What They Say
SES, the bellwether for the satellite broadcast industry, reported its financials and noted that the video division was down 7% YoY although revenue from its HD+ service and Sports and Event business grew. Overall, the firm made €168 million (up 11%) on sales of €888 million (-3.3%) as the network business increased in size and revenue share to €387 million.
As at June 30th 2022, SES delivered 8,028 total TV channels to 366 million TV homes around the world, including 3,092 High Definition TV channels. 72 per cent of total TV channels are broadcast in MPEG-4, with an additional 6 per cent broadcast in HEVC.
What We Think
The momentum in the broadcast business makes you think if you are used to the world of PC or internet speed change. It’s amazing that 22% of the SES channels are still in MPEG-2! The firm has made a lot of efforts to move towards more of a networking model and this is keeping it with a future, but long term, the firm knows that the writing is largely on the wall for the satellite business, although there are still plenty of places in the world where broadband is still to be widely and cheaply available and those areas are still likely to want access to satellite linear TV, which is very efficient (much more efficient than broadband in power consumption delivery of linear video, for example). And many of the homes that SES gets to are via a satellite back end to a local cable or other distribution channel.
SES is also, of course, enabling some of that broadband access. As an HP CEO once said “I have to eat my own lunch before somebody else does”.
I would guess that there may come a point when technology for video distribution needs to be upgraded, but it may be hard to justify by then if the markets are shrinking.
If you are interested in satellites, there are some useful stats and background in 
SES_Roadshow_Presentation_May2022.pdf. (BR)
Data Northern Sky Research (June 2021) – source SES Investor Presentation
