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Google has shaken up the market for fast Internet service in parts of the United States by offering or planning fiber-to-the-home in Kansas City and 11 other cities. Its reported entry into the satellite Internet business could do the same globally—by providing increased competition and better service than existing satellite technologies.

This week the Wall Street Journal reported that Google will spend more than $1 billion to launch a fleet of 180 satellites. The project, the paper reports, is being led by two executives with satellite startup O3b Networks, which Google helped fund in 2010. Neither company would comment on the plan Tuesday.

While satellite launches can be expensive, the strategy could give Google a foothold in a growing business.

The effect of competition could be powerful. Google’s entry into municipal fiber markets has tended to drive down prices and improve service offerings from existing ISPs, according to some analyses (see “Google Fiber’s Ripple Effect” and “When Will the Rest of Us Get Google Fiber?”).

Similarly, if Google could beam Internet connectivity to countries that have only a single ISP—often one controlled by a government—and very high prices for Internet connectivity, “that could be a game changer for a huge swath of the globe,” says Rob Faris, research director at the Berkman Center for Internet & Society at Harvard.

O3b’s name refers to the “other three billion”—a reference to people worldwide who lack Internet access. The company has four satellites in orbit and plans to launch another four next month. Its existing business is providing Internet connectivity to mobile carriers’ base stations.

It isn’t clear what model Google and O3b might pursue. But O3b’s satellites already offer a superior and cheaper way to deliver high-speed Internet than conventional satellite services. Satellite Internet is traditionally provided by geostationary satellites that stay over a given point on Earth. These satellites orbit at 35,000 kilometers—often adding a 600 millisecond delay to the radio signals going back and forth. Such a delay is generally considered excessive for business use.

O3b satellites orbit at a relatively low altitude of about 8,000 kilometers, and the company says this means a more-tolerable 150-millisecond delay coverage to latitudes up to 45 degrees north or south of the equator, a swath of territory inhabited by 70 percent of the world’s population. They can work even though they’re in motion relative to the Earth’s surface because they use technology called “beam-forming” to direct their signals.

Google declined an interview request about its satellite project. But like its other infrastructure efforts, the satellite plan could boost its earnings simply by bringing its services to new users.

That incentive also helps explain Google’s “Project Loon,” a far-out effort aimed at dispatching high-altitude balloons to provide broadband service from the stratosphere. Both Google and Facebook have been acquiring companies and experts to explore using drones for that purpose.

Hear more from Google at EmTech 2014.

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Tagged: Communications, Business, Web, Google, Facebook

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