A relatively unknown company is muscling its way to the front of the pack in the race to provide two-way satellite broadband Internet service, backed by the financial and marketing strength of two of the world’s most influential corporations.
With investments from Microsoft Corp. and EchoStar Communications Corp., Israel-based Gilat Satellite Networks Ltd. established Gilat-To-Home Inc., a company that intends to offer high-speed wireless Internet service by the fourth quarter-months, and in some cases, years, ahead of others in the same space.
Fellow broadband satellite venture Tachyon.net already offers a similar service, but uses a different method, which includes having to run a cable line from the antenna to a server. And Teledesic Corp., the highly touted endeavor of Craig McCaw, is at least four years away from commercial launch.
Gilat-To-Home uses a specially designed 24-inch by 36-inch satellite dish mounted on a user’s home to send and receive data over the Ka frequency band at up to 500 kilobits per second, comparable to that of a digital subscriber line or cable modem.
In February, Microsoft invested $50 million in Gilat-To-Home, creating another conduit for its MSN Internet service.
“MSN Internet Access via satellite is a tremendous value proposition for our subscribers, especially those who live in areas where broadband connectivity is not an immediate option,” said Richard Belluzzo, group vice president for the Consumer Group at Microsoft.
Microsoft said it also plans to purchase during the next four years a significant number of the very small aperture terminal units Gilat’s satellite network employs. VSAT units include an indoor and outdoor unit and a small antenna.
Less than two months after Microsoft partnered with Gilat, Gilat-To-Home peaked the interest of satellite television provider EchoStar, prompting it to purchase for $50 million a 17.6-percent stake in the company. EchoStar agreed to distribute Gilat-To-Home, which will be powered by MSN and its own DISH Network satellite TV service, to its more than 23,000 retailers nationwide. DISH Network customers also will have the option to purchase Internet access with an MSN-Gilat-To-Home co-branded portal, Gilat said.
“We fully expect to provide two-way to the residential market,” said Sandy Colony, vice president of corporate communications for Gilat-To-Home. She said the company has been beta testing with approximately 5,000 users for several months and is on track for a fourth-quarter launch.
Among those using the service now are Indian tribes in the southwestern United States. Colony said the Hopi Police Station, far from the reach of a DSL line or even a multichannel multipoint distribution service signal, has successfully been using the satellite service to access the Internet.
Because Gilat-To-Home is designed to reach customers in very remote regions, Colony said it does not consider DSL or cable modems a threat.
“We do not see ourselves as directly competitive because they (DSL and cable) will have a faster service. … The technology does need a little time to evolve. We will have the advantage of being first to market and the disadvantage of weathering the bumps,” Colony said.
Pricing for the service is yet to be determined, but Colony said it probably will be slightly higher than DSL and cable. But, because of the company’s relationship with EchoStar, customers can use the same dish for video.
Based in McLean, Va., Gilat-To-Home is led by former Packard Bell Electronics Inc. executive Zur Feldman.
