The satellite internet market is predictable to surpass a market valuation of US$ 6 Billion and expand at a CAGR of more than 8% during the forecast period, 2021-2031.
How does satellite internet push high-speed internet forward?
As per 2020 data, globally, there were at least 400 submarine cables in service, and fiber optics cables constitute almost 99% of the total international internet data traffic.
Pricing is considered as a crucial part in providing internet services. Pricing differs as per international internet transit, which can be US$ 1 – 3 per megabit per second (Mbps) per month for prominent cross-country routes – submarine-based services, whereas, the price for dedicated satellite internet could be US$ 200 – 400 Mbps per month. Thus, at the current level, satellite internet is cost-effective only for regions that are remote and have a dispersed population, and places where the deployment of fiber optics is challenging. However, upcoming satellites are expected to provide services at a lower cost.
For instance, in the case of Starlink, the pre-order subscription cost is US$ 99 a month. Along with this, the service requires a series of hardware that cost US$ 499. The kit includes a small satellite dish that is easy to set up at homes and commercial places, along with a router and power supply. This price is far less than existing prices.
Latency is a measure of the time that data takes to pass from one network to another. Because optical fibers are on earth and in near proximity to users, latency associated with them is almost 5 microseconds. Since satellites are present in between heights of 500 km to above 35,000 km, latency is more.
Latency for various orbits are – for GEO it is ~477 ms, for MEO it is ~27-477 ms, and for LEO it is ~2-27 ms. The newer versions of GEO satellites provide higher throughput (HTS) but latency remains the same. Whereas, LEO satellite constellations require a large number of satellites to provide the service since they are low in orbit, cover less area, and revolve around the globe in 88-127 minutes. Their closeness to the Earth enables them to provide the advantage of low latency.
The bandwidth capacity that LEO satellite constellations will be able to provide is likely to undersize existing high-throughput geostationary orbit satellites. Traditional GEO have bandwidth capacity of 1-10 gigabit per second (Gbps), first generation HTS provides range of around 10-50 Gbps, while third generation HTS provides up-to 150-350 Gbps.
While new generation constellations have the capacity of 10s of Gbps for a single satellite, which totals to almost from a single digit to 10s of Tbps. It is expected that by the end of 2021, the speed of satellite internet is likely to be around 20 Tbps, and by the end of the decade, it is likely to reach 60 Tbps.
Similarly, fiber internet provides around 1 Gbps of internet speed. Satellite internet services mainly utilize Ku and Ka bandwidth service. Frequency in each band is the important difference that provides different speeds. Where the Ku-band uses frequency in the range of 12 to 18 GHz, the Ka-band uses frequency in the range of 26.6 GHz to 40 GHz. With higher frequency comes higher bandwidth, which results into higher data transfer and performance.
Looking at their coverage, capability of Ku-band is that it can cover an entire continent by using a single beam. On the other hand, the Ka-band can provide a country-wide coverage with the help of multiple beams. With the use of adequate infrastructure such as large number of satellites, a provider can provide services to adequate number of people.
Satellite internet market – Key Takeaways
- Sales of satellite internet are set to increase at a CAGR of 8% through 2031.
- The speed of satellite internet is likely to be around 20 Tbps, it is likely to reach 60 Tbps by end of the forecast period.
- The satellite internet market is expected to surpass a market valuation of US$ 6 Billion by 2031.
- Satellite internet market holds huge potential as it captures 73% of the global space industry.
Companies from the United States, Canada, Russia, China, India, and Europe are running the next space race in the commercial field. Companies such as SpaceX, Telesat, LeoSat, OnWEeb, Kepler, SES (O3b), Space Norway, and many others are a few of the frontrunners. Recently, Amazon and Facebook have also announced their entry into this field.
· OneWeb is a company with the second-highest number of satellites launched in space, with 254 in total, as of July 2021. OneWeb is joint venture between Airbus and OneWeb. The company was founded in 2012, and raised over US$ 3 Bn.
· Canadian Telesat started its operations in 1969, and they carry strategic experience in satellite communication. The company started planning for satellite internet in 2016 and announced that they will be launching around 120 satellites. Then later, in 2018, they launched their first LEO satellite and began testing in 2021.
· Later they announced their new plan of launching LEO constellation named as Lightspeed, it will be constituting around 298 satellites. But the company has made it clear that they will launching the satellites by 2023 only. Amazon’s Blue Origin will be their launch vehicle. As per the company, total expected cost for the constellation is likely to be around US$5 Bn.
More on the Report
The Fact.MR’s market research report provides in-depth insights into the Satellite Internet Market. The market is scrutinized based on Frequency Band (L-band, C-band, Ka-band, Ku-band, S-band, X-band) By Bandwidth (Less than 15 Tbps, 15-20 Tbps, Above 20 Tbps) By Orbit (Less Than 600 km, 600-1200 km, Above 1200 km), across seven major regions (North America, Europe, East Asia, South Asia, Oceania, Latin America, and Middle East & Africa (MEA).
These insights are based on a report on Satellite Internet Market by Fact.MR.