Rising Competition From Satellite Internet Providers: 4 Strategies To Win
In recent years, the broadband connectivity landscape has rapidly evolved, with nontraditional entrants like satellite providers emerging as formidable competitors to broadband service providers (BSPs), especially in rural and suburban areas. Networks like SpaceX’s Starlink and Amazon’s Project Kuiper are leveraging advancements in satellite technology to offer high-speed internet access at competitive rates in regions where terrestrial infrastructure is limited or nonexistent.
Satellite vs. Broadband Service Providers
Once considered a niche solution, satellite internet has become a key player in the global internet connectivity market. Its ability to deliver data wirelessly from space makes it ideal for reaching rural and remote areas. Low Earth Orbit (LEO) satellites offer low latency and near-global coverage, making them suitable for real-time communication and various internet services at streaming speeds. Furthermore, the internet service price point is expected to decrease, with companies leveraging their e-commerce background and economies of scale to compete on price.
For terrestrial BSPs, this new competition poses a significant challenge. Large wireless carriers are also entering the fray with 5G-based fixed wireless access (FWA) services, further intensifying the competition. Although your subscriber churn rate may be low now, satellite companies are continuing to launch more infrastructure and build up their network, and, before you know it, they’ll start picking off your customers. Upgrading network infrastructure and operations does not happen overnight; it is important to start planning and changing your business model before it is too late. How can you stay ahead in this competitive landscape?
4 Ways To Compete With Satellite Internet Providers
The best way to compete and win is to change the playing field by building a unique value proposition that establishes deep subscriber and community relationships, value-added managed services, and a strong brand identity.
- Focus on availability and capacity. Given the lower reliability of satellite networks, ensure your network can handle high traffic volume and provide consistent, reliable service. Passive optical networks (PONs) are the most reliable for broadband services. However, many BSPs remain on Gigabit PON-based (GPON) fiber-to-the-home (FTTH) networks that can’t deliver more than satellite internet or support the value-added services you need to differentiate in the market. BSPs should invest in infrastructure upgrades, such as next-generation XGS-PON-based FTTH. XGS-PON supports higher download and upload speeds per subscriber than satellite technology. Plus, XGS-PON supports value-added services and network features (like performance testing and actionable insights) that ensure high availability (resulting in high subscriber satisfaction!) and significantly enhance your network’s capacity and performance.
- Enhance the subscriber experience with value-added services. Provide a comprehensive suite of services that add value for subscribers, such as managed Wi-Fi, network and device security, smart cameras, and more. Plus, target your subscribers with services that match their lifestyles, such as parental controls and social media monitoring for parents.
- Leverage your local presence. Unlike satellite providers, you have a local presence, which is a significant advantage! Offering quick installation, local customer support, and community engagement can build stronger customer relationships. In addition, you can provide community-based Wi-Fi services that empower the community and demonstrate the excellent service you deliver.
- Innovate and adapt. Stay ahead by continuously innovating and adapting to new technologies and market trends. A platform approach to service delivery is key to introducing new services to the market quickly and at scale! This includes exploring partnerships with the community and local small businesses to complement your existing services and expand your reach.
Satellite Internet Adoption
Satellite is the most accessible internet, available almost anywhere in the United States. However, it is also one of the most expensive options due to the high cost of launching satellites. Despite this, the global satellite internet market is expected to grow. And Amazon’s Kuiper project business model includes offering the lowest-cost internet service, which will impact a BSP’s financial stability—like how Amazon’s e-commerce business has devastated brick-and-mortar stores in North America.
Table: Comparison Between Satellite and High-Speed Internet Services
Service Type | Coverage | Latency | Speed | Reliability | Cost |
Satellite Internet | Near-global coverage, ideal for remote and rural areas | Higher latency due to long-distance data travel | Improved but variable, often lower than fiber-optic | Affected by weather conditions and physical obstructions | Generally, more expensive; however, new players are going to be price competitive |
Fiber High-Speed Broadband | More prevalent in urban and suburban areas, with lower capacity networks in rural areas | Lower latency, suitable for real-time applications and value-added services | High-speed, consistent, and symmetrical upload and download speeds | More reliable; less susceptible to weather disruptions; higher service availability | Often more affordable for consumers in the long run |
The competition from satellite providers is a wake-up call for BSPs. By enhancing service availability, capacity, and subscriber experience with value-added services, you can leverage your network to differentiate service offerings and stay ahead of the competition in this rapidly evolving market. Don’t be complacent—embrace the challenge and turn it into an opportunity to innovate, grow your business, and further empower your community!
Download our eBook to learn more, “Subscribers Are Demanding Highly Available Broadband—Here’s How To Deliver It."
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