April 20, 2024

Will customers be willing to spend a premium on satellite broadband? | Latest news India

Cables can only be stretched so far. To the nearest telecommunications tower for 3G, 4G or 5G mobile networks. Or indoors, for wired broadband to create a Wi-Fi network for PCs and phones. That physical limitation is represented in figures from the International Telecommunication Union (ITU), which indicate that approximately 67% of the world’s population, or around 5.4 billion people, is now online in some form. Despite growth of 4.7% in 2022, 2.6 billion people remain offline. That’s a big gap, for consumers and businesses. What gives?

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An Internet satellite dish in Rarotonga (WikiCommons)

It is not easy to deploy last mile infrastructure, particularly in difficult terrain and even more so in low-income countries (terrain is not necessarily a limitation here; return on investment is more so). Therefore, the lack of it is the key. In this case, emitted from the sky, specifically by satellites that are closer to Earth. It’s a simple but complex satellite broadband premise, a template used by SpaceX’s Starlink, Bharti Airtel-backed Eutelsat OneWeb, Hughes Communications’ HughesNet and the upcoming Reliance JioSpaceFiber, as well as Amazon Kuiper, which is still in the testing phase .

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Think of this as a combination of how you access mobile broadband on your phones wirelessly from a tower and how you can receive direct-to-home (DTH) TV service from a satellite to your home with a satellite dish. In homes, offices, and static locations, an outdoor unit would receive signals from an aerial satellite that is connected via a network cable to a Wi-Fi router located indoors.

Sound simple? One size does not fit all. There are different types of satellites that are used to offer Internet and voice.

Once approvals are obtained, Starlink will become the third company to receive the Global Mobile Personal Communication Satellite, or GMPCS, license in India. This is the unique approval necessary to offer data services (i.e. Internet) as well as voice via satellite. Having a license does not necessarily obligate companies to provide both services. For example, Starlink may choose to simply offer satellite broadband in India and not a voice calling option on its network.

For now, Reliance and OneWeb hold the GMPCS license in India. The former has not yet started its commercial services, while the latter offers customized connectivity solutions for businesses.

“Satellite broadband has the potential to expand connectivity, close the digital divide, unlock new economic possibilities and foster digital inclusion. In the short and long term, a confluence of technological advancements, affordable service models and supportive government policies can unlock the transformative potential of satellite broadband for India,” said Prabhu Ram, Director, Cyber ​​Industrial Intelligence Group. Media Research (CMR). .

OneWeb and Hughes with their Jupiter platform already offer services for companies and businesses since the end of 2021. The focus areas are government systems, such as connectivity for the armed forces and the provision of digital services in remote locations, maritime services that connect maritime transport fleets at sea, aviation systems for commercial airlines and executive jet operators, as well as land transport fleets. The pricing and technology used to provide connectivity to all of these use cases varies and we are not aware of those contracts. Offering satellite Internet directly to users is not cheap.

There is no escape: satellite Internet is expensive

Starlink’s focus will also be on consumer-oriented broadband services in addition to businesses. Until now, the company has maintained relative global price parity with monthly subscriptions costing around $120 (roughly around $9,975 monthly). This is ten times the cost of cable and 5G broadband services in India.

Can costs be corrected quickly enough? “With satellite Internet on a growth path, supply may exceed demand for years to come. This is mainly because traditional Internet operators offer reliable high-speed Internet at lower prices than satellite Internet,” said Santosh Tiwari, partner at EY-Parthenon India in the consultancy firm’s latest report. How satellite internet can transform digital connectivity in India.

“The price of any new technology is always high. But we also see their costs drop dramatically after adoption. There was a time, just 15 or 20 years ago, when mobile telephony was out of reach for many of those who use it daily. Initially, the price would be high, making it accessible to a niche segment, but it will eventually broaden access and acceptability,” said Faisal Kawoosa, chief analyst at research firm Techarc.

For example, cable broadband plans (Airtel Xstream Fiber plans start $499 per month; JioFiber dependency costs $399 onwards), including Airtel Reliance JioFiber’s flagship 1Gbps speed plans (both priced at $3,999 per month). Considering the recent development of 5G connectivity for homes and offices, Reliance JioAirFiber has plans within a band of $599 and $3999 per month for speeds between 30Mbps and 1Gbps.

Another cost you’re likely to encounter is the hardware to connect your facility to Starlink satellite broadband. Globally, the price of the Starlink outdoor unit, the Starlink Wi-Fi router (probably a dual-band Wi-Fi 5 spec), as well as the necessary cables, is around $599 (around $599) . $49,800).

“If any business model can generate $50 to $60 a month, adoption would be considerably good,” adds Kawoosa, noting the high initial cost to purchase the service and the hardware needed to connect a user to the service (the similar device to a satellite dish and the router, for example).

In essence: methodology

While the satellite broadband model is the same, the approaches differ. Much of this has to do with the technology used and the target user demographic. Starlink uses LEO or low Earth orbit satellites. Early last year, Starlink confirmed that there were more than 4,000 satellites in the constellation surrounding Earth. Since then, they have added more Gen2, or second generation, satellites that can offer faster speeds to more users simultaneously.

LEO satellites operate in space 2,000 km or less above the Earth’s surface. They also tend to be less expensive due to their smaller size, but in some cases their lifespan is potentially shorter. Starlink’s satellite constellation is LEO, specifically located about 550 km above Earth, and there is a reason why SpaceX chose this method.

“Most satellite Internet services come from single geostationary satellites orbiting the planet at 35,786 km. As a result, the data round trip time between the user and the satellite, also known as latency, is high, making it almost impossible to support streaming, online gaming, video calling or other high data rate activities,” they point out. in an explainer on their website. Since Starlink satellites are in a low orbit, that is, closer to the Earth and therefore to each user’s external receiving unit, this latency is significantly lower.

The alleged difference could be as much as Starlink’s 25 millisecond range, compared to the 600 milliseconds that MEO (Medium Earth Orbit) or GEO (Geostationary) satellites can offer, but that may be a selective tone that would be expected from a struggling broadband company. competence.

What will make the difference in the long term, as more users come on board, is the flexibility provided by LEO (smaller but more satellites) that gives Starlink the flexibility with variable orbit and specific demands. Some real-world examples include the Starlink terminals used in Ukraine after the Russian invasion in 2022, and the intervention of OneWeb and SpaceX to reposition satellites over Alaska after an undersea fiber optic cable in the Arctic Ocean was damaged, which cut off internet access for a while. much of the region.

OneWeb already has 618 LEO satellites in orbit. Hughes relies on the Indian Space Research Organization or ISRO’s geocentric geostationary satellites GSAT-11 and GSAT-29 for its services in India, which float about 36,000 kilometers above the earth. They are now part of a group of 75 satellites using the Hughes Jupiter system.

Reliance’s upcoming JioSpaceFiber will offer its satellite broadband services using Luxembourg-based SES’ fleet of geostationary and MEO satellites. Of these, SES-12 will be the largest geostationary satellite, located about 36,000 km above Earth to cover India and much of South Asia, while the MEO satellites (which typically operate between 2,000 and 20,000 km above Earth) Earth, depending on size). and power) are called O3b mPOWER. Reliance Jio is expected to offer services to consumers along with enterprises and businesses.

For India, satellite Internet becomes more important because it could be the critical piece of the puzzle of connectivity that is not easy in a country as diverse as India. There are difficult geographic locations where providing Internet coverage with cell towers is proving challenging; Wired Internet connectivity is a distant dream. “The satellite will complete the equation enabling carpet connectivity across the country offering high-speed internet,” Techarc’s Kawoosa said.

For example, Reliance conducted JioSpaceFiber trials in late 2023 to evaluate internet delivery from the sky, in remote locations such as Gir in Gujarat, Korba in Chhattisgarh and Jorhat in Assam. It will be a recurring theme as satellite wireless covers more and more parts that wired Internet cannot reach.

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