ALEXANDER CAMPBELL / LONDON
Analyst report says "prohibitive" installation costs likely to restrict actual sales growth
The trend towards network centric warfare will create an insatiable demand in Europe for tactical radios and datalinks, with the only limit being tight national defence budgets, says a report by analyst Frost & Sullivan.
As air forces focus more on intelligence, surveillance and reconnaissance (ISR), the demand for high-bandwidth communications, to allow the data they gather to be used immediately, is likely to soar in the next 10 years, the report says.
Although military aircraft numbers are falling in Europe, the report says, "fortunately, the cost of communications on a platform is exorbitant and...the market is forecast to remain steady despite a downturn in numbers".
Aircraft datalink systems are also in high demand, but here, as well, their extremely high cost will come into play. Frost & Sullivan points out that actual sales growth will be only 3.52% a year, due to the "prohibitive" cost. While the datalink units themselves are falling in price, the cost of installation and interfacing remains high, limiting potential sales, the report warns. Hardware installed in the near future is likely to be superseded by more-versatile software-defined radios after 2010, although the technology remains" very immature".
The report adds that, while the market is dominated by established military suppliers like Marconi/Selenia and Thales, commercial suppliers will increasingly challenge them, using advances in civilian technology and communications to compete.
Source: Flight International