The Internet Space Race

Companies are scrambling to offer high-speed online access from the final frontier.

- Aaron Pressman

THE NEXT BILLION PEOPLE who get connected to the Internet may be looking to the heavens. That’s where a race is on to provide online access from fleets of satellites, led by a who’s who of tech and several deep-pocketed startups.

The aim is to help connect people in developing countries, provide speedier online access to mainly rural users who depend on today’s slower and more expensive satellite Internet services, and cater to business customers that want real-time data from their equipment, like oil rigs and ocean buoys.

The biggest names in the race include Facebook, Elon Musk’s SpaceX, and OneWeb, backed by Japanese billionaire Masayoshi Son’s SoftBank Group. They’re pitted against dozens of upstarts like Swarm Technologies, Astrocast, and Sky and Space Global that want to send cheap, toaster-size satellites called cubesats into orbit.

Wary of the competition, existing satellite-based Internet providers such as Viasat and EchoStar’s Hughes Network Systems are moving to defend their businesses. They plan to launch new satellites that are far more powerful than their predecessors.

For now, the satellite-based broadband industry is relatively small. It will account for only $4 billion in revenue this year, according to Morgan Stanley. But with all the planned networks, and a shift in consumer Internet habits, sales are expected to reach the stratosphere. By 2024, revenue is expected to rise to $22 billion and then to $41 billion in 2029.