Alan Woodward lives
out in the countryside, in rural southwest England. He jokes
there are more four-legged than two-legged beings in the
neighborhood. He’s a professor of computer science at the
University of Surrey, and his work revolves heavily around
cybersecurity, communications, and forensic computing. He needs
good internet—and yet he’s never had much luck finding it.
“There’s always been lots of schemes I’ve participated in where
they’ve done so-called superfast internet,” he says. “They
always fail. They always go wrong. Can I try and get fiber to
this house? Not a chance. They won’t even give us a quote for
it. We were absolutely stuck.” He jokes that if he needed to
transfer large files to colleagues, sending USB sticks by mail
was easier than trying to use the web.
Six weeks ago, however, his circumstances changed, thanks to
Starlink. Woodward became a beta user of SpaceX’s internet
service, which uses a growing fleet of 1,600 satellites orbiting
Earth to deliver internet access to people on the surface. As of
the end of July, the company was reporting close to 90,000
users. “Within the first few weeks, I became a real fanboy of
Starlink,” says Woodward.
“For anybody that's been living out of the sticks like me,
Starlink will come as something of a revelation,” he adds.
But Starlink wasn’t designed just to hook up remote
cybersecurity professors: SpaceX has made bigger claims than
that. It hopes to bring high-speed satellite internet to many of
the 3.7 billion people on this planet who currently have no
internet connection at all. Many simply make do with
mobile-phone connections—an expensive workaround in its own
right. (One gigabit of data in sub-Saharan Africa costs 40% of
the average monthly wage.)
And that’s not even considering
people who have internet access but lack a broadband connection.
Almost the entirety of the US has access to the internet, but an
estimated 42 million don't have access to broadband. And even if
they have broadband, Microsoft estimates that 157 million
Americans, most of whom live in rural communities, don’t use it
at broadband speeds of at least 25Mbps. Black communities are
disproportionately more likely to lack access to broadband
internet, even when they are in close proximity to whiter (and
wealthier) communities. After living through covid and a time
when most people relied on the internet as a lifeline, it’s
difficult to think that high-speed internet is still an
unattainable luxury for some.
Unfortunately, it’s not clear whether Starlink can actually
solve this larger problem. “It’s really meant for sparsely
populated regions,” SpaceX founder Elon Musk said at a
conference in June. “In high-density areas, we will be able to
serve a limited number of customers.” And many rural citizens of
the world will be locked out because they won’t be able to
afford it.
Starlink must get costs down fast in order to expand its
customer base, but it must also make enough money to continue
launching hundreds or even thousands of satellites every year.
It’s a delicate needle that might be impossible to thread.
Price points
Typical satellite internet
services place just a few satellites in very high orbits, called
geostationary orbits. From up there, individual satellites can
provide wider areas of coverage, but the latency (or lag time)
is greater. Woodward has used such services before but has
always found them to be “useless.”
Starlink and its competitors, like OneWeb and Amazon Kuiper,
instead deploy tens of thousands of satellites into low Earth
orbit (LEO). Their closer proximity to Earth means latency is
significantly reduced. And while each one covers a smaller area,
the sheer numbers mean they should theoretically blanket the
planet in coverage and prevent any loss of connection.
Starlink began beta testing last year and is now available in 14
countries. Last December, the US Federal Communications
Commission awarded SpaceX $886 million as part of its Rural
Digital Opportunity Fund (RDOF), which subsidizes US telecom
companies that are building out infrastructure to help get
broadband access to rural places.
But it’s not totally clear
whether rural America is a viable customer base for Starlink.
The biggest issue is cost. A Starlink subscription is $99.
Speeds can vary greatly, but the average user should expect 50
to 150 megabits per second. You’d have to pay traditional
satellite internet companies like Viasat (which operates
geostationary satellites) double that amount to get the same
speeds. Not bad.
It’s the upfront expense that will hit you hardest with Starlink,
however. Costs for things like the satellite dish and router
come out to a whopping $499—and that equipment is sold to
customers at a loss. SpaceX founder Elon Musk has previously
said he hopes these costs can come down closer to $250, but it’s
unclear when or if that might happen. For much of the rural
world, in America and elsewhere, the price is simply too high.
So who will the first Starlink users be? The physical and
financial demands of building satellites and launching them into
orbit (though cheaper than ever, still a very expensive
enterprise) mean Starlink will be operating at a loss for some
time, says Derek Turner, a tech policy analyst at Free Press, a
nonprofit that advocates for open communication. And getting
costs down will mean looking at customers beyond just
unconnected individuals in the countryside.
Instead, the early customers are more likely to include the US
military, which when operating in remote areas often relies on
geostationary satellites plagued by congested service and high
latency. Both the Air Force and the Armyare interested in
testing Starlink. Some intelligence experts have pointed to the
troubled pullout from Afghanistan as an example of where the
service could have helped.
Airlines that want to offer passengers faster and more stable
in-flight Wi-Fi are also looking into Starlink. Other commercial
businesses in rural areas might also find value in it. And of
course, there are techies and curious customers in the suburbs
and cities with the money to try it out.
In Turner’s view, adding those customers could help bring prices
down for everyone, but it also means less bandwidth to go
around. Starlink can offset this problem by launching more
satellites—which it eventually plans to do, but that’s assuming
it has enough subscribers.
Musk has said it will take tens of billions of dollars in
capital before Starlink has enough capacity to generate a
positive cash flow. It’s launched 1,600 satellites so far with
no problem, but the eventual goal of 42,000 is an entirely
different matter. “It doesn’t scale as favorably as wired
broadband does,” Turner says. It’s not at all clear yet how many
satellites Starlink will need in order to deliver reliable
high-speed internet to hundreds of thousands or even millions of
subscribers logging on at the same time.
And for many customers, especially commercial businesses, there
are cheaper alternatives to Starlink that can still fulfill
their needs. A farmer who’s using smart sensors to track things
like local weather and soil conditions doesn’t need broadband
internet to connect these devices. That’s where smaller
companies like the US-based Swarm come in: it uses a fleet of
over 120 small satellites to help connect IoT devices for such
use cases. Swarm (recently acquired by SpaceX) offers a data
plan starting at just $5 a month. And of course, if you’re in a
well-populated area, spending $99 a month with another ISP will
likely get you speeds closer to 1,000 mbps.
Backtracking
On the surface, the FCC’s
RDOF award to Starlink would suggest that rural America is an
essential part of how Starlink will grow. But Turner says this
is a misconception, and that SpaceX should not have been allowed
to put down RDOF bids in the first place, because it will be
building out the Starlink network anyway. “I think the FCC would
have been better to direct its resources toward bringing
future-proof broadband to areas where it doesn’t make sense
economically to deploy,” he says.
Acting FCC chair Jessica Rosenworcel spearheaded a review late
last year of how RDOF subsidies were awarded under her
predecessor, Ajit Pai, and found that billions were doled out to
companies to have them bring broadband internet to places where
it was unnecessary or inappropriate, like “parking lots and
well-served urban areas.” A report by Free Press estimated that
about $111 million of SpaceX’s own award would be going to urban
areas or places with no real infrastructure or need for internet
connections, like highway medians. The FCC is asking those
companies, including Starlink, to essentially give back some of
the money. (SpaceX did not respond to questions or requests for
comment.)
Turner acknowledges that LEO satellites are “going to be a very
important innovation in the telecommunication space.” But he
still thinks services like Starlink will be a niche product in
the US, even in the long term—and sees the general trend
continuing toward fiber. Even an emerging technology like 5G
relies on very dense networks of antennas that can connect back
to fibers as quickly as possible. Cable broadband has improved
consistently over time because companies are pushing fiber
networks deeper and closer to customers.
Underdeveloped parts of the world might find
Starlink to be a boon, since many of these places do not have
physical networks like the cable system that the US laid out in
the 1970s, ’80s, and ’90s. But beta testing so far is exclusive
to the US, Canada, parts of Europe, Australia, New Zealand, and
Chile. It’s too early to tell what kind of impact it could have
in the developing world, especially if subscription and
equipment costs stay high.
Woodward’s experience is the kind the company would like to
replicate for all its customers. But Woodward knows he’s
fortunate to be able to afford Starlink, and that it’s able to
meet his needs. For now, at least. “It will be interesting to
see how Starlink holds up when they get 200,000 users,” he says.
“Prices will have to come down, but speeds and service will have
to remain the same. That’s all to be determined.”
Neel V. Patel
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