Connectivity Business News: Connectivity providers capitalize on satellite direct-to-device unknowns

NTN is a technology worth betting on

AST SpaceMobile, Starlink, Skylo among companies looking to bring satellite connectivity to mobile phones this year

by Madeline Durrett, January 29, 2024

This could be a big year for the satellite direct-to-device market, as multiple network providers race to roll out new services. While players such as SpaceX‘s with Starlink already have vast networks in place, the uncertain nature of the market could mean it’s anyone’s game.

The global satellite direct-to-device market is projected to be worth a cumulative $93 billion by 2031, according to a March 2023 report by Northern Sky Research analyst Lluc Palerm.“Mobile network operators need to act quickly to implement their satellite direct-to-device service strategy to differentiate themselves from their competitors and capture a piece of this opportunity,” Palerm said.

Palerm’s estimate is generous compared with other projections, such as the one from connectivity provider Lynk Global CEO Charles Miller, who said in September that he projects the industry to be worth just $1 billion by 2028.

Consulting firms Deloitte and BryceTech have resisted providing estimates far in advance, citing the unpredictable nature of the direct-to-device market, but Deloitte only estimates the market to reach $3 billion in value this year, presuming planned satellite launches remain on pace.

Still a ‘new paradigm’

But what is causing such a disparate range of market estimates?

Tarun Gupta, co-founder and CPO of Skylo Technologies (Courtesy: Skylo Technologies)

“It’s a new paradigm,” Tarun Gupta, co-founder and chief product officer at Mountain View, Calif.-based non-terrestrial network service operator Skylo Technologies, recently told Connectivity Business News on an episode of “The Dish” podcast. “Apple had done a good job at releasing their iPhone 14 and 15 in terms of offering satellite connectivity, but they have not released a lot of statistics in terms of how many people are using the SOS service,” he said.

On one hand, limited statistics — at least for preliminary emergency SOS services — is a positive thing, because it’s an indicator that most people with the service are probably safe, Gupta said. On the other hand, mobile network operators want to profit from adding a satellite component to their cellular network before investing in more advanced services, he said.

For Skylo, the challenge was convincing mobile networkers that the financial potential of the market is worth betting on, Gupta said.

Skylo and Carlsbad, Calif.-based satcom provider Viasat (NYSE: VSAT) expect to deliver SOS and two-way texting capabilities in North America in the first half of 2024, he said, although specific mobile carrier partners employing the service were not disclosed.

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