Events and Shows Kick Off the Spring Season
Hopefully, by the time you read this, the 5th e3 Systems Cycling Challenge from Puerto Soller to Mirador Sa Foradada on Friday 21st April will have been a resounding success! I also hope our cyclists were very generous and that we were able to contribute another significant donation to Yachting Gives Back, our favourite charity. I would like to thank our supporting partners, Speedcast, Swisspath Yachting and Intellian, who help us to make these events free to enter for generous cyclists of all abilities from the wonderful world of yachting.
Following our cycling event, the MYBA Charter Show took place at the end of April in Barcelona, running back-to-back with the Palma International Boat Show (PIBS). This year we elected not to have a booth at the MYBA Show as it was very quiet in 2022. On the other hand, PIBS incorporating the Superyacht Village was a very successful event in 2022 and it’s in our own backyard, so we’re delighted to be exhibiting again this year. We will provide a full report in the next issue.
Will there be ferocious competition ahead between Amazon and Starlink?
This has been the question on everyone’s lips over the last month, and I predict that the answer is a resounding “yes”.
Literally, the day I was finishing my column last month, news came from Satellite 2023 in Washington DC that Amazon had effectively thrown down the gauntlet to Starlink by unveiling the first details of its new phased-array antennas for its LEO project, Kuiper. Or should I say, Jeff Bezos threw down the gauntlet to Elon Musk? Following my further investigations throughout this last month, significant features of Amazon’s Kuiper service have been revealed which will be worrying for Starlink. For the entire satellite communication industry, this is yet another sign of the disruptions ahead. If we thought Starlink was disruptive, I predict that we ain’t seen nothing yet!
The new Kuiper antennas announced at Satellite 2023
As a reminder, Amazon Kuiper announced a remarkable series of flat panel antennas that use its new Prometheus2 processor, as the first move in its competitive battle with Starlink. They will be available in 18, 36 and 152 cm square sizes and will handle bandwidths of 100 Mbps, 400 Mbps and 1 Gbps. They will be powered by their new processor and will be able to be manufactured at under $400 (for the smallest antenna). These three antennas represent a huge leap in technology and have competitive price points when compared to the current Starlink antenna costing $2,500. This already represents a huge leap from the current stabilised antennas from Cobham Satcom and Intellian.
Amazon’s potential business model is not dependent on subscription services
As impressive as these antennas are, they are only one element in the threat to Elon Musk’s Starlink service. This major threat is Amazon’s potential business model. Starlink, like all other satellite services, is 100% dependent on a subscription business model, whereas Amazon isn’t! 80% of Amazon’s earnings come from its AWS (Amazon Web Services) Cloud business, which is a $600 billion per year market, in which it holds a 30% share. If Amazon added free satellite connectivity to AWS, this would increase its share by 1 or 2%, increasing revenue by $6 to $12 billion per year. This would far exceed what it could generate from subscription income.
Amazon Web Services (AWS) is the world’s most comprehensive and broadly adopted Cloud business, with more than 200 fully featured services available from data centres globally. Millions of customers -including the fastest-growing startups, largest enterprises, and leading government agencies- are using AWS to lower costs, increase security, become more agile, and innovate faster.
Amazon has already announced its intention to undercut Starlink, so if this is Amazon’s business model, they could charge whatever they like. It might even give free connectivity to Prime members or AWS clients, thus seriously damaging Starlink’s revenue stream.
Amazon does not intend to offer a consumer-grade service only
Amazon are indicating that with their Kuiper constellation, they will offer an enterprise-guaranteed service, with a CIR and Service Level Agreement (SLA), together with consumer-grade, best-effort service from day one.
It is a fact that it’s very difficult to sell a consumer-grade service to enterprises, but it is easy to sell an enterprise-grade service to consumers. This poses another problem for Starlink, as it has been designed as a consumer-grade service from day one. This is the reason why Starlink is viewed as an add-on rather than a replacement for GEO.
Until Starlink can back its service up with a Service Level Agreement (SLA), its success as a primary means of connectivity will be limited to markets where SLAs are irrelevant. Those markets are where users are focused on high speeds and low cost rather than guaranteed performance, such as maritime. The cruise and yachting markets are an exception as guaranteed high bandwidth connectivity is expected. Starlink, in these latter two cases, is a low-cost, no-commitment addition to its existing capacity.
I think it’s clear that Amazon is so well funded it can afford to give away service for years and with its technologically advanced low-cost antennas, it will certainly pose serious competition for Starlink. The only advantage Starlink has is that they are ahead in the game, and this also explains why Starlink is moving so fast to get a foothold.
Kymeta OneWeb getting closer to commercial launch
OneWeb successfully launched its final deployment of 36 satellites on 26th March. This was its 18th launch, bringing the constellation to a number that will provide global coverage. There are now 648 satellites in 12 planes, 1,200km above the Earth. 588 are active with 60 spare per plane. The throughput is 200+Mbps with 70ms latency.
The Kymeta U8 Peregrine configuration includes two low-profile, lightweight panels that are fully proven in the marine environment and on a number of our clients’ yachts. They are IP66 and salt fog tested with blockage mitigation and LEO/LTE configuration.
We have seen some initial proposals for Kymeta’s Service Plans, which we cannot disclose yet, but unlike Starlink, it will be offering a range of plans with different bandwidths and data caps. However, the most notable difference is that most will include an enterprise-guaranteed (CIR) bandwidth. There will be an early adopter trials option in June to test the service ahead of the commercial launch.
The key advantages of the Kymeta OneWeb LEO service will be SLA and CIR for critical requirements, network integration, network security, a range of service plans, multiple service profiles on one terminal, type-approved maritime hardware, and a choice of user terminal form factors.
Direct to Device (D2D) connecting cell phones to satellites
Connecting cell phones directly to satellites has suddenly become big business. The world took notice when Starlink and T-Mobile, Globalstar and Apple, and Iridium and Qualcomm announced they would soon be making off-grid communication via ordinary smartphones possible. Soon, cellular subscribers and Internet of Things (IoT) network terminals could be connected, regardless of location.
While facilitating emergency phone messaging and texting with an ordinary smartphone is exciting, the real payoff for satellite direct-to-device (D2D) communication is in IoT. In the IoT and Machine to Machine (M2M) market, D2D makes gathering data from billions of sensors or remote operation of machinery and devices possible beyond the reach of wireless or conventional VSAT networks.
We’ll keep you up to speed as these projects progress. Please come by our booth at the Palma Superyacht Village for a chat.
