Very Small Aperture Terminal (VSAT) systems have been for many years and are still providing communication solutions. The traditional use is low-cost solutions for users in need to roll out a network covering a very wide area, which outspans the coverage of terrestrial technologies such as cellular and land-line technologies. Recently, many service providers are enabling broadband services through VSATs over HTS satellites.
One of the main drawbacks of the VSAT solution is the relatively high cost of the terminal, requiring a large antenna, RF and typically a non-standard modem which is implemented using costly and high power components. This disadvantage makes the solution inadequate for many applications. Even though prices have dropped dramatically over the year (30% of the cost every 10 years), prices of VSATs are still in the $300 range and represent a significant obstacle to wide adoption.
In this post, we present an evolution path which will make it possible to reduce the total cost of a VSAT terminal to within $100 range. The main building blocks for such a solution are based on new silicon SoCs for complete baseband modem system as well as the evolution of very low-cost antenna, and new technologies for the RF part such as single conversion ICs or direct RF-sampling ADCs and DACs.


Very Small Aperture Terminal (VSAT) systems have been for many years and are still providing communication solutions. The traditional use is low-cost solutions for users in need to roll out a network covering a very wide area, which outspans the coverage of terrestrial technologies such as cellular and land-line technologies, and it can and does provide communication solutions even in highly populated areas. But, in order to compete effectively with terrestrial alternatives, the cost of VSAT is yet to be reduced. The idea of low-cost VSAT has been discussed over the years, where the definition of “low cost” has always been half or less of the, then current, price. Recently, prices have reached a point close to $300, which is very good for enterprise applications but not good enough for users who want consumer broadband service (wherein ADSL and cable modem – terminal price is around $100).
In this post, we give a short description of the VSAT system, history, and terminal structure, provide an analysis of the main cost factors affecting its price and introduce a path towards cost reduction down to the $100 target.

What is a VSAT?

A VSAT (Very Small Aperture Terminal) is a name for a satellite terminal connecting to a central Hub (master station) over satellite, as depicted in Fig. 1. The name is given due to the small size of the antenna that started as 2.4m in C-band, dropped to around 1m in Ku-band and further down to 0.69m in Ka-band.


VSAT Terminal Elements

A typical VSAT station is shown below. it is composed of three main parts: antenna, outdoor unit (ODU) and an indoor unit (IDU). The (parabolic) antenna is normally mounted on the ground or on the roof top and its size varies depending on the frequency of operation. The antenna system comprises a parabolic reflector and a “feedhorn” mounted in its focal point. The indoor unit (IDU) functions as a modem and also interfaces with the end user equipment. Most modern IDUs include router functionalities which can provide many types of IP services.

Outdoor Unit (ODU)

The antenna system comprises a reflector, feedhorn and a mount. The feedhorn is mounted on the antenna frame at its focal point by support arms. The feedhorn is connected to two active elements via orthomode transducer (OMT) which enables the simultaneous transmission and reception

  • Block Up Converter (BUC) up-converts and amplifies the transmitted RF power towards the antenna dish.
  • Low Noise Block down converter (LNB) amplifies and down converts weak RF signals received from the satellite.

Both the BUC and LNB are connected to the IDU with RF connectors at lower, or Intermediate Frequency (IF), normally L-Band.

Inter-Facility Link (IFL)

The outdoor unit is connected to the indoor unit by a low loss coaxial cable. The typical limit of an IFL cable is about 300 feet. Most common coaxial cable types are RG-6 and RG-11 which are designed for outdoor installation and were meant to meet harsh environment conditions.

Indoor Unit (IDU)

The IDU consists of a modulator and a demodulator which superimpose or segregate the user traffic signal on an IF carrier signal, respectively. The IDU includes a processor that performs the necessary protocol conversion on the data to/from the customer end equipment. The IDU interfaces with the various end user equipment, ranging from stand-alone computers, LAN’s, routers, and telephone equipment as per the service requirement. The IDU is powered from the mains (AC or DC) and responsible for providing the appropriate DC power and a reference signal to the LNB and BUC through the IFL cables.

VSAT Pricing

If you look at the price point of VSATs over the years (Fig.3), one can see that the price dropped to roughly 30% every 10 years. Starting from the early 70s where the price was $35K per VSAT (California Microwave and the Alascom program), down to $300 in 2010. Several announcements of products and their announced price are presented on this chart. Many times, people ask if the price could go any lower, but it always did. The key question for this post is “where do we go from here”.

Brief History

Live satellite communications were developed in the sixties by the National Aeronautics and Space Administration (NASA), named Syncom 1-3. It transmitted live coverage of the 1964 Olympics in Japan to viewers in the United States and Europe. Soon after, on April 6, 1965, the first commercial satellite was launched into space, Intelsat I, nicknamed Early Bird. The first commercial VSATs were C-band (6 GHz) receive-only systems by Equatorial Communications using spread spectrum technology. More than 30,000 60 cm antenna systems were sold in the early 1980s. Equatorial later developed a C-band (4/6 GHz) two-way system using 1 m x 0.5 m antennas and sold about 10,000 units in 1984-85. In 1985, Schlumberger Oilfield Research co-developed the world’s first Ku-band (12-14 GHz) VSATs with Hughes Aerospace to provide portable network connectivity for the oil field drilling and exploration units. Ku Band VSATs make up the vast majority of sites in use today for data or telephony applications. The largest VSAT network (more than 26,000 sites) was developed by Spacenet and MCI for the US Postal Service.

The VSAT Paradigm Shift

Not much has happened since VSATs were introduced in 1984-1986 time frame. Still same bulk antenna, ODU, IDU and IFL cables. It’s true that the manufacturing technologies improved, new materials have been used and new RF components are used inside the ODU active elements (LNB and BUC), which led to price drop over the years as shown in VSAT pricing graph, above.

Biggest Issue – Professional Installation Cost

One of the highest cost factors is the terminal installation and commissioning. The “dream” install price was always $199. Actual installation costs (when the installer leaves the site) could get to $500. The whole process can take 30 min for experienced installer up to 4 hours for a non-experienced installer.
A terminal installation process includes several main steps:

  • The first step includes the assembly of the antenna parts, the mounting of feedhorn/LNB/BUC and mounting the antenna to a fixed amount (i.e. non-penetrating, wall).
  • The second stage of the installation (see Fig. 4) requires the precise antenna pointing towards the satellite. This action requires the calculation of the azimuth (AZ), Elevation (EL) and Skew (SK) pointing angles based on the VSAT terminal location (GPS coordination) and the satellite position in the sky. To be able to pick-up the satellite (transponder) transmitted signal, a designated receiver or spectrum analyzer (SA) must be connected to the LNB. Modern VSATs, which are equipped with the received signal monitoring aid can be used for this purpose as well. Normally, after the initial signal pick-up (course pointing) the pointing must be fine-tuned to achieve the maximum signal strength, indicating optimum pointing.
  • The third stage (commissioning phase) includes the connection of the IDU to the ODU using the IFL cables. The installer must then call the Hub Network Operating & Control (NOC) and ask permission to command the IDU to transmit a pure unmodulated RF signal (continuous signal – CW) at a pre-defined frequency. The NOC personnel should verify that the signal is received properly at the hub and approve the terminal as commissioned and approved to transmit.

The fourth and last stage includes the configuration of the IDU with the system main parameters, i.e. the Rx carrier frequency and symbol rate, Tx frequencies, terminal identification, and other network identification parameters. The IDU, which receives the network forward link (outbound), optionally downloads new operating system and more advanced networking parameter and negotiating with the hub to gain the terminal identification and authorization. At this point, the terminal declares an On-Line state and is ready to provide 2-way communication, mostly IP-based services.

Well…The installation cost can be saved! A terminal Antenna installation and pointing can be “self-installed” by the end-user itself. A simplified design of the ODU assembly (dish, mounting bracket, feedhorn, NLB, BUC), along with a well-detailed documentation and audible or visible pointing indicators (received signal strength).

The path to $100 VSAT Price

Antenna Subsystem

Antenna – cost in the DTH market is in the range of $10. The Key factor in price are ODU weight and environmental requirements (wind speed etc…). An antenna structure can be priced at $22 without Feed-horn can be used as a baseline for 2-way.
LNB – In general per VSAT application, LNB is around $2.5 for Ku and $7.5 for Ka.
RF – A New Ku/Ka Direct Conversion Modulator/Demodulator Chips (>$10 each), the demodulator chip conceptual block diagram is shown below.

Direct RF sampling and Full Band Capture (FBC) – New ADCs and DACs at 64 Gsample/sec with SiGe based front end at the cost of ~$5 are also becoming available, and with a low cost SiGe front end for the LNAs and HPAs cost point of the RF is
reduced to below $30.

Baseband Chips


SatixFy’s SX-3000 is a new ASIC based baseband modem, fully supporting the newly published DVBS2X and DVB RCS2 standards. This DVB-S2 extension standard provides an improvement over existing standards in all aspects of satellite operation and the chip enables its usage over a broad range of applications. The SX-3000 is designed around a SoC, which includes several DSP’s and general purpose processors, supported by special purpose hardware designed to accelerate the main functions along the data path. This design enables full support of the standard as well as a large degree of flexibility that make it future-proof, in the sense that it facilitates the introductions of new algorithms, varying parameters, and even different waveforms. The chip supports Very Low SNR (VL-SNR) waveforms down to the -10 dB range.
The ASIC includes wide veracity of user interfaces for data-path termination i.e. Ethernet MAC, Video (TS and ASI), debug, management and control.

NG chip with DDR and Flash on chip

In order to enable even lower cost solution, once the quantities will become substantial, next generation chip will be able to include many of the peripherals either on the same silicon or as another die in a Multi-Chip-Module and could include DDR and Flash as well as Power Management IC (PMIC) that will enable single voltage operation. The pin count will be substantially lower and the PCB will be smaller and less expensive.

“All Outdoor” Terminal (S-ODU)

The S-ODU terminal is based on the SX-3000 chip from SatixFy and RF to baseband chips from 3rd party vendors. The terminal simplified block diagram.

RF – Forward channel RF is using a 3rd party integrated down-converter from Ka band and tuner. The Return Channel RF is using a 3rd party integrated up-converter to Ka-Band and modulator.

Baseband – Forward channel: the SX-3000 contains a DVB-S2/S2X wideband demodulator and GSE processor for the forward path. The return channel access method can be any standard MF-TDMA protocol which will be implemented in software on an internal DSP in the SX-3000 chip.
IP processing – A dual core CPU will run a Linux-based TCP/IP stack with all necessary routing functionality The user interface is water-proof 10/100 Ethernet RJ45 port.
Mechanical – The terminal is fully outdoor (IP 67) and mounted directly on the antenna
Power. Power to the terminal is fed using standard Power over Ethernet (POE). A standard off the shelf PoE adaptor can be used. Costs can be decreased using a non-standard solution.


VSAT prices were constantly reduced over the years, and nowadays the potential to get to $100 VSAT price is getting closer. The availability of antennas based on DTH at price point below $30 in quantities, seems to be close. LNBs and BUCs for low power, 1W operation are getting integrated into SiGe-based ICs that cost a few dollars each. Either an LNA, PA and direct conversion ICs or direct RF sampling at frequencies such as Ku band, are approaching the $30 range as well. The key is a very low cost, highly integrated baseband modem SoC which the next version (and definitely the one after it) will enable very low-cost IDU or baseband part.
VSAT pricing also includes the IFL cables, the mount, and the power supply but those are much time counted as part of the installation, which is the next main target to go after.