Mon. Oct 2nd, 2023
Will Starlink Satellites Threaten Mobile Operators?

Low-Earth orbit (LEO) satellite solutions like SpaceX’s Starlink and Amazon’s Project Kuiper are promising to bring high-speed internet connectivity to remote areas where traditional infrastructure is impractical or too expensive. However, some wonder if these satellite solutions could pose a threat to mobile operators like Vodacom and MTN.

Vodacom executive head of innovation, Jannie van Zyl, acknowledges that terrestrial solutions offer excellent performance, especially in countries like South Africa where 99.5% of the population has 4G coverage. However, the business case for network infrastructure in sparsely populated areas is weak due to low return on investment. This is where satellite technology comes in, as it can cover larger areas that are otherwise difficult to reach. The challenge, however, is that satellite networks have lower throughput due to limited capacity.

Van Zyl believes that the technologies are complementary, and Vodacom has reached an agreement with Project Kuiper to use LEO satellites to enhance network coverage in underserved areas. Although satellite solutions have advantages such as independence from power grids and immunity to vandalism, they also come with challenges. One of the major challenges is latency, as the distance between the satellite and user device is greater than with terrestrial towers. However, Starlink and Kuiper have latencies comparable to 3G and 4G networks.

Another challenge is the need for a constellation of LEO satellites large enough to ensure continuous coverage. While this is costly, the economies of scale can work globally. Achieving this scale requires significant investment, worldwide adoption, and sophisticated infrastructure interoperability among satellite service providers.

Despite these challenges, Dawie de Wet, CEO of satellite specialist Q-KON, believes that satellite solutions do not pose a threat to mobile operators. He highlights issues with low data transfer and the need for stronger signal strength for emergency satellite connectivity. Additionally, regulatory complexities can hinder LEO service providers from entering new markets, making it easier for them to collaborate with mobile operators.

In conclusion, while satellite solutions like Starlink offer potential for connectivity in remote areas, their impact on mobile operators seems limited. The technologies are seen as complementary, and collaboration between satellite service providers and mobile operators may be the key to overcoming challenges and expanding connectivity access.