Starlink had a team of people in New Zealand earlier this month, visiting partners and kicking off a marketing campaign. A return trip, coinciding with Fieldays (Nov 30-Dec 4) is planned.
Elon Musk’s Starlink had a team in New Zealand earlier this month, building local contacts as a marketing drive for its satellite broadband got underway – from ads aimed at local Facebook users to more old-school airport billboards.
There was also a wide-ranging leaflet drop in mailboxes around the country, including inner-city areas.
Even before the formal marketing push got underway in the first week of October, Starlink had built a tidy base of customers in NZ since it first became available in February last year – initially with limited coverage (Starlink’s network of more than 2300 satellites, and counting, now covers almost all of the country).
Starlink’s second-generation dish features a detachable cable – so you can take the dish with you to get broadband from your bach. Photo / Supplied
The Herald understands some 10,000 have already signed up.
And while pundits have framed Starlink as a good solution for some rural areas, the provider has also been signing up a significant number of people in fibre-rich urban areas.
That’s a testament to the service’s good word of mouth, the still-poor state of broadband in parts of NZ, and the buzz Musk has created for it on social media through the Starlink service being donated to Tonga after its cable cut and Ukraine (the latter with a side-serving of the founder’s geopolitical hot-takes).
Personally, I’ve been surprised at the number of emails I’ve received from people who’ve ordered Starlink, and the number of Starlink users who’ve commented after stories (they’ve been pretty positive overall, but have also highlighted a couple of gotchas. See some of their anecdotes and test results here; satellite broadband has traditionally had lousy speed and lag, but Starlink gets around that by trading the traditional model of a few big satellites in geosynchronous orbit some 36,000km up for a swarm in a low Earth orbit of about 600km).
And bear in mind that initial 10,000 user base has been built at a time when customers have had to take something of a leap of faith – ordering $1049 satellite dish, cable and wi-fi router pack that will arrive an unknown number of weeks later, that they have to install and correctly orientate (with the help of a smartphone app) themselves – although more recently something of a cottage industry has evolved with a number of rural and provincial ISPs, including Tauranga-based Full Flavour, offering to help you out.
SpaceX founder Elon Musk during a T-Mobile and SpaceX joint event on August 25 in Texas. The two companies announced plans to work together to provide T-Mobile cellular service using Starlink satellites. Photo / Getty Images
Consider, too, that Starlink costs $159 a month – that’s cheap by satellite broadband standards, especially as it’s thrown in unlimited data in a sector that’s traditionally had tight caps – but it’s still well above the price of UFB fibre or fixed wireless. And Starlink won’t even give indicative speeds for the consumer version (for its business service, which requires a higher-gain, $4200 satellite dish and costs $840 per month, it promises 350 megabits per second, or on a par with most UFB fibre.)
The October marketing push will presumably have built on that 10,000.
And the Herald understands the Starlink crew will be back in New Zealand soon for a visit timed to coincide with Fieldays (November 30 to December 3).
We know from FCC filings in the US that Starlink – a division of the Musk-owned SpaceX – is growing fast. In February, it said it had more than 250,000 users worldwide. By June, that number had grown to 400,000. By October, it was more than half a million.
This year Starlink has expanded its target market from homes and businesses to recreational vehicles and yachts – and bach owners in NZ have told the Herald they like the company’s second-generation dish – nicknamed Dishy 2 – because (unlike the first generation) it has a detachable cable. You can pick it up and take it with you.
Starlink has also started working with cruise ship operators. And it recently announced a partnership with US mobile network provider T-Mobile. The idea is that from next year, Starlink satellites will be able to act like a “celltower in the sky” to expand coverage of T-Mobile customers’ standard-issue iPhones and Androids.
Mainstream telcos have historically had only limited interest in satellite broadband, which has sat uncompetitively at the margins, using different airwarves. But now, Starlink is signing up a meaningful amount of customers – and at the same time, the evolution of 5G means telcos and satellite broadband operators now covet the same “millimetre wave” spectrum as they eye paths for future growth.
How will local telcos respond to Starlink’s rise?
Look for political pressure on two fronts.
One, the Telecommunications Forum, representing Spark, Vodafone, 2degrees, Chorus and others) has already noted that Starlink sites outside the Commerce Commission’s push to tackle telco marketing, service and billing issues – or indeed almost any oversight from the market regulator.
Telecommunications Forum chief executive Paul Brislen has also invited Starlink to join the Telecommunications Dispute Resolution service, which offers a free, independent service to mediate customer complaints. So far, Musk’s company has not come on board.
And two, in submissions to MBIE, Spark, Vodafone and 2degrees have all called for “symmetric regulation”. That is that satellite broadband should receive the same regulatory scrutiny as land-lubbing local providers.
“Currently, satellite broadband providers are effectively using radio spectrum for free,” Vodafone sniffed in its submission to MBIE.
It’s not quite free, but an MBIE spokesperson told the Herald that Starlink, which has six ground stations scattered across New Zealand, installed by Vocus NZ (now merged with 2degrees) and Cello, is paying $150 for each of its 47 licences, and all of which is paid up until June 2023. That’s $7050 per year – or chump change next to the millions paid by the traditional telcos.
Yes, Spark and Vodafone and 2degrees have been just been given 5G spectrum under a pact recently announced by Communications Minister David Clark – as opposed to the collective $259 million they had to shell out at the 4G auction – but as a quid pro quo they are going to have to spend tens of millions each to improve rural broadband and mobile blackspots.
Exactly how much fork over for in-kind work will be hammered out in talks over the coming weeks, which will occur as MBIE continues its assessment work on the new spectrum landscape, including Starlink.