Broadband satellite project 6 months away from service to 3bn people, says O3b CEO Steve Collar

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The ‘other three billion’ who lend their name to the O3b satellite project should start getting service after the launches of eight satellites in mid-2013, says CEO Steve Collar. First customers will include Amazonian residents as well as people on Caribbean cruises and the oil and gas industry, he tells Alan Burkitt-Gray

Steve Collar: Tests on the first completed satellite indicate O3b
should get two years’ more life than expected — up to 12 years
The company planning to offer high-speed, low-latency broadband to three billion of the world’s population is just six months away from launch — literally.
Start-up operator O3b, backed by Google and a number of other investors, is planning to launch its first four satellites in May 2013, followed by another four in June or July. And O3b hopes they will be followed by another four, making a constellation of 12 broadband satellites that will orbit 8,063 kilometres above the earth.
The satellites will serve a huge part of the world’s surface — everywhere between Japan, northern Italy and the US-Canadian border in the north and most of the South Island of New Zealand.
Though the name of the company stands for “other three billion” — representing three billion of the world’s poorest who are unserved by conventional broadband services — O3b is also winning contracts from some of the richest users in the area, including operators of luxury cruise liners.
“We have a contract with Royal Caribbean to equip Oasis of the Seas,” says Steve Collar, CEO of O3b. The Oasis now has a four-megabit satellite internet service to share between its 5,500 passengers and 2,500 crew. Once O3b’s satellites are in service, the bandwidth will be 350 megabits.
The oil and gas industry is another potential customer. “They are starting to appreciate how important low latency is,” says Collar. “Rigs cost a phenomenal amount of money to run and there’s a big shortage of staff to work offshore. Engineers don’t want to spend their lives offshore.”
So energy companies are starting to consolidate controls into onshore centres, where skilled staff can work their shift and then go home, like normal people.
Most communications satellites orbit 35,786 kilometres above the earth — at which height they appear to be in a fixed point. That’s great for low-cost applications, because you fix the receiving dish to the wall, aim it precisely at the satellite, and leave it alone.
But radio waves travel at the speed of light, so take about a quarter of a second to go up from earth, get amplified at the satellite, and travel down again. That’s fine for one-way TV: no one notices such a delay.
If the satellite is carrying a phone conversation, it takes a quarter of a second to hear the other party’s voice, and a further quarter-second for your voice to get back: add a bit of processing time, and you get to around 600 milliseconds. With practice, it’s just about acceptable. In the 1970s and 1980s, most international phone traffic went by such satellites, so people got used to it.
For data, especially client-server applications such as ERP systems, such a delay is disastrous. “ERP systems fall down once latency gets to more than 400 milliseconds,” says Collar. For video conferencing, where there’s an extra delay for processing, “latency just makes it unbearable”, he says. 

Once launched on Soyuz rockets from Kourou, South America,
the O3b satellites will each orbit the earth in 288 minutes 
Mobile backhaul
O3b hopes to replace these so-called geosynchronous satellites for mobile backhaul, connecting base stations in remote areas. Today’s latency means you’re back to the stilted, uncomfortable conversations that older people remember from a quarter of a century ago. “People hang up,” says Collar.
How does it plan to achieve that? By bringing its satellites down to 8,063 kilometres above the earth — a height satellite people call “medium earth orbit”. That means a round-trip time for the signal of a virtually unnoticeable 55 milliseconds.
But the revenge of physics means you lose the advantage of having the satellites appear to hover in a fixed point in the sky. Each O3b satellite will whizz around the earth in 288 minutes. A dish on the ground will need to keep moving to follow each satellite as it moves across the sky in about 45 minutes. Before it disappears below the horizon and loses contact, another dish must be already aimed at another satellite, just appearing in the sky.
The way O3b has designed the system, there will be a period of a few minutes when both satellites are in view, so the handover can be scheduled carefully. But that puts up the complexity and cost of the receiving equipment.
In late 2012 O3b is in a frenzy of preparation for launch in 2013. “We’ve just done the thermal vacuum tests on the first satellite,” says Collar. This meant putting the first satellite off the production line in a giant vacuum chamber and subjecting it to the sort of extremes of temperature it will get in space.
“All the components were put through the test and the satellite is working as it should,” he reports. “And the good news is that we will probably get a couple of years extra life out of them.” The satellites have been designed for a 10-year life. Based on the first tests, Collar is hoping for 12 “or maybe still further”.
The satellites will be launched, four at a time, on top of Russian-built Soyuz rockets which will operate from Arianespace’s site at Kourou, French Guiana. Soyuz normally operates from Baikonur in Kazakhstan, but Kourou — on the coast of South America — is nearer the equator, where the speed of the earth’s spin gives rockets some extra lift. That means satellites can be a bit heavier than otherwise — either allowing them to be more complex or to carry more fuel so that adjustments can be made so they stay in the right orbit for longer.
At the same time O3b is building the ground stations that will link the satellites to the world’s telecommunications networks. “We’ve finished two, in Greece and Hawaii,” says Collar. Greek incumbent OTE runs the Greek operation, and Hawaii is run by SES, the Luxembourg satellite company that is also a shareholder in O3b.
There’s a third in Perth, Australia, that is close to completion. Telefónica will provide on in Peru, Level 3 one in Texas, and Tata one in Portugal. “And we will have one in the Middle East. We are looking at two options.” That makes seven in all, “and that means we can provide global service” says Collar.
Edge of the network
“Probably one of our biggest opportunities in is mobile backhaul, in places such as Indonesia and Brazil. At the edge of the network you do have a struggle for backhaul,” he says. “When you’re on a data connection to a mobile with a geostationary satellite connection, the latency looks like congestion, so the system reduces the bandwidth to 200 kilobits,” he says.
O3b’s low latency will circumvent this problem, and make 3G data services feasible in remote areas, he says. “We’re talking to all the guys in Brazil and Indonesia.”
Brazil is almost the ideal market for a number of reasons. Not only is Rio de Janeiro-based Petrobras exploring for oil offshore, but the country is developing a national broadband plan — and is getting ready for the football World Cup across the country in 2014 and the Olympics in Rio in 2016.
“In Brazil you have three of the largest mobile network operators competing for customers. Brazil is the perfect storm for us.”
The company is working with Ozônio Telecomunicações, based at Manaus, the capital of the Brazilian state of Amazonas, to deliver what Collar calls “microdata centres” — containerised units with O3b antennas on top that just need plugging into an energy source to become network access points.
Even further up the Amazon, in neighbouring Colombia, a company called SkyNet is already delivering broadband internet connections to a region where 40% of the population lives on only $2 a day. It has a 40 megabit link via geostationary satellite: O3b will increase this to 200 megs, and reduce the latency.
“We’re trying to generate economic and social inclusion for people in remote areas,” says Collar. The company is looking at similar projects in Africa — in the Democratic Republic of the Congo, Burkina Faso and Malawi — and in Asia.
Global coverage
Six satellites are needed for global coverage.The first launch of four will mean that there are gaps between one satellite going below the horizon and the next coming up. With the second launch, weeks after the first, there will be global coverage between 45° north and 45° south, and two spare satellites. Numbers nine to 12, expected to be launched in 2014, will allow O3b to increase the bandwidth that is available across the system.
What about satellites 13 and beyond? “We’re putting some thought into the fleet,” says Collar. “We want to diversify, but we haven’t yet thought of all the things that we can do.”
Some applications may be outside the area of what’s normally thought of as telecoms, he says. “Our orbit is very interesting for a whole bunch of potential applications — such as earth observation and image sensing.”
And then there’s data relay between satellites, he adds, perhaps using optical links. “We could provide inter-satellite optical links between our spacecraft or from other satellites — between navigational satellites, for example.”
There may also be business in serving some aircraft. Not commercial airliners, says Collar, as they would have to justify a full satellite beam each. “But possibly Air Force One and other VIP users,” he muses. Is O3b talking to the White House? “We are talking to the people who are talking to the White House,” he says.
The company has identified consumers of huge quantities of bandwidth from remote areas, including companies that operate ships surveying the ocean bed, looking for oil fields.
Helicopter data
“They generate a phenomenal amount of data with their 3D imaging” says Collar. “At the moment it’s carried to the shore by helicopter. There’s no other way of carrying large volumes of information — we’re talking of two terabytes a day.”
For such users, it’s more than latency measured in hours rather than milliseconds. By the time the helicopter has landed and the data has been delivered and analysed, the survey ship will have moved on, Collar explains. “The company may need the ship to go back and survey more closely.” A set of satellites in medium orbit “can completely revolutionise that industry”, he says.
Beyond the normal geographical limits — roughly the 45° parallels, north and south — O3b could put satellites into inclined orbits that will help improve coverage. “That’s one of the things that we’re throwing into the mix” of looking at future needs.
Is it going to be profitable? Certainly the shareholders — which include HSBC and US-based operator Liberty Global as well as SES, Google and a range of others — will be aware that any satellite system needs high expenditure at the start, and O3b is no exception. In November 2010 the company announced that it had completed the raising of $1.2 billion.
But once the systems are up and running they can become an effective cash generator. “We expect to be cashflow positive reasonably quickly,” says Collar, who talks of “80% margins” though warns of “a while” to pay back the debt.
Some satellite projects have failed, but the extraordinary demand for broadband internet access in towns and cities is driving the need for access in remote and hard-to-reach areas. With projects such as O3b, the internet may soon be everywhere.
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