The environment was a little different outside the Paris hotel that hosted Euroconsult’s World Satellite Business Week in December. The Tuileries Gardens across the street, tranquil when the conference is normally held in September, was instead the site of a raucous Christmas carnival. From the middle of the day until late in the evening, crowds packed the park for food, shopping and, especially, amusement park rides.
The crowds, particularly the screams of people on the rides, were loud enough to be heard in rooms of the hotel overlooking the park. One person sitting in such a room, though, had an alternative explanation for the shouting: “It’s the cries of GEO operators trying to compete with megaconstellations.”
Those geostationary satellite operators say they have a strategy for megaconstellations. Perhaps the biggest buzzword of the conference was “multi-orbit,” where operators combine GEO satellites with non-geostationary orbit (NGSO) systems to provide a solution they argue offers the strengths of both. Beyond the technical challenges of combining GEO satellites with constellations, though, is figuring out how to work with those constellations — and if those constellations want to work with them.
MULTIPLE STRATEGIES FOR MULTIPLE OPERATORS
The central thesis of the multi-orbit strategy is that operators can provide their customers with the best of both orbits. Megaconstellations in LEO or MEO offer low latency needed to integrate with terrestrial systems more effectively, while GEO satellites provide more capacity in a specific region, like urban areas, than a megaconstellation that has to serve the entire globe.
“The dominant issue is not so much the amount of gross capacity but the efficiency of your ability to deliver that capacity in the places where there’s demand. That’s the place where geosynchronous has an advantage,” said Mark Dankberg, chairman of Viasat, during a panel discussion at the conference. “We’re a believer in multi-orbit because of the latency factor.”
“LEO will provide the global coverage and the low latency, and GEO adds on top of that the ability to bring capacity in very high-density populated places,” said Jean-Hubert Lenotte, chief strategy and resources officer of Eutelsat. One example he gave is that, among consumer broadband subscribers, peak demand is in the evenings when they use streaming video services. “Guess what? For streaming services, latency doesn’t matter, meaning that you have strong efficiency between GEO and LEO.”
At the conference, executives tended to elide over the technical challenges of multi-orbit solutions. What makes them feasible is the growing use of software-defined payloads on GEO satellites, allowing operators to shift capacity based on changing demand and markets, and the development of electronically steered antennas that work with multiple satellite systems.
The bigger issue could be how GEO operators can best work with LEO and MEO satellite systems. The most straightforward approach (but also the most expensive) is building your own constellation. That’s what Telesat is doing with its Lightspeed constellation of nearly 300 satellites, which will cost the Canadian operator an estimated $5 billion.
“We do believe that low latency is important today and will be increasingly important going forward,” Dan Goldberg, president and chief executive of Telesat, said at the conference. “We’ll be able to serve a much larger addressable market.”
SES already operates the O3b network of satellites in MEO and is doubling down with the mPOWER series of satellites scheduled to launch this year. “We’ve been operating in NGSO for close to a decade now and could not be more excited about O3b mPOWER,” said Steve Collar, chief executive of SES. “We’ve taken everything that we’ve learned from the O3b constellation and scaled it ridiculously.”
He acknowledged that O3b isn’t competing head-to-head with systems like Starlink that are focused on residential broadband. “We’re really delivering high-throughput, high-flexibility services,” he said, supporting customers like government agencies and cruise lines. “I think we’ve got a very competitive offer overall.”
Eutelsat’s approach is to partner with, and become a major shareholder of, OneWeb. “We’re a big believer in LEOs and even a bigger believer in the complementarity between LEOs and GEOs, so there was a strong strategic rationale for us and a very good entry price after Chapter 11,” Michel Azibert, deputy chief executive of Eutelsat, said of his company’s investment in OneWeb.
“Everyone is talking about multi-orbit solutions. The good news is that we are quite advanced on that,” said Massimiliano Ladovaz, chief technology officer of OneWeb. “The work that we are doing with Eutelsat shows we are ahead on that.”
Both Inmarsat and Viasat have talked about multi-orbit solutions of their own, from Inmarsat’s proposed Orchestra network that would combine GEO, LEO and terrestrial systems to Viasat’s filings with the FCC for NGSO satellites. It’s unclear how Viasat’s acquisition of Inmarsat, announced in November but not expected to close until the second half of 2022, will affect those plans, and neither Dankberg nor Rajeev Suri, Inmarsat’s chief executive, elaborated on those plans during separate appearances at the conference.
Then there’s Intelsat. The operator was once positioned to be a leader in multi-orbit solutions when it announced a merger with OneWeb in 2017, a deal that fell through when Intelsat’s creditors balked at the terms. Both companies ultimately filed for Chapter 11 bankruptcy.
Intelsat executives have talked more recently about multi-orbit strategies. Samer Halawi, Intelsat’s executive vice president and chief commercial officer, in an interview last fall, said the company was considering partnerships with NGSO satellite operators and building its own system. However, Intelsat announced in December that Halawi would be leaving the company at the end of the year. Intelsat’s chief executive, Stephen Spengler, also announced he will retire once the company completes its Chapter 11 restructuring. (Spengler did not participate in person or virtually at the conference because of hearings related to the restructuring effort, organizers said.)
In an interview during the conference, Jon Cobin, chief strategy officer of Intelsat, said the company was still looking at options for NGSO satellites, including both developing its own satellites and partnering with other companies. “We’re evaluating additional orbits. We’ve been looking at non-GEO for many years as a company,” he said. “You need multiple orbits to best provide carrier-grade services to mobile users.”
Cobin said that while Intelsat may be lagging other major GEO operators in articulating a multi-orbit strategy, waiting and watching what the other operators do has advantages. “We think that learning from those lessons, watching how people go to market, has some benefits,” he said. “We think it’s important to be prudent in terms of how we bring that in.”
REGIONAL OPERATOR STRUGGLES
Smaller GEO satellite operators are also thinking about multi-orbit strategies. However, their options are limited since they generally lack the resources to build their own LEO constellations. Instead, they have to look for partnerships among the megaconstellation companies.
“We want a partnership with them so we can resell their capacity,” said Kyungmin David Song, chief executive of South Korean operator KT Sat. “NGSO offers high capacity and high throughput, so we can use their capacity to fill in the gaps we cannot provide for our existing customers.”
“What is important for us is to try to find a partner,” said Miguel Angel Panduro, chief executive of Hispasat. He worried, though, about picking the right partner. “Some insiders consider that no more than two constellations will succeed, so we cannot fail.”
He suggested Hispasat was pinning its hopes on the European Union’s proposed constellation to provide broadband and secure communications. Hispasat is part of a consortium of European satellite operators, manufacturers and other telecommunications companies wrapping up a year-long feasibility study of the system.
Other operators are worried about the impact broadband constellations will have on their business. Adnan Al Muhairi, chief technology officer of Yahsat, said his company “is in discussions and is coordinating” with potential constellation partners. “A large amount of capacity will certainly cause an imbalance of supply and demand in the market,” he warned. “Unless demand can keep up with that supply, you’re going to see some significant impact to the current way business is done.”
He was also skeptical of the interest in low-latency communications that LEO constellations offer. “I haven’t heard anyone ask about latency, personally,” he said. “It is not something that is brought up as a key requirement from our customers.”
“Right now, I don’t see a requirement on the table that we have to combine LEO and GEO,” said Hasan Huseyin Ertok, chief executive of Turksat. “Customers don’t want to deal with which orbit is providing services.”
But, he added, times are changing. “In the coming years, it’s going to be something we have to work on,” he said. “At some point, we have to put LEO satellites into the picture and provide seamless connections for our customers. It’s coming in the next few years.”
STARLINK GOES IT ALONE
One issue those operators face is finding a LEO constellation company to partner with. Eutelsat’s stake in OneWeb may limit partnership opportunities, and Amazon has said little about its interest in partnering with GEO satellite operators. Many other proposed systems are just that: proposed, and thus years away from entering service.
Then there’s Starlink. SpaceX’s broadband megaconstellation is at the forefront of the industry, and the company doesn’t have existing ties to GEO operators, which would make it an ideal partner. Except SpaceX isn’t interested in working with GEO operators on multi-orbit solutions.
“We talk with GEO operators,” said Jonathan Hofeller, vice president of Starlink and commercial sales at SpaceX. That includes those operators that use SpaceX to launch their satellites. “We’re open to exploring where LEO plus GEO makes sense, and we continue to be open. We have yet to find that exact solution that works best.”
He took issue with one of the core tenets of the multi-orbit approach: that GEO satellites are needed to provide additional capacity in urban areas that can’t be met by LEO constellations alone. SpaceX instead thinks the answer is to simply add more LEO capacity.
“There’s no reason why LEO can’t be high density,” he said. “There’s complexity with having a multi-orbit system. Sometimes some people want slower, high-latency internet that may serve them, but if given the choice between a more complex, high-risk solution or one that can provide low latency and high speed all the time and meet their speed and bandwidth demands, they will choose the simpler solution and the simpler architecture that LEO provides.”
Hofeller said SpaceX is focused on building out the consumer broadband market for Starlink, along with enterprise and government customers that form a “three-legged stool” for the business. “We’re just pushing up a tremendous amount of capacity on orbit and finding out how we best utilize that,” he said.
SpaceX might be going it alone, but GEO satellite operators say it can’t be ignored, either. “We can all debate whether Starlink is a great business plan or not, but the reality is that it’s an example of addressing a broader market,” said Telesat’s Goldberg. “They’ve enlarged the market.”
Euroconsult announced that the 2022 edition of World Satellite Business Week would return to its normal slot on the calendar in mid-September, which means the Tuileries Gardens across the street should be peaceful once again. Any shouts you hear then within the walls of the conference hotel might indeed be from satellite operators figuring out their multi-orbit strategies.
This article originally appeared in the January 2022 issue of SpaceNews magazine.