Internet service from space a possibility

Stan Ward

Stan Ward

June 15, 2015

Elon Musk has his head in the clouds – er… space. While earthbound mortals wrestle with mundane things such as cyber-security and government surveillance, his company, SpaceX, is hard at work on what he perceives to be the future of the Internet. Musk has asked the federal government for permission to begin testing on an ambitious project to beam Internet service from space. Not only would the initiative bring better, faster service to users around the globe, and possibly open up markets in poorer countries, it would go toe-to-toe with US behemoths like Comcast and AT&T.

A successful outcome for Musk would see an umbrella of some 4,000 small, inexpensive satellites that would blanket space and beam their signals all over the planet, including to the poorest, most remote regions and, “would be like rebuilding the Internet in space.” It could change California-based SpaceX almost overnight from a rocket company to a giant high-speed Internet provider that would potentially enable and empower billions of people now without service.

Curiously, now that the Internet is regulated as a utility thanks to the recent net neutrality brou-ha-ha, it will give everyone an opportunity to see just how government reacts vis-a vis the Internet and corporations, when presented with avant-garde approaches. It will be interesting to see if the government reverts to its usual role as impediment to innovation, or if it helps grease the skids and becomes a collaborator in creation.

This is not the first time a business titan has undertaken such a grand experiment, but where others, including Bill Gates, had designs on space platforms for the Internet, Musk has a giant leg up – his own rocket. In the mid-1990’s, Teledesic, a company founded by Gates along with wireless executive Craig McCaw tried to employ a similar plan to use multiple, low-earth orbiting satellites to provide Internet access, but abandoned the project as expenses soared past $9 billion.

Musk’s latest technology calls for smaller satellites which are built in-house, and are therefore cheaper to build and operate, and are better integrated. And unlike Dish Network and Direct TV, which rely on a few satellites with restricted coverage, Musk’s plan to blanket space with thousands of smaller satellites operating in low orbit will allow for global coverage for the masses. If things remain on schedule, he could be operational in about five years.

The proposition of utilizing space for expanded digital service has intrigued Internet and media moguls for decades, but many efforts have resulted in failure. Nonetheless, renewed efforts to tame space for commercial Internet means have taken shape. In a grand show of support for Musk and his Internet project, Google and Fidelity recently invested $1 billion into Space X.

Sir Richard Branson is also pursuing a project by partnering Virgin with a company like-minded to Musk. About a year ago we wrote about a man, Greg Wyler, and a company One Web, which was backed by Branson, and whose aim is to bring the entire world online and thus boost economic productivity globally.

Naturally, Musk is optimistic about his chances of becoming dominant in the Space/internet arena, and predicted that his system would reach remote regions, and handle up to 10 percent of Internet traffic in urban and suburban regions where people are “stuck with Time Warner or Comcast”. Moreover, the system would be “a real enabler for people in the poorer regions of the world” – if allowed by countries to function (admittedly not a given by any stretch.)

Paul Gallant, analyst at investment firm Guggenheim Partners, was enthusiastic about the project,

Some people might say the idea of satellite broadband has come and gone. But the cost structure of the business is so much better than when Bill Gates tried it. I think Musk’s track record of disruptive innovation would make this a really attractive business for the FCC to support.”

This will be a first, true test of the FCC and its new net neutrality posture. Eyes will be focused to see if innovation is indeed allowed to flourish, or will be strangled amid a wash of regulation as a utility.

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