GEO operators say they can compete against LEO systems on cost

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WASHINGTON — Despite all the investment in low Earth orbit broadband megaconstellations, operators of geostationary satellites argue they can offer more cost-effective services.

During a Satellite 2022 panel March 21, executives pointed to innovations such as very small GEO satellites and software-defined payloads that allow new GEO satellites to provide broadband services at lower costs than LEO systems, albeit with higher latency.

“There’s no debate, at least for me, that from a cost-per-bit perspective and total cost of ownership, there’s no better economics than GEO, period,” said Bruno Fromont, chief technology officer of Intelsat.

One reason for that is the ability to focus coverage over densely populated areas that LEO systems lack. “You have this illusion that you can launch a lot of LEO satellites and have this big amount of capacity, but 75% of those bits are wasted,” he said, because the satellites are passing over unpopulated areas. “If you really want a lot of capacity, it’s going to be very expensive.”

“There’s no better way of covering high-density regions than with a GEO satellite,” said Adrian Morris, executive vice president of Hughes. “The large GEOs are very efficient. They create the lowest cost per bit.”

The widespread implementation of software-defined flexible payloads on GEO satellites also helps them be competitive. “Flexible GEO satellites, I think, are the answer for the GEO operators to the LEO constellation competition,” said Hadi Alhassani, vice president and chief strategy officer of Arabsat. “It puts us in the race with the LEO constellations.”

He said the uptake of flexible payloads helped the GEO market recover from a sharp drop in orders several years ago, when operators held off on making investments to see how the LEO constellations would take shape. “Now with the flexible satellites, the GEO operators are willing to commit their capex,” he said. “You’re going to see more and more ‘flex sat’ orders this year and the following years.”

Small or “micro GEO” satellites have helped the field remain competitive. “We offer groups and countries and companies the ability to have their own satellite that had been out of reach before,” said Mike Mancini, chief financial officer of Astranis, a company that has signed several orders for its very small GEO satellites. “We think it’s all about driving cost down and access up.”

One drawback of GEO systems compared to LEO constellations is latency because of their much higher orbits. Some operators have touted hybrid or “multi-orbit” solutions that combine GEO and LEO systems to provide low latency from LEO satellites for some applications and the better economics of GEO satellites for others.

Alhassani, though, was skeptical that hybrid networks will be used much in the near term.
“I don’t think we’re there yet,” he said of “orbit agnostic” systems. “For the foreseeable future it’s going to be siloed: you either have to go for GEO services or LEO services.”

The ever-increasing appetite for connectivity may drive demand for both LEO and GEO systems. “The demand is infinite. It is insatiable,” said Mancini. “We need to throw everything up in space we possibly can and have that work together.”