187760.4 194436.8 201350.6 208510.3 215924.5 223602.3 231553.2 239786.8 248313.2 257142.7 266286.2 275754.8 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.01 0.01 0.01 0.01 0.02 0.02 0.02 0.02 0.03 0.03 0.03 0.03 0.05 0.05 0.05 0.05 0.06 0.06 0.055011 0.055011 0.0550114 0.055011 0.041585 0.041585 0.041585 0.041585 0.067405 0.067405 0.067405 0.067405 0.069468 0.069468 0.069468 0.069468 0.081226 0.081226 293.477 303.9125 314.71905 325.9099 510.2531 528.3967 547.1855 566.6423 1426.689 1477.419 1529.953 1584.356 2818.184 2918.393 3022.166 3129.628 4547.364 4709.059
(4) Home Use # Housholds w. Computers (Millions) w. Internet 9.9 10.1845 10.477175 10.77826 11.088 11.40664 11.73444 12.07165 12.41856 12.77544 13.14257 13.52025 13.90879 14.30849 14.71968 15.14268 15.57784 16.02551 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.017 0.017 0.017 0.017 0.04 0.04 0.04 0.04 0.06 0.06 0.06 0.06 0.09 0.09 0.09 0.09 0.12 0.12 Astrolink Market Share 0.06287 0.06287 0.0628702 0.06287 0.047526 0.047526 0.047526 0.047526 0.077034 0.077034 0.077034 0.077034 0.079392 0.079392 0.079392 0.079392 0.09283 0.09283 Astrolink Demand (Tb/quarter) 19.86214 20.43293 21.020116 21.62418 39.56753 40.70459 41.87433 43.07769 107.7464 110.8427 114.0281 117.3049 186.5544 191.9155 197.4306 203.1042 325.7418 335.1027 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 729 0 0 755 19678 755 782 19678 782 810 19678 810 1273 39357 1273 1318 39357 1318 1365 39357 1365 1413 39357 1413 4231 39357 4231 4381 39357 4381 4536 39357 4536 4696 39357 4696 7799 39357 7799 8075 39357 8075 8361 39357 8361 8657 39357 8657 13468 39357 13468 13945 39357 13945
Alternative 4 Aggregate Demand Projections Year 2004.3 2004.4 2005.1 2005.2 2005.3 2005.4 2006.1 2006.2 2006.3 2006.4 2007.1 2007.2 2007.3 2007.4
Asia
(1) Telecommuters # Telecommuters (Millions) # MBits/ Telecommuter (per quart) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (2) Telemedicine # Operations/Quarter (Millions) # MBits/ Operation Penetration Astrolink Market Share Astrolink Demand (Tb/quarter) (3) Electronic Commerce (Intercompany) # Company Mbits/ Company (per quarter) Penetration Astrolink Market Share Astrolink Demand (Tb/quarter)
35.6 36.9 38.2 39.6 41.0 42.4 43.9 45.5 47.1 48.8 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 37994.29 0.08 0.08 0.1 0.1 0.1 0.1 0.12 0.12 0.12 0.12 0.085094 0.085094 0.027444 0.027444 0.027444 0.027444 0.032576 0.032576 0.032576 0.032576 9217 9545 3985 4126 4273 4425 6527 6760 7000 7249
50.5 37994.29 0.13 0.02158 5387
52.3 37994.29 0.13 0.02158 5579
54.2 37994.29 0.13 0.02158 5777
56.1 37994.29 0.13 0.02158 5982
7.069308 7.20664 7.34664 7.48936 7.634853 7.783171 7.934372 8.088509 8.245641 8.405825 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 5.87 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 0.202123 0.206049 0.079035 0.08057 0.082135 0.083731 0.13027 0.132801 0.135381 0.138011
8.569121 5.87 0.1 0.020599 0.103556
8.73559 5.87 0.1 0.020599 0.105567
8.905292 5.87 0.1 0.020599 0.107618
9.078291 5.87 0.1 0.020599 0.109709
285560.1 295714.1 306229.1 317118.1 328394.2 340071.2 352163.5 364685.8 377653.3 391081.9 3504 3504 3504 3504 3504 3504 3504 3504 3504 3504 0.06 0.06 0.07 0.07 0.07 0.07 0.09 0.09 0.09 0.09 0.081226 0.081226 0.026196 0.026196 0.026196 0.026196 0.031096 0.031096 0.031096 0.031096 4876.504 5049.903 1967.651 2037.617 2110.071 2185.101 3453.422 3576.219 3703.382 3835.067
404988 3504 0.1 0.020599 2923.158
419388.6 3504 0.1 0.020599 3027.1
434301.3 3504 0.1 0.020599 3134.737
449744.2 3504 0.1 0.020599 3246.203
(4) Home Use # Housholds w. Computers (Millions) w. Internet 16.48604 16.9598 17.44718 17.94857 18.46436 18.99498 19.54084 20.1024 20.68009 21.27438 # MBits/ Household (per quart) 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 1877.1 Penetration 0.12 0.12 0.14 0.14 0.14 0.14 0.18 0.18 0.18 0.18 Astrolink Market Share 0.09283 0.09283 0.029939 0.029939 0.029939 0.029939 0.035538 0.035538 0.035538 0.035538 Astrolink Demand (Tb/quarter) 344.7327 354.6394 137.272 141.2169 145.2751 149.4499 234.6409 241.3839 248.3206 255.4567 (5) Total Demand (Tb) Capacity (Tb) Total Use (Tb) 14439 39357 14439 14950 39357 14950 6090 39357 6090 6305 39357 6305 6529 39357 6529 6760 39357 6760 10216 39357 10216 10577 39357 10577 10952 39357 10952 11339 39357 11339
21.88575 1877.1 0.2 0.023542 193.4312 8504 39357 8504
22.51468 1877.1 0.2 0.023542 198.9899 8805 39357 8805
23.1617 1877.1 0.2 0.023542 204.7084 9117 39357 9117
23.8273 1877.1 0.2 0.023542 210.5911 9439 39357 9439
Alternative 4 Aggregate Demand Projections Year 2000.1 2000.2 2000.3 2000.4 2001.1 2001.2 2001.3 2001.4 2002.1 2002.2 2002.3 2002.4 2003.1 2003.2 2003.3 2003.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
5567 1 19678 28%
6403 2 39357 16%
9327 3 59035 16%
9504 4 78714 12%
9469 5 98392 10%
14166 6 118071 12%
9880 6 118071 8%
10093 6 118071 9%
24036 6 118071 20%
28832 6 118071 24%
29454 6 118071 25%
30092 6 118071 25%
42611 6 118071 36%
43567 6 118071 37%
44547 6 118071 38%
45552 6 118071 39%
272 121.6 115.52 110 110 110 0 0 0 0 0 0 0 0 0 0 84.41315 84.41315 84.41315 84.41315 86.94554 86.94554 86.94554 86.94554 89.55391 89.55391 89.55391 89.55391 92.24053 92.24053 92.24053 92.24053 30 35 51 52 51 77 54 55 130 156 160 163 231 236 242 247 -326 -171 -149 -143 -146 -120 -33 -32 41 67 70 74 139 144 149 155 12 13 14 15 16 17 18 19 20 21 22 23 24 25 26 27 -257.2124 -132.4019 -113.1761 -106.1382 -106.0438 -85.76474 -23.34575 -22.09396 27.49117 44.1179 45.43759 46.74108 86.3818 87.84896 89.30385 90.74697 -257.2124 -389.6143 -502.79045 -608.9286 -714.9725 -800.7372 -824.0829 -846.1769 -818.6857 -774.5678 -729.1302 -682.3892 -596.0074 -508.1584 -418.8545 -328.1076
Year
2004.1
2004.2
2004.3
2004.4
2005.1
2005.2
2005.3
2005.4
2006.1
2006.2
2006.3
2006.4
2007.1
2007.2
2007.3
2007.4
Total World Use Satellites in Orbit Available Capacity % Use Launch Cost Operating Cost Revenue ($M) Profit NPV Cumulative NPV
70106 6 118071 59%
70658 6 118071 60%
73368 6 118071 62%
75063 6 118071 64%
29544 6 118071 25%
30705 6 118071 26%
30943 6 118071 26%
31670 6 118071 27%
42803 6 118071 36%
44444 6 118071 38%
45513 6 118071 39%
46611 6 118071 39%
33305 6 118071 28%
34115 6 118071 29%
34947 6 118071 30%
35802 6 118071 30%
95.00774 95.00774 95.007744 95.00774 97.85798 97.85798 97.85798 97.85798 100.7937 100.7937 100.7937 100.7937 103.8175 103.8175 103.8175 103.8175 380 383 398 407 160 167 168 172 232 241 247 253 181 185 190 194 285 288 303 312 62 69 70 74 131 140 146 152 77 81 86 90 28 29 30 31 32 33 34 35 36 37 38 39 40 41 42 43 163.8921 162.3644 167.29995 168.9954 33.12656 35.75381 35.71172 36.98381 64.42938 67.44534 68.85589 70.25666 34.81608 36.08468 37.34173 38.58764 -164.2155 -1.851071 165.44888 334.4442 367.5708 403.3246 439.0363 476.0202 540.4495 607.8949 676.7508 747.0074 781.8235 817.9082 855.2499 893.8376
Total ($M) U value
893.8376 -0.000131 Spot beams Channel/Beam Channel per Reduction Factor beam Quarter Mb/s 19678 64 1 130 0.3 7.884 0.0054
satellite capacity price ($/ Mb)
LAUNCHING STRATEGY USA 1 USA 2 EUR 1 EUR 2 ASIA 1 ASIA 2 Tot Cost
2000.1 2000.4 2000.3 2001.2 2000.2 2001.1 3841.6
Crystal Ball Report
Simulation started on Tue, May 27, 1997 at 4:25:42 PM Simulation stopped on Tue, May 27, 1997 at 4:42:48 PM
Forecast: Total NPV (alt 4) [MARKET 2.XLS]alt 4 - Cell: D128
Summary: Certainty Level is 99.20% Certainty Range is from 0.00 to 8 $ Million Display Range is from -500.00 to 4,000.00 $ Million Entire Range is from -274.89 to 4,666.23 $ Million After 1,000 Trials, the Std. Error of the Mean is 27.05 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error Value 1000 1,658.02 1,595.52 --855.54 731,947.11 0.33 2.71 0.52 -274.89 4,666.23 4,941.13 27.05
Forecast: Total NPV (alt 4) (cont'd)
Forecast: Total NPV (alt 4) 1,000 Trials
.026
[MARKET 2.XLS]alt 4 - Cell: D128
Frequency Chart
3 Outliers
26
.020
19.5
.013
13
.007
6.5
.000 -500.00 625.00 1,750.00 2,875.00 4,000.00
0
Certainty is 99.20% from 0.00 to $ Million
End of Forecast
Forecast: U value (alt 4) [MARKET 2.XLS]alt 4 - Cell: D129
Summary: Display Range is from -1.5000e+0 to 0.0000e+0 utils Entire Range is from -1.5626e+1 to -5.4302e-21 utils
After 1,000 Trials, the Std. Error of the Mean is 1.6903e-2 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error CE=
Forecast: Total NPV (alt 1)
Value 1000 -4.1972E-02 -1.1770E-07 --5.3452E-01 2.8571E-01 -2.5519E+01 7.2736E+02 -1.2735E+01 -1.5626E+01 -5.4302E-21 1.5626E+01 1.6903E-02 317.076
[MARKET 2.XLS]alt 1 - Cell: D128
Summary: Certainty Level is 9.9100e+1% Certainty Range is from 0.0000e+0 to 8 $ Millions Display Range is from -5.0000e+2 to 4.0000e+3 $ Millions Entire Range is from -2.8312e+2 to 4.6619e+3 $ Millions After 1,000 Trials, the Std. Error of the Mean is 2.7045e+1 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error Value 1000 1.6519E+03 1.5903E+03 --8.5525E+02 7.3145E+05 3.2913E-01 2.7104E+00 5.1773E-01 -2.8312E+02 4.6619E+03 4.9450E+03 2.7045E+01
Forecast: Total NPV (alt 1) 1,000 Trials
.025
Frequency Chart
3 Outliers
25
.019
18.7
.013
12.5
.006
6.25
.006
6.25
.000 -5.0000e+2 6.2500e+2 1.7500e+3 2.8750e+3
0 4.0000e+3
Certainty is 99.10% from 0.0000e+0 to $ Millions
Forecast: Total NPV (alt 1) (cont'd)
[MARKET 2.XLS]alt 1 - Cell: D128
End of Forecast
Forecast: U-value (alt 1) [MARKET 2.XLS]alt 1 - Cell: D129
Summary: Display Range is from -1.7500e+0 to 0.0000e+0 utils Entire Range is from -1.6966e+1 to -5.6726e-21 utils After 1,000 Trials, the Std. Error of the Mean is 1.8297e-2 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error CE= Value 1000 -4.4857E-02 -1.2396E-07 --5.7859E-01 3.3477E-01 -2.5719E+01 7.3612E+02 -1.2899E+01 -1.6966E+01 -5.6726E-21 1.6966E+01 1.8297E-02 310.427
Forecast: Total NPV (alt 2)
[MARKET 2.XLS]alt 2 - Cell: D128
Summary: Certainty Level is 99.20% Certainty Range is from 0.00 to 8 $ Million Display Range is from -500.00 to 4,000.00 $ Million Entire Range is from -264.11 to 4,671.96 $ Million After 1,000 Trials, the Std. Error of the Mean is 27.07 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error Value 1000 1,666.00 1,602.81 --855.92 732,604.55 0.33 2.71 0.51 -264.11 4,671.96 4,936.07 27.07
Forecast: Total NPV (alt 2) 1,000 Trials
.026
Frequency Chart
4 Outliers
26
.020
19.5
.013
13
.007
6.5
.000 -500.00 625.00 1,750.00 2,875.00 4,000.00
0
Certainty is 99.20% from 0.00 to $ Million
Summary: Display Range is from -1.5000e+0 to 0.0000e+0 utils Entire Range is from -1.4029e+1 to -5.1281e-21 utils After 1,000 Trials, the Std. Error of the Mean is 1.5239e-2 Statistics: Value Trials 1000 Mean -3.8484E-02 Median -1.0942E-07 Mode --Standard Deviation 4.8191E-01 Variance 2.3224E-01 Skewness -2.5247E+01 Kurtosis 7.1542E+02 Coeff. of Variability -1.2522E+01 Range Minimum -1.4029E+01 Range Maximum -5.1281E-21 Range Width 1.4029E+01 Mean Std. Error 1.5239E-02 CE= 325.751
Forecast: Total NPV (alt 3) [MARKET 2.XLS]alt 3 - Cell: D128
Summary: Certainty Level is 98.90% Certainty Range is from 0.00 to 8 $ Million Display Range is from -500.00 to 4,000.00 $ Million Entire Range is from -306.46 to 4,649.48 $ Million After 1,000 Trials, the Std. Error of the Mean is 27.02 Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Value 1000 1,634.67 1,573.79 --854.46 730,093.53 0.33 2.71 0.52
Range Minimum Range Maximum Range Width Mean Std. Error
-306.46 4,649.48 4,955.94 27.02
Forecast: Total NPV (alt 3) 1,000 Trials
.027
Frequency Chart
2 Outliers
27
.020
20.2
.013
13.5
.007
6.75
.000 -500.00 625.00 1,750.00 2,875.00 4,000.00
0
Certainty is 98.90% from 0.00 to $ Million
Forecast: Total NPV (alt 3) (cont'd)
[MARKET 2.XLS]alt 3 - Cell: D128
Summary: Display Range is from -2.0000e+0 to 0.0000e+0 utils Entire Range is from -2.1425e+1 to -6.4206e-21 utils After 1,000 Trials, the Std. Error of the Mean is 2.2924e-2
Statistics: Trials Mean Median Mode Standard Deviation Variance Skewness Kurtosis Coeff. of Variability Range Minimum Range Maximum Range Width Mean Std. Error CE=
Value 1000 -5.4238E-02 -1.4627E-07 --7.2492E-01 5.2550E-01 -2.6248E+01 7.5940E+02 -1.3365E+01 -2.1425E+01 -6.4206E-21 2.1425E+01 2.2924E-02 291.4367
Assumptions
Assumption: C26
Cell: C26
C26
Lognormal distribution with parameters: Mean 5.0% Standard Dev. 1.5% Selected range is from 0.0% to 19.5%
Mean value in simulation was 5.0% Correlated with: D26 (D26)
2.0%
4.4%
6.8%
9.2%
11.6%
0.50
Assumption: D26
Cell: D26
D26
Lognormal distribution with parameters: Mean 6.0% Standard Dev. 1.6% Selected range is from 0.0% to 24.7% Mean value in simulation was 6.1% Correlated with: C26 (C26) E26 (E26)
2.6%
5.2%
7.7%
10.2%
12.7%
0.50 0.40
Assumption: E26
Cell: E26
Lognormal distribution with parameters: Mean 6.5% Standard Dev. 1.8% Selected range is from 0.0% to 20.0% Mean value in simulation was 6.6% Correlated with: D26 (D26) F26 (F26)
Assumption: F26
E26
2.8%
5.6%
8.5%
11.3%
14.2%
0.40 0.50
Cell: F26
F26
Lognormal distribution with parameters: Mean 7.0% Standard Dev. 2.0% Selected range is from 0.0% to 22.0% Mean value in simulation was 7.0% Correlated with: E26 (E26) G26 (G26)
2.9%
6.1%
9.3%
12.4%
15.6%
0.50 0.50
Assumption: G26
Cell: G26
G26
Lognormal distribution with parameters: Mean 6.0%
Standard Dev.
2.2%
Selected range is from 0.0% to 27.6% Mean value in simulation was 6.0% Correlated with: F26 (F26) H26 (H26)
1.9%
5.5%
9.1%
12.7%
16.3%
0.50 0.20
Assumption: H26
Cell: H26
H26
Lognormal distribution with parameters: Mean 5.0% Standard Dev. 3.1% Selected range is from 0.0% to 20.0% Mean value in simulation was 4.9% Correlated with: G26 (G26) I26 (I26)
Assumption: I26
0.8%
6.5%
12.1%
17.8%
23.5%
0.20 0.60
Cell: I26
I26
Lognormal distribution with parameters: Mean 4.5% Standard Dev. 2.5% Selected range is from 0.0% to 18.0% Mean value in simulation was 4.5% Correlated with: H26 (H26) J26 (J26)
0.8%
5.3%
9.7%
14.2%
18.6%
0.60 0.40
Assumption: J26
Cell: J26
J26
Lognormal distribution with parameters: Mean 4.5% Standard Dev. 2.6% Selected range is from 0.0% to 20.0% Mean value in simulation was 4.6% Correlated with: I26 (I26)
0.8%
5.5%
10.1%
14.8%
19.5%
0.40
End of Assumptions
Bibliography
Blackley, Neil and Tom Watts. The Global Satellite Marketplace. Ready for Take-Off. Merrill Lynch Global Communications. April 1997.
Kelic, Andjelka, Graeme Shaw, and Daniel Hastings. Comparative Study of the Astrolink, CyberStar, Spaceway, Teledesic, and VoiceSpan Satellite Communication Systems Using a Cost per T1 Minute Metric. Space Systems Laboratory. Department of Aeronautics and Astronautics. Massachusetts Institute of Technology. January 6, 1997.
Watts, Thomas W., and David A. Feedman. Satellite Communications. Instant Infrastructure. Bear Stearns Equity Research. November 5, 1996.
Ka-Band Services and Requirements. Prepared by the Communications Center for Lockheed Martin. March 1996.
36