Bharti Group founder Sunil Bharti Mittal recently complimented Elon Musk for his significant contributions to advancing satellite communication (satcom) technology. However, Mittal emphasized a crucial distinction: satcom is fundamentally a complementary service, not a substitute for established terrestrial networks.
Satcom's Role: Complementary, Not Supplementary
In an interview, Mittal articulated his belief that while the capacity being created in satcom was once unimaginable, its inherent design prevents it from supplementing or replacing terrestrial infrastructure. "I must compliment Elon Musk that he is pushing the boundaries," Mittal stated, acknowledging the unprecedented expansion of satcom capabilities. Yet, he added a key caveat: "The cost for a bit, cost for a GB, is never going to be at a point where he can contest fibre or terrestrial radio connectivity."
Market Dynamics and ARPU Differences
Mittal highlighted the varying viability of satellite services across different global markets. He suggested that regions like the US, Europe, and Japan, with their higher Average Revenue Per User (ARPU) of $50-60, present a sustainable environment for satellite-based connectivity for homes or mobile customers. In contrast, India's ARPU stands around $3, making it an economically challenging market for high-cost satcom services.
He noted that even with "fanciful technology," Elon Musk's ventures are increasingly integrating local spectrum and ground networks with satcom, effectively adopting a complementary approach. "So in the end, even he's saying the same thing that we are saying, you can only be complementary," Mittal observed.
India's Unique Connectivity Landscape
India's robust terrestrial network coverage, even in rural areas, further complicates the competitive landscape for satcom. "In India, unlike even the US, we don't have dark spots. We have coverage available everywhere the population is there," Mittal explained. He questioned the logic of satcom providers attempting to compete in a $3 ARPU market when their business model requires significantly higher returns.
Mittal predicted that satellite operators seeking to enter the Indian market would likely need to collaborate with existing local terrestrial operators. He also reiterated his earlier statements regarding the delay in satellite internet licenses in India, asserting that his company, which applied five years prior and has ground networks ready, is significantly ahead of Musk in the queue for approvals.