16 June 2023

Plummeting costs per bit and ground segment advances are enabling nations to take greater advantage of satellite than ever before, says Amy Saunders

Satellites have been delivering essential services for the better part of a century. Use cases like national broadcast, navigation, weather forecasting, disaster recovery, telemedicine, remote learning, mobile communications, IoT, etc. have all proved invaluable the world over. But what it all comes down to is enabling connectivity.

“Connectivity for all has become a priority for governments across the world, with Asia Pacific potentially reaping an economic dividend from digitalisation of more than $8.6 trillion to 2025, according to the Asian Development Bank (ADB),” says Gaurav Kharod, regional vice president – Asia Pacific, Intelsat. “Yet, according to Euroconsult’s latest report on Universal Broadband Access (UBA), APAC and sub-Saharan Africa alone hold 85% of the world’s unconnected people, with a quarter located in India. This may be explained by factors like rural and remote communities, difficult and sometimes inaccessible terrains, and the economic viability of such connectivity solutions. The lack of infrastructure, long and costly to build, has a direct impact on countries’ digital development. Satellite, with its ubiquitous coverage, is the only way to deliver an immediate, robust connectivity, everywhere and at any time.”

Connectivity - by whatever means - is big business and is only expected to grow.

“The emergence of large low Earth orbit (LEO) and mega-medium Earth orbit (MEO) constellations and next-generation geosynchronous (GEO) very high throughput satellites (VHTS) in southeast Asia and Oceanic region will drive wholesale and consumer retail prices down further extending the price declines that began in 2015-2016,” said Bill Rojas, research director for IDC Asia/Pacific, in a statement. “The wholesale price drops will further expand the number of use cases that will become feasible…”

Shaking things up – direct-to-device

With costs plummeting, new applications are becoming more accessible. Today satellite connectivity is joining with standard consumer devices to offer direct-to-device (D2D) services - which has been named by NSR as the ‘largest opportunity in satcom’s history.’

The NSR market forecast for D2D is US$66.8 billion in 10-year revenues versus US$38.5 billion for wholesale non-geo satellite services. NSR expects average monthly users to reach 386 million by 2030.

The ability to communicate via satellite through standard mobile phones will reduce barriers to entry and help bridge the digital divide, while MNOs stand to gain by boosting customer satisfaction, reducing costs, and unlocking new revenue opportunities.

“D2D can have both challenges and opportunities for MNOs,” explains Martin Coleman, partner, Colem Engineering. “On one hand, it may pose competition to MNOs in areas where satellite connectivity becomes a viable alternative to terrestrial mobile networks. On the other, MNOs can leverage D2D technology to enhance their service offerings. They can integrate satellite connectivity into their networks, providing seamless handover between terrestrial and satellite connections. This hybrid approach can ensure continuous coverage in remote or underserved areas, offering a more comprehensive service.”

“The D2D technology is interesting,” agrees Kharod. “We think that High Altitude Platform Station (HAPS) could address a need from customers to achieve MNO D2D capabilities and performance (5G/6G) from the stratosphere. D2D is a nascent technology, and some technological and regulatory challenges need to be fixed, but this could, ultimately, help drive cost down and open new markets, helping respond to the needs of MNOs in the region.”

While the technology is still developing, there have been many big partnership announcements in recent months, and the world’s first seamless 5G D2D connection across different network layers into the stratosphere, space and back was achieved in Croatia earlier this year. Deutsche Telekom’s mobile service provided from the stratosphere took the backhaul path via Intelsat’s satellite and its ground infrastructure to the backbone network or directly to the ground station. The data transfer started with a standard 5G cell phone over a 20MHz channel. In the airspace above Pula, Croatia, Deutsche Telekom achieved data speeds of up to 200Mbps.

D2D is expected to unlock extraordinary opportunities, although adoption will depend on factors like cost, reliability, terrestrial alternatives, policy makers, and market dynamics.

“The impact of satellite-to-device technology in southern Asia can be transformative, enabling connectivity in remote areas, enhancing disaster resilience, and fostering IoT deployments,” concludes Coleman.

Cost is key

Satellite can play a huge role in enabling essential services, although its use has traditionally been hindered due to the hefty price tag. However, while terrestrial infrastructure remains less expensive on a cost per bit level, its deployment is often price prohibitive due to small, dispersed communities, or challenges arising from the natural landscape itself – such as southern Asia’s many islands - rendering satellite the only viable option.

Recent advances in satellite and ground equipment technologies have led to better economics, says Kharod. “We have also developed cellular backhaul managed services for MNOs to back up and build out 2G, 3G, 4G, 5G, and IoT coverage anywhere, in less time and more cost-efficiently than when relying on terrestrial backhaul alone. Connectivity cost should not take over quality, and this is why we are working on innovations to make satellite more affordable.”

The combination of plummeting cost per bit for satellite capacity, and reduced ground station equipment prices herald a new era for connecting southern Asia’s more challenging locations. However, investments will still be significant in cost. A combined effort will be required from government and industry to ensure that growing connectivity demands are met, without breaking the bank.

“Responding to the growing connectivity needs of the region will require a concerted effort,” concludes Kharod. “We believe that partnerships between satellite communications companies and governments will enable to bring together complementary capabilities, playing a crucial role in delivering the much-needed connectivity.”