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Low Earth Orbit satellite network
Low Earth Orbit satellite network
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For decades, Geostationary Earth Orbit (GEO) operators were in the communications catbird’s seat 22,000 miles above the Earth, but the arrival of Low Earth Orbit (LEO) networks, like Elon Musk’s Starlink, is bringing the Old Guard in satellite com down to terra firma.
“The proprietary and specialized GEO infrastructure of the past is now weighing down space industry incumbents that find themselves needing to rapidly innovate against mounting competition,” ABI Research Senior Analyst Andrew Cavalier wrote in a recent research report.
An indicator that innovation is in order is how the financial markets look at the major GEO players. Cavalier pointed out that in February, Moody’s Ratings changed its outlook on satellite operator SES from “stable” to “negative,” which has been attributed to increased competition in the satellite sector, price pressure, and risk of oversupply from LEO networks.
Meanwhile, he continued, European satellite operator Eutelsat OneWeb has seen its market capitalization drop more than 57% during the last six months, and Moody’s has given American Geostationary Earth Orbit operator EchoStar a Caa2 rating and a negative long-term outlook. Cavalier added that another GEO operator, Hughes Network, has been hemorrhaging broadband subscribers, dropping from 1.17 million at the end of 2023 to 869,000 at the end of 2024.
“If the performance of these companies is coming from only the initial rise of SpaceX’s Starlink, then the full deployment of Project Kuiper and Chinese mega constellations Qianfan (Shanghai Spacecom Satellite Technology (SSST)), Guowang (China SatNet), and Honghu-3 (Hongqing Technology) could signal the end of a GEO era,” he wrote.
Low Orbit, High Value
Cavalier noted that LEO networks pose several challenges to GEO networks. LEO nets operate in lower orbits — 186 to 800 miles versus 22,000 for GEO nets — so they can offer lower latency links. “That enables more user-friendly applications like streaming, video calling, and gaming, which suffer from GEO connections due to higher latencies,” he told TechNewsWorld.
Service cost is also a rapidly evolving factor, as LEO networks are constantly pushing down service costs to users across verticals, he added.
LEO networks also constantly launch satellites, which results in the network being updated every two to three years, he continued. “GEO often has much longer procurement processes and satellite lifetime — around 15 years — making those networks more static in comparison,” he said.
Radiation is also less of a problem for LEO satellites. “LEO operates in a lower radiation environment than GEO,” explained Daniel Bliss, a professor at Arizona State University and director of the Center for Wireless Information Systems and Computational Architectures.
“You can’t quite use the same electronics that you use on Earth for LEO, but pretty close,” he told TechNewsWorld. “When you go into deeper space, you need to put a lot of engineering effort into making sure that the hardware will survive higher radiation levels.”
In addition, Cavalier noted that GEO satellite networks — unless operating multiple satellites covering different regions — have a fixed region of coverage and service provision, while LEO networks operate on a global basis.
However, GEO networks can also provide consistent and persistent coverage to entire regions of the Earth. “A single GEO satellite can cover 40% of the Earth’s surface,” John Strand, CEO of Strand Consulting, a consulting firm with a focus on telecom, in Denmark, told TechNewsWorld.
He added that because of their higher altitude, GEO satellites are also less exposed to space debris.
“The big advantage of GEO is those big birds have really big pipes on board, so you can push a lot more data through a GEO network than you can a LEO network,” Jim Dunstan, general counsel of TechFreedom, a technology advocacy group in Washington, D.C. told TechNewsWorld.
Cavalier added that GEO networks, over time, are far less capital-intensive businesses than the mass manufacturing model of LEO networks, enabling a lower total cost of ownership to provide basic coverage and connectivity.
“This enables GEO networks to provide coverage to applications that may not need low latency as a priority, such as IoT devices and low-data rate mobile assets that move in and out of coverage, freeing up LEO capacity to target user applications that demand low latency,” he explained.
“I really think there’s going to be a very robust market for GEO operators in the internet of things [IoT],” Dunstan said. “It’s going to require them to rethink themselves, what they do and what they have. They have big pipes, but they’re going to have to be better distributed rather than just these single streams going up and down. They’ve never had to do it before, but they’ll have to learn how to do it to stay relevant.”
GEO Here to Stay
Eutelsat OneWeb, the only GEO operator that also has a LEO network, sees a multi-orbit approach as the future of satellite communication. “From our perspective, GEO is complementary to LEO satellites in the way they can offer continuous global connectivity and ultimately, a multi-orbit approach dynamically allocates resources based on demand and specific application requirements,” Eutelsat spokesperson Katie Dowd told TechNewsWorld.
“The market is evolving toward multi-orbit systems that use GEO for broad coverage and LEO for high-speed, low-latency applications such as streaming or gaming,” she maintained.
“In an increasingly connected world, customers are looking for always-on, always-connected, resiliency, redundant connectivity solutions, and this underpins the case for multi-orbit solutions,” she said.
“GEO satellites may also evolve to focus more on high throughput services — broadcasting, government communications, Earth observation, and weather monitoring — while LEO will address latency-sensitive applications — maritime and aviation, gaming, streaming,” she added. “The integration of GEO and LEO is and will continue to create new market opportunities and expand the capabilities of satellite communications.”
Whatever direction GEO networks decide to go in the future, it probably won’t include retail broadband. “There’s no way that GEO can compete with LEO in retail broadband,” Christopher Ali, a professor of telecommunications at Penn State University’s Donald P. Bellisario College of Communications, told TechNewsWorld.
“I don’t think the industry will die, but I do think it’s going to pivot away from retail,” he added.
“I think we’re in the very early stages of the traditional satellite industry’s response to new LEO entrants,” said Jay Robbins, Americas telecommunications leader for EY, a global professional services company.
“Hybrid GEO-LEO services, as well as industry consolidation and early pivots, are the first steps in this transformation, but not the last,” he told TechNewsWorld.
“GEO SmallSats are one example of an emerging model that gives more capital efficiency to GEO operators, which I think we’ll see more of in the future,” he added. “Another example is better use of dynamically utilizing satellite capacity. We’re also seeing GEO operators start to rethink their asset and value chain structures.”
John P. Mello Jr. has been an ECT News Network reporter since 2003. His areas of focus include cybersecurity, IT issues, privacy, e-commerce, social media, artificial intelligence, big data and consumer electronics. He has written and edited for numerous publications, including the Boston Business Journal, the Boston Phoenix, Megapixel.Net and Government Security News. Email John.