Space X Starlink Beta Starts In 6 Months, Bringing A Glimmer Of Hope To Crappy US Broadband Market

from the disrupt-the-undisruptable dept

The US broadband market is a competitive mess. US telcos have routinely refused to upgrade their aging DSL lines, as the return on investment has never been fast enough for Wall Street. That has left cable giants like Comcast and Charter (Spectrum) with bigger broadband monopolies than ever before. While many see 5G wireless as some sort of competitive panacea waiting in the wings, there's a litany of problems (cost, reach, competition eroding M&As) that suggests folks should temper their enthusiasm.

Then there's satellite broadband. Long despised by consumers for slow speeds, inconsistent performance, high prices, and usage caps, the sector is poised for disruption by a number of low-orbit satellite ventures. These new offerings offer significantly lower latency using a litany of smaller low-orbit satellites. One of the major players is of course Space X, whose Starlink satellite broadband service is slated for a public beta six months or so from now according to Elon Musk:

The beta is poised to include both Europe and the United States, which the company previously stated should see a full commercial launch sometime later this year. After launching another 60 Starlink satellites yesterday, Musk indicated there were now "420 operational Starlink satellites" preparing to offer service. The service offers the promise of some significant disruption to a sector that very much could use a competitive kick in the ass.

That said, Starlink may never truly challenge the domination of telecom monopolies like AT&T and Comcast. For one, it's still far too early to know what kind of speeds or prices users will be looking at, and it's quite possible that the price point, throttling restrictions, or usage caps could result in the service being a flimsy alternative to fixed-line broadband. Musk has also previously noted how while the service latency should be a LOT better than traditional satellite broadband (20ms versus 200ms or higher), the service isn't going to have the kind of bandwidth needed to seriously compete in denser urban or suburban markets:

"The challenge for anything that is space-based is that the size of the cell is gigantic... it's not good for high-density situations," Musk said. "We'll have some small number of customers in LA. But we can't do a lot of customers in LA because the bandwidth per cell is simply not high enough."

Keep in mind that the US broadband industry is routinely peppered by well hyped potential disruptors that consistently fail to deliver.

Broadband over Powerline, for example, was widely hyped as a competitive panacea by folks looking to deregulate the telecom sector, only to fall flat on its face due to interference issues. The current FCC has similarly justified its pandering to existing monopolies with the promise that competition (be it 5G or satellite) is just around the corner. But there's no shortage of low-orbit satellite ventures thatn have fallen flat on their face, and there's no shortage of politically powerful companies (AT&T, Verizon, T-Mobile, Comcast) busily lobbying to ensure another major competitor never upsets the apple cart.

That said, there's still hope that Starlink offers a genuine, helpful option to users left out of reach of traditional options. With more than 42 million Americans still unable to get any broadband at all, and millions more unable to afford it due to limited competition and high prices, the US broadband sector can certainly use all the help it can get.

Filed Under: broadband, competition, elon musk, satellite broadband, starlink
Companies: space x, starlink