Who needs satellite internet?

For many it is difficult to think about the possibility of being without internet, but this is the reality of many places in Brazil. Although fixed broadband services are present in most municipalities, there are still several villages and rural areas that cannot rely on terrestrial connection or even a cellular signal.

For this group of people, satellite internet is usually the only alternative to stay connected with the rest of the world. This service has been around for some time, but it has only become (a little) more accessible in recent years.

Satellite Internet keeps changing

Hughes President Rafael Guimarães explains to the Tecnoblog that the sector has undergone profound changes: “It is about 10 years ago that the market started using another frequency band for satellite broadband, the Ka band. Until then, the sector used the C band, which was very expensive, and the Ku band ”.

Hughes is the main satellite operator in Brazil. According to Anatel, the company ended March 2021 with 275,100 fixed broadband accesses. The market also has another strong competitor, Viasat, but the company does not disclose the number of customers.

Rafael Guimarães, president of Hughes do Brasil (Image: Disclosure)

The evolution for the band Ka represents more than an alphabet soup: Guimarães explains that, because it is a higher frequency, there is more spectrum available and, therefore, greater capacity. “In the past, about 10 years ago, a large Ku band satellite had 2 Gb / s capacity and cost US $ 400 million, including launch and insurance. Today, with the Ka band, it is possible to have equipment with 500 Gb / s for the same cost ”, says the executive.

Satellite Internet arrives in places where there is no fixed network (Image: PIRO4D / Pixabay)

This capacity is made possible by the fact that the Ka band reuses the frequency in different regions: “The Ka band is analogous to the cellular network: there are several smaller cells, with concentrated power, side by side. With this, it is possible to multiply the capacity by reusing the spectrum several times in different places ”.

The executive comments as it was in the past: “The use was very restricted because of the value, so the cost-benefit equation was not worth it, as there was little bandwidth for a very high amount”. Guimarães says that today it is possible to achieve speeds unimaginable 10 years ago: “If you could get 256 kb / s internet [via satélite] would be satisfied ”.

It is not a service for everyone

HughesNet’s basic plan has a download speed of 10 Mb / s and 1 Mb / s of upload, at a cost of R $ 179.90 per month. However, the service does not work as terrestrial broadband and there is a 10 GB deductible to use during the day and an additional 40 GB during the night.

HughesNet antenna installation (Image: Disclosure)

HughesNet antenna installation (Image: Disclosure)

“We could have plans with unlimited deductibles, but nobody would pay. It is necessary to create a cost and franchise balance that the person can use ”, he reports. “We have plans from 10 GB to 80 GB in the month, but the sale is very concentrated in the 10 GB plan, simply because of the value. As much as we do a lot of catechesis [sobre uso de dados], we run into the reality of the market ”.

Whoever surpasses the franchise can remain connected to the internet, but at a reduced speed of 1 Mb / s. It is also possible to hire additional packages, but the amount charged by HughesNet is quite salty: the cheapest has 1 GB of internet at a cost of R $ 17.90, while the largest has 10 GB and costs R $ 159.90.

Because it is an expensive and limited service, it is difficult to find anyone interested in hiring satellite internet in places where terrestrial broadband is present. In a capital city, it is possible to find plans with hundreds of megabits per second for less than R $ 100. Hughes says that 80% to 90% of customers are in rural areas.

I asked him if there is a maximum limit of satellite dishes hanging, and Guimarães reveals that it is not. “The limit is the division of the band. You have to be careful to divide capacity intelligently: if I have few subscribers, I don’t have the expected return; if I put too many and pass the point, customers start to complain. It is a fine adjustment, more art than science to hit the optimum ”.

Currently, Hughes has between 60 Gb / s to 70 Gb / s of capacity in Brazil joining three satellites. One of these devices came from Yahsat, which was preparing to operate in the Brazilian broadband market, but decided to join the competitor.

The leap in internet use in the pandemic

The pandemic has made many people even more dependent on the internet. This was no different in the satellite service: Guimarães reveals that the demand for connection has increased a lot, and even those who were already customers started to use 30% more suddenly.

The addition of the Yahsat satellite was important for Hughes, which saw a traffic explosion with the arrival of the COVID-19 pandemic: “The demand for bytes on the network has exploded”, he comments.

Satellite difficulties: taxation and foreign exchange

The president of Hughes says that a large part of the company’s efforts is to make satellite broadband more accessible, better and with more bandwidth. “Here in Brazil we have the‘ normal ’difficulties of being a company. Today, a third of what the subscriber pays for Hughes goes straight to the government. It is a shocking thing, if you say that to a foreigner he doesn’t understand ”, says Guimarães.

Foreign currency costs are also another obstacle: “Most of our expenses are in dollars, and we do not charge anything in dollars to our residential client. The satellite is in dollars, the terminal is manufactured outside Brazil. All the foreign exchange risk the company has to assume, we charge in reais, with annual readjustments based on inflation ”.

Satellite internet, from a user’s perspective

To understand the other side, I talked to Edison Santiago, a mobile application developer who has a site in Campo Mourão, in the interior of Paraná. “The place is 15 km from the city, but cell service is considerably affected because it is a valley. From the top of the hill, I can see the buildings in the city and get a quiet signal, sometimes even 4G, but there is practically nothing in the house ”.

HughesNet antenna installed in Campo Mourão / PR (Image: Edison Santiago / Personal collection)

Edison claims that he signed up for satellite internet because all the other options were disappointing, and it wasn’t exactly a choice. The plan contracted with HughesNet has a speed of 15 Mb / s, but there is a 20 GB deductible and another 20 GB package to use during the day: “There are cheaper plans with an extra deductible during the night, but as my use bigger is during the day it didn’t make sense to me ”.

Before the satellite internet, Santiago had other options: “I have two major problems: the wind is very strong in the place, so using any directional antenna ends up being complicated because the wind misaligns. The other is that the house is in a valley, so to have a direct view [termo técnico para descrever posicionamento de antenas de radiofrequência] for the city it would be necessary to use a tower ”.

He reports that he has already used internet via radio, but faced problems with misalignment antenna, equipment failure and provider problems. The mobile internet was his second option, but Edison said that the signal was getting weaker and weaker: “At first I was able to get a signal at home and used a Vivo Box, but today it doesn’t work properly even with an external antenna”.

Satellite modem and router installed by Hughes (Image: Edison Santiago / Personal collection)

Satellite modem and router installed by Hughes (Image: Edison Santiago / Personal collection)

The difference between a satellite or terrestrial connection

I asked him if it is very different to use internet via satellite: “I was already aware of the high ping (around 700 ms to 800 ms), but I believed that it would only affect online games and other more ‘immediate’ things, when in fact he affects almost everything. I can see slowness in the first request when opening an application and even when accessing my surveillance cameras ”.

Another variation happens during video or audio calls (VoIP): “Having a meeting was a very different experience. The delay of almost 1 second provided some funny moments, there were crashes on both my part and the others. But now I started to warn about this delay and the meeting flows normally, with the participants waiting for the other to finish talking.

Hughesnet speed test (Image: Edison Santiago / Personal Collection)

Hughesnet speed test (Image: Edison Santiago / Personal Collection)

Even with the setbacks, Santiago says he can work smoothly using the satellite internet, because he doesn’t need as much bandwidth to send his codes. However, the developer says he spends most of his time in a location with a fixed internet connection and has become accustomed to avoiding large downloads and streaming while on the site.

Will the expansion of cellular networks end the satellite?

The frequency auction for 5G should be held next semester, but Hughes is not intimidated by this: “[A quinta geração] it is more complementary than threat. There will be situations in which cellular coverage will arrive and, eventually, the consumer will stop using the satellite. Particularly, I think this will take a long time, Brazil is very large, the territory is extensive, I do not believe that in a future of 5 years the country will be completely covered with a cellular signal ”, said the executive.

Guimarães also sees mobile networks as technology as a complement, and says that about 60% of B2B revenue comes from cellular operators: “There are many places where the operator will put cellular coverage with satellite backhaul, because it is the easiest way to to arrive. The operator wants to cover a road, so place the base stations and connect to the satellite, without having to pull fiber or set up a radio link ”.

TIM antenna covers stretch of road in General Salgado / SP (Image: Reproduction / TIM)

TIM antenna connected via satellite covers stretch of road in General Salgado / SP (Image: Press Release / TIM)

This model of towers connected via satellite is defended by TIM to serve remote locations. The operator introduced the concept of unplugged site, in which the cell antenna is powered by solar energy and drains traffic through a satellite dish. Guimarães did not comment on which operators are Hughes customers.

And what about Elon Musk’s Starlink constellation?

The sector is expected to change a lot in the coming years: SpaceX maintains tests with a constellation of satellites that will provide internet services comparable to a terrestrial optical fiber. During the beta period, already in operation in the United States, Elon Musk’s company promises latency from 20 ms to 40 ms, and speeds from 50 Mb / s to 150 Mb / s, with no traffic limit. The promise is to arrive in Brazil by the end of 2021.

Starlink antenna (Image: Disclosure / SpaceX)

Starlink antenna (Image: Disclosure / SpaceX)

“From the point of view of operation, there is no doubt that these constellations work,” says Guimarães when asked about how Hughes sees the competitor. He comments that his company is a partner in another constellation, OneWeb, which has similar capabilities.

However, the business model is an unknown question for the executive: “The big question is whether this will ever be feasible from the cost point of view. In the United States, for example, Starlink sells its service for US $ 99 per month, plus the value of the equipment for US $ 499. If you translate this into the exchange rate and include Brazilian taxes, these US $ 99 became R $ 700 per month , not to mention the initial value ”.

“It is a company that cannot be underestimated, Elon Musk managed to be disruptive in a lot of businesses”, he comments. “The new satellite that arrives next year brings more capacity to Brazil, and the idea is to bring plans with a lot more franchise and greater speed”

I asked Edison if he would be willing to be a Starlink customer: “I signed up for the beta as soon as it opened, I paid for the subscription and I’m hoping to be selected. But I believe that the maximum monthly amount that you would be willing to pay is between R $ 300 and R $ 350 ”.

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