Analysis Impact Due To 3,5 GHz Frequency Spectrum Implementation for 5G Technology: The Business Valuation of
Satellite Operator
Ageng Kharisma Putri1, Imo Gandakusuma1
1 Faculty of Economics and Business, University of Indonesia, Jakarta, Indonesia
*Corresponding Author: [email protected]
Accepted: 15 July 2021 | Published: 1 August 2021
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Abstract: Customer demands for higher data rates and lower latency demand technological evolution. Thus, driving the evolution of mobile technology from 4G to 5G. Mobile operators believed that 5G could offer high-speed internet networks for their users. However, due to the limited frequency spectrum, the Government needs to reallocate the frequency spectrum for the 5G implementation. One of the frequency spectrum candidates for the 5G implementation is the 3,5 GHz frequency spectrum. But, currently, this frequency is allocated for satellite as Extended C-Band. Satellite operators may no longer use Extended C-Band due to the interferences impacting the satellite operators' business. Satellite operators will suffer from losses since they lost their business opportunities. With frequency reallocation, it is necessary to provide fair compensation to satellite operators to avoid such losses under government regulations. This research contributes to formulation compensation for satellite operator to avoid loss in their business.
Keywords: satellite, 5G, 3,5 GHz spectrum frequency, compensation
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1. Introduction
Satellites are a significant component in telecommunications because many terrestrial technologies rely on or at least interact with satellite services. Satellite-based systems provide distinct and complementary capabilities for terrestrial networks. One of the advantages of a satellite is that it can reach unreachable areas by other telecommunications infrastructures, such as copper cables, microwaves, and fibreoptic networks (Acker et al., 2020). Future terrestrial and mobile networks will rely on satellites for cost-efficient multicast of high-bandwidth data streams and high-definition media, delivering a next-generation converged service experience to consumers in the most effective way (Acker et al., 2020).
At the end of 2019, the total number of people using mobile services and the internet in Indonesia is 196,71 million from Indonesia's total population of 266,91 million, or around 73,7% (APJII, 2020). Increased demand of consumers in the mobile technology with high data rate has driven the development of 5G technology. 5G technology in Indonesia is expected to launch in 2023 (Kominfo, 2020).
Indonesia, represented by the Ministry of Communication and Informatics (Kominfo), is currently making studies and conducting experiments in allocating frequency spectrum for 5G technology in Indonesia. Kominfo already has a frequency spectrum candidate for 5G implementation in the low, middle, and upper-frequency bands (Mustakim, 2019). One of the
most widely recommended spectrum frequencies for 5G is 3,5 GHz spectrum frequency.
(Radio & Management, 2018).
Unfortunately, in Indonesia, the 3,5 GHz spectrum frequency is currently being allocated for fixed satellite services as Extended C-Band downlink frequencies (Menteri Komunikasi dan Informatika Republik Indonesia, 2018). Extended C-Band and C-Band frequencies are very important for telecommunications for the satellite industry, especially in Indonesia and other tropical areas with high rainfall (Setiawan & Aksah, 2017).
5G technology implementation on 3,5 GHz spectrum frequency will cause interferences on the satellite services on the Extended C-Band frequency (Setiawan & Aksah, 2017). There is a possibility that satellite operators may no longer use extended C-Band frequency. Hence, the satellite operators may lose the business opportunity on this frequency. Under government regulations, there is compensation for satellite operators due to this frequency reallocation (Kominfo, 2000). This study will focus on the impact of the 5G implementation at the 3,5 GHz frequency spectrum on satellite operators and calculate the compensation to close the financial gap because of lost business opportunities.
2. Literature Review
Spectrum Frequency Usage in Indonesia
The regulation and management of Indonesia's spectrum frequency are performed by the Minister of Communication and Informatics of the Republic of Indonesia (KOMINFO).
KOMINFO has assigned spectrum frequencies by issuing licenses to a specific user for specific purposes, limiting access to and using the spectrum frequency. KOMINFO has set the spectrum frequency in the ministry's regulation number 13 of 2018 to allocate Indonesian radio spectrum frequencies. Based on the regulation, a 3,5 GHz spectrum frequency is given for fixed satellite services called Extended C-band.
Indonesian satellites are satellites that use Indonesian satellite filling (Kominfo, 2014). Based on ASSI (Indonesia Satellite Association), Indonesia currently has six satellites that use Indonesian satellite filling. Satellite services using the Extended-C and C frequency bands are widely used in Indonesia by Indonesia's natural characteristics, including high rainfall and humidity (Setiawan & Aksah, 2017). Using this frequency can provide a good level of service availability, usually used for banking, military, and critical missions. The capacities used in the current Extended C-Band frequency for Indonesian Satellites are as follows:
Figure 1: Extended C-Band Utilization Utilized
66%
Idle 34%
Utilized Idle
Spectrum frequency management for 5G technology is a critical issue for its implementation.
KOMINFO already has a frequency spectrum candidate that will be used for 5G implementation in the lower band, middle band, and upper band. Currently, KOMINFO is focusing on the middle band at a frequency of 2,6 GHz and 3,5 GHz. The middle band frequency spectrum is needed to become the umbrella network that ensures the mobility of mobile users (Mustakim, 2019).
Valuation for Analysis Impact and Sensitivity Analysis
The definition of valuation in general is a process in which a monetary valuation of a good or service is carried out by considering all aspects. Valuation can be used for various reasons, including valuation can be used in determining decisions related to the company's business development, besides that it can also be used to calculate potential losses. This research will use replacement cost and discounted cash flow (DCF) method for valuation.
The replacement cost is the amount that must be paid by an entity to replace the asset at its present value. Using this method, the researcher looks at the business operating assets and assigns a value based on how much it costs to replace them. The DCF method is a method of valuing a project, company, or asset using the concept of the time value of money (time value of money).
It is necessary to identify the projected revenue received by satellite operators and all satellite operating costs to see the satellite operator's net income to calculate the valuation using the DCF method. Also, you must take into account the initial outlay and depreciation of the satellite.
It is necessary to identify the number of satellite services using the Extended C frequency spectrum and all earth stations used for that service to calculate the replacement cost. The costs required including:
1) Costs incurred only once at the beginning
a. The cost of replacing and adding equipment at all affected earth stations as capital expenditure (CAPEX)
b. Cost of re-pointing the antenna for operational expenditure (OPEX one-time charge) 2) Cost incurred continuously every year (operational expenditure) is the cost of leasing a
satellite transponder using another frequency spectrum (assuming the satellite transponders on the satellite are fully utilized).
Analysis of the impact of implementing 5G at a frequency of 3,5 GHz is carried out by comparing two models of calculating the satellite business valuation. Model 1 calculation is the calculation of the satellite business valuation where the satellite is still normally operating.
Model 2 calculation calculates the satellite business valuation after the implementation of 5G at a frequency of 3.5 GHz. The difference between the calculations of Model 1 and Model 2 is that there is a replacement cost component. A change in the profitability ratio of the satellite operator's business can be seen by comparing the two models.
The next step is to calculate compensation using sensitivity analysis. The principle of sensitivity analysis is based on changes in input in the model and observing changes in model output. Here are the steps for conducting a sensitivity analysis:
1) Determine the basis of the model
2) Specify the different parameters that can be selected to vary in the model 3) Observing changes in value
The sensitivity analysis is performed by considering replacement cost variations in the net income margin. Therefore, the compensation per year is determined for the sensitivity analysis.
3. Method
This research adopted the qualitative method. A case study research is conducted to understand the effect of implementation 5G technology using 3,5 GHz spectrum frequency. This case study research is necessary due to its impact on the satellite industry since the satellite's 3,5 GHz spectrum frequency is already used.
This research was conducted at the stated own companies in Indonesia, which operate telecommunication satellites using a 3,5 GHz spectrum frequency. The data used in this research are based on each satellite. This research featured data from the year satellite launched to 2020.
The calculation of the impact of re-allocation of the 3,5 GHz frequency, which was previously used for satellites, is then transferred to 5G technology depending on the quantity of 3,5 GHz frequency usage on the satellite and the remaining lifetime of the satellite. The longer the satellite's life remains, the greater the impact on operators because they have to bear the same depreciation burden every year. Still, satellites cannot provide the same revenue because there are transponders with a frequency of 3,5 GHz that cannot be used.
Model 1 calculation is the calculation of the satellite business valuation where the satellite is still normally operating. The implementation of 5G technology on the 3,5 GHz frequency spectrum is that there are transponders on satellites and equipment on earth stations that cannot be used, so that satellite operators cannot provide services on these frequencies. In contrast, the current condition of satellite operators has had contracts and provided services to the customer.
To continue providing services to subscribers who currently use the 3,5 GHz frequency spectrum, satellite operators need to move the service to another frequency spectrum. The transfer will incur a cost, which in this study is called the replacement cost.
This fee will certainly be an additional burden for satellite operators, which will affect the valuation and performance of its business. The calculation of the valuation with this additional cost will be carried out in the calculation of Model 2, where the replacement cost will be included in the cost structure for each satellite year.
Then the compensation is calculated by considering the costs incurred each year and comparing it with the valuation of the business under normal conditions. After the compensation is obtained each year, the values are then presented to get one compensation value at the beginning of the 5G implementation.
4. Discussion
To begin the calculation, we need to know all the necessary information on sales projections, revenue projections, cost projections, and depreciation per year.
Sales data for 2017 to 2020 are real data obtained from satellite operators, while data from 2021 to the end of the satellite's life span is a projection. The sales projections that is presented in MHz unit can be seen in the Table 1.
The revenue comes from lease revenue for monthly, annual and occasional periods of transponder capacity to satellite service providers. Rates usually vary based on the length of the lease, the size of the rental capacity, the satellite's age, and the satellite's capabilities.
However, in this study, one transponder tariff will be used, which refers to the market price from the results of interviews with satellite operators, namely:
- Standard C-Band : USD 1500/ MHz / month - Extended C-Band : USD 1280 / MHz / month - Ku-Band : USD 1000 / MHz / month
Based on data from Northern Sky Research, there will be a price erosion of satellite transponders on the C-Band and Extended C-Band frequency spectrum by an average of 2,3 percent and the Ku-Band frequency spectrum an average of 4,3 percent. This price erosion will be considered in the calculation and presented in the Table 2. After knowing the price of each transponder, we can calculate the revenue that is presented in the Table 3.
The main components of satellite operating costs are for staff and infrastructure (hardware and software) for monitoring and satellite maneuvering. Based on the Futron survey, the cost of operating one satellite for is USD 1.250.000 per year.
In addition to satellite operating costs, there are components of non-tax fees that telecommunications service providers must pay to the government based on Indonesian Government Regulation Number 80 of 2015. Satellite operators must pay telecommunications service provision rights fees 0,5 percent of the company's gross revenue, Telecommunications Universal Service Obligation Contribution (USO) 1,25 percent of the company's gross revenue, and radio station license fee. The cost of the radio station license fee is USD 98.316, which calculated from formulas as stated in Indonesian Government Regulation Number 80 of 2015.
Service provision right fee, USO, and radio station license fee are paid annually. The cost projections can be seen in the Table 4.
The depreciation value is calculated using the straight-line method by dividing the price of the satellite by the lifetime of the satellite. In this research, the satellite price is USD 199.700.000, divided by the satellite lifetime, which is 15 years, equals USD 13.313.333 per year.
After obtaining the income and expense calculations and accompanied by depreciation, we can calculate the profit and loss projections for Model 1. This Model 1 profit and loss projection can be seen in the Table 5.
Table 1: Sales Plan Projections in MHz
Sales Plan 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
C Band 19,20 22,29 17,13 21,31 21,36 21,36 21,36 21,36 21,36 21,36 21,36 21,36 21,36 21,36 21,36 Ext C Band 9,60 9,39 7,73 11,50 11,52 11,52 11,52 11,52 11,52 11,52 11,52 11,52 11,52 11,52 11,52 Ku Band 10,40 9,32 11,62 11,38 11,44 11,44 11,44 11,44 11,44 11,44 11,44 11,44 11,44 11,44 11,44
Table 2: Price Erosion in Thousand USD
Price 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
C Band 1,50 1,50 1,50 1,50 1,47 1,43 1,40 1,37 1,34 1,30 1,27 1,25 1,22 1,19 1,16 Ext C Band 1,28 1,28 1,28 1,28 1,25 1,22 1,19 1,16 1,13 1,11 1,08 1,06 1,03 1,01 0,99 Ku Band 1,00 1,00 1,00 1,00 0,96 0,92 0,88 0,84 0,80 0,77 0,73 0,70 0,67 0,64 0,62
Table 3: Revenue Projections in Thousand USD
Revenue 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
C Band 12.442 14.444 11.100 13.809 13.523 13.212 12.908 12.611 12.321 12.038 11.761 11.490 11.226 10.968 10.716 Ext C Band 5.288 5.172 4.258 6.334 6.199 6.057 5.917 5.781 5.648 5.518 5.391 5.267 5.146 5.028 4.912
Ku Band 4.493 4.026 5.020 4.916 4.729 4.524 4.329 4.142 3.963 3.792 3.628 3.471 3.321 3.178 3.040 Total
Revenue 22.222 23.642 20.378 25.059 24.451 23.793 23.154 22.534 21.932 21.348 20.780 20.229 19.694 19.174 18.668
Table 4: Cost Projection in Thousands USD
Cost 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Operation
Cost 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250
USO 278 296 255 313 306 297 289 282 274 267 260 253 246 240 233
Service
Provision Fee 111 118 102 125 122 119 116 113 110 107 104 101 98 96 93
Radio License
Fee 98 98 98 98 98 98 98 98 98 98 98 98 98 98 98
Total Cost 99.956 1.762 1.705 1.787 1.776 1.765 1.754 1.743 1.732 1.722 1.712 1.702 1.693 1.684 1.675
Table 5: Model 1 Profit and Loss Projections in Thousand USD
Profit & Loss 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
EBITDA 20.485 21.880 18.673 23.272 22.675 22.028 21.401 20.792 20.200 19.626 19.068 18.527 18.001 17.490 16.993 EBITDA
Margin 92,18% 92,55% 91,63% 92,87% 92,74% 92,58% 92,43% 92,27% 92,10% 91,93% 91,76% 91,58% 91,40% 91,22% 91,03%
Depreciation 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 EBIT 7.172 8.567 5.360 9.959 9.361 8.715 8.087 7.478 6.887 6.313 5.755 5.213 4.687 4.176 3.680
Tax 1.793 2.142 1.340 2.191 2.059 1.917 1.617 1.496 1.377 1.263 1.151 1.043 937 835 736
NI 5.379 6.425 4.020 7.768 7.302 6.798 6.470 5.983 5.509 5.050 4.604 4.171 3.750 3.341 2.944 NI Margin 24,20% 27,18% 19,73% 31,00% 29,86% 28,57% 27,94% 26,55% 25,12% 23,66% 22,16% 20,62% 19,04% 17,43% 15,77%
The impact of implementing 5G technology on the 3,5 GHz frequency spectrum is that there are transponders on satellites and equipment at ground stations that satellite operator cannot use, so that satellite operators cannot provide services on these frequencies, while the current condition is that satellite operators have contracts and provide services to the customer. To continue to provide services to customers who currently use the 3,5 GHz frequency spectrum, satellite operators need to move the service to another frequency spectrum. The transfer will incur costs, which in this study are called replacement costs.
One-time CAPEX fee is the cost that the operator must incur to continue providing services for customers. Customers who use the Extended C-Band frequency spectrum needs to replace the LNA and add filters, and cost of re-pointing the antenna to direct the antenna to another satellite. Meanwhile, customers who use the C-Band frequency spectrum only need to replace the LNA and add filters. For customers using the Ku-Band frequency, there is no change. This cost only incurred in the beginning of the 5G implementation. One-time CAPEX fee is described below in the Table 6.
Table 6: One-Time CAPEX fee in Thousands USD Frequency
Band
Number of Remotes
Number
of Hubs LNA Filter Installation Cost
Repointing Cost Total Remotes Hubs
Ext C Band 171 25 134 126 94 88 64 506
C Band 16096 15 11.035 10.367 7.724 29.127
Total 29.633
There is another cost that needs to be carried out continuously every year (operational expenditure) called transponder lease fee. This cost is for leasing C-Band transponders to replace Extended C-Band transponder, assuming the transponders on the satellite have been fully utilized. This fee will be an additional cost every year for satellite operators in calculating cash flow.
The cost projection in Model 2 will add a replacement cost consisting of a CAPEX one-time charge and a transponder lease fee. Model 2 cost projection is presented in the Table 7.
After obtaining cost projections in Model 2, then we can calculate a profit and loss in this model, then compare it to the Model 1. The Model 2 profit and loss is presented in Table 8.
The comparison between Model 1 and Model 2 profit and loss is that there is a decline in business performance, marked by the decrease in EBITDA margin and net income margin.
Compared to Model 1, the reduction that occurred was quite significant, with an average decline in the EBITDA margin of 44,9 percent per year and a moderate decrease in net income margin of 35,9 percent per year, where the most significant drop occurred in 2023 in early 5G implementation.
Table 7: Model 2 Cost Projections in Thousand USD
Cost 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
Operation
Cost 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250 1.250
USO 278 296 255 313 306 297 289 282 274 267 260 253 246 240 233
Service
Provision Fee 111 118 102 125 122 119 116 113 110 107 104 101 98 96 93 Radio
License Fee 98 98 98 98 98 98 98 98 98 98 98 98 98 98 98
One Time
Charge - - - - - - 29.633 - - - - - - - -
Transponder
Lease Cost - - - - - - 6.962 6.802 6.645 6.492 6.343 6.197 6.055 5.915 5.779 Total Cost 1.737 1.762 1.705 1.787 1.776 1.765 38.348 8.544 8.377 8.214 8.055 7.899 7.747 7.599 7.454
Table 8: Model 2 Profit and Loss Projections in Thousand USD
Profit & Loss 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
EBITDA 20.485 21.880 18.673 23.272 22.675 22.028 (15.194) 13.990 13.555 13.134 12.725 12.330 11.946 11.574 11.214 EBITDA
Margin 92,18% 92,55% 91,63% 92,87% 92,74% 92,58% -65,62% 62,08% 61,80% 61,52% 61,24% 60,95% 60,66% 60,37% 60,07%
Depreciation 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 EBIT 7.172 8.567 5.360 9.959 9.361 8.715 (28.507) 677 242 (180) (588) (984) (1.367) (1.739) (2.099)
Tax 1.793 2.142 1.340 2.191 2.059 1.917 (5.701) 135 48 (36) (118) (197) (273) (348) (420)
NI 5.379 6.425 4.020 7.768 7.302 6.798 (22.806) 541 193 (144) (470) (787) (1.094) (1.391) (1.679) NI Margin 24,20% 27,18% 19,73% 31,00% 29,86% 28,57% -98,50% 2,40% 0,88% -0,67% -2,26% -3,89% -5,55% -7,26% -9,00%
Table 9: Model 2 Revenue Projections in Thousand USD
Revenue 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
C Band 12.442 14.444 11.100 13.809 13.523 13.212 12.908 12.611 12.321 12.038 11.761 11.490 11.226 10.968 10.716 Ext C Band 5.288 5.172 4.258 6.334 6.199 6.057 5.917 5.781 5.648 5.518 5.391 5.267 5.146 5.028 4.912
Ku Band 4.493 4.026 5.020 4.916 4.729 4.524 4.329 4.142 3.963 3.792 3.628 3.471 3.321 3.178 3.040
Compensation - - - - - - 57.665 10.452 10.544 9.400 8.954 8.526 8.116 7.729 7.354
Total
Revenue 22.222 23.642 20.378 25.059 24.451 23.793 80.819 32.986 32.477 30.748 29.734 28.755 27.810 26.902 26.022
Table 10: Model 2 Profit and Loss Projections After Compensation in Thousand USD
Profit & Loss 2017 2018 2019 2020 2021 2022 2023 2024 2025 2026 2027 2028 2029 2030 2031
1 2 3 4 5 6 7 8 9 10 11 12 13 14 15
EBITDA 20.485 21.880 18.673 23.272 22.675 22.028 41.462 24.259 23.915 22.369 21.523 20.707 19.920 19.168 18.439 EBITDA
Margin 92,18% 92,55% 91,63% 92,87% 92,74% 92,58% 51,30% 73,54% 73,64% 72,75% 72,38% 72,01% 71,63% 71,25% 70,86%
Depreciation 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 13.313 EBIT 7.172 8.567 5.360 9.959 9.361 8.715 28.148 10.946 10.602 9.056 8.209 7.393 6.607 5.855 5.126
Tax 1.793 2.142 1.340 2.191 2.059 1.917 5.630 2.189 2.120 1.811 1.642 1.479 1.321 1.171 1.025 NI 5.379 6.425 4.020 7.768 7.302 6.798 22.519 8.756 8.481 7.245 6.567 5.915 5.286 4.684 4.101 NI Margin 24,20% 27,18% 19,73% 31,00% 29,86% 28,57% 27,86% 26,55% 26,12% 23,56% 22,09% 20,57% 19,01% 17,41% 15,76%
From the above calculations, a minus net income margin is obtained due to additional costs borne by operators. Operators need to get additional revenue to maintain a minimum net income margin of the same as Model 1 to avoid losses. The calculation of compensation as additional revenue is carried out using sensitivity analysis to get the same net income margin as Model 1. This sensitivity analysis is carried out every year, starting from 5G implementation (2023) until the end of the satellite's lifetime. Model 2 revenue projections with additional compensation is presented in the Table 9.
Then again, we calculate the profit and loss calculation for Model 2 to see the effect of additional compensation on net income margin. The Model 2 profit and loss calculation after compensation is presented in Table 10.
From the results of the Model 2 profit and loss calculation, it can be seen that the addition of a compensation component to revenue can cover the loss of satellite operators due to replacement costs. In the end, we get the same percentage of net income margin for both Model.
Using the 5G timeline, which will be implemented in 2023, the satellite operator will get compensation in 2023. Assuming a satellite industry WACC of 10,57%, we can calculate the compensation calculation using the present value formula as presented in Table 11.
Table 11: Total Compensation
Year Compensation PV factor PV Compensation
0 57.665 1 57.665
1 10.452 0,904 11.556
2 10.544 0,818 12.891
3 9.400 0,740 12.707
4 8.954 0,669 13.383
5 8.526 0,605 14.091
6 8.116 0,547 14.831
7 7.729 0,495 15.616
8 7.354 0,448 16.429
Total Compensation 169.170
The total compensation for a satellite is USD 169.170.000
5. Conclusion
Our analysis has focused on the Extended C-Band because it has become the most affected frequency from the 5G implementation on the 3,5 GHz frequency. From the discussion above we can conclude that the 5G implementation on the 3,5 GHz frequency causes a decrease in business performance for satellite operators, with an average decline in the EBITDA margin of 44,9 percent per year and a moderate decrease in net income margin of 35,9 percent per year.
The minimum compensation for satellite operators in order to maintain their business is USD 169.170.000. Compensation calculations in this study are carried out by considering the technical cost factor only and can be differ for each satellite based on its remaining satellite life time and number of customers.
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