Study on feasibility of SATCOM for railway communication

Final Report
The following assumptions have been considered to model this scenario:
Voice communications are assumed to migrate to less bandwidth-consuming data services.
Hence, handheld terminals would not be required, lowering CAPEX, while OPEX would also
come down as well, since it is dominated by voice communications
As expected, the results, as presented in section §9.3.4, show that this scenario would render
SATCOM solutions more competitive, since they would not be penalized by the voice communication
fees or by the use of costly handheld devices.
In this positive business case, combined with the high compliance with the rest of technical
requirements, would potentially make Iridium NEXT or Inmarsat 4/6 very serious contenders for a
GSM-R replacement.
9.3.3.2.3 Break-even with revenue-generating value-added services
First of all, the global NPV (Net Present Value) evolution for broadband solutions will be presented
compared to GSM-R. The NPV has been computed as a result of adding the revenues to the
expenses originating from technology implementation.
Figure 82: Absolute NPV evolution broadband solutions (compared to GSM-R)
For the above analysis, a moderately optimistic implementation has been considered for LTE,
assuming that the number of existing, upgradeable GSM-R stations should be doubled.
As seen above, in the long run, GEO/Ka-band is the most competitive broadband SATCOM option,
only trailing the most optimistic implementations of LTE by a very close margin, with an IRR of 72%
compared to the latter‘s 70% (with an NPV by 2035 of €18.100 M compared to LTE‘s €21.900 M,
which can be taken as a reference. In comparison, SmartLNB involves higher communication fees,
which hinders its competitiveness compared to GEO/Ka-band, yielding an NPV of €14.700 M by 2035
and an IRR of 57%. It must be taken into account that, despite this, both solutions would provide a
stronger overall business case compared to today‘s GSM-R.
Doc.Nº: SRAIL-FNR-010-IND
Edit./Rev.: 1/1
Date: 16/02/2017
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