In January 2024, satellite-direct-to-standard-phone provider Lynk and Telikom Limited, a prominent mobile operator in Papua New Guinea, jointly announced the launch of its initial Non-Terrestrial Network (NTN) mobile services for subscribers using Lynk’s “cell-towers-in-space.” This ABI Insight provides an overview of the development, the potential impact and challenges of the NTN mobile technology, and the commercial prospects of the NTN mobile market.
Registered users can unlock up to five pieces of premium content each month.
Log in or register to unlock this Insight.
From Cell Towers to Space: The NTN-Mobile Service Revolution with Lynk
In early 2024, Lynk launched its initial Non-Terrestrial Network (NTN) mobile service in Papua New Guinea with the country’s state-owned telco company Telikom Limited. The service, which will initially offer Short Message Service (SMS) capabilities, is expected to expand in the future to include voice calls, data services, and emergency alerts. Telikom Limited has confirmed that the NTN-mobile service will first be rolled out in Hela Province.
Lynk's NTN-mobile service is an innovative space technology with the goal of bringing mobile connectivity to remote and underserved areas. Lynk’s satellites essentially act as "cell-towers-in-space" to provide connectivity for typical end-user handsets operating with GSM and Long Term Evolution (LTE), and using frequencies already used for terrestrial cellular services in the 617 – 960 Megahertz (MHz) frequency range. Lynk satellites connect directly to mobile phones within its coverage area using modified cellular signals compatible with existing mobile phone networks. This allows mobile phones to seamlessly switch between terrestrial towers and Lynk satellites as needed. Lynk has permission from the Federal Communications Commission (FCC) to operate in frequency bands ranging from 617 – 960 MHz (space to Earth transmissions) and 663 – 915 MHz (Earth-to-space) with earth stations outside the United States, as well as tracking and control at 20 Gigahertz (GHz) and 30 GHz and in the 2 GHz band. The company’s FCC operating approval said that it will connect off-the-shelf cellular devices with its satellites using Ultra-High Frequency (UHF) bands—but not in the United States, as the company has not sought access to UHF bands here. Lynk currently uses the Ka-band (20 – 30 GHz), S-band (2 – 4 GHz), and sub-GHz Radio Frequencies (RFs) (400 – 900 MHz) to route cellular traffic between Mobile Network Operator (MNO) infrastructure and end-user handsets. Lynk’s current constellation of satellites consists of three satellites in Low Earth Orbit (LEO) and the company’s goal is to operate more than 50 satellites by the end of 2024. Lynk has plans for a constellation of around 5,000 satellites in total.
The Potential of NTN-Mobile Technology: Taking Connectivity to New Heights
NTN-mobile is rapidly emerging as a game-changer in the world of communication. The goal of the technology is to bridge the digital divide by providing mobile coverage through constellations of satellites that directly communicate with standard mobile phones, without the need for bulky Satellite Communications (SatCom) terminals or dedicated networks.
While Lynk is still in its early stages of development, its NTN-mobile service offers several potential benefits:
- Remote Areas and Emergencies: Lynk aims to provide basic connectivity in remote areas and during emergencies where traditional terrestrial networks might be unavailable or unreliable. This can be crucial for communication, safety checks, and accessing essential services.
- Underserved Populations: Lynk can potentially bridge the digital divide by offering basic communication access to people in regions with limited or no terrestrial network coverage. Lynk has signed multiple commercial contracts with MNOs covering seven island nations in the Pacific and Caribbean, including with Telikom PNG in Papua New Guinea (PNG) and bmobile in the Solomon Islands.
Potential Challenges for Lynk:
- Limited Coverage: As Lynk is still in the early stages of deployment and focusing on initial services with a smaller number of spacecraft, Lynk's coverage area is limited. With just three satellites in LEO, the company can only provide services in smaller regions, where the satellites pass overhead frequently enough to maintain connectivity. Expanding the service to other regions would require significantly more satellites.
- Data Transmission Delays: The time it takes for data to travel between a phone and a satellite depends on the satellite's distance and position. With only three satellites, there's a high chance that a phone might not have a direct line of sight to any of them at a given time. Furthermore, without the use of Inter-Satellite Links (ISLs), Lynk satellites that carry user data will have to wait until ground stations are in sight for data downlink. This can lead to longer delays in establishing a connection and transmitting data, impacting service quality.
- Fierce Competition in the NTN-Mobile Market: Other companies such as SpaceX’s with Starlink and Amazon with Project Kuiper are also developing LEO satellite Internet/NTN-mobile constellations with much larger initial deployments. For one, Starlink has ~4,900 active satellites in LEO (as of 4Q 2023) and it has launched the first six Starlink satellites equipped with Direct-to-Device (D2D) capabilities in January 2024. The company also announced that it has plans to bring its NTN-mobile service to market in the coming year. Starlink will be a formidable competitor for Lynk in the NTN-mobile market with its extensive launch capacity and ability to seamlessly integrate with the existing Starlink broadband network with ISLs. Amazon Kuiper's ambitious plans, financial backing, strategic partnerships (i.e., with Vodafone), and focus on innovation also strongly suggests that it has the potential to become a significant player in the Internet of Things (IoT) and NTN-mobile market.
The Evolving Value Proposition of the NTN-Mobile Marketspace
Integrating satellite and terrestrial mobile networks could unlock new revenue opportunities for the satellite, semiconductor, and telecoms industries. ABI Research forecasts substantial market growth with a Compound Annual Growth Rate (CAGR) of 36% in shipments from 2023 to 2030 for the NTN handset segment, reaching over US$228 billion in market revenue. For more details, refer to ABI Research's Satellite Communication Terminals & CPE Shipments: NTN (MD-SATTN-101).
ABI Research has three recommendations for market participants in the NTN-mobile market space to optimize their business growth and capitalize on the growing demand for SatCom connectivity:
- Embrace Strategic Partnerships: NTN-mobile market participants should partner with existing MNOs to leverage their established customer base and terrestrial cellular infrastructure for distribution and service integration. Leading MNOs such as T-Mobile, AT&T, Rakuten Mobile, Rogers, Salt, Telefónica, Telstra, Globe Telecom, Vodafone, KDDI, Orange, Zain, and others have entered into explicit commercial partnerships with NTN-mobile service providers AST SpaceMobile, Lynk Global, and SpaceX.
- Prioritize Affordability: NTN-mobile service providers should develop flexible pricing models and tiered pricing plans with targeted service packages to cater to different user needs and budgets to increase affordability and market penetration. NTN-mobile service pricing strategies could include pay-as-you-go, subscription plans, or even hybrid models, while targeted service packages could include service packages such as emergency packs, travel packs, or even education packs.
- Invest in Service Innovation: While basic voice and data services are crucial for bridging the connectivity gap, NTN-mobile 's true potential lies in venturing beyond these traditional offerings. Investing in service innovation could unlock lucrative opportunities for NTN-mobile providers and their strategic partners. Some exciting possibilities with NTN-mobile technology would be real-time emergency response, IoT connectivity, and in-flight services. The benefits of service innovation would be competitive advantage, new revenue streams, and possible societal impact for the NTN-mobile service providers.