100/20 Mbps is Not Enough
by Doug Mohney, October 7, 2021
Proposals to raise consumer broadband speeds to 100 Mbps are
nothing new, dating back to FCC Chairman Reed Hundt first floating the idea in
2002 and the FCC’s “Connecting America: The National Broadband Plan” in 2021.
Twenty years later with the looming availability of $65 billion in the $1.2
trillion infrastructure bill on Capitol Hill, 100/20 Mbps is now being touted
as a “good enough” solution for many communities, just like 25 Mbps/3 Mbps had
been since 2015.
But why should the U.S. settle on half-measures when it
comes to once in a lifetime opportunity for investing in broadband
infrastructure? COVID clearly outlined the many holes in today’s patchwork of
broadband solutions to communities and homes around the nation, with delivery
systems built around legacy plant (copper & fiber) and earlier technologies
stretched to provide multi-person households the bandwidth necessary to support
both work-from-home and remote learning at the same time.
More upstream bandwidth, preferably symmetrical bandwidth,
is clearly one area where existing and proposed asymmetrical offerings fall
short for both real-world home and business use cases. Asymmetrical bandwidth is justified on the
assumption of one-way video streaming to multiple people in a household. It is typically
the option of last resort for businesses, who need symmetrical/upstream
bandwidth to support real-time communications and cloud services that are
critical for work-from-home, online schooling, remote healthcare and other key
applications that have become mainstream as a result of the global pandemic.
Video conferencing tools such as Microsoft Teams, Zoom, and
other applications – quickly showed how assumptions of less than 100 Mbps
symmetrical speeds being adequate were flawed. Some municipalities worked to
deploy WiFi hotspots through schools and other means to fill in broadband gaps,
but students and parents alike across the country were left struggling to find
a balance point between educational continuity and earning a paycheck without hometown
solutions based on fiber.
While most students
are back in physical classrooms today, the need for more upstream and
symmetrical bandwidth goes far beyond a COVID/stay-at-home environment. Businesses of all sizes are particularly
challenged for bandwidth for different reasons.
Small businesses need more and symmetrical bandwidth for accessing cloud
services of all types, ranging from the standards of Office 365 subscriptions
and fast off-site backups to call center and video streaming.
Virtual Private Network (VPN) services are a necessity for
enterprise remote workers, adding an additional 5 to 10 percent overhead due to
the provider and protocol used. In an asymmetrical environment, there’s not a
lot of room for more than a single VPN user on a connection once video
conferencing or a couple of applications are fired up.
Defenders of the status quo – i.e., those who say “It’s good
enough” – argue that people and businesses that don’t have enough bandwidth
should “simply” move to an area where there is more. But the problem is that
areas with “more” are also more expensive in terms of housing and the general
cost of living – not to mention the internet service providers in those areas
are investing more to extend their networks to unserved areas close by.
For example, Comcast Business is pumping
$28 million to extend its “fiber-rich” network to nearly 7,000 businesses in a
four state area and Washington D.C.
Once completed, small to medium-sized businesses will get access to 1
Gbps and larger enterprises will be able to get 100 Gbps services. If Comcast
is spending its own money to deliver 1 Gbps services to unserved customers in non-urban
areas like the Eastern Shore of Maryland and Martinsburg, West Virginia, it’s
hard to argue that 100/20 Mbps is sufficient today.
If the U.S. is truly going to invest in the future with $65
billion in infrastructure monies, it only makes sense to “invest once for the
future” by putting money into gigabit-class (and faster) networks built around
fiber that can support not only today’s needs but a future that includes 5G
wireless, true work-from-anywhere (WFA) for businesses, advanced telemedicine
delivery, and rich distance learning capabilities.
Cable's All Fiber Future
by Doug Mohney, September 1, 2021
The dirty little secret in the cable industry is its
increasing use of fiber and the roadmap of technologies it will adapt in the
years to come to deliver 10 Gbps and faster speeds to its customers. Fiber is
an essential element for cable builds, especially in rural areas where the need
for speed is driving a “fiber rich” or “fiber deep” approach.
Fiber has been the go-to medium of choice when it comes to
greenfield builds for years, so much so NCTA–representing “America’s Cable
Industry”–features a 2017 fiber build by Eagle Communications in the rural town
of St. Francis, Kansas on its website. Residents can get up to gigabit
symmetrical speeds today through a fiber-to-the-home
network–presumably with no traditional coax cable involved.
But America’s Cable Industry has big plans for existing infrastructure
as well, putting fiber deeper into the network to deliver higher speeds to
existing customers on legacy cable plant. CableLabs,
the self-described “leading innovator and R&D lab for the cable industry,”
has lots of information on the technologies it is working with today for moving
to 10G service and beyond. The 10G platform being promoted today is expected to
delivery better network reliability, security, and low latency, as well as
raise the cable industry’s current 1 Gig broadband delivery bar.
One of the cornerstones to 10G and beyond services is
CableLabs PHYv1.0 and PHYv2.0 point-to-point coherent optics standards,
initially providing standardized
equipment to deliver 100Gbps and 200 Gbps Ethernet speeds on a single
wavelength of light for distances of up to 80 kilometers on a single strand of
fiber. The combination of distance and high speed enables a cable operator to
set up a high-speed Ethernet link between a cable head-end data center and an
outdoor unit in the field where services will be distributed to customers at
the last mile (or less).
A clean high-speed Ethernet link enables cable companies to
get rid of a lot of legacy equipment in the middle and towards the edge of the
network, with legacy control and management services virtualized and delivered
in software. Putting things in software instead of using dedicated hardware
reduces energy consumption and improves overall reliability, especially as
field equipment gets older.
Cable Labs is a bit vague on how service providers will go
beyond 10 Gig speeds, other than to note a combination of new standards like
its full duplex coherent optics technologies and “a few plant updates” will
provide a path to 25G and beyond. Back in 2018, Cable Labs President and CEO
Phil McKinney said coherent optics demonstrations delivered 256 Gbps over 80
kilometers using a single wavelength of light, with multiplexing of eight
wavelengths providing speeds of up to 2 terabytes (Tbps). Further improvements
in encoding and modulation were anticipated to bring up speeds to 4 Tbps.
Talking about delivering speeds of 10 Gbps and faster isn’t
crazy talk by the cable industry, especially for business customers who
typically want symmetrical bandwidth and guaranteed quality of service through
SLAs. Businesses currently on coax cable are likely to be the first to get a
full fiber upgrade. Residential customers may take a bit longer for a “last
mile/last foot” upgrade, but the maintenance and power advantages of fiber over
legacy hardware are just too good to ignore.
The Numbers Become Clearer for Fiber and Satellite
by Doug Mohney, August 4, 2021
Shenandoah Telecom Company (Shentel)’s strategy and
estimated costs for fiber deployments disclosed to Wall Street analysts bring
into sharp focus the future of broadband. Light Reading reports
Shentel estimates it costs anywhere between $1,000 to $1,400 to pass a
household for their GloFiber product with initial capabilities of up to 2 Gbps
service using XGS-PON. In its existing Shentel rural markets served by DOCSIS 3.1
hybrid fiber-cable, costs are between $1,500 to $2,500 per home passed while
its Beam fixed wireless offering will deliver up to 100 Mbps at a cost per
passing of around $250 to $350 per market.
Over the next five years, publicly-traded Shentel expects to
add hundreds of thousands of fiber and fixed wireless customers, while it may
add only 4,000 or so cable customers onto its legacy network. Adding customers
to a greenfield fiber territory is substantially cheaper than adding a cable
customer, so the company is investing big in fiber and fixed wireless in lower
density rural markets.
Roughly speaking, Shentel will take five years to add
500,000 customers with a mixture of future-proof fiber capable of going to 10
Gbps and 100 Mbps fixed wireless service which will likely be upgraded with
better gear and/or enhanced with fiber deployments enabled by broadband
SpaceX Starlink says it is up to 90,000 customers around the
world and plans to have up to 500,000 customers on its satellite broadband
network service within a year, according to its latest update with the Federal
Communications Commission (FCC) and reported
by CNBC. Unfortunately, SpaceX
didn’t break out how many users it is serving in the U.S. is and is still
touting a customer pre-order/wait list of over a half million users globally.
How SpaceX gets from 90,000 customers today to 500,000
customers worldwide in a year is a path it hasn’t described. Based on previously reported data to the FCC
and some guesswork, SpaceX is currently manufacturing Starlink dishes at a rate
between 15,000 to 20,000 per month. In
order to meet its goal of 500,000 dishes within a year, the company would have
to ramp up by producing and shipping an average of over 34,000 dishes per month
starting now in August. At the same
time, SpaceX wants to further drive the cost of its dishes down from $1400 to
$500 or less – preferably less, since the company currently charges $500 for
the end user terminal equipment and eats the difference as the cost of
acquiring a customer.
SpaceX also hasn’t provided details on how it plans to get
to gigabit level speeds, another promise it has been touting to the FCC and the
has released Speedtest data showing Starlink delivering download speeds of
around 97 Mbps and upload speeds of nearly 14 Mbps with latencies of 45ms.
Compared to legacy providers HughesNet and Viasat, SpaceX cleans up in terms of
broadband speeds and latency but doesn’t come close to matching the “All Fixed”
speeds of 115 Mbps download and 17 Mbps upload with a latency of 14ms.
While Starlink is still in beta, SpaceX CEO Elon Musk saying
speeds will go up to 300 Mbps downlink speeds in the fall. But there are no
promises by the company that it will be able to deliver gigabit speeds with
existing equipment or how many of its GEN2 advanced satellites will have to be
put into orbit to get to gigabit speeds.
SpaceX will argue that Starlink provides faster speeds than the FCC 25/3
Mbps baseline minimums on the books, but that’s all moot if there aren’t enough
dishes to go around to those that want and need them.
SpaceX Starlink – Is 3% to 5% a threat or a warning?
by Doug Mohney, July 7, 2021
Last week participating virtually at Mobile World Congress, SpaceX CEO Elon Musk said the company’s Starlink satellite broadband service was complementary to fiber and 5G services, providing access to the three to five percent of the world that didn’t have such broadband options. He said Starlink is best for “low density” areas with some capability to serve “medium density” areas, but being Elon, he didn’t explicitly define what the difference between low and medium density is.
Musk went on to say Starlink had nearly 70,000 simultaneous users online and the company was continuing to lose money on the terminal hardware, selling it to users at $500 while costing “more than a thousand dollars” per dish today. Of course, SpaceX is working hard to build lower-cost dishes and will one day – again, Elon didn’t say when – get the equipment price down to $250 to $300, a price point originally cited back in 2016.
Exactly how many dishes SpaceX is shipping per month is not known, but since the company told the FCC it had 10,000 beta users in February, a little back-of-the-envelope math (70,000 estimated users in late June – 10,000 in February = 60,000 / 4 months-ish) provides a guesstimate of around 15,000 dishes per month. SpaceX is working on ways to increase dish production rate with Musk saying the company will reach 500,000 users within 12 months.
Does Starlink service really threaten existing broadband service provider? If we take Musk at his word, fiber and 5G have nothing to worry about in the near-term, since the fastest rates expected from Starlink in the second half of this year will peak around 300 Mbps downlink speeds and perhaps 20 Mbps to 40 Mbps uplink speeds.
Cable and legacy DSL services likely have the greatest concerns, with frustrated users at the end of old coax or copper cable having no hesitation to jump onto Starlink beta services if all the Reddit users on the r/Starlink section are to be believed. However, these users will have to get in line with existing million plus HughesNet and Viasat geosynchronous earth orbit (GEO) satellite broadband customers who have heard the siren song of lower latency and faster broadband speeds.
SpaceX has stated on several occasions Starlink has a backlog/wait list of over 500,000 customers. It’s easy to believe that number when you tally up existing GEO satellite customers and legacy cable/DSL customers who have been waiting for faster options for years. For most, paying $500 down for equipment and trying to find the place to mount a Starlink dish is nothing compared to the thousands of dollars an incumbent wireline carrier wants to pull upgraded copper or fiber to a residence.
If anything, consumers may find themselves waiting behind government and enterprise customers willing to pay substantially more than $100 per month for Starlink services. SpaceX is working with Google to directly connect its data centers to the Starlink network. Google and SpaceX will team up to sell directly to enterprise customers, enabling single hop access to Google Cloud apps in the second half of this year. Add on demonstrations SpaceX is conducting with the U.S. military, commercial aviation, and the oil and gas industry, and it may be difficult for SpaceX to financially justify selling a dish to a consumer household paying only $100 per month.
SpaceX believes it will ultimately be able to support several million Starlink users in the future, but exactly when and what mix of those users are consumers are unknown because the company just doesn’t talk about those kinds of data at this point in time. If Starlink is ultimately spun out as a public entity years into the future, SpaceX will have to be more forthcoming on its customer mix and growth projections, along with other mundane benchmarks used by financial analysts like customer acquisition cost and average revenue per user (ARPU).
The Starlink warning to broadband companies is the relatively low cost and higher speeds the satellite network is capable of delivering to consumers in comparison to legacy wireline and first generation wireless systems. Companies that haven’t made efforts to upgrade infrastructure and network speeds will find themselves under increasing scrutiny by users who want “service like Starlink.” A few dishes in a service territory may have a significant customer impact beyond a relatively small loss of revenue. Broadband providers are going to have to be more proactive in discussing their pricing policies and network upgrade plans or they will be faced with being more reactive to disgruntled customers who have heard about Starlink as an option.
Satellite Rural Broadband: Billions, No. Small Percentages, Maybe.
by Doug Mohney, June 10, 2021
For over a decade, satellite broadband companies have hyped how they will serve the billions of people who currently don’t have basic internet access, but the reality is that they haven’t delivered. O3b derives its name from the “other 3 billion” people on the planet who didn’t have access to the internet when it was founded in 2007. Fast forward to 2021 with the number increasing to four billion people that “still have no internet,” according to Astranis’ web page.
If we focus on the United States, a country with sufficient wealth to pay for infrastructure investments, the January 2021 Federal Communication Commission (FCC) annual broadband report estimates around 14.5 million people in the U.S. did not have access to the copper standard of 25/3 Mbps fixed broadband service at the end of 2019. And this is before delving into the known hot mess of where the FCC gets its data compared to the reality on the ground and the agency’s reboot of broadband maps with a more crowd-sourced approach.
How many users can be served by new satellite broadband systems, such as SpaceX Starlink? SpaceX founder and CEO Elon Musk tweeted on May 4 that the company’s Starlink satellite broadband service can provide service for up to 500,000 users total in the near-term best case. Supporting “several million” users will be “more of a challenge,” Musk said, with the solution impractical for large scale use in denser urban areas.
Under the FCC RDOF auction, SpaceX will receive $886 million over a decade to deliver broadband speeds of 100 Mbps/20 Mbps to 640,000 locations across 35 states. SpaceX might be providing broadband to about 4.4% of the 14.5 million unserved/underserved within a decade, assuming Starlink gets all its 12,000 satellites in orbit by then to support millions of users. The company expects to be servicing up to 5 million users in the U.S. if it gets approval for its FCC license modification requested back in August 2020, up from its 1 million cap approved in March 2020.
SpaceX is serious about its RDOF commitment, having recently hired a regulatory compliance analyst to work out of the company’s DC office. Over the months and years to come, there will be plenty of data churned out to illustrate how SpaceX is connecting the unserved and underserved with the company tapping into other FCC subsidy programs through certification as an Eligible Telecommunication Carrier (ETC). Getting carrier status will enable it to offer voice services and tap into Lifeline and Emergency Broadband Benefit (EBB) programs.
But we still come back to the fact that SpaceX will only impact around 4.4% of the 14.5 million underserved/unserved in the U.S. after a decade through its current market approach of one dish per user. Other new entrants are leveraging different, more efficient approaches to provide bandwidth to underserved areas. OneWeb and Telesat are positioning themselves as backhaul carriers delivering hundreds of megabits (OneWeb) to gigabit or more (Telesat) into rural communities, providing local connectivity via terrestrial wireless solutions ranging from “simple” WiFi to cellular. Telesat has teamed up with the Rural Broadband Consortium to develop and refine satellite rural/remote community service models for deployments in Canada to meet the government’s 50/10 Mbps household service goals, an approach that will no doubt migrate southward to the U.S. over time.
Satellite community models should be more cost effective than the “Everyone gets a dish” approach by enabling more users within a geographic area to access bandwidth rather than a few handfuls of users overloading an overhead satellite, but they also should provide a longer-term roadmap for viable long-haul network builds as well. Everyone in the history of internet access always wants more bandwidth, be it residential users or businesses. In a community model, gigabit-level satellite backhaul could ultimately be replaced by fiber to provide higher levels of service with satellite transitioning to a backup/redundant link.
Regardless of the model, satellite broadband connectivity is not going to scale to serve “billions.” There’s just not enough new companies, not enough satellites in the sky and on the drawing board and not enough radio frequency spectrum capacity to get to a fraction of a billion users over the next decade. Everyone should stop pretending otherwise.
Half a Million SpaceX Starlink Pre-Orders Aren’t Important – What Is?
by Doug Mohney, May 20, 2021
SpaceX says it has received more than 500,000 orders for its Starlink broadband service as of early May. Is this good news for the satellite broadband effort? Or deflection from more meaningful numbers SpaceX should be disclosing?
“To date, over half a million people have placed an order or put down a deposit for Starlink” was a statement made by a SpaceX spokesperson made during the March 4, 2021 pre-launch countdown to put yet another 60 satellites to orbit, making a total of over 1,400 operational satellites as of this writing.
Over half a million orders or pre-orders sounds quite impressive, doesn’t it? But we don’t know if these orders are worldwide or simply in the U.S. We don’t know how many orders have been fulfilled compared to pre-orders. Or how many of these orders are individual versus business users. It’s just a big number and there’s no way to audit or confirm it, since SpaceX is a private company and doesn’t conduct regular analyst briefings or press conferences.
Let’s place some context based on previous SpaceX statements made to the Federal Communications Commission (FCC). SpaceX received a license to operate up to 1 million user terminals (dishes) in the U.S. in March 2020. The Starlink limited beta started in July 2020, with the company opening a web page to take email addresses so interested parties could receive updates and service availability information.
By the end of July SpaceX had filed a modification to its U.S. license to expand to 5 million dishes, “due to the extraordinary demand for access to the Starlink non-geostationary orbit satellite system. Despite the fact that SpaceX has yet to formally advertise this system’s services, nearly 700,000 individuals represented in all 50 states signed up over a matter of just days to register their interest in said services at www.starlink.com.”
The SpaceX Starlink public beta started in October 2020, expanding from the United States into Canada and the UK in January 2021, followed by the company starting to accept $99 pre-orders worldwide in February, and dishes starting to appear in Austria, Germany, France, Australia, and New Zealand so far this year.
It would be interesting to know how many interested customers converted to orders and paying beta customers from pre-orders and those who simply registered interest, but since SpaceX expanded its pool from U.S. users to worldwide in January, there’s no way to know. We just have the 700,000 U.S. individuals who expressed interest which clearly are less than the 500,000 worldwide signups for orders and pre-orders that have occurred to date.
SpaceX is already starting to limit fulfillment according to Reddit users waiting for Starlink service. Some potential U.S. customers are seeing “Max capacity” messages for their particular address locations, with service not available until the end of 2022. Elon Musk tweeted on March 4, “Only limitation is high density of users in urban areas. Most likely, all of the initial 500k will receive service. More of a challenge when we get into the several million user range” but there’s no way to square what Elon says with the Reddit information.
The more interesting question is how fast the first 500,000 SpaceX Starlink users will be turned up. At the beginning of the year, SpaceX had turned up over 10,000 beta customers per a February 2021 FCC filing, but the company has not provided an estimate as to how many more users have been added since then.
User turn-up is keyed to production of the $1,500 SpaceX Starlink antenna, a marvel of modern electronics. The company has said little on current or expected future production rates, but it would have to produce anywhere between 5,000 to 7,500 antennas per month in order to start making a significant dent in a 500,000 pre-order backlog.
Why isn’t SpaceX talking about antenna production rates and expected ramp-up to sign-on customers? While it is not a public company, SpaceX is in the process of being a registered commercial carrier so it can collect FCC RDOF broadband monies and other subsidies. Understanding how rapidly SpaceX plans to connect more customers, especially whose who need federal support to access broadband and landline services, would be in the public interest.