Lynk inks New Zealand deals seeking cash to grow satellite fleet

Lynk Global has secured two new MNO partners in New Zealand as it seeks investment to grow satellite fleet and improve coverage reliability.

Tereza Krásová, Associate Editor

June 8, 2023

5 Min Read
Lynk inks New Zealand deals seeking cash to grow satellite fleet
The race seems to be on to connect phones directly to satellite.(Source: Andrey Suslov/Alamy Stock Vector)

In the first few days of June, Lynk Global made two announcements relating to New Zealand – the first being a successful trial of satellite-enabled texting with local telco 2Degrees and the other a partnership with another operator, Spark. While the company's technology holds the promise to improve connectivity in areas with zero coverage, more satellites will be needed to provide a reliable service.

Lynk is one of several satellite firms hoping to establish themselves as providers of non-terrestrial (NTN) communications. Its main advantage is that it can connect to any mobile device, unlike competitors.

As Lynk's CEO Charles Miller explained to Light Reading last year, this is achieved by placing the technology that would normally be located inside a cell tower directly in the satellite. By compensating for the Doppler effect, which occurs when sound or light waves are emitted by a moving object – interested readers can see the full explanation on MIT's website – Lynk allows a mobile device to interact with the satellite much like it would with any other device.

This should, in theory, make it much easier for operators to start offering satellite-based communications to mobile users – or at least that's the logic many telcos seem to have followed. Lynk currently counts over 20 partnerships in different parts of the world, including Australia, Ghana, Canada, Mongolia, the Bahamas and Papua New Guinea.

New Zealand, meanwhile, seems to be in a race to provide satellite connectivity. One, the result of a recent rebranding by Vodafone NZ, partnered with Starlink in April. While its focus will initially be on offering users satellite dishes for broadband, the ultimate goal is to use Starlink's network to improve One's mobile coverage.

MNOs' strategies fall broadly into two categories, as Miller explained on a podcast by (a Light Reading sister publication), with some expecting to charge a premium for the service. In such cases, a revenue-sharing agreement will be put in place. Others may offer the service for no additional charge and shoulder the costs themselves.

Seeking investors

Details about Starlink's technology are sparse, but it is likely different from Lynk's. When a US partnership between the Elon Musk-owned satellite firm and T-Mobile was announced, the press release stated that a "vast majority of smartphones already on T-Mobile's network will be compatible." This would suggest there is an additional requirement restricting the service.

Several direct-to-device companies, including Globalstar and Iridium, currently use custom waveforms, which means handsets need to support them to use the service. Lynk, meanwhile, says any 3GPP-compliant phone will be compatible. Its services should initially include texting and emergency phone calls, but eventually the solution could be used to replace loss-making cell towers.

The question is when that might happen. In 2022, when its deal with the wholesale provider of communication services BICS was announced, trials were expected to take place that year. While December has come and gone, no consumer trials seem to have happened, as far as Light Reading could establish. Now the company touts late 2023 for a possible launch in New Zealand.

Seemingly, one of the issues is sparse coverage. Miller has confirmed Lynk currently has three satellites in space out of 1,000 planned by 2025. To achieve optimal coverage, he says 5,000 would be needed. This could shed some light on the following statement by 2Degrees's CEO Mark Callander: "Initially, the service is limited to times when Lynk satellites are passing overhead. As more satellites are launched, the more frequent overpasses will become."

A 2020 Lynk video suggests an overpass window could be as short as three minutes, begging questions about how often they occur with only three satellites in orbit and whether this would permit their use in the event of an emergency.

Bandwidth is also limited on existing satellites, with Miller describing the capacity per beam as the main limiting factor. Capacity for each beam currently averages 10 Mbit/s to 15 Mbit/s, which is shared among all the users connecting to it. The capacity offered to any given customer will therefore depend how much overall demand there is in the area. To increase bandwidth, the satellite design will need to change.

Shooting for the stars

Miller admits money is preventing the company from launching additional units, with the future launch schedule depending on investment. According to Crunchbase, it has raised $21 million so far.

It is unclear how much a single satellite and its launch may cost. Lynk's last two satellites were launched by SpaceX after plans to launch its second satellite via Spaceflight's orbital transfer vehicle – itself launched by SpaceX – failed. At that time, Miller told Space News that launching satellites directly via SpaceX is "a lot more expensive."

The second and third satellites eventually made it into orbit on board SpaceX's Falcon 9 rocket, each weighing 132 pounds (60kg). Using the calculator on SpaceX's website – assuming Lynk is eligible for the rideshare program – Light Reading could establish that at current prices the costs of transporting 60kg of payload would be $390,000. The cost of the equipment itself is another matter entirely.

Once in space, however, Miller emphasized on the podcast that marginal costs are close to zero, arguing that Lynk can always drop prices to a level that is affordable for MNO partners, even in emerging markets, and make money.

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— Tereza Krásová, Associate Editor, Light Reading

About the Author(s)

Tereza Krásová

Associate Editor, Light Reading

Associate Editor, Light Reading

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