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Elon Musk Enters In-Flight Wi-Fi Market With Small SpaceX Satellites

SpaceX wants to show the world that its Starlink satellite system can deliver Netflix and YouTube at 30,000 feet. That’s why it recently held a demo to the media aboard a jet operated by its first airline, the regional airline JSX.

SpaceX wants to show the world that its Starlink satellite system can deliver Netflix and YouTube at 30,000 feet. That’s why it recently held a demo to the media aboard a jet operated by its first airline, the regional airline JSX.

The brief jaunt from Burbank to San Jose, California marks the beginning of Elon Musk’s bid to acquire in-flight business from satellite providers Intelsat and Viasat Inc. already serving thousands of aircraft.

It won’t be easy, even for a serial market disruptor like Musk.

“Are they a serious competitor? Yes,” said Jeff Sare, president of commercial aviation at Intelsat, a leading provider of airline wireless services. Still, Sare said, “We don’t believe there is anyone who can beat us.”

Starlink, part of Musk’s Space Exploration Technologies Corp., provides broadband from a constellation of low-flying small satellites. Lower satellites orbit the planet in 90 to 120 minutes. That’s a departure from the established practice of using a few powerful spacecraft in higher and slower orbits. An advantage for Starlink is that the signals arrive earlier.

This is a plus for the company’s core business of providing broadband to primarily rural households in sparsely populated areas. Starlink has launched more than 3,000 satellites and serves more than 400,000 subscribers, the company said in recent filings.

But one drawback to Musk’s technology is that small satellites have less capacity and may struggle to meet the needs of large aircraft in crowded skies. Numerous planes teem with travel hubs, with each plane carrying 100 or more connected passengers. With satellites racing around the globe, few serve an area like Atlanta and its busy airport, raising capacity issues, B. Riley Financial said in a note last year. SpaceX said projections underestimate how fast the system is evolving.

US regulators recently called Starlink’s “technology in development” when they turned down the service for an $866 million government grant.

Starlink says it can serve aircraft of all sizes, citing an agreement with Hawaiian Airlines’ parent company to operate large Airbus and Boeing aircraft. As for the grant’s rejection, the company said it was unfairly rejected by officials assessing current data rates rather than the faster service envisioned when the sky network is built.

“You have to get it to work, and you have to get it cheap,” said Chris Quilty, a partner at Quilty Analytics, a consultant to the space and satellite industry. “It is a very complex market. And the airlines have been extremely cautious in the past.”

Starlink managers know their work is ahead. “There are many challenges to get to where we want to be,” said Jonathan Hofeller, vice president of Starlink Commercial Sales. “It will take time for people to adopt the mindset of JSX and Starlink.”

The company’s deals with JSX and Hawaiian, announced in April, came after SpaceX offered Starlink to four of the largest US carriers, unsuccessfully, according to people familiar with the issue.

“This is a foot in the door for Starlink,” said telecommunications analyst Roger Entner. “This is the proof of concept. Once it works on JSX, it works everywhere.”

Part of the attraction for JSX was Starlink’s flat antenna, not much bigger than a large pizza box. It’s less bulky than the revolving dishes commonly used by other satellite services, so it fits on top of the bodies of Brazil’s Embraer SA’s smaller regional jets that JSX flies on.

The antenna “is definitely an advantage in terms of securing in-flight connectivity contracts for regional jets,” said Louie DiPalma, an analyst at William Blair & Co. The company does business with Viasat.

Airlines could upgrade more than 1,000 aircraft in regional fleets from slow legacy internet systems in the coming years, and Starlink is “a leading contender” to win such contracts, DiPalma said.

Intelsat says it remains the largest provider of in-flight service, with about 2,000 aircraft connected by its satellites and about 1,000 aircraft connected by air-to-ground systems communicating with terrestrial equipment. Viasat says the in-flight system will serve about 1,930 aircraft, with agreements to equip an additional 1,210 aircraft.

About 10,000 commercial aircraft already have in-flight wireless connections, a number expected to exceed 36,000 by 2031, according to NSR, a satellite and aerospace industry researcher owned by Analysys Mason. Annual sales in the market are expected to exceed $7.3 billion in 2031, up from $1.9 billion in 2021, NSR said in an email.

On the JSX test flight, the Starlink system consistently recorded transmission capacities in excess of 100 megabits per second, as measured by the Ookla app, a testing service. There were about a dozen people on board. Additional onboard devices increased demand to the equivalent of 20 to 30 passengers using the system.

“I’m excited,” said JSX Chief Executive Officer Alex Wilcox, who was aboard the flight over California trying to browse the web and make WhatsApp calls on the system. “It exceeded my expectations.”

Days after the test flight, a cross-country trip on a packed American Airlines Airbus with Viasat gear and more than 100 passengers delivered about 2.2 megabits per second.

Netflix and YouTube videos flowed smoothly on both flights, and two-way video chats worked well over WhatsApp. On every plane, email was received and sent with ease, another selling point — or maybe not — for those who remember the flight as a haven from work.

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