What happens to telecoms companies when we get our data from the sky?

Enrique Dans
Jan 20, 2015 · 3 min read

The recent announcement by a visionary with a proven ability to implement his ideas, Elon Musk, that he intends to set up a company to create a constellation of satellites to provide broadband internet access will no doubt be causing headaches for anybody who works or has invested in a conventional telecommunications company: a fleet of some 700 interconnected satellites, each weighing the same as a scooter, providing internet access at competitive speeds and prices. In other words, internet for the planet, from heaven.

The progressive lowering of costs and reduction in size of the components required to launch satellites means that Musk, whose SpaceX project is focused on space transport and satellites, among other things, is not the only person thinking in these terms: Greg Wyler, formerly of Google, a man with considerable experience in the subject, has already come up with a similar idea called OneWeb, which obtained financing from Qualcomm and Virgin. At one point, Wyler left Google seemingly to work with Musk on SpaceX, but then decided to go it alone.

Competition could of course play a major role in the way this industry develops. Money is another factor: Elon Musk has only just announce his project, which still has no name, and already Google has said it is interested in investing in it. Google’s intentions are clear: it considers itself a company that will take advantage of any tide that raises all boats, and the more access to internet there is on the planet, the better, whether it comes from helium balloons, drones, or satellites, the company doesn’t care.

Everything would seem to suggest that satellites will be providing internet access within a few years: those who can afford it, based on prices that will likely fall rapidly, will have their data beamed down to them from the skies at broadband speeds. Those who can’t will use a unidirectional internet, educational or informational based in repositories and also distributed by satellites via projects such as Outernet, which has already surpassed its crowdfunding objectives via Indiegogo.

How did we get from projects such as Iridium or Globalstar, limited to voice communications or low-speed data, to the current situation where there are new initiatives aiming to provide the movement of data at speeds comparable to broadband? The answer, in a word, is architecture. While Iridium or Globalstar are based on fleets of 76 or 32 satellites respectively, designed to transmit to small antennas or cellular equipment, Musk or OneWeb’s involve 10 times the number of satellites, backed up by high power geostationary antennae: many more cells, more satellites to connect with and to exchange data between themselves, and much more modern equipment.

Once satellites are put in place it is practically impossible to maintain it, and the only option when they go wrong is to send them back down into the atmosphere where they burn up, and then replace them. In comparison, drones or helium-filled balloons offer many more advantages: they can be brought down to earth in a controlled way for maintenance and updating. But in one way or another, everything suggests that in the not-too distant future, a large number of us will no longer receive our data via the terrestrial infrastructure provided by traditional telecoms companies, but straight out of the sky.

This is a revolution in which the losers look set to be the traditional operators. In an environment in which communications are increasingly important and in which data is at the center of everything, relative newcomers are positioning themselves to be able to offer data in new ways, using systems that just a few years ago would have been considered science fiction. Companies prepared to breach the sacred principle of internet neutrality and blackmail companies not to degrade their information or data could find themselves being swept aside by the operators of the future using technology in the sky and subject to regulation much more difficult to exercise by the known players. The battle lines are drawn…

(En español, aquí)

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 and blogger at enriquedans.com

    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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