The growing convergence of satellite technology and cellular smartphones, driven by the integration of non-terrestrial networks (NTN) connectivity into the 5G cellular ecosystem as introduced in 3GPP Release-17, is one of the key drivers of a burgeoning satellite connectivity market that will maintain its strength over the course of the 2020s, according to data from analysts ABI Research and CCS Insight.
ABI Research’s The role of satellite in 5G: non-terrestrial networks mobile predicts that the NTN-Mobile segment has the potential to reach a market value of at least US$18bn, with up to 200 million connections by 2031. It added that the NTN Mobile marketspace has a positive outlook, with a projected compound annual growth rate (CAGR) of 59% from 2024 to 2031.
It predicts the revenue growth in this sector will be driven primarily by the introduction of NR-NTN satellite services, which is expected in 2026. ABI believes that the potential adoption of NTN satellite services in consumer vehicles for mobile emergencies, messaging, voice, and data communications use cases would also drive the growth of NTN-Mobile connections.
It said that following the release of 3GPP Release-17, the satellite-to-mobile marketplace has gained significant momentum, driven by notable product launches and major announcements. Companies such as Apple, Huawei, ZTE, Qualcomm, Motorola, MediaTek, Bullitt, Globalstar, Inmarsat and Iridium were cited as leading the charge in this area, having formed strategic partnerships within the cellular mobile and satellite industries.
ABI also noted that these collaborations have extended beyond to include mobile network operators (MNOs) aiming to expand their network coverage. Examples given were T-Mobile partnering with satellite operator SpaceX/Starlink to provide satellite-to-mobile connectivity services, while satellite operators AST SpaceMobile and Lynk have also established strategic alliances with MNOs such as Vodafone, Rakuten Mobile, AT&T, Bell Canada, MTN Group, Orange, Zain KSA, Saudi Telecom Company (STC), and Telefónica.
Yet while acknowledging that exciting advancements are underway in satellite-to-mobile technology, Victor Xu, satellite communications research analyst at ABI Research, said it was important to note that the recently announced satellite services will initially prioritise low data rate communications through IoT-NTN technology,”
“Currently, satellite communication services have mainly focused on specialized emergency services and messaging with low data rates. Still, satellite networks are anticipated to eventually incorporate NR-NTN, a 5G-based, more advanced communication standard, in the next few years,” said Xu.
“Integrating NR-NTN will increase capacity and network capabilities, enabling more concurrent users and applications with higher data rates. As a result, new possibilities and use cases for satellite connectivity will emerge.”
While ABI was making its assessment, a study from CCS Insight revealed new opportunities for enhanced global connectivity, with projected growth in satellite-connected devices and the introduction of new satellite constellations that can fill connectivity gaps in remote areas.
CCS Insight forecasts that 92 million phones will have built-in satellite messaging functionality by the end of 2023, a significant rise from just under 2 million devices in 2021. This shift in accessibility it said was being driven by Apple's tie-up with Globalstar for the Emergency SOS feature in the iPhone 14 range, as well as Qualcomm’s partnership with Iridium, which is bringing similar capabilities to Android phones.
The research firm believes that with the integration of satellite connectivity on mobile devices, the market will soon no longer be reliant on hardware modifications. With commercial services expected to launch later in 2023, new low-Earth-orbit satellite constellations led by AST SpaceMobile, Lynk and SpaceX are set to work alongside terrestrial mobile networks to provide satellite connectivity to all unmodified phones.
CCS Insight believes that these enhanced satellite networks have the capability to grow to deliver voice and data services as the constellations evolve. It adds that network operators will be able to offer these satellite services as add-ons to existing subscription packages, catering to the growing demand for ubiquitous connectivity.
As demand for enhanced global connectivity continues to rise, the analyst forecasts that 15% of global mobile subscribers are expected to own a smartphone that supports satellite messaging by 2027 and an additional 10% will benefit from satellite plans provided by their operator.
By capitalising on revenue streams generated through operators and supplementary services, CCCS believes that the direct-to-device satellite market is poised to amass $18bn in revenue by 2027. This market it said represented a “vast opportunity”, with an audience of more than 4.8 billion people who could access satellite services through a compatible smartphone. It calculated that as many as 493 million people worldwide lack any kind of mobile network coverage.
“Bringing satellite capabilities to mass-market smartphones marks a milestone in the telecom industry,” said Luke Pearce, senior analyst at CCS Insight.
“This development creates exciting opportunities for consumers, manufacturers and operators and promises to help bridge the digital divide. The projected growth in revenue and subscribers highlights the potential this integration holds for expanding connectivity options – we’re witnessing the start of a new era where satellite services become an integral part of everyday smartphones.”
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