First they built above ground with overhead cables, then underground in ducts, but now they are looking up again, this time into space.
Judging by the number of television and telecoms companies currently setting up multi-billion dollar satellite systems, a lot of our future communications needs are going to be met by metal bodies hurtling overhead.
The use of satellites for communications is nothing new: there are already many ringing the Earth 35,000 kilometres above the equator in geostationary Earth orbits (GEOs), so called because their 24-hour orbit matches Earth's, meaning they always remain above the same spot. These fixed mirrors in space have long been used for relaying telecoms and television signals between dishes, and the imminent arrival of digital television means more are being launched.
In Europe, two of the leading television satellite companies are SES (Societe Europeenne des Satellites) and EUTELSAT. SES, owner of the seven Astra satellites and with four more on the way, is about to float 15 per cent of its equity on the Luxembourg stock market, valuing the company at up to $6.1 billion (£4.4 billion). The company is 20 per cent owned by the Luxembourg government, and its shareholders include Deutsche Telekom and Ulster Television.
With customers including BSkyB and the BBC, as well as several European public broadcasters, SES claims there are 24 million dishes pointed at its satellites, leading to its service being received in more than 70 million European homes. It already has strong revenues $481 million last year and is planning to expand in two directions: geographically into Eastern Europe and service-wise into interactive multimedia.
French-based EUTELSAT operates 11 satellites, is building seven more, and claims to broadcast radio and television channels into more than 65 million households via direct satellite, cable or community systems. The company about to be split into two branches, a limited company and an intergovernmental organisation last year reported operational revenues of ECU 354 million, with net profits of ECU 128 million.
Satellites are also being used to provide global telecoms networks. One of the first off the mark, Inmarsat, was set up in 1979 to provide worldwide mobile satellite communications to the maritime community. Inmarsat now offers voice, fax and data services to customers on land, sea and in the air, via a system of GEO satellites.
However, GEO satellites are not the only telecoms satellites. Low earth orbit (LEO) satellites are becoming the system of choice for many operators, involving necklaces of lower satellites circling in fast orbits. Because they are orbiting lower, these don't suffer the same end-to-end delays associated with telecoms using GEO satellite systems, and transmitters or receivers can be lower powered and don't require fixed dishes, opening them up to mobile phone use.
Such a system is to be provided by Iridium, which is due to launch its global mobile phone service on September 23rd. Owned by Chicago-based Motorola, the company has spent 10 years designing and building a $4.7 billion system. It now has 66 satellites orbiting 780 kilometres above Earth, connected to each other and to existing telephone systems through 12 ground stations.
Iridium users will use special phones, currently costing $3,000, and will primarily use existing terrestrial networks. But whenever such existing cellular service is unavailable, the phones automatically switch to a direct connection to the nearest orbiting satellite. Digital voice, fax and data services will be available, costing from $4 to $6 per minute in Western countries, or at the subsidised rate of $1 to $2 per minute in developing countries whose governments sign partnership agreements.
Iridium chief executive, Mr Edward Staiano, has said he expects the system to break even in cash flow after one year, but this may be optimistic given that other, less costly systems are expected to begin service from next year.
One of these is being put in place by San Jose-based Globalstar, founded by Loral Space and Communications and QUALCOMM. Globalstar's system is expected to cost $2.6 billion, but the company aims to start service and generate revenues as early as next year even though only eight of the 56 satellites have been launched so far.
Globalstar's system involves eight planes of satellites orbiting at 1,414 kilometres, offering voice, fax and data services between the latitudes of 70 degrees north and south. Like other systems, users will use hand-held or vehicle-mounted terminals similar to today's mobile phones. The company says it will provide "cost effective interconnection to the telephone office for the unserved `hard-toreach' population in developed and under developed urban and rural areas".
British-based ICO Global Communications is also planning a satellite-based mobile phone system, due to begin service in the year 2000. The private company has 60 investors who, it says, have committed "in excess of $2 billion". Currently filing for a public offering on the New York Nasdaq, ICO will later this year start putting 12 satellites into medium Earth orbit (MEO) at an altitude of 10,390 kilometres, offering a service which complements existing cellular services by filling gaps in service. The handsets will be dual mode, supporting satellite and existing cellular systems. ICO says users will be charged through existing cellular phone bills.
The above projects may be ambitious, but they are all in the halfpenny place compared to the giant $9 billion Teledesic project, sponsored primarily by Bill Gates, Craig McCaw, Motorola, Saudi prince Alwaleed Bin Talal and The Boeing Company. Teledesic aims to provide a global "Internet-in-the-Sky" system via 288 LEO satellites (plus spares), offering broadband access to service providers anywhere in the world, starting in 2003. Services will not be offered directly to end users, the company says.
Despite the huge set-up costs, Seattle-based Teledesic expects to offer access rates comparable with terrestrial broadband access, and with similar quality to fibre-based service. Pioneered by McCaw, the company aims to provide advanced telecoms infrastructure worldwide, targeting in particular the less developed regions. Designed as a data network based on the same principles as the Internet, the Teledesic network is banking on all applications in the future using the same types of networks, offering a sort of giant converged network in the sky.
Between them all, the above satellite networks represent a huge investment in the communications infrastructure of the coming decade. But with typical satellite lifetimes of seven to 15 years, and ever-increasing bandwidth demands, it looks like the skies may get a lot more crowded yet.
Eoin Licken can be reached at elicken@irish- times.ie
