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SpaceX

Google investment revives satellite Internet talks

James Dean
Florida Today
FILE- In this April 20, 2014, image made from a frame grabbed from NASA-TV, the SpaceX Dragon resupply capsule begins the process of being berthed on to the International Space Station. Astronauts hurriedly evacuated the U.S. section of the International Space Station and moved to its Russian module after a problem emerged Wednesday, Jan. 14, 2015, but Russian and U.S. officials insisted all six crew were not in any danger. (AP Photo/NASA-TV, File) ORG XMIT: NY112

It was a hot idea in the '90s: Provide global Internet access with mega-constellations of dozens or hundreds of small satellites flying in low Earth orbit.

The result was "a bloodbath of serial bankruptcies," one financial analyst wrote last week.

Several companies including Teledesic, which planned to launch more than 800 satellites and claimed Microsoft co-founder Bill Gates as an investor, failed.

Now big investments in two new ventures, including Google backing for SpaceX, bet that the idea's time has come.

"Even though we had the false dawn of all the excitement about Internet in the sky back in the late '90s, good ideas can still come around again," said James Muncy, a space policy analyst with PoliSpace.

Google and Fidelity last week poured $1 billion into SpaceX, which had just announced plans to open a satellite development office in Seattle.

That followed news of Richard Branson's Virgin Group and Qualcomm investing in start-up OneWeb, which has similar goals to expand high-speed Internet access.

"Assuming that one or both of these efforts achieve success, their impact on the global telecom industry could be profound," wrote analyst Chris Quilty of Raymond James and Assoc. in St. Petersburg, Fla.

Quilty said the companies face "daunting" technical, financial and regulatory challenges.

But much has changed over the past 20 years, including Google's creation and emergence as a technology titan.

Today small satellites are far more capable, launch costs are improving, demand for high-speed data continues to grow and deep-pocketed entrepreneurs and investors are hunting for ways to make money in space.

"I think it is a different era," said Bob Richards, CEO of Moon Express, a Silicon Valley-based startup developing a commercial moon lander. "It doesn't mean everyone is going to succeed; some will fail. But when you put the names behind it like are behind the new constellation between Google and SpaceX, I wouldn't bet against them."

'CONSTELLATION' OF SATELLITES

Many details about the proposed new Internet satellites are unknown, but they are expected to range in size from roughly 200 to more than 600 pounds.

That's small compared to traditional communications satellites flown 22,000 miles over the equator, but larger than the tiny "CubeSats" some new companies are using to generate images of Earth with commercial value.

San Francisco-based Planet Labs, which is deploying such nano-satellites from the International Space Station, recently announced it had raised $95 million in new financing.

"The state-of-the-art in small satellite systems really has taken off, and they can do the kinds of things that maybe weren't as feasible back when Teledesic was on the drawing boards," said Edward Ellegood, space industry analyst for the Space Coast Tech Council.

That technology shift leads to a new approach to building and deploying networks of small satellites instead of a single, highly capable bird that might cost hundreds of millions dollars and be handled like a delicate work of art.

"Normally the way satellites are done is they're like Battlestar Galactica – there's like one of them and it's really giant and if this thing doesn't work it's terrible, like the whole business collapses," SpaceX CEO Elon Musk told an audience in Seattle this month. "But if you have a large constellation, you can afford to lose individual satellites and it doesn't affect the constellation very much."

SpaceX envisions deploying more than 4,000 satellites, and OneWeb nearly 650.

Large numbers of spacecraft are needed to cover parts of the world lacking good Internet access from ground or space-based providers.

That means the satellites have to be cheap, said John Olds, CEO of Atlanta-based SpaceWorks Enterprises.

"That's what's changed in the last 10 years, that's different from Teledesic," he said. "The satellites are getting less expensive, and that's sort of enabling these things to be reconsidered."

Contact Dean at 321-242-3668 or jdean@floridatoday.com. Follow him on Twitter at @flatoday_jdean.

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