In the 1997 Hollywood sensation Breakdown, Kurt Russell’s wife is kidnapped by money-crazed truckers. To do this, they isolate him while driving in a desert country with no telephone signal.

Rural connectivity of a country is an age-old problem. Enter Google & SpaceX.

The 1980s were a decade of leaps & excess. While Gordon Gecko was declaring “Greed is Good”, technologists were figuring out how to connect to the internet via a modem & a telephone line.

I can still hear those 64kb scratches from the Pentium one computer in Marius’s bedroom.

Sidenote:

Marius was my friend throughout grades 4 to 6. He was that friend to me. The sleepover friend. That play computer games friend. That, “Vusi is it safe to drop you off at the township” friend.

Don’t act like it’s just me.

Back on the subject…

Motorola was the first out of the gates with satellites phone in 1989. Their idea was to target adventurers, and navigators but also emergency situations such as sea rescues. The phone was invented to overcome the challenges of classic GSM. Good times.

How Exactly Do Satellite Phones Work?

Satellite phones connect to other phones or the network by radio through orbiting satellites. So, it’s a mobile two-way communication device using low-orbit satellites.

This is the key:

A two-way communication device & a low-orbit satellite.

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So the question is,

“If you could find a cost-effective way to deploy a network of satellites at low orbit what other connectivity problems would you solve?”

And could you do something to increase the speeds of connectivity for the users?

Faster Connectivity.

Quicker Deployment.

Better Reach.

And the holy grail,

NB: Demand-Led Asset Allocation.

The Invention Of The Loon

Many years ago while on a speaking tour in Colombo, Sri Lanka, a friend of mine (and YPO board member) told me about this interesting project that Google was running called the Loon.

The idea – as he explained it – was that they were sending balloons into the stratosphere.

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The idea was to use high-altitude balloons in the stratosphere (at an altitude of 18-25 km) and create an aerial wireless network to deliver the Internet to remote and rural communities.

Testing this in Sri Lanka given its urban concentration and rural sprawl made sense.

To do this, Google began testing their idea in the skunkworks division, X. They would later spin out the loon into a new business.

During the 2017 natural disaster in Puerto Rico, Loon deployed their balloons to provide connectivity and help the citizens and the rescue workers.

Google Loon signed its first commercial agreement with Telkom Kenya in 2018 and swiftly raised $125mln from Son’s Softbank in 2019.

Alastair Westgarth, the former CE of Google Loon said that they had struggled to lower the costs. This made scaling difficult.

So they popped the balloon and closed the Loon shop.

Meanwhile, the perfume salesman has been growing from strength to strength with Starlink. I just placed my order & am due delivery in 2023. I think.

You pay USD599 once-off for the hardware & USD110 per month.

Travel With Starlink

In a world where some mobile telco operators are still forcing clients to sign a ridiculous 2 year contract plan with a ridiculous “lose your finger” when you want to cancel clause, Starlink is offering:

  • No contracts.
  • 30-Day Trial.
  • Take the satellite with you in your RV.

This thread is a good case study of how the same problem can have wildly differing theses on how to address it, profitably.

For Google (Alphabet) their bet with balloons in the stratosphere. But they couldn’t lower the cost of production sufficiently to build a business case.

Project Taara

For SpaceX, their approach was to leverage its space dominance and double down on its manufacturing prowess (Elon is really good at building shit! Cars. Satellites. Fire-blowing things. Tunnels for fast trains. Humanoid named after an iconic cartoon).

But the battle for supremacy is not over yet, Google (or rather “X”) is betting on its light-based internet technology as the answer.

Yes.

You read that right … LIGHT!

This is from their website. They are calling this Project Taara.

You may be wondering why telcos are not simply deploying fiber to address this.

Simply, rural terrains are not notoriously hard to reach and are often uneconomical to service. The revenue potential when compared with the upfront investment to “lay the pipes” doesn’t marry.

If you want to find out more on Project Taara, start HERE (https://www.youtube.com/watch?v=HoybAZNpLjk )

So, in the next 10 years, a movie about a man losing his phone signal, having a breakdown, and then having his wife kidnapped by bandits will not be a reasonable plot.

Mobile & fiber companies better get serious about last-mile connectivity or lose it.