- SpaceX won’t become the 4th national MNO, despite the EchoStar spectrum buy, according to analysts
- This is because its D2D services can’t deliver the kind of spectral efficiency that mid-band 5G can
- SpaceX will, however, become a good global partner for hyperscalers and enterprises
No, despite multiple breathless posts on LinkedIn, SpaceX won’t become the 4th mobile network operator in the United States, despite its $17 billion purchase of wireless spectrum from EchoStar, according to analysts.
After AT&T’s surprise purchase of EchoStar's mid-band 3.45 GHz and low-band 600 MHz spectrum for $23 billion in late August, SpaceX followed that up by scooping up EchoStar’s AWS-4 and H-block spectrum for $17 billion last week.
This has led many commentators to speculate that SpaceX will become the interstellar version of a 4th national mobile network operator (MNO) for the U.S., now that EchoStar/Dish can no longer fulfill that role. This, however, will not be the case, Mobile Experts President Joe Madden told Fierce in an email.
“The short answer is no, Starlink won’t be creating a ‘fourth MNO’ from space,” he wrote. “There are multiple issues, including penetration of buildings for indoor services, limited capacity and the high cost of space-based bandwidth.”
This is because spectral efficiency for direct-to-device (D2D) satellite services is much lower than can be achieved by the mid-band 5G services delivered by terrestrial operators today. “The new Starlink D2D capacity density is about 2000x - 1,300,000x lower than terrestrial mid-band 5G,” stated Stephen Yates, the founder and CEO of an unnamed stealth startup in a recent post on LinkedIn.
“Calling D2D a 5G replacement isn’t a bold vision, it’s magical thinking,” the CEO stated.
An indoor problem
Disruptive Analysis founder Dean Bubley also recently posted on LinkedIn that indoor coverage would be a real problem for SpaceX/Starlink D2D services. “Space-based wireless, even if it’s at frequencies supported in normal smartphones, won’t work properly indoors, Bubley wrote. “And” uplink from devices to satellites will be even worse.”
“We spend about 80% of time, and use 80% of cellular data indoors,” he noted.
The analyst also stated that indoor Wi-Fi coverage couldn’t be relied on. “It’s not possible to rely on Wi-Fi everywhere, although it obviously helps in some places, if authentication is fast and automated,” he said.
Bubley told Fierce that there will be use cases for a Starlink D2D service, particularly for its Tesla connected vehicles, as well as for trucks, planes and trains. Military and public safety, various IoT uses and some on-demand spectrum sharing and leasing models could also be use cases, he noted.
“Conceivably [it] could be used for satellite-based private 5G over wide areas, eg for connecting fleets of vehicles, or remote sites like oil exploration," said Bubley.
All of this will require more cooperation with traditional MNOs than naked competition, as Joe Madden noted. “I expect Starlink to partner with the major operators more than they compete,” he said.
“Starlink will have the advantage of becoming a global carrier, not just a regional player,” Madden wrote. “They will need to collect spectrum in many additional countries, and partner with local MNOs in each country. But when enterprises or hyperscalers are looking for a global partner for IoT data or other low-bandwidth applications, Starlink will be a good choice,” he concluded.