THE NEW MOBILE SATELLITE SYSTEMS:
WHAT CAN THEY REALLY DELIVER?

This article is the first in a series of four, designed to provide a overview of the new proposed mobile satellite services in the light of the International Telecommunication Union's forthcoming World Telecommunication Policy Forum, to be held in Geneva on October 21–23.

This first article gives some background on the proposed new systems, what they might offer to users, and the issues involved in getting them up and running. Subsequent articles will deal with Big and Little LEO systems in more depth, while the final article in the series will look closely at the legal, political, economic and regulatory problems inherent in these systems. It is these issues that will form the basis of discussions during the World Telecommunication Policy Forum.

In October this year, the ITU will host its first-ever World Telecommunication Policy Forum, focused around the theme of Global Mobile Personal Communications by Satellite (GMPCS). This rather unwieldy acronym is the generic term encompassing a number of exciting new satellite systems that have the potential to fundamentally change the way people around the world communicate.

Increased personal mobility, restructuring of world trading arrangements, and cheaper and faster international transport have combined with dramatic improvements in the field of communications to bring about a rapid globalization of the world's economy. This process has profoundly changed the world we live in, and is the driving factor behind the development of these new mobile satellite systems.

While cellular telephony has changed modern working practices by making staff more mobile and more easily reachable, two problems still remain. The first is that the user of a mobile phone is only contactable while within a mobile phone 'cell'. Many countries' cellular networks do not provide 'blanket coverage', that is, there are places where the phone will not work. This is especially true in remote areas or areas of low population density, where it may not be economically feasible to install the equipment necessary to support the network.

Additionally, while it may be possible to contact colleagues who are out of town on business, contacting them when they are out of the country is much harder. The first mobile telephone systems were designed for use within a single country. Later, it was recognized that the ability to use a mobile phone internationally was also desirable, particularly in regions such as Europe where business travellers frequently cross national borders. This thinking led to the development of the GSM system for mobile telephony, which offered users a feature known as 'international roaming'. This allows a user to telephone from, and be telephoned in, any other country with a GSM network which has a 'roaming agreement' in place with the home country. The problem with this system is that it now seems unlikely to meet the original need for seamless international communication. Several countries in the world have implemented a GSM network, but some may have such a system but not allow users from certain countries to call or be called because a roaming agreement is not in place.

For these reasons, some companies have devised new systems which will ensure that all users are contactable at all times, no matter where they happen to be. These systems employ networks of satellites, and will be the GMPCS systems of the future.

GMPCS systems in fact represent more than just a new kind of global mobile phone; the kinds of new capabilities they offer will be much more profound. Imagine, for example, that you are travelling on business in a remote part of China. On the basis of your work, you need to telephone a colleague in your Paris office. You also want to send a client in Moscow an urgent fax from your laptop computer, for which you will need access to data from a spreadsheet located on the network drive at your company's corporate headquarters in Montreal. Unfortunately, today, you'd have little hope of making these connections. For a start, you would not be able to telephone Paris, since even with your GSM phone you're way out of cellular range. What's more, there is no international GSM roaming agreement between France and China. And because you're not near a fixed line telephone, you can neither send the fax or get hold of the data you need from the corporate server in Canada.

GMPCS systems promise to change all that. The new non-geostationary satellite constellations, due to come into operation over the next few years, plan to offer global, seamless communications between any points, no matter where they are on the Earth's surface. What's more, you'll be able to transmit not just voice, but data, sound, and images, so you could send your Russian client not only the figures for your joint project – say a new oil well – but even plans of the proposed installation and a computerized fly-through of the model. In theory, you could also have the possibility of initiating a conference call with colleagues at other sites around the world, with the ability to hear and see your co-workers in broadcast-quality video and to perform real-time revision-marking of shared documents on the computer screen.

Naturally, some of these kinds of sophisticated multimedia capabilities are still many years away. For example, the computer technology needed to handle complex tasks, such as real-time video on a laptop PC delivered via a moving satellite, is still just a pipe dream. And even if the current range of planned new satellite systems come into operation according to schedule, there may be many technical problems to iron out before they are able to deliver a simple, reliable, voice circuit. What's more, initially, at least, services are likely to be too expensive for the mass market.

Nevertheless, we have today within our reach the promise of global communications never before dreamt of, opening up a whole range of new commercial opportunities for savvy entrepreneurs and established communications providers alike, and a wealth of exciting new services for users. Like the Internet – once the sole domain of ivory-towered academics, but now dominated by young, hip and computer-literate Web surfers – the new global mobile services should quickly find themselves widely used as the market grows and prices fall, although they are likely, initially, to attract only a small base of corporate users. And, as with the Internet, we can only speculate on the types of services users of these new satellite networks may find 20 years from now. How many in the academic community would have dreamt that their esoteric research network would one day be providing a mass market with news, weather forecasts, horoscopes, retail and banking opportunities and consumer information?

So how will the new GMPCS systems take shape? And when? Firstly, there is an important distinction to make between the two main types of system currently in the pipeline. The first, known generically as 'Little LEO' satellites, will offer a range of text and data services. The second type of satellite, known as Big LEOs, and will offer users seamless global voice, fax and possibly even broadband* services.

The 'Low' of LEO's Low Earth Orbit refers to the distance of 700 to 1,500 km at which the satellites are located above the Earth's surface – they are only 'low' in relation to traditional geostationary communications satellites, which orbit the Earth at a distance of 36,000 km. In fact, these Low Earth Orbit satellites are still nearly twice as high as Space Station Mir, which orbits at around 400 km from Earth. Both types of system are non-geostationary, meaning that the position of the satellites changes in relation to the surface of the planet. In operation, they will form a moving constellation, circling the globe and relaying messages back and forth between each other and users, and/or earth stations.

The Little LEOs will almost certainly be the first systems in full operation, with some systems already partially on-line, and most due to start offering services between 1997 and 1998.

Little LEOs are generally smallish satellites around 1m³ in size and weighing about 100 kg. Most ventures currently in the pipeline propose to use the satellites as either 'bent pipe' systems, or store-and-forward systems. The so-called bent pipe system relays messages directly between users, while the store-and-forward approach means that a satellite receives information from a ground station, stores it in on-board memory, continues on its orbit, and releases the information to the next appropriate ground station, or user. Users will access the new Little LEO systems using small hand-held messaging units weighing less than 0.5 kg, and incorporating a low-power omni-directional antenna.

Little LEO services will tap into a range of markets. Messaging is expected to be a high-demand service, and will include e-mail, limited Internet access, two-way paging and fax. Remote data communications will also be an important area, especially for Emergency Services.

Other important niche markets will be digital tracking (for the transportation management market), environmental monitoring, and SCADA (Supervisory Control and Date Acquisition – a system which provides remote monitoring of isolated facilities such as mines, oil refineries etc). The Little LEO proponents hope to gain by offering fast and inexpensive services, and by getting a foothold in the market well ahead of their bigger cousins.

But while these systems may well be first to market, it will be the Big LEOs that will attract the lion's share of media attention. Most of these systems won't be up and running until 1998 or later, but they do promise users a greater range of services. The most well-known of these is global mobile telephony – the ability to make and receive calls on a mobile telephone anywhere in the world. Other services, though, will include data and fax, and even (in the case of one proposed system in any case) broadband video. In this highly competitive market, the main contenders will offer small hand-held mobile terminals only a little larger than today's diminutive cellular phones, and which incorporate a largish aerial. (The appearance of the units is, in fact, not unlike the analogue mobile telephones of the mid-1980s).

The Big LEO systems will comprise a constellation of several satellites, moving around the globe and picking up and relaying users' telephone calls from one region, country, or continent, to another. Some of the proposed systems support satellite to satellite communications, making them, in reality, an enormous wide area network. Most, though, rely on uplinks and downlinks to earth stations to complete the call circuit.

The advantages of the Big LEO systems seem obvious – until you factor in the cost. Compared with the Little LEOs, the cost of a call, at least initially, will probably be prohibitive for most users, with the exception of large corporations with a genuine need for instant global voice communications to remote areas at any time. Those users simply needing a global voice network, or a global high-speed computer network, can in many instances already meet their needs with existing fibre optic networks or via the kinds of value added networking services now being offered by most of the leading telecommunications carriers.

What's more, the very services offered exclusively by the Big LEOs are already available, to some extent. The INMARSAT 3 mobile satellite system has already accepted its first calls, using new spot-beam satellites. This system uses small (although not hand-held) phonesets and charges about the same for a call as the Big LEO systems. True, the transmission time delay on the system is a little longer, and INMARSAT 3 cannot offer walk-while-you-talk capabilities; but the fundamental elements of many of the planned Big LEO systems are available today to the serious user who is ready to pay for the privilege.

Which brings us to the hottest issue – that of call pricing. What exactly will users be expected to pay, both for the handset and for the call airtime? At the moment, the figures are a little hazy, but it would probably be safe to say that most systems plan to offer voice service at US$1-3.00 per minute. However, since most operators will market their services via resellers, this may not reflect the cost to the user, which could be substantially higher. Furthermore, the cost of buying a handset is expected to come in at US$700-3,000.

But before writing off the system as just too expensive to be feasible, it pays to bear in mind that the first analogue mobile phones sold for similar kinds of prices, and that the cost of calls on cellular networks around the world has dropped significantly as the volume of users has grown and markets have matured. There is every reason to expect that the same kind of thing will happen with the new global satellite services, although the time frame for a meaningful reduction in pricing will depend on how many people sign up for the service in its early stages.

The Little LEO and Big LEO markets will be examined in a subsequent article, but one operator needs to be singled out at this stage, since technically it qualifies neither as a Big LEO nor a Little LEO. This is the Teledesic system proposed by the company set up by Bill Gates of Microsoft, together with Craig McCaw (founder of McCaw Cellular, which was acquired in 1994 by AT&T). Like the Big LEOs, the system will be able to support voice as well as data and fax. But unlike the Big LEO systems, Teledesic's offering will be targeted at the computer market, and will focus more on high-speed data transfer capabilities than on the provision of mobile telephony.

Teledesic's system, which comprises by far the largest number of satellites (estimated at a constellation of hundreds of units spinning around the planet in non-geostationary orbit), aims to provide users with broadband multimedia-type services, allowing them to rapidly access and transfer data, text, still and moving images and sound, anywhere in the world. The system is highly ambitious, and is not due to come into operation until the year 2001 – yet, if realized, it could represent a most significant change in business and personal communications. The company claims that the cost of calls – which will mostly be data transfer links – will be much lower than other systems. The price of user terminals is still up in the air.

The would-be GMPCS system operators still have a lot of work cut out for them before the systems become a commonplace part of the global telecommunications environment. For a start, there are a number of technical problems to overcome in setting up, launching and operating such complex satellite constellations. And since these kinds of systems have never existed before, there will inevitably be teething troubles before they function smoothly and can guarantee problem-free, high-quality service.

In addition, competition for a niche in this new market is very high, and many industry analysts have remarked that it is unlikely that the market can support the number of players currently lined up to provide services. It seems certain that there will be some casualties along the way as market forces work to weed out those operators who are unable to raise the necessary capital, who are less-competitive, or who fail to make the grade in terms of service provision.

International licensing, too, may prove a sticking point for operators. The incompatibility problems which plague current cellular networks when roaming from country to country could be just as bad for the new GMPCS networks, unless most operators can secure operating licences in at least the majority of the world's nations.

Finally, operators will have a tough job persuading customers to fork out what is, after all, a sizeable amount of cash for the ability to use a system many people may not actually need. It's great to have the ability to call anybody, anywhere, at any time – but after the initial novelty wears off, how many of us really have a need, or even a desire, to do so? Perhaps, when system costs fall, we may feel it's worth paying a little more for the option, but that initial fight for market share is likely to be hard and bloody.

All that said, there is no doubt that the new GMPCS services will play a key role in the development of world communications, and are certain to have a profound influence on the way the telecommunications and information technology markets develop over the next 10 - 20 years.

The political, social, socio-economic and regulatory issues raised by the provision of these new global services will be dealt with in a future article, and will also be the subject of the International Telecommunication Union's World Telecommunication Policy Forum in October. At this meeting, carriers and service providers will get together with representatives of the world's telecommunication administrations and regulators to forge a strategy for the implementation of GMPCS.

We are witnessing the birth of a new way of communicating. How difficult that birth proves to be is largely in the hands of industry and government.

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