Analyst: Satellite DTD market worth billions
June 5, 2023
Analysts at Quilty Space say they estimate the satellite direct-to-device (DTD) market holds the promise of burgeoning into a multibillion-dollar industry.
“It comes as no surprise that in the race to equip unmodified smartphones with satellite connectivity, various players are jockeying for position. Who crosses the finish line first, or even who stays in the race, will be determined by a combination of factors that we identify,” says Quilty.
“Direct-to-Device (DTD) has emerged as a novel satellite communications paradigm that could revolutionise the industry just as TV broadcasting did in the 1990s and broadband connectivity did decades later. Considered an implausible concept when first proposed by startups AST SpaceMobile and Lynk Global back in 2017, DTD went mainstream in 2022 with the promise of new revenue streams that attracted traditional mobile satellite operators (Iridium and Globalstar), wireless handset manufacturers (Apple and Samsung), wireless chip vendors (Qualcomm), Mobile Network Operators (AT&T, T-Mobile, and Vodafone), and the space industry’s goliath, SpaceX,” adds Quilty.
“And now just as SpaceX has proven that with the right strategies, Starlink can push satellite past its reputation as an expensive niche technology, DTD is leveraging the satellite industry’s big brother – the trillion-dollar terrestrial telecom industry – to do the same.”
Quilty asks (and answers): why this newfound attention? “First, DTD delivers a value proposition that complements a rich, existing industry ecosystem – the wireless industry – rather than residing in its own silo. Second, the DTD market could burgeon into a multibillion-dollar source of industry revenues by the end of the decade.”
“We estimate that the potential consumer DTD addressable market (at 100 per cent penetration) ranges from ~$45 billion (for basic emergency services) to ~$170 billion (for full-service). Our findings indicate that a market penetration rate between 5 per cent-15 per cent is attainable near term. Actual market sizing will be determined by a combination of factors, including financial strength, intelligent systems design, and the right go-to-market and spectrum strategies. The most crucial determinant though will be the extent and quality of service,” suggests Quilty.