PARIS — While there is growing interest in providing connectivity by satellites directly to phones, there is no consensus on how quickly that market will grow, or even what that market should be called.
A panel at Euroconsult’s World Satellite Business Week here, featuring executives from companies that have provided satellite telephony services for years and new entrants planning to offer connectivity for unmodified phones, offered widely diverging views on how fast the emerging “direct-to-device” market will grow.
AST SpaceMobile and Lynk Global, which are developing satellite constellations to provide services for existing phones, believed the market will grow quickly. “We’ve been surprised in the market interest,” said Scott Wisniewski, executive vice president and chief strategy officer of AST SpaceMobile.
That’s driven, he said, by a desire by customers to remain connected. “We think the end user will be willing to pay. It doesn’t have to be that much.”
He didn’t give a specific estimate for the rate of growth when asked how long the direct-to-device market would reach $1 billion in annual revenues, but Charles Miller, chief executive of Lynk Global, estimated it would take less than five years.
“We think this is a much bigger opportunity and speed is the critical differentiator,” he said.
Others are more skeptical. “I think it’s going to take longer,” said Suzi McBride, chief operating officer of Iridium. “I think it’s going to take a good 10 years to get vehicles up there, capabilities up there, people adopting it, seeing what the service really is.”
That’s based, she said, on Iridium’s experience offering phone service for more than two decades. “I think we have to be very cautious and that we manage those expectations properly so that it is successful in the long term.”
Jassem Nasser, chief business development officer at Thuraya, expected it would take 7-10 years for the direct-to-device market to reach $1 billion in annual revenue. That’s based, he said, on expectations that the biggest opportunity will be in broadband data, rather than voice or messaging services, which will require advanced technologies and significant capital expenditures.
“To be able to deliver proper broadband data is going to take time, because I don’t think we have the right formula today in terms of constellation complexity and satellite design, as well as the capex involved,” he said.
Miller was unconvinced. “If AST and Lynk and SpaceX are right, the people who think this is going to take 10 years are going to miss the bus.”
Amid a discussion about access to spectrum and partnering with mobile network operators, the panel grappled with another issue: what to call this market. The industry has increasingly referred to it as “direct-to-device” while engineers often use the term non-terrestrial networks, or NTN.
Those buzzwords, Miller argued, are “inside baseball” that don’t effectively communicate its capabilities to the public. “Part of what we need to do is speak the language of our customers, the five billion people with a phone,” he said.
He suggested “sat-to-phone” as a more descriptive alternative. “This is going to be the big growth for the satellite industry into the future,” he said. “We should get the category right.”
“I don’t think the consumers really care” about the name, countered McBride. “They care about connectivity.”
