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Can Satellite Services Compete with DSL?

Members of the ISP-DSL list discuss whether Gilat's two-way satellite-based Internet services are a threat to traditional DSL.

[October 19, 2000]

On the ISP-DSL list in October, KM asked,

"Has anyone looked at Gilat-To-Home's offering of satellite-based Internet access at www.gilat2home.com? Any thoughts on the competitive threat it'll offer to DSL providers?"

A number of respondents reassured KM that satellite can't compete with DSL:

[KG suggested] "Satellite will never supplant DSL in areas where DSL is available. The ping times will never satisfy the average DSL consumer; the costs will be substantially higher than DSL; and it appears there may be as much as a three-year commitment. With DSL, there are some interesting VoIP options out there; VoIP will never fly via satellite. If you are doing a reasonable job of supplying DSL, you should not feel threatened."

[TR added] "Latency with satellites is another problem, and a bad one. And the more people using it, the longer the queuing time."

[BH noted] "Another problem with satellite service is that during a moderate to heavy storm, rain or snow, service will be disrupted." Others noted that there is a solid market for the product:

[DD explained] "Gilat-To-Home is pretty good for users who cannot get DSL service. It's kind of like a cable modem in the sky-like cable modems, it has a number of problems, not the least of which is security. On the positive side, it is relatively inexpensive, it's available almost anywhere, and it will have really fast download speeds at first, until everyone gets on it. So overall, this product is a greater threat to cable than to DSL."

[KR acknowledged] "I have heard a rumor that the product cannot stream video because of the height of the satellites: that will be a huge impediment in five years if true. For now, though, I would buy the service in a New York minute for my home in rural Georgia."

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