April 2011Tactical Communications – The Ultimate Backbone for C4ISR By Maj. Sabbir Ahmed (Ret’d), Industry Analyst, Aerosp...
Introduction                                                            Tactical Communications (TACCOM) is pivotal to the...
Why still TACCOM when SATCOM seems do the job?                                                            SATCOM, with its...
Key Market Trends                                                            Military end users in Europe are keen to inte...
Market Revenue Potential                                                            In Europe, despite budgetary pressure,...
Key Market Challenges                                                            Government Funding Restraints            ...
Dismounted Soldier Interface Programmes                                                            It is paramount that di...
COTS technologies will continue to stay and will increasingly be used in all types of                                     ...
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Tactical Communications – The Ultimate Backbone for C4ISR


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Tactical Communications – The Ultimate Backbone for C4ISR

  1. 1. April 2011Tactical Communications – The Ultimate Backbone for C4ISR By Maj. Sabbir Ahmed (Ret’d), Industry Analyst, Aerospace, Defence & Security
  2. 2. Introduction Tactical Communications (TACCOM) is pivotal to the conduct of operations and its significance as the backbone for C4ISR continues to increase. The key challenge for industry and end-users is on how to utilise this optimally in order to achieve complete situational awareness on the battlefield. The potential of tactical communications as an enabler to achieve the flow of real time intelligence from the soldiers to the command centres and decisions from the command centres to soldiers is yet to be exploited to its full potential. However, research indicates significant increase in the adoption and application of tactical communications to achieve complete situational awareness especially within western European forces and NATO nations.Tactical Communications – The Ultimate Backbone for C4ISR TACCOM forms the part of Military Communications (MILCOMM) which only concerns the front end soldiers operating in a theatre environment (formations of division, brigade and below). TACCOM consists of Personal Role Radio (Soldier radio/handheld device and Manpack up to section level), Combat Net Radio (High Capacity Data Radio and Vehicular Intercommunications Radio at command/operation centres) and Tactical Network (TacNet). It forms a loop to the Strategic Communications (STRATCOM) backbone in an effort to ensure seamless connectivity in a sensor- to decision maker- to shooter chain. Although at times SATCOM terminals are used in the formation it is not the focus of this Market Insight. Figure 1: Communications Segments Under Study MILCOMM MILSATCOM Tactical Strategic Strategic Network Tactical Tactical Trunk System Radio Network Legend Soldier Radio Included Not Included CNR PRR Man pack High Capacity VIC Data Radio SDR Source: Frost & SullivanMarket Insight © 2011Frost & Sullivan Page 2
  3. 3. Why still TACCOM when SATCOM seems do the job? SATCOM, with its versatility and rapid deployment capability (the likes of SATCOM on - the- move), might be a preferred choice when it comes to supporting highly mobile war fighters deployed in expeditionary operations. However, in practice, armed forces cannot depend on a single mode of communication and using alternative forms of communication is a battle-tested concept. If the satellite system collapses due to enemy action then radio, being embedded on a different architecture (terrestrial as opposed to SATCOM being celestial), will survive the action. Therefore, radios (both short and long range) will still find relevance as effective back up for SATCOM and as a stand-alone platform.Tactical Communications – The Ultimate Backbone for C4ISR Figure 2: Key Features of Radio-based Communications More robust Le t ss en th em ro ov ug m h lif of e m co do st ee RADIO Fr e ag M us or th e More reliable Se id w cu nd re ba ee Fr Source: Frost & Sullivan TACCOM will also hold ground for the foreseeable future due to challenges associated with SATCOM; which suffers from power loss during adverse weather and terrain conditions, such as cloud and rain, mountainous terrain and deep forests. This is particularly common with higher frequencies such as Extremely High Frequency (EHF) and Advance Extremely High Frequency (AEHF) that characterise modern military SATCOM. In comparison, Tactical Radios barely sufferMarket Insight during adverse weather and terrain conditions, as their lower frequency signals can easily bend around obstacles, and is subject to less power loss. SATCOM strengths such as versatility, bandwidth and range advantage could be partly overcome by Software Defined Radio (SDR) technology which is nearing maturity. SATCOM and TACCOM should be viewed as complimentary rather than competing technologies to form an integrated communications architecture which is an enabler for achieving total situational awareness. © 2011 Frost & Sullivan Page 3
  4. 4. Key Market Trends Military end users in Europe are keen to integrate their own legacy pitched systems and seem to care less about interoperability with the allies. Armed forces across Europe use a wide variety of command, control and communication systems that are supplied by different companies. The products even lack commonality and interconnectivity within the forces. Programmes such as Cormorant in the United Kingdom, Moise Sic Terre in France, KINTOP in Germany, amongst others primarily focus on unifying existing C3I projects into net-centric, service-oriented architecture. The aim is to give C3I a common platform within its family of products, offering improved solutions to the soldiers, though in practice achieving the desired integration has beenTactical Communications – The Ultimate Backbone for C4ISR challenging and little improvement has been made to interoperability with other military systems. SDR (Software Defined Radio) is likely to continue being considered as a next-generation communication solution. It is a key platform that integrates all systems in a theatre level networked battle environment. Due to the current economic slowdown, investment in waveforms, standards and integration solutions have reduced, which is likely to further advance the mass uptake of SDRs across Europe to 2013 and beyond. MODs increasingly prefer to procure capabilities with through-life service as part of the solution. This procurement trend has strengthened and, since being championed in the UK, has become widespread across Europe. Leasing models are becoming more widespread which provides MODs with advantages that include lower upfront investment and distributing project costs over the lifecycle including service support and technology upgrades. The European market is gradually moving towards a unified defence equipment market. As part of the initiative, the Defence Technological and Industrial Base (DTIB) of the European Defence Agency (EDA) has initiated policy guidelines on procurement, offsets, industry best practices and intra-region arms transfer. The ultimate aim is to create a single European defence equipment market that would bring the much needed economies of scale and synergies to the European defence industry, avoid duplications, streamline budgetary allocations and standardise the European forces equipment. In reality progress has been slow. The defence service market is expected to grow significantly over the next decades. For example Frost & Sullivan estimates that the defence electronics market, one of the key indicators in the sector, is expected to reach US$ 20 billion in the next five years. This is only the tip of the iceberg if you consider market opportunities in servicing and managing the life-cycle of platforms and ‘system-of-systems’ assets.Market Insight Support in-Services will be the core focus of procurement models until 2020 and beyond. More specifically, emerging business models for defence procurement such as PBL / Contracting for Availability (CfA) and Outsourcing for Maintenance (OfM) are likely to lead this trend in the industry. © 2011 Frost & Sullivan Page 4
  5. 5. Market Revenue Potential In Europe, despite budgetary pressure, market growth will continue to be positive over the forecast period, and is primarily driven by both soldier modernisation programmes and a drive for situational awareness out to the last tactical mile (networked force). The European Tactical Communication (TACCOM) market is forecast to be worth $1,582 million in 2018, and grow at a compound annual growth rate (CAGR) of 4.1% between 2008 and 2018. Stronger growth can be expected between 2012 and 2015, mainly driven by upgrade opportunities of existing radios to Software-defined Radios (SDRs) and further investment towards TacNet.Tactical Communications – The Ultimate Backbone for C4ISR Figure 3: TACCOM Market: Total Radio Market Value (Europe), 2008 - 2018 2000 1500 1000 500 0 2008 2009 2010 2011 2012 2013 2014 2015 2016 2017 2018 SR Manpack VIC HCDR Source: Frost & Sullivan Combat net radio (CNR) will account for the highest share (43%) of the total revenue of $17.74 billion over the 10 years forecast period (2009-2018), and PRR and TacNet segments at 29% and 28% respectively. At the sub-segment level vehicular intercommunications radio (VIC) and high capacity data radio (HCDR)/tactical network nodes will grow and therefore companies with a strong portfolio of solutions across different segments are expected to experience steady revenue growth. Figure 4: TACCOM Market: Segment-wise Market Share (Europe), 2008 - 2018 PRR 29% Tac Net 28%Market Insight CNR Source: Frost & Sullivan 43% © 2011 Frost & Sullivan Page 5
  6. 6. Key Market Challenges Government Funding Restraints It is evident that major spenders in this market (including the UK, France, Germany, Italy, Spain and Netherlands) will undergo defence budget cuts between 5% and 10% year on year until 2015. This will result in fewer new defence projects, delay or downsizing and even cancellation of existing defence projects. However, the communications and integration projects will be less affected though it is widely believed that the decision cycle on funding new or existing communications projects will be longer.Tactical Communications – The Ultimate Backbone for C4ISR Radio Standardisation, Bandwidth and Technology Limitations The bandwidth limitation of HF, VHF and UHF legacy radios continues to be a problem in integrating legacy systems with the new IP-based SATCOM systems. Though efforts are underway to overcome this, a breakthrough in technology that would allow the transmission of video and imagery through radio as part of networked communication has not yet been achieved. The industry is looking at projects like the Joint Tactical Radio System (JTRS) in the United States as a benchmark project for the European market. The project utilises in software-defined architecture and logic to overcome challenges, and is being tested for further capability enhancement through improvements in waveforms and transistors used in the amplifier needed. The issue of interoperability and integration depends on uniform standards, specifications and procurement regulations which are still some distance from being implemented across the European MODs despite push from the EDA. Key Opportunity Overview Soldier Modernisation Programmes European MOD’s move towards enhancing soldier efficacy has created significant opportunity for soldier radio systems, as well as other soldier level situational awareness components, such as handheld devices/computer terminals and fuel-cell batteries. Most European MODs are currently running soldier modernisation programmes and others will eventually run the same. Notable investment opportunity for soldier level C3I systems is expected between 2013 and 2020 across Europe. SDR-based Major Upgrade Programmes Most of the major defence communications companies have already rolled out SDR products including Cobham’s TacG2 and Rockwell Collins/ Thales Communications FlexNet. Major radio upgrade projects (including TacNet) will be SDR-based with open modular architecture to accommodate further capability enhancement as the technology matures.Market Insight System Integration Programmes The network system that integrates TACCOM and STRATCOM is critical for today’s highly mobile military missions. Frost & Sullivan believes hat demand for tactical network solutions will be high across most European MODs to 2020. © 2011 Frost & Sullivan Page 6
  7. 7. Dismounted Soldier Interface Programmes It is paramount that dismounted soldiers are constantly connected to their parent vehicles and C2 net. This means soldiers’ handheld radio/terminal should be rugged enough to operate in all environmental conditions (mountainous or jungle terrains and urban setting) while having access to IP-based communication services including video streaming. The demands for these solutions (that give dismounted soldiers access to wider situational awareness and enable them to call fire assets on targets) are growing by the day. Competitive EnvironmentTactical Communications – The Ultimate Backbone for C4ISR The European TACCOM market is fragmented and no company has a dominant market share. Due to the diverse customer needs, there is a wide range of radio products in the market. Given the push for a single equipment market with uniform systems and standards by the European Defence Agency, Frost & Sullivan expects consolidation in this market. The underlying trend in the European defence communications sector is that the industry is undergoing expansion either organically or through M&A or alliance, and major radio companies are branching out to SATCOM terminal and network market, in order to capture some share of the burgeoning space-based communications segment. Most of the participants view escalation of SATCOM terminals as complementary, and not as a threat to their radio business. SATCOM is poised to galvanise the demand for HCDRs and SDRs, the two essential elements of networked communications. Key Messages for the Industry Participants Suppliers to the European defence market should consider the following segments as part of their product portfolio: soldier radio/handheld terminals (with integrated elements of situational awareness), tactical networks with network integration components, high capacity data radio (HCDR) with multiple communication service capability and vehicular intercommunication (VIC) with dismounted soldier interface. The solutions would be SDR technology-based, as well as capable of interfacing with SATCOM terminals. Defence communication companies must be able to capitalise on increased interest in software- defined radio (SDR) technology; keeping in mind that any new TACCOM projects would essentially be based on software-defined architecture; therefore, driving the need for advanced capabilities in installing SDR architecture on existing hardware and integrating them with other legacy communication systems. Any new communication equipment developed by companies should preferably be based on open architecture and modular in nature, so that incremental capabilityMarket Insight upgrade is possible as the technology matures. © 2011 Frost & Sullivan Page 7
  8. 8. COTS technologies will continue to stay and will increasingly be used in all types of communication systems in the foreseeable future. The MODs will continue to value COTS due to its ability to deliver advanced capability with notable cost savings, which is more relevant in the current economic climate. Given that COTS solutions are now being effectively customised to provide the required security encryption and system reliability, defence companies should seek partnership opportunities with COTS organisations that have the right technology/application to offer. It is imperative for suppliers to understand the nuances of through-life capability management (TLCM), as MODs are increasingly putting the responsibility for management (from initialTactical Communications – The Ultimate Backbone for C4ISR purchase to routine maintenance, and end-user training to interim capability upgrades) on to their providers. It is therefore essential that suppliers understand the cost implications of service delivery at key stages of the equipment life cycle (total cost of ownership), in order to manage project risk well, and be more profitable. Oxford 4100 Chancellor Court Oxford Business Park Oxford, OX4 2GX, UK Tel: +44 (0) 1865 398600 Fax: +44 (0) 1865 398601 London 4, Grosvenor Gardens, London SWIW ODH,UK Tel 44(0)20 7730 3438 Fax 44(0)20 7730 3343 enquiries@frost.com http://www.frost.com http://www.aerospace.frost.com About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, enables clients to accelerate growth and achieve best-in-class positions in growth, innovation and leadership. The companys Growth Partnership Service provides the CEO and the CEOs Growth Team with disciplined research and best-practice models to drive the generation, evaluation, and implementation of powerful growth strategies. Frost & Sullivan leverages 50 years ofMarket Insight experience in partnering with Global 1000 companies, emerging businesses and the investment community from over 40 offices on six continents. To join our Growth Partnership, please visit http://www.frost.com. © 2011 Frost & Sullivan Page 8