Cape Town, 12 Sep 2008
Google teaming up with new satellite company O3b could be beneficial for bandwidth-starved Africa, but there are questions over how it will be done, says Gartner principal analyst Will Hahn.
On Tuesday, a consortium consisting of the Internet search giant, O3b, banking group HSBC and cable operator Liberty Global announced it would launch a constellation of up to 16 low-earth orbit (LEO) satellites.
These satellites would circle the earth at the equator and European aerospace company Thales is building the first.
"It`s certainly a significant announcement - there are some new players involved, a substantial number of transponders and new 'birds` covering especially Africa, as the least penetrated region in the world," Hahn notes.
He says the announcement speaks of access to speeds up to 10Gbps, which he finds interesting as the latest generation of satellites available have capacity of 100Gbps.
Only five?
"Also, it`s confusing to assert that five satellites can give global coverage, when speaking of LEO 'birds` (which O3b does on its Web site). That`s more likely a bare minimum for coverage of the Southern Hemisphere and, at any rate, the 16 satellites announced in this launch pale in comparison to Globalstar`s 48 LEOs and Iridium`s 66. We tentatively believe this 'Asia, Africa, Latin America and the Middle East` network will focus in its first phase on Africa."
Hahn contends that such a focus would make sense, as this is easily the least penetrated region in the world (and one of the fastest growing). The impact on pricing would be significant, assuming that O3b and partners can bring the vision of a data/backhaul network to fruition on LEO-based satellites.
"The use of such a network for data is the key differentiator - the other incumbents may also be planning upgrades to capacity with this in mind, but only time (and perhaps the pressure brought by a successful new entrant in O3b) will tell."
In his personal view, satellites need to have a competitive response to the new cables finally starting to come through Africa (principally Seacom, with 1.28Tb due for 2009, and also the government-sponsored projects coming in somewhat later).
He also asserts that O3b has not made definite claims with regard to video transmission yet. "But we know broadcasters will require redundant capacity and paths for their most important programs and applications. The [2010] World Cup promise for no single point of failure is only the most prominent example," Hahn says.
New demand
Gartner states that, more importantly, this new capacity will bring demand for new applications, not simply more coverage with basic voice and messaging services. O3b emphasises data applications and this could be quite significant for Africa.
Hahn says two-way TV/video is a key differentiator for IPTV (primarily offered over fibre). It is not impossible to offer this via satellite, but it`s hardly feasible and price is one major issue - this new network could alleviate a major roadblock around the pricing of all data applications, even if it does not directly offer video at first, he notes.
"The presence of Google is always sure to excite interest and the conspiracy crowd could hardly be happier, I`m sure. Google`s aim seems largely to commoditise carrier strengths in the network and reach users via its search portal to provide them with apps that keep them on their own servers.
"Its vision is one in which folks with Internet access can answer all their important needs through Google apps," Hahn says.
Non-discriminatory practices
He points out that Google has worked with carriers in the past, but overall seems to prefer a future in which it does not differentiate against off-network traffic, and generally is content to take fees for access like "a good utility" and stay out of the applications arena.
"The result for Africa`s end-users, at least in the short run, should be quite beneficial. ISPs, large verticals such as finance organisations, and even telcos can benefit from increased capacity at lower prices (always given the important caveat of open access and non-discriminatory practices).
"I continue to believe there is plenty of room for more capacity around Africa, especially in the satellite sector where it has been so severely constrained and highly priced in the past," Hahn says.
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