Satellite’s rise is real: 3 big questions for 2025

The Journey So Far In 2022, fewer than 20 partnerships existed between telecom operators and satellite players. By December 2024, that number had grown by almost 7x, collectively covering around 70% of the mobile subscriber footprint across the world.

Despite the stellar growth, 2024 was a set-up year. Only around 20 of the 100 partnered operators currently provide live satellite-enabled services.

For industry veterans who have seen massive hype build around satellite services in the past, this might all seem like deja vu, with the prospect of a major bubble burst. Whether or not that’s the case will depend on three big questions that will define much of the satellite and non-terrestrial networks (NTN) landscape over the next 3 years. Let’s take a closer look.

1. How fast will telco NTN services become commercially available?

Deals like Apple-Globalstar and Skylo-Google will drive early consumer adoption, initially enabling SOS and SMS features. However, this does not mean commercial services will be available full time immediately. Instead, we are likely to witness a phased transition where LEO satellite constellations begin by offering partial service (2-3 hours/day in areas covered by a given constellation) in 2025/26 when satellites are overhead, gradually expanding to continuous 24/7 offerings to the polar latitudes by 2027/28.

Direct-to-device (D2D) connectivity is the cornerstone of the consumer narrative, enabling uninterrupted service in areas with limited or no coverage and during emergencies. Our data indicates for companies like AST SpaceMobile, Starlink, and Lynk Global, this model underpins the majority of their partnerships for integrating satellite services with mobile networks.

The constellation activity is a response to clear demand. However, whether people will pay more for having satellite access is a different question. Our research shows that around 60% of consumers were willing to pay extra for satellite-enhanced connectivity. Around half were open to paying up to 5% more, while others considered paying 5–20% extra.

2. What happens with enterprise IoT?

While direct-to-cellular services have captured much attention, the enterprise segment is equally interesting. Our work with enterprises highlights robust sentiment; 43% view satellite as critical to their tech plans – just below 5G (47%) and ahead of 4G (35%).

Sateliot’s contract for connecting 8 million devices on its NB-IoT NTN roaming, OQ Technology’s €1 million contract for a private network based on 5G IoT satellite in LEO, and China Telecom’s 5G NTN Marine deployment highlight growing momentum in enterprise IoT satellite connectivity.

A diverse range of industries seek to leverage satellite connectivity, particularly those with operations in rural or remote locations (eg mining, oil and gas), or businesses involved in asset tracking (eg logistics, automotive). 3GPP Release 18 introduces additional functionality and enhances compatibility for NTN with RedCap IoT devices, potentially expanding the addressable market.

Pricing for IoT modules varies significantly, but should be driven down as solutions scale. At the same time, while average revenue per user is typically less than $1 per month (except for connected car subscriptions), our base case estimate suggests that IoT revenues enabled by satellite connectivity could reach $10 billion annually by 2035, representing approximately 25% of current IoT revenues generated by mobile operators.

3. Can two (very different) spectrum strategies coexist?

Satellite constellation providers are generally utilising either MSS spectrum – which is globally harmonised by the ITU (eg the MSSA consortium and various vendors) – or repurposing existing terrestrial spectrum that has been acquired by mobile operators (eg Starlink and AST’s approach). The use of both MSS and terrestrial spectrum will likely coexist. However, understanding their respective trade-offs matters.

MSS spectrum benefits from being universally available, with established protections to mitigate interference risks. However, constellation providers still require landing rights to operate in any particular country.

The terrestrial spectrum model relies on repurposing existing licensed holdings of the mobile operators.

However, it faces interference risks and complex engineering challenges, especially in regions with strict spectrum use regulations like the US. This model also requires regulatory approvals on a country-by-country basis, which may delay global service availability.

Starlink is leading this trend with a raft of partners: T-Mobile US, Rogers (Canada), Optus (Australia), One (New Zealand), Salt (Switzerland), Kyivstar (Ukraine), and Entel (Peru and Chile). The speed at which it launches in new countries will serve as one indicator for the model’s time to market.

WRC-27 will also explore the use of mobile satellite in IMT bands between 694/698 MHz and 2.7 GHz, and new mobile satellite bands (1427-1432, 1645.5-1646.5,

1880-1920, 2010-2025, 2120-2170 MHz). As the industry advances with studies and trials on the WRC-27 agenda items, it is essential to address the complexities of cross-border spectrum management, roaming, and national licensing to ensure smooth implementation.

Ultimately, how much and how fast satellite services are monetised by the telco operators will likely be defined by answers to the above questions. 2025 is an important proof point year to validate the performance and economics of reformed LEO constellations. To this end, MWC25 will be an important marker and sense check on the sector’s ability to deliver on the promise of NTN.