* Satellite winning race over wireless
Generations of people have run from the farm toward the city, which is why we all curse during rush hour. But the idea of telecommuting, even part time, makes it possible for many to return to the small towns they rejected decades ago. Unless, of course, the small town doesn’t have broadband access.
The leading broadband satellite provider is Hughes Network Systems. It also supplies broadband of all flavors to large enterprises (look on the roofs of retail stores and you’ll almost always see a Hughes satellite dish) and DirecTV to consumers. Mike Cook, Senior Vice President of Hughes North American Division, called to tell me about the company’s small business product line.
“We estimate there are 10 to 15 million households, and 3.5 million small businesses, outside the reach of terrestrial broadband,” said Cook. Small businesses to Cook mean companies with less than 40 branches, but most of the Hughes’ focus is on businesses with maybe 20 employees over five sites.
It seems to me Hughes and other satellite providers will have this market to themselves for quite a while. Cable providers and telephone companies are busy fighting each other about VoIP service when not making deals to bundle more and more junk into your bill. Cable and DSL news reports just mention new features, not maps of new coverage areas. Digging trenches for wires, either cable or telephone, costs money, and traditional broadband providers seem content to cover the majority of American households but not push to get every household because of the high cost.
Although a satellite costs millions to build and launch, the incremental cost of adding new subscribers is just the billing setup expense. And Hughes has been improving technology to increase connection speeds and serve more customers on existing equipment.
“Starting last year we upgraded our transponders for a significant gain in bandwidth efficiency,” said Cook. “The same transponders can now handle many more megabits than before. As a further benefit, we can dynamically change the coding rate to better penetrate rain.”
Satellite broadband will always suffer some latency. Cook admits the 24,000 mile round trip adds about a half second to each packet delivery, but Hughes does what it can. TurboPage technology at Hughes servers pre-fetches links so they’re ready when you click, and puts the performance on par with (admittedly mediocre) consumer DSL. “Our side by side tests comparing satellite to DSL are very close,” said Cook.
When I wrote Broadband Bible Desktop Edition four years ago, satellite Internet service for consumers and small businesses went one direction: down. You had to use the telephone number to send your traffic upstream while the downstream traffic came through the satellite. Not only do satellites support two way traffic now, the business service can be called downright snappy (especially compared to DSL).
The HughesNet Business Internet plan provides up to 2Mbps downstream speeds, and 500Kbps upstream (best case). That’s the high end product for $179.99 per month if you buy the satellite gear, and $219.99 if you lease. Home office users can get service as cheaply as $59.99 for 700Kbps down and 128Kbps up after buying the equipment. Between the two ends of home user to high-speed business user are several speed and price options.
The other option for broadband in the boonies, wireless, seems to be stuck in the starting gate. The top wireless ISPs, according to Broadband Wireless Exchange Magazine, support about 20,000 subscribers. No. 10 on the magazine’s top 10 list has just under 4,000 subscribers. The wireless “revolution” has yet to gain traction, and WiMAX will start getting the “missing in action” tag if it doesn’t standardize and roll out soon.
But even though WiMAX can reach up to about 10 miles from each tower, providers need to build a lot of towers, and the best way to amortize those tower costs is over lots of subscribers. Rural areas, by definition, have few subscribers scattered far and wide.
Satellite will remain the choice for stationary broadband in the boonies, while wireless improvements will start edging outward. Part of the delay with wireless is due to the desire to support various wireless devices as they move around. European tests aim to keep WiMAX connected to laptops inside train cars going 60 MPH. Satellite can’t beat that, but you may give up in frustration before the wireless providers reach you.
Will you pay more for satellite Internet service for your dream Bed & Breakfast by the lake in the mountains? Isn’t sitting in the country and avoiding rush hour worth a few extra dollars per month? I think so, and Hughes’ 325,000 small business satellite customers agree.
