Tag Archives: Satellite cellular

Competing with Satellite Cellular

A recent article in Fierce Network quotes AT&T’s CEO John Stankey as saying that he’s not too worried about competition from satellite cellular providers. He said the new technology is better suited for specialty niches like maritime and IoT.

His comments raise a lot of interesting questions. First, Stankey is right that satellite cellular is not going to compete well head-to-head with traditional cellular in markets that have strong cell coverage. An Ookla report for the second quarter of 2025 shows nationwide median download speeds for the big three cellular providers as 275 Mbps for T-Mobile, 134 Mbps for Verizon, and 129 Mbps for AT&T. Speeds in urban markets are significantly higher.

A market weakness for the big cellular carriers is rural coverage, which is going to be a target market for satellite cellular. You don’t have to drive far outside most urban areas and county seats to encounter areas with little or no cellular coverage by the big companies.

There seems to be interest and a potential market for satellite cellular. Viasat released the results of a survey that indicated that 60% of cellular customers worldwide, and 56% in the U.S., would consider paying extra to get access to satellite cellular connections. You have to take a survey done at the early stage of the new industry with a grain of salt since real interest is going to depend on the quality, ease, and cost of using satellite cellular. The survey results are interesting because they show a lot of people who must be encountering situations where traditional cellular is inadequate.

Stankey pointed out the weaknesses of the satellite cellular concept. The biggest weakness is that there isn’t good indoor coverage. However, I would be shocked if somebody doesn’t eventually solve that problem. Perhaps Starlink dishes or standalone outdoor receivers can be used to communicate with cellular satellites, which could then somehow get the signal into the home. The issue that I haven’t heard being discussed is the ability of satellite cellular to connect to moving vehicles.

Stankey’s more significant observation is that a satellite network can never duplicate the huge amount of bandwidth needed to give cellular customers the services they want. He’s absolutely right, and it’s unrealistic to think that satellite providers could have enough bandwidth collectively to become the fourth major carrier in the market. Cellphone usage is no longer just about texting and voice calls, and cell customers want to stream videos and upload pictures and videos. For satellite to become a viable rural solution, it will need to provide enough bandwidth to satisfy expected customer demand.

There are a few other issues that will also affect the long-term competition issue. Cellular broadband speeds are still improving. For example, AT&T recently installed the spectrum acquired from EchoStar in 23,000 towers to improve speeds. We’re five years away from seeing the beginning of the 6G generation of cellphones. It’s too early to know specifically what that means, but it has to mean more speed and capability for terrestrial cellphone networks.

One of Stankey’s comments is intriguing: that satellite cellular might be the solution for IoT. I’ve been reading for a decade about the potential for widespread agricultural sensors, but this has never happened in any material way. A big part of the problem is the bandwidth needed to communicate with sensors. Rural cellular networks are generally lousy or nonexistent in areas that are mostly farm fields. The second issue has always been power, but there have been advancements in small solar power units that could finally combine with ubiquitous satellite cellular coverage to make farm sensors a reality.

Cellular from Satellites

There was a burst of recent press about cellular service provided from satellites. This was probably prompted by the two recent hurricanes that have disable terrestrial cellular and broadband networks in the southeast. I’ve seen speculation and discussion on Reddit and other forums where people have been wondering if satellite is the future of cell service and if the ubiquitous giant cell towers will eventually become obsolete.

The short answer to that question is no, but the longer answer is that there are a lot of reasons why this is unlikely to happen. The first is pure physics. Radio waves of all types spread over distance, and a cellular signal sent from a satellite will spread and weaken a lot compared to the same signal sent from a cell tower in your neighborhood. As radio waves spread, the size of the receiving antenna needs to be larger to catch the full signal. A cellphone does not present a big enough area to receive a strong satellite signal. You can easily see this by comparing the size of your cellphone to the size of a Starlink receiver.

Everything I’ve read says that there is also a major line-of-sight issue with cellular wireless connections. I don’t know about you, but the vast majority of my cellphone calls are made inside my house, a business, or a moving car. How useful is satellite cellular if it only operates optimally when you are outdoors?

The strength of cellular signal equates to quality. Speed tests show that my AT&T cellular signal is consistently over 100 Mbps and sometimes as high as 200 Mbps. Space cellular companies cannot match those speeds. My cellphone is consistently faster than the speed test results I’ve seen for Starlink home broadband.

Another huge issue is spectrum. Terrestrial cell companies use several different bands of spectrum to deliver cell traffic – all they need to do to add a new band is to get handset vendors to build it into future phones. None of these same bands of spectrum are available for satellite providers since the spectrum has been allocated to cell companies by the FCC through auctions. To provide ubiquitous satellite cellular, the space carriers need to find a lot more spectrum and get it built into handsets.

Then, there is a national security issue. Imagine if we moved all cellular coverage to space. It would present an attractive target in times of war. It would be much easier to sabotage a satellite network than the hundreds of thousands of terrestrial cell towers.

Finally, I’ve always believed in the old maxim, “If it ain’t broke, don’t fix it”. I think a large majority of people are happy with the way their cellular works. It’s hard to imagine people ditching traditional cellular service for something that doesn’t work as well.

With all of that said, there is still a market for satellite cellular in the U.S., and probably a bigger market for it around the world. There are still many rural places in the U.S. where cellular coverage is terrible, or non-existent. The FCC is poised to tackle the holes in rural cell coverage using the soon-to-be-launched 5G Fund for Rural America. When those networks are built, the market for satellite cellular in the U.S. will be even smaller.

But even then, there will be a sizable market for satellite cellular in the U.S. Nobody is going to ever build cell towers to cover the vast wilderness areas of the country. Satellite cellular is going to be very popular with campers and hikers and folks who work in remote areas since it gives them a lifeline to the world.

Satellite cellular could be a boon to much of the rest of the world. Even countries with a lot of cell sites often do not have the same kind of fiber backhaul used at our towers. In places where cellular is the primary form of broadband, cell towers are often already badly oversubscribed. Where our cellular speeds are often over 100 Mbps, the speeds in many third world countries is a tiny fraction of that speed.

I suspect the companies doing this will do quite well if they can make the cellular reasonably functional. But it’s hard to envision satellite cellular as a competitor to terrestrial cellular in first world countries.