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Space Communications Is Exciting But Won’t Be Affordable For Consumers: Ookla To News18 Tech

The Indian government has realised the potential of the space sector and is soon planning to conduct auctions to offer satellite spectrum to interested parties. The market has evolved and become flexible nowadays which has paved the way for private startups and firms to enter the bidding and look to co-partner with established space organisations. Apple also showcased its focus in this space with the space communications feature now enabled on iPhone 14 in select countries.

But what does this sector promise for India, and how it plans to change the dynamics of high-speed connectivity in the country? Sylwia Kechiche, Principal Analyst, Enterprise at Ookla spoke to News18 Tech talking about the nuances of this technology, what has catapulted its evolution and how India could have a big role to play in its success.

News 18 Tech (NT) – What has catapulted the interest in the satellite communications sector in India?

Sylwia Kechiche (SK) – Before we talk about the scenario, I would like to touch upon the different kinds of satellites that are available in the market. When we talk about satellites you have

– Geostationary Satellite (GEO) – It is 36000 km away, offering very high latency which makes it impractical for basic use cases but gives you good coverage.

– Medium Earth orbit (MEO) – It is in the middle, almost 8000 km away and giving slightly lower latency.

– Low Earth orbit (LEO) – But everything has changed since the introduction of LEO. These are 1000 km away, which is still far but it is closer. The latency is lower compared to the other two, which means you can do things in real time. But it requires more satellites to be sent to space. So the likes of Starlink, OneWeb and Amazon have been investing in the LEO space,

With LEO, you can not only get broadband internet but now we have started talking about device-to-device communications through mobile devices. It is still early days with this tech, which is not new but what has happened is that the standardisation of the sector from the 3GPP.

Traditionally you had ground stations, wherein the signal from the satellite goes to the device, which means the latency was high. Lot of changes have come about because of investment and standardisation of the sector. You won’t get 5G-like speeds from the satellite, it is more like 3G speed of 3-5MBps but it all depends on how far you are, the congestion.

So, the overall changes have come about because of the emergence of LEO, investment and competition among companies in India along with supportive regulatory standardisation

NT – Space has been a secretive space in India, but that’s clearly changing with more involvement of the private companies. Has the technology advanced and become accessible?

SK – It is still a very expensive technology, the cost of sending a satellite into space is high. The price point is going down and the distance for (LEO) is not that far, and in India, because the fixed broadband penetration in India is low and skewed towards the urban areas. That means the left out parts can be covered with the help of satellite tech. We have seen other countries adopt this initiative, in the UK and US are looking at affordable broadband to far flung areas.

There is a lot of interest from the government to connect these areas, as it helps them bridge the divide between urban and rural areas, not only in terms of the penetration but also narrow the digital divide.

NT – Satellite communications mostly cater to enterprise and business, so when you say it will connect to rural areas, will the end user get to use these services?

SK – The main reason for that is the high price point which makes it difficult to access for the consumers. If you see the average revenue per user in India, it is around Rs 100 but Hughes that targets enterprises) is not affordable to the end users like you and me. If you take a 1 GB plan via satellite tech it will cost you Rs 5,000 which is expensive itself, and add to that you have to buy a hardware receiver (which costs around Rs 60,000).

If you look at these numbers (even in developed countries) and compare that to what people actually spend, it explains why the satellite tech is focused towards the businesses so far. The cost should go down but only if the cost of the satellite and the hardware comes down drastically.

In India, the way I see it is that the space sector services might be funded, backed by the government, to support schools and other institutions in rural areas. Enterprises have been connected for a long time. Operators are trying to find the best price point where it is affordable for the end user.

NT – You say schools and hospitals need the satellite tech first in rural areas, but they need hardware to run them, how can they afford setting up the support system?

SK – For projects like these, you have to look at the work done through the make in India scheme, which has been quite successful at producing hardware-software. And the subsidiaries are entrusted in making the services work in remote areas. Having all the hardware manufactured in India helps with better localisation, giving products at a faster pace of development.

Satellites are now allowed to be the backhaul technology, so the maturity curve in technology and we should wait and see how they offer (the services) in these areas in India. There are a lot of examples to look at (other countries) but it is still early days.

NT – India is going to be one of the first countries in the world to have satellite spectrum auctions. Is that the main objective of the government (with this sector), earning revenue rather than building a world-class ecosystem?

SK – India’s national broadband mission plan has satellites as part of a technology mix to extend broadband across India. The Department of Telecom (DoT) is working with partners to make it happen. There has been talk about how to allocate spectrum, and they figured auctions are the best way. It is a very interesting space. If the satellite space is going to be run by the government, funded by them, then it makes sense to be part of a wider strategy. And this brings a synergy between them and the private enterprises.

We can’t comment on what will be the government’s roadmap but it is obvious that the consumers are aware about satellite tech (via Ookla consumer survey) and the buzz created has generated interest among different entities and given this sector the room to grow and become a promising part of the country’s future. India has set itself a mission to become a leader in this space, so we need to see what kind of decisions will be taken to enable that vision.

NT – But satellite communications work outside of geography. So how does one tackle the geo-political tensions when it comes to such technologies?

SK – The decision to allow and not allow someone operate is done by the regulatory body, it is as simple as that. But yes, it is quite tricky.

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