Is SpaceX StarLink Launched for Africa? | #eBizInsights

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On May 23rd, 2019 SpaceX successfully launched the 1st 60 satellites of the planned 12,000 low orbit satellite constellation as the start of Elon Musk’s audacious 10-year $10 billion broadband space programme.  SpaceX just took a giant leap toward making global internet coverage a reality as its fifth Falcon 9 rocket of the year took flight on Thursday evening (May 23), sending 60 internet-beaming satellites into space. 

Known as StarLink the satellite constellation is part of a new generation of low-earth-orbit (LEO) satellite space communication network solutions.

A constellation of LEO satellites includes thousands of small satellites that provides continuous, global coverage as the satellites move. Unlike GEO satellites, LEO satellites also fly at a much faster pace because of their proximity to Earth.

The SpaceX’s StarLink constellation will place 66 satellite per orbital plan at a height of 550km above ground. The satellite will communicate through four inter-satellite laser links forming a communication channel in space which is then linked back to earth ground communication stations. Using shortest path computational simulations shows that a New York-to-London link will have a round-trip latency of 46msec vs the current undersee cable networks of 76msec. (Will satellite then be faster than fibre?)

How much will it cost?

So far very little factual information could be sourced on the planned broadband service profiles, the pricing models and other critical end-user go-to-market metrics. Working with the total project cost of $10 billion and with an FCC filing information by SpaceX Services, a SpaceX sister company, to license 1 million end-user terminal equipment we can estimate some service metrics. Then adding to this the current North America competitive landscape from HughesNet, Viasat and Dish with typical user rates of between $70 and $200 per month then SpaceX Services will have to connect the 1 million users at an average rate of $109 over a 10 year period to balance the project business case.

Will this work in Africa?

Technically yes, once the satellite is launched it will work in Africa, and anywhere else in the globe. The more difficult question is; Will I be able to buy this service in Africa?  It is too early to say if the service will be commercially available in South Africa and Africa, what we can discuss is what will be required to ensure service availability and continued market delivery.

The SpaceX StarLink service will require installation of a fixed two-way communication dish and terminal at each user location, similar to a DStv installation. This means possible future Service Providers of the StarLink service must have the capability to install thousands of specialist terminals at end-user locations throughout the service region. Next the service provisioning, on-going quality-of-service requirements, network operation, etc requires specific niche engineering skills set which is not currently part of the general service providers technical environments.

Initially the probable target market will mostly be “off-grid” locations, meaning users at locations which are “off-the-telco-grids” and not connected to the 3G mobile networks or fibre networks.  These are the niche market sectors and will further more require specific focussed marketing campaigns and target sales teams. The incumbent mobile operators and national Telco’s are not currently structured to deal with such a niche service and business set of requirements.

To answer the question; Will this be available in Africa? we must consider the business attractiveness of this special niche service and if any of the Telco’s will indeed adopt this as a go-to-market product. At an average end-user price of R1500 for the service, and based on an estimation of 100,000 terminals (10% of the base), the potential annual revenue income for a Telco will be R150M.  Putting this in context, this will be about 0,2% of Vodacom’s 2019 revenue. For the big Telco’s this will probably not considered attractive enough to invest the resourced required for such a specialized satellite service product.

A possible outcome

Given the expected technical speed and latency performance advantages of the SpaceX StarLink service, the benefits to connect all “off-grid” users as well as providing a high-reliable, easy to deploy fibre-alternative service SpaceX Starlink does build a compelling case that Africa can’t ignore.

It can thus be expected that a new generation of highly-focussed, niche satellite Service Providers will target this opportunity. For providers such as the Q-KON group, who is already leady this market sector with the current HTS satellite services products, this will be a logical next step in meeting the ever- growing demand for trusted broadband services in Africa.

About Q-KON

For over 25 years, Q-KON has provided wireless and satellite solutions across the African continent. Helping businesses harness technology for growth, gain access to new markets, and uplift communities, Q-KON has established an extensive pan-African implementation and delivery capability.

Q-KON believes that technology in itself is meaningless, rather focusing on how the right solutions can fill the connectivity gaps across the continent in order to improve people’s day-to-day lives – in business and in general. The company has completed projects in over 40 countries throughout Africa, has service partners in over 20 countries, and is well established in the African market.

Q-KON’s solutions provide major advantages for customers, including:

  • efficiency, enabled by experience and technology
  • guaranteed high speed network access, regardless of location
  • tangible results, leading to improved operations

 

www.qkon.com

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eBizRadio

eBizRadio is a live multi- platformed social media service providing an online forum to the business community for holding conversations on the key issues related to specific businesses as well as availing a space for cross-business collaboration in response to key issues affecting the world of business. The place to go if you want to know about business and lifestyle

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