Bahrain: Brave New World: The Satellite Industry In The Middle East And North Africa (MENA)

Last Updated: 10 March 2010
Article by Sonya Shaykhoun

Introduction

The multi-billion dollar satellite industry is an area that has seen phenomenal growth in the private and public sectors in the last fifty years and is expected to continue to grow for the foreseeable future. What makes such growth particularly remarkable is that the satellite industry is extremely expensive: satellite projects (i.e., manufacture, launch and insurance of one satellite) typically require upfront investment of at least one hundred million US Dollars. The commercial satellite industry is particularly active. While North America and Western Europe have the largest commercial satellite transponders, the MENA Region, South Asia and Latin American markets, and to a certain extent emerging markets such as China, Brazil and Indonesia, are fast developing. In light of these rapid developments, this article provides a snapshot of the satellite industry with a particular focus on the commercial telecommunications sector in the MENA region and a survey of the pertinent international and regional legal and regulatory framework.

History of Satellites

The "Space Age" began in the mid-1950s. The Russians launched the first satellite, Sputnik 01, in October 1957 and sent Laika, a dog, into orbit less than a month later. Intelsat launched the first communications satellite, the "Earlybird", in 1965 and a mere four years later, the first man landed on the moon on July 21, 1969. During the 1970s and 1980s, Japan, China, the UK, Brazil, Mexico and Luxembourg all launched their first satellites.

In 1985, the first satellite launched in the MENA region was Arabsat-1A by the Arab Satellite Communications Organisation (Arabsat), which was founded by the twenty-one members of the Arab League in 1976. Arabsat owns and operates four satellites in the MENA region at 26º and 30.5º East – touted as the youngest and fastest growing satellite fleet in the MENA region, launching one satellite per year over four years from 2008.

Nilesat, the Egyptian Satellite Company, has two satellites, Nilesat 101 and Nilesat 102 at 7º West and has additional space capacity on Nilesat 103 (Atlantic Bird 4) at the same orbital position. Both Arabsat and Nilesat, the mainstays of the MENA satellite industry, provide the gamut of satellite services, as does relative new-comer Noorsat, a global communications company headquartered in Bahrain. By 2011, SmartSat, a recently formed alliance between a Jordanian and a Kuwaiti company, hopes to have launched the MENA region's first privately owned satellite.

A brief overview: Satellite facts

A satellite is an object that has been placed into orbit through human effort using a launch vehicle from a country authorised to launch spacecraft. A communications satellite comprises dozens of transponders, which are wireless devices that pick up and automatically respond to an incoming signal and typically has a "lifespan" of up to fifteen years. Upon its expiration, it could be replaced with a new satellite and the original satellite is relocated to a higher orbit (hence the term "space junk"). According to statistics published by NASA, the US space agency, there have been about 4000 satellite launches, several hundreds of which are reportedly still active.

Satellites serve a variety of purposes including military / espionage, earth observation, all manner of communications, navigation, weather and research. Satellites are even used to monitor global warming. In January 2009, Japan launched the Ibuki satellite, a satellite tasked with monitoring gases in the Earth's atmosphere, from the Tanegashima Space Center on an island south of Kyushu in southern Japan. In February 2009, NASA launched the Orbiting Carbon Observatory (OCO) designed to monitor carbon dioxide in the Earth's atmosphere, however, it failed to reach orbit.

In a communications context, satellites facilitate live digital TV broadcasts (including HDTV), emergency communications and real time communications to and from ships at sea and airborne aircraft alike. Because satellites have a large "footprint" (i.e. the ground area that the satellite transponder covers) and require less infrastructure than cable and other traditional telecommunications networks, satellite communications systems can reach even the most remote geographical areas without negatively impacting the environment (i.e. satellites use solar energy and emit zero carbon).

Commercially speaking, uses such as direct-to-home (DTH), broadband and video services are driving the growth while cellular backhaul, maritime and other mobile services are coming to the fore. There has also been an increased demand for broadband and fixed satellite services (FSS) provision. The International Telecommunications Union (ITU), the leading UN agency for information and communication technology issues, reported that commercial capacity leasing will cause revenues to grow and that an estimated 83 per cent of transponders leased in the future will be for video distribution and DTH services and occasional use by television broadcasters. Research shows that the satellite industry generated USD 8.33 billion in 2007 which is expected to grow to USD 12.90 billion in 2017. In the MENA region alone, commercial satellite-lease revenues have grown 17 per cent per year since 2003.

Brief survey of the law and regulation of satellites

Original pre-Space Age legislation concerned the use of the radio-frequency spectrum and the emphasis vis-à-vis frequency management on an international basis was on national sovereignty. In the Space Age, the United Nations aimed to establish a global principle ensuring that the benefits of space exploration and use should be extended to all mankind without reference to wealth or might, a concept that is encapsulated in Article 1 of the Outer Space Treaty adopted by the General Assembly in its resolution 1962 (XVIII) of 13 December 1963. Article 1 informs the current regulation of satellite communications with regard to the use of radio spectrum and orbital positions. The regulation of the satellite industry, which is increasingly commercial, is a delicate balance between public and private interests and is inherently political.

Satellite regulation is a complex enterprise with international, regional and national layers. The regulation of the technical aspects of radio-frequency use falls under the ambit of the ITU. Government representatives must go through the ITU with respect to negotiation, agreement and monitoring of technical matters such as satellite positions and frequencies. Other layers of regulation are based in the constitution of international organisations, such as the International Mobile Satellite Organisation (IMSO), EutelSat IGO and the International Telecommunications Satellite Organisation (ITSO), providing satellite telecommunications.

In the MENA region, there are a few organisations that provide guidance and regulate the satellite telecommunications industry. In the past, the Arab Telecommunications Union (ATU), which became defunct in 1980 in conjunction with Egypt's ejection from the Arab League for political reasons (although Egypt was readmitted in 1989), aspired to unify Arab telecommunications policy. As regards the ITU, MENA countries fall into Regions D (Africa) and E (Asia and Australasia) in terms of regulation of radio communications, a split that was accepted in 1997 by a meeting of Arab ministers in Damascus, presumably for tactical reasons.

Other bodies that participate in the regulation of satellites/telecommunications in the MENA region are the ITU's Arab Regional Office (ARO) in Egypt, established in 1991; Arabsat and the Arab States Broadcasting Union (ASBU) which give certain rights and responsibilities that are tantamount to regulation.

ASBU, a not-for-profit professional organisation, promotes a range of initiatives, including the development of "the spirit of Arab brotherhood", representing member-organizations, coordinating and defending the positions and interests of Arab states in the international arena. ASBU's activities focus on engineering, radio, sports and television broadcasting, as well as inter-Arab and international cooperation. With regard to inter-Arab cooperation, ASBU both cooperates with the Arab League's specialised agencies and monitors the progress of joint projects and implements resolutions and recommendations issued by the Arab Information Ministers Council and the Arab Information standing Committee issue.

The Arab League, founded in Cairo in 1945, is a voluntary organisation, comprised of independent primarily Arabic-speaking countries, whose self-proclaimed objective is to "build ties among the member states, coordinate their policies and promote their common interests." The Arab League is involved in programs of a political, economic, cultural and social nature of interest to its members. Recently, this interest extended to satellite TV broadcasting, an area which had, until recently, escaped regulation.

In February 2008, the Arab League met in Cairo and produced the Arab League Satellite Broadcasting Charter to provide guidelines for the ever-increasing number of free-to-air and encrypted satellite channels broadcasting in MENA (e.g. from 13 in 1993 to 400 in 2008). All Arab League states signed the Charter except for Qatar and Lebanon (decisions of the Arab League are only mandatory for those members who sign them). The Charter's aim is to provide "the frameworks and principles required for organising broadcasting and audio visual satellite reception in the Arab world". The Charter sparked controversy because, although it advocates broad principles such as the right to "express opinions, preserve Arab culture and promote cultural dialogue through satellite broadcasting" (Article 1) and requires compliance with "religious and ethical values of Arab society and maintain its family ties and social integrity" (Article 6), it does have teeth as a non-compliant broadcasting entity risks losing its licence in its home country.

Dissenting views bemoaned the threat to public freedoms they believed the Charter poses, particularly given the wide interpretation governments can give to these core principals. In the two months immediately after the signature of the Charter, Egypt closed down three satellite TV channels and confiscated satellite transmission equipment thus preventing the broadcast of forty channels, including Al Jazeera, Dubai TV and France TV.

Conclusion

The satellite industry is as diverse as it is complicated. In the MENA region, the satellite communications industry is a booming industry that owes its development not only to globalisation but to cultural, technical, financial and geographical factors. As more satellites are launched and more services are available to a wider audience, regional satellite regulation may very well undergo further adaptation to reflect the crowded brave new world of satellite TV, radio and Internet as well as the possible necessity of introducing competition laws as the industry continues to develop at its current quickened pace.

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions