The emergence of the low-earth orbit (LEO) satellite broadband sector has the potential to confront a challenge that the telecommunications industry has always faced, according to a new analysis from Ookla.
Traditionally, sparsely populated areas have not received as much attention from fiber providers as those with greater populations because they simultaneously had less revenue potential and were more expensive to reach and serve. Satellite services can change that.
The report, titled “Why Satellite Broadband Is Becoming a Bigger Part of U.S. Rural Connectivity Plans,” reaffirms that fiber still dominates. Currently, it says that only 3% of Broadband Equity, Access, and Deployment (BEAD) Program funding awards are for Starlink and less than 1% are for Amazon Kuiper.
But what starts as a trickle can end in a flood, with more moving to fiber. This was helped by the change in BEAD Program guidelines that made non-fiber options more viable.
“While fiber remains the dominant technology, satellite internet’s growing share shows that states aren’t treating it as a niche option; many are planning for it as a complementary piece of their buildout strategies — particularly in places where fiber or fixed wireless is too expensive or complex to deploy,” the report says.
The report looks at pros and cons of the LEO satellite broadband sector, which so far is dominated by Starlink. The key negative it noted was that localized congestion can be a problem, as illustrated by a dramatic decline in download speeds in Nevada during last year’s Burning Man festival.
On the plus side of the equation is that spectrum reuse is increasing capacity, cost declines are enabling larger fleets, and coverage is broader. It adds, however, that the technology remains best suited to low-density areas.
Greater use of LEO satellite broadband platforms will drive the need to prove and promote reliability, compliance and performance, the report says.
Late last month, Starlink Vice President of Engineering Michael Nicolls posted on X that the company’s median peak-hour network-wide speeds increased by over 50% this year. Typical download speeds are more than 200 Mbps, typical upload speeds are more than 30 Mbps, and median global latency is about 26 ms.
