From the newsletter (sign-up if you want it sooner): Despite the hype and investment pouring into satellite D2D services, new analysis says space-based connectivity will complement, not replace, terrestrial networks, whose advantages in capacity, coverage, reliability, and economics remain decisive for mass-market communications. But BMW, and lots of others, see its uses.
Maybe it needs restating: satellite direct-to-device (D2D) services will not replace terrestrial wireless infrastructure. This won’t stop all the rocket fuel on the D2D fire, of course. SpaceX has today (July 16) lit another fuse on its Starship system to put 20 next-gen Starlink V3 satellites into space, albeit only for a demo to validate its launch systems for larger Starlink payloads. A new SEC filing, meanwhile, says AST Space Mobile has delayed its own D2D launch by at least a couple of months – late 2026, now stretching into 2027 – after a Blue Origin rocket exploded at Cape Canaveral at the end of May.
Which shows that the high-cost D2D battle depends as much on getting satellites into orbit as it does on connecting phones from space. Back on Earth, the Wireless Infrastructure Association (WIA) has sponsored two analyst reports that identify four constraints that might put terrestrial telcos at some kind of ease. Long-distance satellite signals are weaker (if we didn’t know), making all-important indoor coverage difficult; satellite beams serve larger areas, so spectrum must be shared by more users, and relative capacity shrinks; D2D usage is concentrated in remote locations, still; and terrestrial networks are just cheaper otherwise – “where most Americans live and work”
Mobile Expert states: “The physics and economics tell a consistent story that satellites are not a replacement… Satellite D2D can help extend coverage in remote areas, but terrestrial networks will continue to provide the speed, capacity, reliability, and coverage that consumers and businesses expect.” TMF Associates writes: “The momentum behind satellite innovation has sparked an important conversation about the future of wireless connectivity and the role satellites can realistically play… [They] cannot replicate the speed, capacity, indoor coverage, and reliability provided by terrestrial networks.”
Which doesn’t mean terrestrial providers like AT&T, T-Mobile, and Verizon – newly reviewed and ranked in the US by RootMetrics – are not vulnerable to space takeovers. Afterall, Space X and Blue Origin, in the business of launching and exploding rockets, are operating on a different capital scale. Even AST SpaceMobile sets its stall out in its SEC filing – albeit about vertical integration, and using its $1 billion in convertible notes for acquisitions, potentially, to “mitigate risks… with third-party launch providers”. Nor does it mean that D2D services won’t be lucrative niches, in the back-woods gaps left by terrestrial systems – for rural coverage, emergency comms, industrial services, roaming extensions.
These exist, increasingly. German automaker BMW has just demonstrated voice over satellite with Viasat, for example – which ups the ante as D2D moves into vehicles, machines, and industrial systems.
