Global satellite IoT sector set to rocket – report

• With just 10% of the earth’s surface covered by terrestrial connectivity services currently, the IoT opportunity looks enormous, according to Berg Insight
• Satellite IoT can both complement or even, it seems, replace terrestrial IoT networks
• Collaboration between between satellite operators and mobile operators to exploit new hybrid satellite-terrestrial connectivity will be commonplace 
• Many new entrants to the sector will develop and operate proprietary connectivity technologies based on LEO constellations of nano-satellites

The global satellite internet of things (IoT) subscriber base is set to ramp up from 5.1 million in 2023 to 26.7 million by the end of 2028, a compound annual growth rate (CAGR) of 39.2%, according to a new market forecast from trusted independent research house Berg Insight of Gothenburg, Sweden, which believes the sector represents a huge and, potentially, highly lucrative opportunity for established players and sprightly, hopeful startups alike. 

Given that a mere 10% of the planet’s surface currently has access to terrestrial connectivity services, the opportunity for satellite IoT is massive, as it can complement both terrestrial cellular and non-cellular IoT networks and is a particularly important technology for use in remote locations for applications in agriculture, asset tracking, maritime and intermodal transportation, oil and gas industry exploration, utilities and construction, as well as for governments and government agencies.

Both incumbent players and startup satellite operators are fighting it out to get a share of the satellite IoT market and Berg Insight’s latest Satellite IoT Communications Market report covers more than 40 of them. Currently just 17 of the operators analysed offer commercial satellite IoT connectivity services but, the report says, the sector is growing steadily and forecasts that revenues will grow at a CAGR of 34.8% from the €302.9m achieved in 2023 to €1.35bn in 2028. 

Iridium, the US-owned low-earth orbit (LEO) constellation (66 satellites plus in-flight spares) is the biggest and best known of the global satellite IoT network operators. It has been around since the 1990s and, after a shaky start, long-ago established itself as a vital and popular resource that is now serving almost 1.8 million subscribers. Iridium’s subscriber base grew by 18% over the course of 2023 and is expected to grow again this year. 

Iridium’s first-quarter 2024 results showed that revenues from IoT services came in at $39.4m, up 23% year on year. IoT subscriber numbers grew to 1,766,000 customers, with the average revenue per user (ARPU) hitting $7.57 compared with $7.22 a year earlier. 

The other big, established operators are Inmarsat, Globalstar and Orbcomm. Orbcomm, another American company, is an interesting case. It offers industrial internet and machine-to-machine (M2M) comms hardware, software and services to track, monitor, and control fixed and mobile assets in an array of markets including transportation, heavy equipment, maritime, oil and gas, utilities and government. The company provides hardware devices, modems, web applications and data services delivered over multiple satellites and cellular networks. Over the years, Orbcomm has transitioned into an end-to-end solution provider, delivering services on its own satellite network as well as being a reseller partner of Inmarsat and others. At the end of last year, Orbcomm had about 700,000 satellite IoT subscribers on its own and Inmarsat’s networks (Inmarsat does not publish its own IoT user numbers). 

Meanwhile, Globalstar reached 48,000 IoT subscribers. However, and despite its name, the company does not provide worldwide coverage because its satellites have to be within range of an earth station gateway. Six months ago, the company was granted permission to begin the deployment of up to 17 improved direct-to-smartphone connectivity satellites in 2025. The news was enough to give Elon Musk yet another fit of the conniptions, as he complained that SpaceX’s Starlink constellation will suffer because of Globalstar’s new ‘birds’. (Currently SpaceX has launched more than 7,000 low-earth orbit satellites and the final constellation will comprise up to 42,000).  

In addition to the established, incumbent satellite operators, a large number of new initiatives are planned by the likes of Astrocast, AST SpaceMobile, CASC/CASIC, E-Space, Hubble Network, Kepler Communications, Kinéis, Ligado Networks, Lynk, Myriota, Omnispace, Skylo, the aptly named Swarm Technologies (part of the SpaceX empire) and Totum. Perhaps not all of them will get off the ground but those that do will predominantly launch LEO nano-satellites, some of which will feature novel proprietary connectivity technologies specifically to support IoT devices and will leverage terrestrial wireless IoT connectivity technologies. Companies going down that route include OQ Technology, AST SpaceMobile, Omnispace, Sateliot, Galaxy Space, Ligado Networks, Lynk, Skylo and Starlink, all of which are using cellular technologies that conform to 3GPP standards; EchoStar Mobile, Fossa Systems, Lacuna Space, Innova Space and Eutelsat, which plan to use LoRaWAN (long range wide area network) technology; and Hubble Network (Bluetooth).

According to Berg Insight CEO Johan Fagerberg, collaborations between satellite operators and mobile operators exploiting new hybrid satellite-terrestrial connectivity opportunities will become commonplace within a few years. He points out that “Skylo has been the most active non-terrestrial network provider lately for hybrid cellular/satellite offerings working with Deutsche Telekom, BICS, Emnify, floLIVE, Monogoto, O2 Telefónica (Germany), Particle, Soracom, Transatel and 1Global (Truphone). Additional satellite IoT operators partnering with mobile operators and mobile virtual network operators (MVNOs) include Sateliot, Starlink, OQ Technology, Omnispace, Lynk, Intelsat, Viasat and AST SpaceMobile,” he added. 

– Martyn Warwick, Editor in Chief, TelecomTV