SAN MATEO (04/18/2000) - Despite the fervor surrounding DSL and cable options for remote workers, outfitting corporate outposts far away from fiber-rich infrastructures remains a problem for many IT managers.
"There are really limited options for some locations. Enterprises resort to twisted pair [wiring connections], install their own microwave systems, or turn to leased lines. But there are some real problems when there is no fiber to the curb," said broadband-industry watcher Mark Anderson, president of Technology Alliance Partners, in Friday Harbor, Washington.
A new generation of satellite-based services, however, is now on the horizon.
Backed by hefty technology and aerospace players, two startups, SkyBridge LP and Teledesic, are moving forward with plans for a next round of LEO (low earth-orbiting) broadband satellites.
Both companies envision LEO constellations that will provide voice, video, and data services including Internet access at speeds up to 100Mbps downstream to virtually any spot on the globe, regardless of the location's surrounding fiber infrastructure.
But price tags on the build-outs of these constellations run into the billions.
And those pursuing broadband satellite initiatives have hit some trouble in getting the funding they need, especially given the high-profile bankruptcy of satellite phone company Iridium.
Despite this, however, there is a strong case for being able to provide broadband access in even the far reaches of the globe. It is a proposition that appeals especially to multinational companies or to those enterprises that are wiring offices in largely rural areas.
"Out of the entire broadband market, by 2008 we are saying that 10 to 15 percent will be satellite. That is a pretty considerable number -- mainly in areas where there aren't other options like DSL or cable," said Christopher Baugh, senior analyst for satellite and cable systems at Pioneer Consulting, in Cambridge, Massachusetts.
Bethesda, Maryland-based SkyBridge in 2003 plans to launch 80 LEO satellites and build 140 companion ground stations.
SkyBridge executives portray the company as a wholesaler of "space telecommunications" services for ISPs and service providers. Those providers will then offer alternative broadband access methods to enterprise customers and others.
SkyBridge claims it will be able to beam data to corporate enterprises at rates of up to 100Mbps downstream and 10Mbps upstream. The technology will also support different networking protocols, including IP and ATM.
Meanwhile, Bellevue, Washington-based Teledesic plans to build a LEO system of 288 satellites, which will start service in late 2004. Each satellite will function as a node on a fast-packet network.
By interconnecting the satellites, the result will be a space-based network that accommodates faults and local congestion.
Because there are so many satellites in Teledesic's planned constellation, each will cover a relatively small area and overlap with others to improve performance and make up quickly for any satellite failures. The satellites will also orbit at a relatively low altitude to provide latency rates comparable to those of ground-based networking protocols. Latency rates now plague traditional geostationary satellite services.
Although Teledesic currently is not even close to launching the satellites, company executives are working on a short-term plan to begin offering service.
Specifically, Teledesic is on the verge of acquiring bankrupted satellite company ICO Global Communications.
ICO fell into bankruptcy shortly after the high-profile bankruptcy of the Motorola-inspired Iridium project. ICO's system is a constellation of mobile voice and data LEO satellites, which were well into development and about two years away from launching.
Teledesic likely will retool the ICO system to support wireless Internet and packet data.
But Teledesic claims it will still move forward with its own satellite infrastructure build-out.
The goal is to use the satellites ICO has started building to expand the reach of satellite data and offer a migration path to Teledesic's higher data rates, said Roger Nyhus, director of corporate communications at Teledesic.
Getting into the broadband market as quickly as possible may be crucial to both Teledesic and SkyBridge, because there is some industry skepticism surrounding planned LEO deployments.
"Some doubt that it will happen," Technology Alliance's Anderson said. However, he added that it was a good sign that Teledesic moved to acquire ICO's assets.
"They want to get into the business today, which I think is smart," he said.
Still, LEO detractors paint the efforts as doomed, because terrestrial broadband technology is now moving so fast that the LEO constellations may be obsolete by the time they are operative.
It is a notion that both companies strive to discredit.
"We are going to be arriving in 2003. The first broadband deployments were in late 1998, and it wasn't until 1999 that DSL really began to take off," said David Finkelstein, senior vice president of marketing and business development at SkyBridge.
"We still think there will be enough low-hanging fruit, especially in rural areas, since deployment of fiber is so heavily concentrated in cities," Finkelstein added.
Along with the worry that LEO technology may arrive somewhat late to the broadband scene, there remains the Iridium shadow hanging over the efforts.
Because Iridium's satellites would not support data transmission, they were deemed worthless by the industry and are now stranded in space with no buyer.
They are expected to soon burn in the earth's atmosphere.
Iridium's fate has prompted LEO investors to ask tough questions.
"Of course the question gets asked, [regarding] whether the same fate that befell Iridium will befall us. We think that is absolutely not the case," Finkelstein said.
SkyBridge, Teledesic, and others claim Iridium collapsed mainly because it was a narrowband infrastructure.
"Services based on telephony and low data rates have had trouble," Pioneer Consulting's Baugh said. "The satellite industry has had some setbacks with launch failures, trouble reaching target subscriber base, etc. But the industry [developing around] servicing the Internet via satellite has been very robust."
Also, both SkyBridge and Teledesic enjoy high-profile support. Telecom pioneer Craig McCaw, founder of Nextlink, started Teledesic, which will need $10 billion to complete its LEO constellation.
But Teledesic has garnered funding from other well-known personalities, including Bill Gates and Saudi Prince Alwaleed Bin Talal. Corporate sponsors include Boeing and Motorola, which is taking the lead on developing and deploying Teledesic's network.
Started by Alcatel in 1993, SkyBridge puts its LEO costs at about $6 billion.
But the company recently picked up financial backing from Litton Industries, adding Litton to a list of underwriters that includes Loral, Boeing, Mitsubishi, Sharp, and Toshiba.
Geostationary options improve
Technology allowing traditional geostationary satellites to host two-way Internet access is moving along. New services using existing satellites may provide some solutions for network-enabling remote locations.
Geostationary satellites, circling at 36,000 kilometers above the Earth's surface, are currently incapable of effectively processing signals necessary for standard TCP/IP data and voice signaling, but some recent efforts point to a possible breakthrough. For example, Loral Space & Communications' Globalstar venture last week teamed up in a demo with Qualcomm to prove that Globalstar's voice satellite services will soon be capable of hosting Internet connectivity.
Also, Israeli company Gilat Satellite Networks recently locked up $50 million in funding from Microsoft to build out its VSAT (very small aperture terminal) technology. VSAT uses small, fixed satellite antennas to transmit data and multimedia signals from geostationary satellites to a central hub and then out to diverse locations. Gilat claims its February deal with Microsoft will provide one of the first two-way consumer satellite broadband access methods.
These advances in geostationary satellite technology therefore may pose yet another hurdle to the build-out of expensive LEO (low earth-orbiting) constellations, industry observers said.
"I think that technology is being created every day for the geostationary satellites, so that there is no real need to put up all of the LEOs," said Lance Mortensen, president of San Jose, California-based r)Star Broadband Networks, which provides networking services to make use of satellite connectivity.