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In a lot of ways, I think this is an accurate take. I worked at SES for years, starting at NewSkies Networks (I was there through the SES acquisition when they
by wrigby 2y ago
In a lot of ways, I think this is an accurate take. I worked at SES for years, starting at NewSkies Networks (I was there through the SES acquisition when they merged us with Americom), then a second stint at O3b (just before SES fully bought the controlling stake). My take may be a little short-sighted, as I was really young at the time.
The thing that struck me is that they operated more like real-estate investors than tech companies. Geostationary satellite technology had remained largely unchanged for a couple decades, so these companies were engaged in the business of:
- Obtaining real estate (an orbital slot)
- Putting a big, expensive, largely commoditized[1] asset on that real estate
- Operating that asset as efficiently as possible to achieve a good ROI
This meant that the executives were often stronger at things like financing hundred-million dollar purchasing projects (a huge skill on its own) and running a skeleton technical operations staff (to keep OpEx down), but lacked the foresight to see what the Internet meant for their product relevance.
1: Of course something as technically complex as a spacecraft isn't a commodity, but there was largely no differentiator in what it _did_: receiving, shifting, and re-transmitting analog RF signals, almost always in 36 MHz and 72 MHz wide chunks. You could buy one from Thales, Lockheed, Boeing, etc., but to the operator's customers, they all basically looked the same.
- kiba 2y agoAn orbit is basically real estate and probably should be treated as such.
- deleted 2y ago[deleted]
- breckenedge 2y agoThese are service providers, not rent seekers. By focusing on OpEx above all else, they missed an opportunity to build starlink first. They were doing the right thing as long as nothing ever changed. Now they’re forced to consolidate further and are probably going to disappear.
- MichaelZuo 2y agoThis would only apply if they decided to expand into LEO or MEO. But if the board decided to stick to Geostationary orbit, they were doing the smart thing by treating it like a real estate business. Because it is literally real estate.
- breckenedge 2y agoIf space-based telecom moves from GEO to LEO, then there’s no reason for GEO telecoms to exist anymore.
- MichaelZuo 2y agoThe real estate would still be worth quite a bit, so even in the worst case they will just move on to be literal real estate holding companies.
- Gare 2y agoSatellite TV is probably not going away anytime soon.
- simfree 2y agoDish and DirecTV are rapidly bleeding customers, the latter is not planning to launch any new birds for this dying business. It might only be a decade before this industry consolidates further into the remaining satellites, with some large providers going extinct entirely.
- wrigby 2y agoYes and no. They also dragged their feet on high-throughput Ka-band spacecraft with smaller spot beams. ViaSat built and launched ViaSat-1 while SES was still ordering satellites designed around analog video broadcast. In the terrestrial real-estate analogy, this seems to me like missing out on potential returns because you built the wrong type of building on the land you own.
- panick21_ 2y ago
- dylan604 2y agoMy real estate doesn't move though. So while maybe applicable to a GEO stationary orbit, it doesn't really fit LEO oribts.
- TeMPOraL 2y agoOrbits themselves don't move, they're time-invariant (short term, but so is the ground). Six numbers are all it takes to define an orbit; if you put something on it, it stays there and blocks it off - like building on a plot of land.
- dylan604 2y agopedants going to pedant. objects in orbits move so that you can have multiple objects in the same orbit. you can't do that with real estate. they have the opposite with time shares where there's one object that different people get to use at different times. there is no real estate where for a portion of the day it is one building, but then it is a different building later.
- bartonfink 2y agothis is the entire basis of timeshare real estate. it's not that hard to see how the metaphor holds up, dude.
- hedora 2y agoAlso, I hate to break it to you, but your homes are spinning around the earth's axis once a day (at the same rate as a geosynchronous satellite, in fact!) Anyway, Starlink wants to scale up to 42,000 satellites. I can't imagine that's anywhere close to the maximum number that could fit in their altitude range. After all, if arranged in a grid, that's just ~ 200 x 200 satellites. The earth's surface area is many orders of magnitude larger than that, and the satellites are occupying a larger (and much thicker) orbital shell.
- dylan604 2y agodude, that's exactly what i said. better context reading before going off with dude bro comments perhaps?
- panick21_ 2y agoYes. But Tesla turned it into a competition between a company that invests in real estate and a company that operates highly profitable stores on the real estate. The product they sell is a highly complex product that took half a decade of development and substantial upfront investment in technology and organization. The difference here is that SES has to get up front investment to buy productive asset that could then make money. The never had to do a huge up front investment in technology, including a whole butt-load of very complex very unique hardware and software. And that's not enough, because the terminals are just as big a part of having a functional LEO platform as the sats are. And that again requires a very complex development and a very large upfront investment in production. Literally non of this stuff, neither the rocket, nor the sats, nor the operations, nor the terminals are a commodity in any sense. You can go to a space company and ask to buy some propulsion for such a sat, no problem. But if you tell them 'we would like to buy 5000' your gone get back blank stares. Nobody just has something like that just laying around. And then you go down the line of every single part on the sat, no provider actually has the capabilities you need, and your gone have to get involved with financing all of that at least partially.
- hehdhdjehehegwv 2y agoActually Space Law is pretty wild, it’s a whole thing. https://en.wikipedia.org/wiki/Space_law https://en.wikipedia.org/wiki/Space_law
- talldayo 2y agoAgreed - I used to be a Hughesnet customer before switching to Starlink. It's genuinely incomprehensible how slow satellite internet is for the price; stuff like Starlink is a long-overdue kick in the pants to these satellite providers. Say what you will about Elon et. al, it's probably true. But Starlink is a killer tool for people that live where Comcast and AT&T refuse to build lines. It's a much better deal (infinite bandwidth versus metered) and a no-brainer for anyone that's still paying for expensive, stodgy satnet.