How Starlink is about to disrupt the telecommunications sector

Enrique Dans
Mar 1 · 3 min read

If the logo doesn’t ring a bell, put it on your radar. Starlink, the satellite telecommunications company created by Elon Musk leveraging SpaceX’s rocket development, continues to complete milestones on schedule and announces that it will offer 300Mbps connectivity services with an approximate latency of 20ms by the end of this year.

In the United States, where the company has garnered a favorable deal that includes $900 million in funding under FCC programs aimed at providing connectivity to rural areas, that’s a very competitive offer, so much so that many ISPs have protested to the FCC claiming that the technology used by the company is experimental, not sufficiently tested, and will cause problems in the future. If you don’t spot that as a clear sign of disruption, you haven’t seen enough disruptions yet.

Not only has Starlink been deploying its satellite network through each SpaceX launch, it has also been offering pre-registration through its website and already has about 10,000 people in the United States it will offer, in addition to web connectivity, a telephone service with emergency calls and access prices for users with low incomes, challenging telecommunications operators head on.

And while customers are already receiving their connection kits and antennas, posting unboxing videos and writing about how their lives have changed thanks to the connectivity provided by the company, what’s really interesting is that, given Starlink’s configuration and technology, it could consider expanding this service to most of the planet by the end of this year, potentially causing major disruption in the telecommunications sector.

Starlink’s evolution very interesting: on the one hand, it is leveraging SpaceX’s rocket launch missions, a company that has managed to systematically lower the cost and entry barriers for putting satellites into orbit (it can launch up to 60 satellites at a time, or even use them to fill idle capacity on other missions). At the same time, it has created its own technology, making them much cheaper and more efficient, and with a very low failure rate. But above all, it aims to create an infrastructure that can be used anywhere in the world, simply by offering it through a web page, without the need for too much development of corporate infrastructure in each market: the antennas can be installed independently, and the service can be provided with almost no need to deploy teams of people to provide backup.

One of the biggest questions with telecommunications is how to provide connectivity to sparsely populated rural areas where infrastructure deployment is not economically viable. What happens if many of these areas, along with others such as those affected by natural disasters, begin to be served by satellite connectivity services like Starlink’s, with competitive bandwidth and latency at a reasonable price? What happens if these services begin to be considered as an option not only in these areas, but in others that until now have been relatively underserved by traditional telecommunications companies?

Starlink also raises many other issues in a market that has traditionally tended to be highly regulated: what happens to the amortization of frequency operating licenses or the amortization of infrastructure, in many cases resold to other companies, if competitors using satellite technologies appear that are able to offer a competitive service in any market? And what happens in markets where governments seek to maintain oversight of operators’ connectivity offers, taking advantage of them to exercise some form of censorship? Are governments such as Russia really going to start harassing those who connect in this way?

Will we soon see competitive Starlink offerings in rural areas in your country? That was a science fiction scenario until recently, but now seems to be, contrary to what usually happens with Elon Musk’s announcements, about to meet its deadline. The announced disruption seems to be arriving according to plan. Will this year see the arrival of vastly more competitive telecommunications?

This article was previously published on Forbes.

(En español, aquí)

Enrique Dans

Enrique Dans

Written by

Professor of Innovation at IE Business School, blogger at enriquedans.com and Senior Contributor at Forbes

Enrique Dans

On the effects of technology innovation on people, companies and society (writing in Spanish at enriquedans.com since 2003)

Enrique Dans

Written by

Professor of Innovation at IE Business School, blogger at enriquedans.com and Senior Contributor at Forbes

Enrique Dans

On the effects of technology innovation on people, companies and society (writing in Spanish at enriquedans.com since 2003)

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