The Rural Reality of Starlink
While innovation is to be applauded, it must be weighed against other options in order to decide its value. For rural broadband, the question is: does it make more sense to spend money on a robust fiber/wifi terrestrial solution or on a Starlink alternative that will take years to deliver, could — incredible as it seems — crash financially leaving customers in the lurch, and is not future-proof?
Specifically, there are three reasons to question the strength of a Starlink solution for rural Canada in particular:
- Geo-zone coverage flaws
- The Starlink Business Plan is financially dubious, as Musk himself has said, and requires the placement of an additional 30,000 satellites with a million customers to make it work. In an email leaked in November 2021, SpaceX CEO Elon Musk says that the company could go bankrupt if, by the end of 2022, it can’t achieve Starship and Starlink milestones that are by all practical appearances out of reach.
- In 2021 launches were delayed by global shortages, especially in computer chips.
- An overall consideration is whether the market has started to turn against high-tech companies. Facebook’s wipe-out of 26% of its stock, worth more than $230-billion in value, could be a signal. Even after record earnings, Tesla’s value dropped by ten percent in just one day at the end of January, 2022. The investor market for the even more fragile Starlink service could be just as bad, leaving it to fail just as its predecessors Iridium, Globalstar and Orbcomm went bankrupt.
- Elon Musk has acknowledged that his first generation of satellites is “financially weak” and it will be necessary to build a new Starship rocket in order to launch a second-generation constellation to “handle the bandwidth demand” that would be generated by selling “several million” terminals per year.
- Musk has said Starlink could serve less than 5% of internet users and still generate $30 billion a year in revenue. Critics called that wishful thinking. An analyst at TMF Associates said that Starlink would struggle for enough capacity to support that level of demand, especially as people are consuming more data for video streaming. That would mean “significant additional expenditure on upgrading the satellites and adding more satellites.”
- Starlink must keep pace with terrestrial broadband expectations in order to create a viable business — something competing satellite broadband systems have failed to do for the last 20 years. Unlike the innovations represented by SpaceX’s rockets and Tesla’s electric cars, Starlink is not entering a relatively static market where competitors seek to maximize profits from their existing products. Instead, Starlink is competing in a broadband market where data consumption per subscriber has grown by at least 20% to 30% each year for the last two decades and shows no sign of slowing. Although Starlink offers much better speeds than existing geostationary satellite broadband systems today, it is far from clear that the system will be able to provide 5 to 10 times more capacity per subscriber at the end of the decade.
- Starlink’s customer growth to 140,000 subscribers is not very impressive, considering that there are currently 1.7 million homes served by satellite, and competitors like Viasat say there is only limited room for more growth. If that market does not grow dramatically, then the whole Starlink plan will crumble.
- The American government in particular has set aside hundreds of millions of dollars to create terrestrial community-based networks, with the full expectation that they can evolve into 5G and other advanced systems. Terrestrial telecom providers are racing to deploy high-speed, fifth-generation (5G) broadband services. The rapid spread of wireless and terrestrial broadband, along with high prices, were significant factors in killing previous low-Earth-orbit satellite ventures. Motorola-backed Iridium Communications Inc. went through bankruptcy after billions of dollars in investment, while a similar fate met Teldesic, backed by Microsoft Corp. founder Bill Gates.
- Starlink units will not be available any time soon, as shortages in chips have caused a slow-down in deliveries, with only 5,000 new units available in the past two months, according to a report in January 2022.
- Capacity could be an issue. In 2020 there are about 5 billion internet users. Five percent of that (Musk serving via Starlink) is 250 million users. 80% of the traffic is video streaming at 4 Mb/s. Assuming that 50% of subscribers are streaming: 125 million * 4 Mb/s *80% = 400,000,000 Mb/s or 400,000 Gb/s streamed up and down via the ground stations. If Starlink would build 400 ground stations worldwide, the traffic per hub is still 1,000 Gb/s. It is technically doable but at what cost.
- Starlink could be obsolete before it is widely received.
Geo-Zone Coverage Flaws
- For northern countries like Canada, Starlink faces a huge technical obstacle because the lower angle of elevation on the horizon used by the current satellites (25 degrees now instead of the 40 degrees Musk was hoping for) means that hills and trees will be worse barriers than before. This means that there is a high likelihood that the signal will be blocked by trees and houses and hills. For LEO satellites, you can’t just trim a tree and get a good signal; you have to trim the radius of trees all around your house. And around your neighbour’s house. Otherwise the service would likely be obstructed for about two hours per day and, as one report concluded, “Starlink, judged on its capabilities right now, is simply not a real competitor” to other solutions.
- In Canada especially, the weather dependencies of Starlink would show more, with snowfall, rain, thermal shut-down in heat waves, and wind affecting service.
There are other options for providing service to remote locations — options that provide better service, with sound finances and much less environmental damage. Perhaps we could put the brakes on for now and — for once — consider the trade-offs from our technology.