DEFINITION of 'Very Small Aperture Terminal (VSAT)'

A very small aperture terminal (VSAT) is a two-way ground station that transmits and receives data from satellites. A VSAT is less than three meters tall and is capable of both narrow and broadband data to satellites in orbit in real-time. The data can then redirected to other remote terminals or hubs around the planet.

BREAKING DOWN 'Very Small Aperture Terminal (VSAT)'

VSAT networks have a number of commercial applications, including enterprise resource management. The use of VSAT to track inventory was one of the many innovations Walmart pioneered in retail to effectively manage its vast inventory in real time and reduce delivery costs between the warehouse and stores. Combined with the hub system of inventory storage, VSAT allowed Walmart to stock its stores more precisely and reduce how many times product had to move between locations before being sold. Other manufacturers use VSAT to relay orders, check production figures real-time as well as other functions that are otherwise handled over a wired network.

In fact, the National Stock Exchange (NSE) of India has one of the largest VSAT networks in the world and offers it as one of its connectivity options. VSAT offered the NSE a way to offer access in areas where wired options are limited. With the exception of the occasional sun outage due to solar radiation distorting signals from the satellite, the VSAT network has held up. As of 2017, the NSE supported 2500 VSAT and 3000 leased lines, making it the largest private wide area network in the country. 

Advantages and Disadvantages of a VSAT Network

VSAT networks have a big advantage when it comes to deployment. Because the ground station is communicating with satellites, there is less infrastructure required to service remote locations. This was one of the reasons Walmart chose VSAT as it started out heavily leveraged to rural America where telecommunications infrastructure was less dense than in the cities. This has made VSAT networks an ideal choice for providing connectivity to remote work sites like exploratory drilling sites that need to relay daily drill logs back to headquarters. VSAT is also independent of local telecommunications networks, making it an ideal system to back up wired systems and reduce business recovery risk. If the wired network goes down, business can still go on using the VSAT network. 

However, VSAT does have limitations. The most obvious is latency, as it takes time for information to reach the dish and the station due to one part of the system being way up in geosynchronous orbit above the earth. So protocols that require a lot of back and forth communication rather than one-way data transfer experience lag. The signal quality can also be affected by the weather and other buildings getting in the way.

 

RELATED TERMS
  1. Networking

    Networking is a process that fosters the exchange of information ...
  2. Economic Network

    An economic network is a combination of individuals, groups or ...
  3. Satellite Operation

    A satellite operation is a small office or branch office in a ...
  4. Bank Wire

    A bank wire is an electronic message system, which allows major ...
  5. Network Effect

    The network effect is a phenomenon whereby a good or service ...
  6. Distributed Applications (ĐApps)

    Distributed Applications are software applications that are stored ...
Related Articles
  1. Investing

    American Airlines Finds a New WiFi Provider

    Shares of inflight connectivity provider Gogo (NASDAQ: GOGO) were down meaningfully Friday after a competitor disclosed that it won an important contract with American Airlines Group (NASDAQ: ...
  2. Insights

    SpaceX Wants to Launch a Massive Satellite Internet Network (TSLA, GOOGL)

    According to newly filed documents, the California-based company hopes to operate an orbiting digital communications array consisting of 4,425 satellites.
  3. Investing

    The Future of In-Flight Entertainment: Bring Your Own Screen

    The seatback screen is going the way of in-flight smoking on domestic American Airlines flights.
  4. Investing

    4 Networking Stocks that You Must Own (AKAM, CSCO)

    Understand how networking stocks fit into the technology sector. Learn about four leading networking companies that investors should own in 2015.
  5. Investing

    SpaceX's Disaster Could Be Cubesats' Selling Point

    The SpaceX explosion is likely to push a shaken industry to use smaller, cheaper satellites.
  6. Investing

    JetBlue "Fly-Fi" Finally Takes Off (JBLU, LUV)

    Airlines are waging a wireless war. Count JetBlue (NASDAQ: JBLU) as the latest to join the fray -- the carrier's "Fly Fi" inflight wireless Internet service went live this week on one of the ...
  7. Insights

    AT&T’s Disruptive White Box Trial Succeeds

    AT&T succeeds in transferring data traffic using low-cost computer switches and software.
  8. Financial Advisor

    Networking For Financial Professionals: Maintaining A Strong Industry Presence

    Find out the most productive methods of networking best suited to ambitious financial professionals.
  9. Insights

    Elon Musk's SpaceX Postpones Next Launch Until January (TSLA)

    It has already lost one customer due to the delay.
  10. Small Business

    How Business Owners Can Benefit From Remote Employees

    Remote employees can work remotely full-time or part-time. This option is a desirable perk and increases your candidate pool. Here's how to make it work.
RELATED FAQS
  1. What is the telecommunications sector?

    The telecommunications sector is comprised of companies that transmit data in words, voice, audio or video across the globe. Read Answer >>
  2. When evaluating terminal value, should I use the perpetuity growth model or the exit ...

    Examine the important calculation of a terminal value in discounted cash flow analysis, and learn which method of calculating ... Read Answer >>
  3. Can you pay off a Walmart credit card in store? (WMT)

    Understand the various methods that consumers can pay off a Walmart credit card. Learn which options are the easiest and ... Read Answer >>
  4. How to calculate the inventory turnover ratio?

    The inventory turnover ratio is a key measure for evaluating how effective a company's management is at managing inventory ... Read Answer >>
Hot Definitions
  1. Business Cycle

    The business cycle describes the rise and fall in production output of goods and services in an economy. Business cycles ...
  2. Futures Contract

    An agreement to buy or sell the underlying commodity or asset at a specific price at a future date.
  3. Yield Curve

    A yield curve is a line that plots the interest rates, at a set point in time, of bonds having equal credit quality, but ...
  4. Portfolio

    A portfolio is a grouping of financial assets such as stocks, bonds and cash equivalents, also their mutual, exchange-traded ...
  5. Gross Profit

    Gross profit is the profit a company makes after deducting the costs of making and selling its products, or the costs of ...
  6. Diversification

    Diversification is the strategy of investing in a variety of securities in order to lower the risk involved with putting ...
Trading Center