OneWeb can ease the Huawei headache

As Bri­tain en­ters a bid­ding war for the satel­lite com­pany it may also of­fer the space age so­lu­tion to the 5G co­nun­drum, writes Matthew Field ‘Pick­ing a head-to­head fight with Ama­zon and SpaceX is not a bat­tle I would want to fight’ ‘No UK ci­ti­zen need eve

The Daily Telegraph - Business - - Technology Intelligen­ce -

Streaks of light from fast­mov­ing in­ter­net satel­lites have be­come a com­mon sight in Bri­tain’s night skies this sum­mer. Th­ese lowearth-or­bit satel­lites, 600 miles above the Earth, are de­signed to beam in­ter­net from space, pro­vid­ing con­nec­tiv­ity to ru­ral ar­eas that may oth­er­wise have been left be­hind.

One com­pany that had been hop­ing to pro­vide such a ser­vice was OneWeb, which went bank­rupt in March after its big­gest in­vestors pulled out amid the coro­n­avirus cri­sis.

To­day, Bri­tain will en­ter into a bid­ding war for OneWeb, which could see the Gov­ern­ment take a 20pc stake in the com­pany for $500m (£406m). The Gov­ern­ment hopes its satel­lites could form a back up to mod­ern GPS and give the UK some sov­er­eign satel­lite nav­i­ga­tion ca­pac­ity. Th­ese po­si­tional satel­lites are seen as an an­swer to Bri­tain be­ing kicked out of Europe’s Galileo project.

But OneWeb’s satel­lites could of­fer other uses too. The orig­i­nal aim of the net­work was to pro­vide global linked-up broad­band cov­er­age with 650 satel­lites weigh­ing un­der 550lb. It has so far put up 74. Amid its bank­ruptcy, the com­pany has also stepped up its claims that it could pro­vide faster broad­band and 5G cov­er­age from its satel­lites as well as of­fer­ing back­haul, es­sen­tially backup ca­pac­ity, to mo­bile net­works.

All this could, in the­ory, help im­prove Bri­tain’s tele­coms re­silience and even re­duce our re­liance on Huawei in some re­mote lo­ca­tions. While OneWeb has been eagerly pro­moted as of­fer­ing a GPS ri­val, ac­cord­ing to a re­port by the Satel­lite Cat­a­pult, which has lob­bied in favour of res­cu­ing OneWeb, satel­lites could help con­nect 60,000 homes in in­ter­net not-spots.

The re­port said: “An­other im­por­tant op­por­tu­nity that OneWeb pro­vides is, fi­nally, to be able to of­fer su­per­fast broad­band to ev­ery UK house­hold” while also “[pro­vid­ing] full 5G ca­pa­bil­ity to those and many more house­holds by 2025”. It added: “No UK ci­ti­zen need ever feel dig­i­tally ex­cluded again.”

But will th­ese bold claims work, and how re­li­able is satel­lite tech­nol­ogy for pro­vid­ing broad­band? De­spite its col­lapse into bank­ruptcy on March 27, OneWeb has stepped up its am­bi­tions.

In late May, it sub­mit­ted a re­quest to the US com­mu­ni­ca­tions reg­u­la­tor for plans to launch up to 48,000 satel­lites. Boss Adrian Steckel, the Texan tele­coms vet­eran who re­mains chief ex­ec­u­tive amid its bank­ruptcy, said: “We have al­ways be­lieved LEO satel­lites must be part of a con­verged broad­band net­work.”

In the US, this has seen the Fed­eral Com­mu­ni­ca­tions Com­mis­sion promis­ing nearly $10bn in in­cen­tive pay­ments to satel­lite mak­ers as part of its 5G ru­ral broad­band auc­tion, which, ac­cord­ing to Mor­gan Stan­ley, could of­fer a $100bn op­por­tu­nity by 2040.

Low-earth-or­bit satel­lites are seen as be­ing able to pro­vide th­ese “fi­bre­like” speeds be­cause they are a lot lower than reg­u­lar satel­lites, which are nearly 22,000 miles above earth. But de­spite be­ing lower, the tech­nol­ogy is not as sim­ple as 5G beam­ing straight to a phone or broad­band di­rectly to a home router. Mod­ern satel­lite phones are bulky and ex­pen­sive and de­signed for re­mote en­vi­ron­ments like oil rigs.

“We have been talk­ing about us­ing this tech­nol­ogy in hard to reach places for 15 years,” says Matthew Howett of As­sem­bly Re­search. “It’s the final 1pc to 2pc.”

Satel­lite use for con­sumers would still rely on ter­mi­nals on the ground. A ru­ral home, for in­stance, could be con­nected to the satel­lites us­ing a con­sumer an­tenna, rather than a ca­ble.

Al­though costs of satel­lites have come down, launch­ing rock­ets is still not cheap. Mean­while, la­tency, the speed at which sig­nals travel back and forth, is an un­solved prob­lem.

OneWeb says its tech­nol­ogy will soon be fit for 5G speeds. In tests in South Korea last year, broad­band speeds us­ing its low-or­bit satel­lites achieved 400Mbps and a la­tency of 32 mil­lisec­onds. Not quite as fast as ground net­works, but the mar­gin has shrunk. For reg­u­lar ru­ral broad­band, how­ever, it would plug a gap.

How­ever, OneWeb is not alone in de­vel­op­ing this tech­nol­ogy. SpaceX, a satel­lite ven­ture led by Elon Musk, is ar­guably fur­ther ahead with hun­dreds of satel­lites in or­bit. Ama­zon is also try­ing its hand at a broad­band con­stel­la­tion. As Chris Quilty, a space an­a­lyst and pres­i­dent of Quilty Analytics, notes: “Pick­ing a head-to­head fight with Ama­zon and SpaceX is not a bat­tle I would want to fight.”

And even Musk, who is OneWeb’s main ri­val with Star­link, is not wholly con­fi­dent the tech­nol­ogy is eco­nom­i­cally com­pet­i­tive.

Bri­tain will to­day put up $500m for a 20pc stake in OneWeb. Ma­jor fi­nanciers, in­clud­ing In­dian bil­lion­aire Su­nil Mit­tal’s Bharti En­ter­prises, are back­ing the UK of­fer.

Al­though the satel­lites may of­fer a life­line for those stuck in a not-spot, suc­cess in this cor­ner of the space race is far from guar­an­teed.

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