EURASIP Journal on Wireless Communications and Networking 
Volume 2008 (2008), Article ID 596383, 8 pages
doi:10.1155/2008/596383
Research Article

Is HAPS Viable for the Next-Generation Telecommunication Platform in Korea?

Jonghwa Kim,1 Deokjoo Lee,2 Jaekyoung Ahn,3 Do-Seob Ahn,4 and Bon-Jun Ku4

 1Department of Industrial Engineering, Konkuk University, 1 Hwayang-Dong, Gwangjin-Gu, Seoul 143-701, South Korea
2Department of Industrial Engineering, Kyunghee University, 1 Seocheon-Dong, Kiheung-Gu, Yongin 446-701, South Korea
3Department of Industrial & Information Systems Engineering, Seoul National University of Technology, 172 Gongneung-Dong, Nowon-Gu, Seoul 139-743, South Korea
4Radio and Broadcasting Research Division, Electronics and Telecommunications Research Institute, 162 Gajeong-Dong, Yuseong-Gu, Daejeon 305-350, South Korea
Received 30 September 2007; Revised 12 February 2008; Accepted 6 May 2008

Recommended by David Grace

Abstract

HAPS is a promising technology capable of providing broadband multimedia services as an alternative to the satellite communication system or terrestrial network. In this study, economic aspects of HAPS service are analyzed, HAPS services are defined, and revenues from the defined services are forecasted assuming nine scenarios. Capital expenditure as well as operating expenditure is estimated. To evaluate the profitability of HAPS service, the net present value (NPV), payback period, and the internal rate of return (IRR) are calculated. The results show that HAPS is economically justifiable in all the scenarios. Assuming that ARPU for the service is $35 per month in the average scenario, NPV is calculated as $2964 million, IRR becomes 31.9%, and payback occurs in 2017, which implies that HAPS service is profitable in Korea. In addition, the results of the sensitivity analysis show that the results are fairly robust.