Elon Musk’s Satellite Internet Starlink Prepares to Enter India Despite Resistance... Elon Musk’s satellite internet service, Starlink, is gearing up to enter India, one of the largest countries in the world. Despite resistance from existing service providers, the Indian government has given the green light for Starlink to operate within the country.
Government Approval Amid Industry Pushback
Last week, the Indian government announced its decision to allocate satellite spectrum for broadband services through administrative processes rather than auctions. This decision has faced criticism from major players such as Mukesh Ambani's Reliance and Sunil Mittal's Bharti Airtel. These companies expressed concerns that such a move could disrupt fair competition in the telecom sector.
Additionally, several agencies have raised apprehensions about Starlink’s entry into India. Why is there such significant opposition to Musk's Starlink? How does it pose a threat to current service providers? And how does Starlink operate? Let's delve deeper.
What is Satellite Internet?
Satellite internet refers to delivering internet services directly to consumers via satellites, bypassing traditional mobile towers and optical fiber networks. Currently, this technology is limited to the Indian Space Research Organisation (ISRO) in India.
Since 2021, Elon Musk has been attempting to establish Starlink in India. However, opposition and regulatory hurdles delayed its entry. As of now, Starlink operates 6,419 satellites in orbit and serves over 4 million customers across 100 countries.
India’s Potential for Satellite Business
Musk has recognized the immense potential of satellite internet in a country like India, where approximately 80% of internet users rely on Reliance Jio and Bharti Airtel. Despite their dominance, many parts of India still lack reliable internet and mobile coverage due to insufficient towers and technical challenges. Satellite internet and call services can address these issues, enabling connectivity even in remote areas.
A study by consulting firm EY-Parthenon estimates that 40% of India's 1.4 billion population still lacks internet access. In contrast, neighboring China has about 1.09 billion internet users, according to global online trend tracker DataReportal.
Why the Resistance?
Current service providers in India have invested heavily in acquiring spectrum licenses through auctions. They view Starlink’s entry, potentially bypassing auctions, as a direct threat to their business. While the government has yet to announce spectrum pricing, companies are concerned about competing with Starlink if Musk enters the Indian market under these conditions.
Reliance Jio has already invested billions in spectrum auctions to prepare for challenges from players like Starlink. It has also partnered with SES Astra, a leading satellite operator based in Luxembourg, to strengthen its satellite communication offerings.
How Does Starlink Work?
Starlink operates using Low Earth Orbit (LEO) satellites positioned 160 to 1,000 kilometers above the Earth's surface, offering high-speed internet and call services. In contrast, SES uses Medium Earth Orbit (MEO) satellites, which are considered a more cost-effective approach.
Musk’s Starlink can deliver internet speeds of 250–350 Mbps, significantly higher than the 50–60 Mbps speeds provided by existing Indian service providers. Additionally, satellite communication (Satcom) eliminates issues caused by weather disruptions affecting mobile towers, ensuring uninterrupted service.
Concerns of Existing Players
Reliance and Airtel are not only concerned about Starlink's entry into the competition but also about the potential obsolescence of their existing infrastructure, such as mobile towers and related equipment. The widespread adoption of satellite internet could render these investments unnecessary, leading to significant financial losses for existing providers.
Another concern stems from Starlink’s market strategies in countries like South Africa and Kenya, where it offered low-cost and even free services for up to a year to gain market dominance. If similar strategies are employed in India, other providers may be forced to lower their service charges, impacting their profitability.
Furthermore, competing with satellite internet would require Indian companies to make substantial investments in their infrastructure, adding to their financial burden.
Future Prospects
To enable direct internet services to mobile phones, Starlink is equipping its satellites with an eNodeB modem. This technology can deliver services to existing smartphones without additional hardware or software upgrades.
Chipmaker Qualcomm is also designing chipsets that enable smartphones to receive satellite broadband signals, extending these services to ordinary smartphones beyond premium devices like iPhones.
The entry of satellite internet players such as Starlink and Jeff Bezos’s Project Kuiper will significantly impact the Indian telecom market. At least half a dozen companies, including Rivada Networks, Viasat, Telesat, and Globalstar, are also eyeing the Indian Satcom market. While this will provide Indian consumers with more options, it poses a considerable challenge to existing telecom operators.
Implications for Consumers and Service Providers
The advent of satellite internet in India could lead to lower service charges as providers compete to retain customers. Consumers will benefit from faster and more reliable internet services without infrastructure-related disruptions. However, existing service providers will need to innovate and adapt quickly to survive in the evolving market landscape.