Tata Group firm Nelco partners with Telesat; In Talks to offer Satellite Broadband

Nelco, a Tata Group company, is talking with Teleset, a Canadian LEO operator, to sign a pact to launch satellite broadband services in India. The pact will launch the said service under the latter's Lightspeed brand; this will thrust the partnership headlong against the likes of OneWeb, Starlink and Project Kuiper.

Tata Group Looking to Expand Horizons to Satellite Broadband

PJ Nath, MD, Nelco, said, "Nelco and Telesat will have a master services agreement (MSA) to provide Lightspeed LEO (low-earth orbit) satellite services in India… we are in the process of finalising details of the commercial arrangements". However, he added that the company did not have any plans to float a JV with Telesat.

This move will make Teleset the fourth global LEO satellite operator after OneWeb, Starlink and Project Kuiper; the latter preparing to enter the Indian market. Just like the rest of them, the satellite broadband services Telesat will offer will also use the 28 GHz band.

This pact will see the companies operate in a B2B model in India. Therefore, it will offer backhaul to telcos for regions with weak telecom infrastructure. Nath said, "our focus segment is B2B, and main markets would be cellular backhauls/mobility, remote village connectivity and (meeting) enterprise needs for reliable connectivity with fibre-like latency in rural areas via satellite". He also added that the companies will file for various approvals required to operate a satellite broadband service in India. More importantly, the companies will seek landing rights, as the upcoming Spacecom policy allows for companies to have local satellite gateways.

The Canadian company has plans to invest almost $5 billion to build a constellation with 298 satellites. Also, Telesat plans for a commercial launch in 2024. However, its competitors, Starlink and OneWeb, already have satellites in orbit, and have a significant head start over it.

Satellite Broadband Gaining Momentum in India

Experts see Indian satcom space as a $1 billion annual revenue opportunity. As such, this partnership comes as a move to gain the early mover advantage. So far, about 75% of Indian rural landscape has no access to broadband. Therefore, LEO has long been seen as an alternative to install ground-based network to deliver connectivity.

Sabyasachi Majumdar, group head, ICRA, said, “satellite communications was traditionally marred by low speeds and high latency rates, but new-gen LEO satellites have overcome these issues". He said that if the operating environment becomes favorable, India’s satcom user base can reach 1.5-2 million by 2025; it will also generate ₹5,000-6,000 crore of revenue annually.

The new Spacecom policy has been long overdue; the policy will frame licensing rules for LEO players and provide clarity on installing in-country satellite gateways. The industry also expects 100% FDI via automatic route in satcom, via the Spacecom policy.

The industry is wary of the Department of Space’s current role as licensor, regulator and operator; it says this will cause a conflict of interest with private satellite builders and satcom service providers. However, the industry remains confident that the policy will address these worries.