Lynk/Omnispace Deal Shows Challenge of D2D Fueled by Terrestrial Spectrum: Analysts
Lynk Global's pending merger with Omnispace marks yet another direct-to-device (D2D) satellite operator dropping plans to rely on reusing terrestrial mobile spectrum and instead incorporating mobile satellite service (MSS) spectrum. Space spectrum consultants and analysts told us it illustrates the challenges of a terrestrial-mobile-alone model. Lynk didn’t comment. Under the Lynk/Omnispace deal, announced last week (see 2510240004), the combined company will use Omnispace’s S-band spectrum for D2D service. That follows AST SpaceMobile's plans to use Ligado's L-band spectrum for its D2D service and SpaceX's proposed purchase of the rights to EchoStar's MSS spectrum.
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The D2D deployment path is tied to what spectrum the mobile carrier can make available, while using MSS spectrum means that satellite operators can plan deployments independently of mobile network operator (MNO) partners, emailed Analysys Mason's Janette Stewart. The spectrum that mobile carriers can make available might have limits, since most terrestrial spectrum is already used for carrying terrestrial mobile data traffic, she said. “Limited spectrum means a limited D2D deployment” in terms of the capacity, the number of users who can be supported, and the services that can be offered.
MSS spectrum, especially in the 2 GHz band, has the benefit of being mostly globally harmonized, Stewart said. The S band includes the 2 GHz band. When mobile carriers reuse terrestrial mobile spectrum, it’s unlikely that they can all make the same spectrum available for D2D, since they don’t have identical spectrum portfolios, Stewart noted. “This creates design trade-offs in the satellite network if the network needs to flex operation across different spectrum bands in different markets.”
Beyond the lack of global coordination, using terrestrial spectrum for D2D service is problematic because it’s expensive to reallocate terrestrial spectrum to lower-value satellite use, Summit Ridge Group's Armand Musey said in an email. Simultaneous spectrum sharing between satellite and terrestrial networks isn't technically viable today because handset antennas are omnidirectional, so the signals can't be isolated to point directly to the tower or satellite, he added.
Michael Calabrese, director of New America’s Wireless Future Program, told us a satellite service providing supplemental coverage from space using mobile carrier spectrum is highly constrained. Those satellite operators can operate only with the permission of the terrestrial licensee and typically can serve only areas outside the coverage of the mobile carrier, he said. There are also constraints on serving border areas, although that’s a much bigger problem in Europe, he noted. MSS bands lack those restrictions, he said, adding that an MSS operator can serve customers of multiple carriers when using its own band and can potentially even compete with MNOs with its D2D service, as Globalstar and Apple are doing.
Carriers "like to own, not partner," when it comes to spectrum, Recon Analytics’ Roger Entner told us. “The investment in building out infrastructure is just too large to rely on a partner that may hold the carrier hostage when it comes to price negotiations.”
The Omnispace deal was driven by the flexibility to use various spectrum bands to provide service, Lynk told us in an email. It said future deployments of D2D are likely to incorporate both MSS and terrestrial mobile, with MNOs' needs varying by geography and economy. The deal "is positioned at the intersection and able to access the right spectrum type and the right technology to deliver the most effective solutions for our customers."
The Lynk/Omnispace deal shows how "absolutely essential" spectrum is for D2D, given how all the players offering D2D with terrestrial spectrum now have access to MSS spectrum, Analysys Mason's Lluc Palerm wrote last week. Pointing to other consolidations and deals in the D2D space, such as the SpaceX/EchoStar and AST/Ligado spectrum agreements and the Viasat/Space42 partnership on D2D service (see 2509150011), Palerm said MNOs might want multiple players to compete in the market, "but consolidation is healthy and natural as the market matures and constellations need to gain scale."