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posted by LaminatorX on Tuesday January 20 2015, @11:48PM   Printer-friendly
from the cloud-above-the-clouds dept.

Ars Technica On Sunday reported that Elon Musk (of SpaceX and Tesla fame) and Sir Richard Branson (Virgin Galactic, etc.) are each preparing to launch LEO (low earth orbit) constellations of satellites to provide world-wide internet coverage:

It was an interesting week for ideas about the future of the Internet. On Wednesday, satellite industry notable Greg Wyler announced that his company OneWeb, which wants to build a micro-satellite network to bring Internet to all corners of the globe, secured investments from Richard Branson's Virgin Group and Qualcomm. Then in a separate announcement on Friday, Elon Musk said that he would also be devoting his new Seattle office to creating "advanced micro-satellites" to deliver Internet.

[...] OneWeb, formerly WorldVu Satellites Ltd, aims to target rural markets, emerging markets, and in-flight Internet services on airlines, the Wall Street Journal reported. Both Branson and Qualcomm Executive Chairman Paul Jacobs will sit on the company's board, but Wyler did not say how much Virgin and Qualcomm invested in his company.

Wyler said that his company's goal is to create a network of 648 small satellites that would weigh in at around 285 pounds each. The satellites would be put in orbit 750 miles above the Earth and ideally cost about $350,000 each to build using an assembly line approach. Wyler also said that Virgin, which has its own space segment, would be launching the satellites into orbit. “As an airline and mobile operator, Virgin might also be a candidate to resell OneWeb’s service,” the Journal noted. Wyler has said that he projects it to take $1.5 billion to $2 billion to launch the service, and he plans to launch in 2018.

[...] On the other hand there's Musk, who's a seasoned space-business launcher that's starting fresh in the world of satellite Internet services. The Telsa and SpaceX founder announced his plans to launch 700 satellites weighing less than 250 pounds each in November.

His satellites would also orbit the Earth at 750 miles above. Musk spoke to Bloomberg on Friday evening explaining that 750 miles above the Earth is much closer than the tens of thousands of miles above the Earth at which traditional telecommunications satellites operate.

Then it got even more interesting.

Ars is now reporting Google might pour money into SpaceX — that it really wants satellite internet:

The Information reported on Monday that, according to “several people familiar with the talks,” Google is considering investing in SpaceX to support its plan to deliver hundreds or thousands of micro satellites into a low (750 mile) orbit around the globe to serve Internet to rural and developing areas of the world. The Information's sources indicated that Google was in the “final stages” of investing in SpaceX and valued the company at “north of $10 billion.” SpaceX is apparently courting other investors as well.

[...] The Information added another interesting tidbit that was not widely reported in previous discussions of SpaceX's plans for global Internet service: “Mr. Musk appears to be trying to get around his lack of spectrum rights by relying, in part, on optical lasers.”

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  • (Score: 2) by martyb on Wednesday January 21 2015, @06:05AM

    by martyb (76) Subscriber Badge on Wednesday January 21 2015, @06:05AM (#136604) Journal

    I have absolutely no idea why companies are up to this crap.

    Though I often disagree with him, Joel Spolsky (author of "Joel on Software") has written what I think is a tremendously insightful post which I believe covers this spectacularly well: Strategy Letter V []. Don't let the fact that it was written June 12, 2002 throw you off — I think it is as meaningful today as when it was written way back then.

    In summary: Commoditize your Complement. Here's an excerpt, though I highly recommend reading the entirety of the short article.

    Once again: demand for a product increases when the price of its complements decreases. In general, a company's strategic interest is going to be to get the price of their complements as low as possible. The lowest theoretically sustainable price would be the "commodity price" -- the price that arises when you have a bunch of competitors offering indistinguishable goods. So:

    Smart companies try to commoditize their products' complements.

    If you can do this, demand for your product will increase and you will be able to charge more and make more.

    When IBM designed the PC architecture, they used off-the-shelf parts instead of custom parts, and they carefully documented the interfaces between the parts in the (revolutionary) IBM-PC Technical Reference Manual []. Why? So that other manufacturers could join the party. As long as you match the interface, you can be used in PCs. IBM's goal was to commoditize the add-in market, which is a complement of the PC market, and they did this quite successfully. Within a short time scrillions of companies sprung up offering memory cards, hard drives, graphics cards, printers, etc. Cheap add-ins meant more demand for PCs.

    When IBM licensed the operating system PC-DOS from Microsoft, Microsoft was very careful not to sell an exclusive license. This made it possible for Microsoft to license the same thing to Compaq and the other hundreds of OEMs who had legally cloned the IBM PC using IBM's own documentation. Microsoft's goal was to commoditize the PC market. Very soon the PC itself was basically a commodity, with ever decreasing prices, consistently increasing power, and fierce margins that make it extremely hard to make a profit. The low prices, of course, increase demand. Increased demand for PCs meant increased demand for their complement, MS-DOS. All else being equal, the greater the demand for a product, the more money it makes for you. And that's why Bill Gates can buy Sweden and you can't.

    He goes on to give other examples such as how Netscape open-sourced their browser (Netscape Navigator) so they could sell their server software. So you might think that's all very interesting, but what does it all have to do with Internet Satellites?

    Google has been following the very same plan. Don't just take my word for it. Consider these examples which illustrate just some of the ways it has been doing this.

    They provide free search so they can find out what people are searching for so they could better target (charge more for) advertising. They provided free e-mail so they could scan your messages and sell targeted advertising. They provided free and fast DNS so they could get a better handle on who goes where and who looks at what so that they could better target the advertising and charge more for it. They created and gave away the Chrome browser so they could better track where people go on-line. They hosted, and provided rapid access to, huge libraries of open-source javascript (such as jscript.js) so developers link to Google's copy of it on each of their web pages — Google get's a hit every time a user hits that page. They host on-line font files to do the same thing. Google maps and Google earth — again finding out where people are and what they are looking at. Google's scanning entire libraries of books and making them free on-line. They're rolling out Google Fiber for much less than the competition does (but still at a profit) so as to commoditize internet access and thus be better able to monitor where people go on-line.

    Never mind "Do no evil" — their goal is nothing short of having a collection of all the world's information. The more they have of what you want, and that they can make available to you quickly and at no cost, the more they can gain access to information about you and your interests and what you spend money on.

    As I see it, a constellation of satellites providing high-speed and world-wide internet coverage is just another step along the same path. Commoditize their complement (internet access) to build demand for their targeted advertising, for which they can charge higher rates. Imagine if they were the world's ISP? How much Google would love to be able to monitor all of your on-line access? Every web site you go to. Every song or video you stream. Sure, "https everywhere" is putting a damper on that, but they still have their DNS servers and they have an index of the entire internet, remember?

    Are the other webmail, search, or social media companies any better? I have no illusions that the other companies are entirely blameless. Still, I try to not keep all my eggs in one (google-sized) basket. I have my own web host through which I can get e-mail. I primarily use DuckDuckGo for search. I've stopped going to /. and now to my soical networking here on SoylentNews.

    Some might well argue that my tinfoil hat is fitting a little too snugly and it's blocking the blood flow to my brain. Actually, my main concern is what areas have I missed? Where else does it have its tendrils? It has gotten to the point that there are times when I feel like going on-line is akin to volunteering to be stalked. I wouldn't stand for someone following me around all day making note of everywhere I go and everyone I see so that they could sell this information to someone else; why should I be expected to accept it when I am on-line?

    Please note that I singled out Google for the preceding only in light of their being mentioned as a possible party to the proposed system of internet satellites. A similar case could be made (admittedly to a lesser extent, perhaps) were one to consider Twitter, Instagram, Apple, or Facebook among countless others.

    P.S. Please forgive any typos or grammatical errors as it is now just after 1:00 AM and I am finding it hard to stay awake, let alone write cohesive sentences.

    Wit is intellect, dancing.
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  • (Score: 2) by Phoenix666 on Wednesday January 21 2015, @11:02AM

    by Phoenix666 (552) on Wednesday January 21 2015, @11:02AM (#136662) Journal

    Thank you for posting this. I've never taken the time to think about Google's business model, but I'm going to read Spolsky's essay in depth when I'm more awake.

    Washington DC delenda est.