The UK’s mobile phones network giant Vodafone (VOD) has ambitious plans to allow users to make calls and access superfast internet from an army of satellites in space.
The £36bn company has become one of the lead investors in AST & Science, which is described as being the first satellite-based mobile broadband service that will work on standard smartphones.
The AST service is being branded as SpaceMobile and is designed to support seamless roaming to and from terrestrial networks at comparable data speeds, provided on a wholesale basis to mobile network operators.
The network would use very small ‘nano’ satellites sent into Low Earth Orbit and would initially offer 4G services to partner networks globally, with 5G delivered in the future.
Vodafone has not said how much cash it is actually putting into the venture, but we do know that AST has so far raised $128m in total funding and Vodafone, alongside Japanese internet group Rakuten, have become its biggest investors. Others to plough cash into the venture include American Tower, Latin American media business Cisneros and Samsung among others.
Investors seem to like the idea, sending shares in Vodafone up more than 1% to 135p.
SHOULD INVESTORS BE GETTING EXCITED?
Not yet, according to analysts.
Today’s announcement has been called ‘premature’ by one analyst given that AST is still only ‘testing just one of what will ultimately need to be thousands of satellites to provide full coverage’, said Philip Carse, of the Megabuyte analysis boutique.
‘There is no detail on planned service timescales or indeed total investment needed, which we assume will be a significant multiple of the $128m raised to date.’
But Carse does accept that there may be value in the concept down the line. ‘The use of what sound to be very small satellites represents a lower deployment risk than the larger satellites used by some fixed broadband providers,’ the analyst said.
‘The ability to access the service with a standard smartphone could represent a challenge for existing satellite mobile broadband services from the likes of Inmarsat and Intelsat, which require bespoke terminals.
However, ‘after decades of failed satellite ventures, we’ll refrain from getting excited just yet’, Carse concludes.
