The transition last year of the $42.45 billion Broadband Equity, Access, and Deployment (BEAD) Program from a fiber-first to tech-neutral opened the door to satellite approaches. Most immediately, it is an opportunity for Starlink, SpaceX’s low-earth orbit (LEO) service.
Indeed, Starlink’s BEAD awards will cover 476,000 locations — the most of any provider — and the company received BEAD grants totaling $738.8 million.
Winning locations and grants is one thing. Meeting BEAD requirements and customer expectations is another. Opensignal looked at whether Starlink can provide the high-quality connectivity BEAD requires and whether, at the end of the day, the service is an “access stopgap or rural-focused provider.”
Opensignal’s findings suggest Starlink is an interim solution that faces significant performance, capacity, and affordability challenge:
- Performance constraints: Starlink underperforms other access technologies in both rural and urban areas — at least where those other technologies are available
- Capacity constraints: Subscriber load already leads to degraded performance
- Affordability constraints: Starlink is most affordable in areas with low relative demand
“The short version? Our findings suggest that while Starlink might offer ‘good enough’ access to unserved locations, it is not currently a scalable solution for digital inclusion in more urban areas,” said report author Fiona Armstrong-Mills, who is Opensignal’s principal analyst for the Americas.
“Its performance and affordability decrease as subscriber density increases, limiting its role in more populated areas. These areas are also more likely to be served by a different provider with potentially better performance, and here Starlink remains more of a complementary access layer than a long-term substitute for terrestrial networks.”
Ookla was more generous to Starlink in a report that was also released this month. It found that Starlink has strength in urban areas and rural users get better broadband speeds than urban users in 29 of 50 states. It found that Starlink had had more users in urban than rural areas in Florida, Massachusetts, Hawaii, New Jersey, and Connecticut.
Another Ookla report released in early February, though, found that while Starlink’s market size and capacity have grown during the preceding year, the service’s median upload speed of 16.91 Mbps was more than 3 Mbps under the federal and BEAD requirement of 20 Mbps.
Tom Reid, the principal of the Reid Consulting Group pointed to another potential cloud on Starlink’s horizon. LEOs move very fast and are comparatively low. Thus, Reid told Telecompetitor, signals must be handed off often between satellites. To do so smoothly requires a field-of-view cone (i.e., an unobstructed view) of 110 degrees. Reid found that 70% of Starlink BEAD locations could face foliage challenges.
