ERIC Number: ED305044
Record Type: Non-Journal
Publication Date: 1988-Nov-1
The Mobile Satellite Services Market.
Mobile satellite (MSAT) technology is the basis for a new component of the telecommunications industry capable of providing services to small inexpensive subscriber terminals located almost any place in the world. The market for MSAT space segment capacity (bandwidth and power) is a natural monopoly that can be logically and technically distinguished from the market for MSAT services. The production of services relies on satellite power and bandwidth as factor inputs. From a social welfare perspective it is advantageous that the market for services be competitive to generate incentives for firms to probe the cost and demand surfaces of the service space. The demand for services is defined by subscriber choices in two distinct markets. The initial choice involves the selection of a terminal, determined by a tradeoff between price, functionality, and the price of usage, which may vary for terminal types. The subscriber then chooses among service offerings subject to the constraints imposed by the technical attributes of the terminal. The "physical" layer service standards, which specify terminal antenna gain, modulation, and error-correction coding, are evaluated in an engineering-economic analysis that models the variable cost of producing basic communications capacity. The demand for MSAT is considered in two parts: a reservation price for the subscriber terminal and the demand for usage. The demand for usage is a function of a vector of quality attribute variables. Of these, channel throughput (measured in bits per second), because of its importance for the supply of digitalized voice quality, is isolated as the most crucial to the determination of a subscriber's terminal reservation price as well as the subscriber's usage demand. The text is supplemented by eight figures and an appendix presents representative power budgets for a global beam mobile satellite link. (33 references) (Author/EW)
Publication Type: Opinion Papers; Reports - Research; Speeches/Meeting Papers
Education Level: N/A
Authoring Institution: N/A