Astranis Space Technologies says it has struck a deal with Alaska’s Pacific Dataport Inc. to provide America’s northernmost state with three times as much satellite data bandwidth as it has today, via its first satellite in geostationary orbit.
“It is a firm contract in the many tens of millions of dollars,” Astranis co-founder and CEO John Gedmark told GeekWire in advance of today’s announcement. It also arguably ranks as the biggest deal of its type for a satellite company as young as Astranis, which emerged from stealth mode less than a year ago.
Astranis put a small-scale test satellite into low Earth orbit last year, and plans to follow up with the launch of a 660-pound (300-kilogram), 3-foot-wide telecommunications satellite in the second half of next year. Gedmark said the satellite would be sent up as a secondary payload by a major launch provider, but declined to say which one.
“This is going to happen fast,” he said.
The satellite will fill a slot that’s been set aside for Pacific Dataport more than 22,000 miles over Alaska. “It has a capacity of 7.5 gigabits per second, which is enough to more than triple the satellite capacity that is over Alaska right now,” he said.
Gedmark and Ryan McLinko, Astranis’ other co-founder and chief technology officer, created the company with the goal of bringing high-speed data access to more of the estimated 4 billion people around the world who are currently underserved when it comes to internet services.
They’re not alone in that quest: SpaceX, OneWeb and Telesat are among the other companies seeking to bridge the broadband gap with satellite networks. Those companies, however, are planning to put hundreds or thousands of satellites into low Earth orbit, also known as LEO. In contrast, Astranis will rely on miniaturized satellites that can be placed one by one into geostationary Earth orbit, or GEO, to focus on specific geographical areas.
The drawback to GEO vs. LEO has to do with the lag time, or latency, for transmitting signals back and forth. But Gedmark said GEO can still hold an important place in providing high-speed internet access to the billions who are off the beaten track for broadband.
“If they are underserved or have no connection at all, then they just want internet as fast as possible. … Really, 95 percent of what people do in today’s world is not latency-sensitive,” he said.
The California-based company’s analysis of the satellite broadband market revealed surprising opportunities close to home.
“What we found was that one of the most urgent needs is right here in the United States, and in rural areas,” Gedmark said. According to a study conducted by the Pew Research Center, 35 percent of Americans — roughly 113 million people — say they don’t use broadband at home.
In Alaska, 39 percent of the state’s population is underserved with broadband, according to figures from BroadbandNow. So from Astranis’ perspective, it made sense to start with Alaska and with Pacific Dataport, a satellite communications company that’s supported by Microcom and Space Partnership International.
“We really couldn’t have asked for a better first customer and a better partner,” Gedmark said.
In today’s news release, Astranis and Pacific Dataport said the satellite broadband service will bring costs down to an average that’s three times less than the current pricing for both residential and wholesale customers. Gedmark told GeekWire that the price tag would be “less than $100 a month for true broadband access.”
Pacific Dataport’s deal is structured as a seven-year lease of broadband capacity on Astranis’ first satellite, and there’s likely to be more to come.
“PDI was created specifically to address this connectivity problem in Alaska,” Chuck Schumann, founder of Pacific Dataport, said in the news release. “Through our work together, we ultimately hope to provide 40 Gbps [gigabits per second] to 50 Gbps of dedicated bandwidth to bring the entire state of Alaska online with broadband internet — including many in the state who have no access at all.”
Gedmark expects the demand for broadband access to keep rising due to the proliferation of data-intensive applications, including streaming video from services such as Netflix and Amazon Prime. And he expects Astranis — which got a $13.5 million investment boost last year — to be ready to serve that market.
“Help is on the way,” he said.