Examining a Potential Competitor to Traditional Space Broadband Operators

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At the end of my last post, I asked: What is new, the thing that makes the upcoming satellite broadband operators sure they’ll get return on investment?

Here are my guesses, and we’ll start by looking at SpaceX’s Starlink demonstration satellites, Tintin A and Tintin B. These satellites were launched a few weeks ago.

Based on this FCC document, the Tintins are probably the Microsats mentioned within: https://apps.fcc.gov/els/GetAtt.html?id=185534&x. The satellites described are very small, but not cubesat-sized. Each one is about 1 meter cubed, with a mass around 400kg. By comparison, the Hispasat communications satellite which was launched a little later weighed over 6000 kilograms and about 27X9X7 meters in size (http://licensing.fcc.gov/myibfs/download.do?attachment_key=1144453, pg 13).

The small size of the TinTins is significant. It means SpaceX can load up a Falcon 9 with at least 20 of these. Probably more, based on the LEO/GTO mass specifications of the Falcon 9: http://www.spacex.com/falcon9. SpaceX needs to load up many, many Falcon 9’s with these Microsats/Tintins to get 12,000 satellites into orbit (http://www.businessinsider.com/spacex-starlink-internet-satellite-launch-paz-youtube-2018-2). The company would also have to maintain a launch rate exceeding anything the company has achieved so far.

Even if the company used the Falcon Heavy instead of the Falcon 9, deploying 12,000 satellites might take a while. If the Big Falcon Rocket becomes a reality, then all bets are off. There likely is the benefit of using one’s own rocket fleet to launch one’s satellites.

Back to the satellites, and lots of conjecture.

The small size and mass of the satellites may mean the satellites are very, very inexpensive when compared with the costs of building geostationary satellites. The number of satellites means SpaceX may benefit from assembly line production of satellites not yet seen in the space industry (although I would bet that China could change this very, very quickly). Looking at what the company did with rockets, the satellites themselves are probably not anything special. We see some of that already on the FCC filing. When SpaceX constructed its rockets, it did not to introduce anything exotic and stuck with tried and true technologies. The company just made them better and used them differently. It helps the company that it also seems more willing than most to take risks.

But the satellites themselves probably aren’t the reason SpaceX and other companies building similar constellations are confident. The confidence may be more about the market, politics, and lack of choice.

In the United States, people generally have put up with very, very mediocre or worse broadband. Even paying more for broadband is no guarantee it will be fast or good. But the other side of this monopoly is there is no real alternative to the one cable provider–and DSL is not a cable competitor. This means, then, that at the very least, citizens in the U.S. might be very willing to jump the cable-monopoly ship with no hesitation, IF the other alternative is significantly better, with significantly better customer service, and is cheaper. Politically and mindshare-wise, cable companies are viewed with the sort of contempt and resentment reserved for tax collectors. It’s one of the reasons why trends like cord-cutting are growing annually (https://bgr.com/2018/03/20/best-home-internet-vs-cable-2018/).

Data communications is growing. Streaming television requirements may demand more bandwidth as images become higher resolution. People will probably have more than a smartphone with them (they may not even have a smartphone–but that’s a discussion for another time), which means more communications devices per person. This implies networked communications isn’t even close to becoming saturated, as devices that serve our needs become smaller, more efficient, and less obtrusive. These devices will be ubiquitous and reliable as people expect them to work, all the time, every time. Homes and cars will be extremely networked for energy efficiency reasons, safety, security, and convenience. And to think that other people around the world, in poorer countries, won’t want those things is to ignore history.

The silliness of bandwidth and speed caps will need to be left behind for this kind of future. Broadband will need to be more affordable. And broadband infrastructure needs to be ready to take this on, whether from space or on the Earth. In the U.S., at least, the terrestrial broadband companies don’t appear remotely ready, and even seem to be attempting to turn back the clock. Which may be why constellations like SpaceX’s are appealing to entrepreneurs and represent some ray of hope to potential consumers.

The kind of orbits these new satellites are in will allow access to broadband ANYWHERE on the globe. The orbits are so close to the Earth that these companies believe their versions of space broadband will be faster. This appeals to gaming nerds and might be perfect for Internet of Things devices. And SpaceX has noted this constellation might also be helpful in aiming communications out, towards, say, Mars. Which means the company does not necessarily need to rely on the rotation of the planet to bring ground stations into view of Mars. But 12,000 seems overkill for that purpose.

However, these satellites are capable of serving broadband customers who could potentially come from many different markets, not just somewhere on 1/3 of the Earth’s face. And, if these satellites are cheap, it may not cost much to deorbit an outdated one and send up an upgraded, more capable satellite–just like Planet and Spire have been doing with their cubesats. Upgrade-ability is desirable in the minds of these newer potential space operators, and longevity equates to irrelevance. And the price for the constellation is cheap (https://www.fool.com/investing/2016/11/19/spacex-wants-to-give-you-satellite-internet.aspx)!

Yes, I said cheap! Conjecture continues in the next post.