March 16, 2016
This week, we take a deep dive into satellites, plus a look at a powerful new generation of thumb drives and cutting-edge 5G technology.
A Big Bet on Satellites
Satellites will soon bring speedier Web service to users across the globe, including areas of the world that lack coverage today. Both big satellites with huge Web capacity and fleets of small satellites are aiming to make global broadband ubiquitous. Over the next few years, California-based satellite operator ViaSat will launch a series of new satellites to offer faster Internet to folks in remote locations where physical connections are scarce. Another company, OneWeb, based in Virginia, will launch a constellation of more than 600 small satellites in low-Earth orbit to blanket the globe with broadband. It will be operational by 2020. Others in the industry are also shifting into higher gear when it comes to broadband. Facebook, Google, Amazon, Microsoft and other digital companies stand to profit from these efforts as they help the more than 4 billion people without Internet start to get connected.
The heated competition among satellite firms spells lower prices for businesses and consumers. Big players are trying to fend off upstarts backed by billions of dollars in funding as satellite operators race to meet rising demand for high-speed, data-heavy uses. The result: a glut of capacity that will drive down prices for many satellite services, from broadband to phone, for companies in oil & gas, aviation, maritime industries, agriculture and more.
"We need to find new customers," said Pierre-Jean Beylier, CEO of SpeedCast, at a recent satellite conference. His company provides Internet in Asia, the Middle East, Europe and Africa. Companies with fleets of big satellites include Intelsat, Eutelsat, Telesat and SES. Newer small-satellite firms include Terra Bella (owned by Alphabet), Planet Labs and Spire. Expect new satellite business services to crop up, including new ways to securely connect machines, observe Earth and communicate. And look for fast growth in emerging areas such as drones and 5G networks.
A big shakeout in the industry is coming over the next three to five years.Fierce competition will cause a number of start-ups to go belly-up while trying to recoup the big up-front costs. Some of the big players will struggle to maintain profits as they seek new customers and fend off new entrants, leading to more consolidation and partnerships. Facebook, for instance, partnered with Eutelsatto launch a satellite in 2016 that will connect millions in Africa to the Web. "We're in technology, we have to get used to disruption," said Rupert Pearce, CEO of Inmarsat, at the satellite conference.
Expect a bigger push for cheaper, more innovative satellite equipment,addressing a big problem for consumer adoption: the high cost of ground equipment. Cheaper antennas are on tap from firms such as Kymeta and Phasor Solutions; both use advanced materials for thin, lightweight antennas. Mobile antenna prices need to drop from tens of thousands of dollars to less than $100. Kymeta recently partnered with Toyota for its thin antenna tech, proving that the technology is getting closer to mass adoption. Pricing pressure will hit ground equipment makers, too, such as Honeywell and Harris. Other big changes as satellite manufacturers race to speed up the slow, costly process of building satellites: using more 3-D printing, assembly robots and off-the-shelf parts. Satellite makers upgrading their manufacturing processes include Boeing, Airbus Group and Lockheed Martin.
Satellite Broadband in the U.S.
In the U.S., prices for satellite broadband figure to drop a bit, but plans will still be stingy with data. Even with the upgrades, satellites will struggle to compete with wired broadband and land-based cellular, so ViaSat and European partner Eutelsat will find it hard to sell to the masses here and in other developed markets. "Relatively few people want to rely on satellite Internet as their primary access," says Tim Farrar of TMF Associates. But it's much faster than it used to be, he says. ViaSat's planned satellites will hit 100 megabits per second for consumers and 10 times faster for businesses. For those lacking choices or located in hard-to-reach rural areas, the high-speed plans will be welcome. (Wonder how much satellite broadband costs today? Check out pricing from Hughes, the largest satellite Internet provider in the U.S.)
In-flight Wi-Fi on airlines is set for a big speed boost and lower prices, too.ViaSat's new satellites will deal a blow to in-flight Wi-Fi firms such as Row 44 and Gogo, with speeds fast enough to stream video. The cost? Likely free, sponsored by ads. The upgrade to today's spotty, pricey airplane Wi-Fi will be a boon to business fliers.
Computers on a Thumb Drive
The next big thing for on-the-go workers: USB sticks that house a full PC.The tiny devices boast full-fledged Windows 10, high-speed Wi-Fi and lots of storage. They cost around $100 and can be plugged into any monitor: a hotel television set, a conference room display or a PC monitor. All that's needed for a complete PC is a display, a wireless keyboard and mouse. "The compute stick could provide a simple solution for something that's missing today," says Jeff Orr, research director at ABI Research. Sellers include Intel, Asus and Lenovo.
Sales of the devices will grow the fastest in areas that have high-speed broadband. Look for rising use by real estate agents, insurance companies, schools and retailers. The devices can be used for customer displays that show new product info regularly. Hotels can use the sticks to make low-cost touch screen ticket counters. Restaurants can use them for digital menus, schools for low-cost PCs. The full PC capability gives the hardware an edge over higher-priced tablets or desktop computers. Shipments will pass 5 million in 2021, predicts ABI Research.
Sellers also see the sticks as a cheap way to retrofit homes or offices into connected settings. Every room in a home could have a smart display for online TV, sports scores, stocks and more.
On the Front Lines With 5G
I recently got a front row seat to see some cutting-edge 5G technology.Last week at the Washington, D.C., headquarters of the Federal Communications Commission, technology experts convened to talk about and show off millimeter wave radio signals. The wireless tech is being tested for superfast connections that will be a big part of 5G standards. In one demo, I used an Oculus virtual reality headset to control an actual digger in Texas. Ericsson was showing how wireless tech with virtually no lag time could enable a remote operator to control diggers, robots or drones. In another demo, Samsung displayed antennas set about 20 feet apart with blazing-fast connection speeds of nearly 4 gigabits per second (or 4,000 megabits per second). "5G is a national priority," FCC Chairman Tom Wheeler said at the event.
The industry's rapid pace of development underlines high hopes for 5G.Companies at the FCC event -- including Google, Qualcomm and Intel -- said one of the biggest challenges will be building new apps that harness the faster speeds. Not to say there aren't still engineering problems. When someone raised a hand or a notebook between the two Samsung antennas, the speed rapidly dropped. And unlike Wi-Fi, millimeter wave signals won't penetrate walls. But wireless engineers say they are figuring out how to go around or bounce off objects. They also say they're getting closer to cheap smartphone antennas for 5G.
Two-thirds of workers expect that, within 50 years, robots or computers will steal most of the jobs we do today, according to a recent Pew survey. A glaring disconnect: 80% of workers don't think their own jobs will be made obsolete by technology. For now, just 11% of workers are worried about losing their current job to automation.
Three-quarters of U.S. drivers say they would feel unsafe in autonomous cars, according to a survey by AAA. We expect early fears to fade as perceptions quickly change. Also from the survey: Millennials love self-driving tech for the convenience and cool factor, but don't want to pay more for it.
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