LEO Satellites: Revolutionary Connectivity or a Supporting Act?

Together with the team from Strand Consult, I have written a free report titled “Will LEO Satellite Direct-to-Cellular Networks Make Traditional Mobile Networks Obsolete?”
This report offers a comprehensive analysis of the role of Low-Earth Orbit (LEO) satellites in the telecommunications industry. It examines the advancements in satellite technology, the challenges in achieving service parity with terrestrial networks, and the implications for global connectivity. It explores the technical, economic, and regulatory factors shaping the deployment of Direct-to-Cell satellite services and evaluates whether these networks can complement or replace traditional cellular infrastructure.
This report builds upon the discussions and analyses on my Technology-Economics blog, techneconomyblog.com, where the evolving dynamics of telecommunications investments and innovation are regularly explored. This report aims to illuminate the forces driving developments in LEO satellite networks, the challenges they face, and how these technologies will likely shape the telecommunications industry’s future. It aims to provide inspiration and insights that can be used to frame discussions about the trends and transformations affecting connectivity on a global scale.
When reading recent media and comments on various media postings, one can quickly get the impression that satellites will replace traditional mobile networks. This narrative often simplifies a complex issue, creating the perception that satellite technology is a universal solution to global connectivity challenges. However, a more pragmatic view reveals that satellite networks like those operated by Starlink offer revolutionary opportunities but are unlikely to make terrestrial mobile networks obsolete. Instead, these technologies will coexist, each serving distinct roles in the communication ecosystem.
The Satellite Race to Reach the Phone.
Among the various players in the Low-Earth Orbit (LEO) satellite market, Starlink, led by Elon Musk’s SpaceX, has emerged as the frontrunner. With a network of almost 7,000 satellites operating, 300+ (2nd generation or Gen2) satellites have Direct-to-Cell capabilities. SpaceX’s spectrum regulatory approach outside the U.S. has been criticized for not always adhering to local licensing frameworks (e.g., cases in India, France, and South Africa). Its reliance on spectrum that local regulators have not officially granted can create tensions with governments and local telecom providers. Starlink operates a global satellite network with thousands of satellites covering areas without always having lawful access to the spectrum on which it provides services. This is an even more significant challenge regarding the regular cellular spectrum used for traditional mobile cellular services licensed and used by local telecommunication companies. Thus, it requires, at least, the satellite operator to collaborate locally with telco operators who have the usage rights of the cellular spectrum of interest.
SpaceX has supposedly planned to deploy an additional 30,000 Gen2 satellites but has not officially specified the exact timeline for this deployment nor how significant the share of D2C capable satellites is. Given the company’s current launch cadence and capabilities, it is anticipated that this expansion could occur over the next 5 to 10 years. This ambitious plan aims to enhance global internet coverage and increase network capacity. Each satellite has a lifespan exceeding 5 years, with the 2nd generation having powerful thrusters that enhance the lifetime and support a safe decommissioning process when the satellite is retired. The relatively short useful life will necessitate a near-constant replenishment to maintain the network. Despite these challenges, Starlink’s aggressive strategy and innovative technology have placed it light years ahead of competitors like Amazon’s Kuiper and Eutelsat’s OneWeb.
As of January 2025, Amazon’s Project Kuiper has not yet launched any operational satellites, including those with Direct-to-Cell (D2C) capabilities. The project is still in development, with plans to deploy a constellation of 3,236 LEO satellites to provide global broadband coverage. Amazon has committed to launching 50% of this constellation by July 30, 2026, as per the Federal Communications Commission (FCC) requirements. The Kuiper Project’s LEO satellites, optimized for mid-latitude coverage, may not provide consistent or high-quality connectivity at extreme northern latitudes. This contrasts with Starlink, which already operates polar-orbit satellites to serve more northern regions like Alaska, northern Canada, and the Arctic.
One of the most remarkable aspects of Starlink’s success is its ability to build a functional global network without initial access to the necessary spectrum. This bold approach has drawn comparisons to Jeff Bezos’ Kuiper project, with Strand Consult humorously observing that while Bezos is still setting up a “burger bar,” Musk is already running an “interstellar McDonald’s“.
Several companies are advancing D2C connectivity through LEO satellite constellations, aiming to connect standard mobile devices directly to satellites. Among them, AST SpaceMobile has launched five operational satellites, detailed in FCC filings, to deliver 4G and 5G services globally, with plans to expand its network with up to 243 satellites. AST SpaceMobile’s advanced phased-array antenna, BlueWalker 3, is one of the most powerful in the industry required to deliver good quality services to unmodified cellular consumer devices. Similarly, Lynk Global has deployed satellites to provide coverage in remote areas, emphasizing partnerships with telecom operators and regulatory approvals.
Geespace, part of Geely Technology Group, has launched 30 satellites in China and plans to expand to 72 by 2025, targeting global broadband and D2C capabilities. The Qianfan (“Thousand Sails”) constellation, in intent and capabilities closest to SpaceX, is another Chinese initiative that has deployed 54 satellites and aims for over 15,000 by 2030, positioning itself as a major player in satellite-based communications. US and Chinese initiatives drive significant advancements in D2C technology, integrating satellite connectivity into everyday communications and addressing global coverage challenges.
The rise of LEO satellites has sparked discussions about the potential obsolescence of terrestrial cellular networks. With advancements in satellite technology and increasing partnerships, such as T-Mobile’s collaboration with SpaceX’s Starlink, proponents envision a future where towers are replaced by ubiquitous connectivity from heaven. T-Mobile and Musk have on occasion made it clear the Starlink D2C service is aimed at texts and voice calls in remote and rural areas, and to be honest, the D2C service currently hinges on 2×5 MHz in the T-Mobile’s PCS band, adding constraints to the “broadbandedness” of the service.
However, the feasibility of LEO satellites achieving service parity with terrestrial networks raises significant technical, economic, and regulatory questions. This article explores the challenges and possibilities of LEO Direct-to-Cell networks, shedding light on whether they can genuinely replace ground-based cellular infrastructure or will remain a complementary technology for specific use cases.
Before we write off the terrestrial cellular infrastructure completely, let’s have a look at the obvious differences between a Low-Earth Orbit satellite aiming to service unmodified mobile devices in the same manner as the terrestrial cellular network does today.
Physics Matters.
Physics tells us how a signal loses its signal strength (or power) over a distance with the square of the distance from the source of the signal itself (either the base station transmitter or the consumer device). This applies universally to all electromagnetic waves traveling in free space. Free space means that there are no obstacles, reflections, or scattering. No terrain features, buildings, or atmospheric conditions interfere with the propagation signal.
Physics also tells us how a signal’s strength depends on the frequency of the electromagnetic wave. The higher the signal frequency, the more energy is absorbed, scattered, or attenuated as it propagates through space or a medium. In free space, where there are no obstacles, reflections, or scattering, the path loss increases with the square of the frequency. This means that as the frequency of a signal increases, the signal strength diminishes more rapidly over a given distance compared to lower frequencies, even under ideal conditions. This dependency is a fundamental property of electromagnetic wave propagation and becomes increasingly significant as the operating frequency moves higher, such as in millimeter-wave or terahertz bands.

The figure above illustrates the difference between (a) terrestrial cellular and (b) satellite coverage. A terrestrial cellular signal typically covers a radius of 0.5 to 5 km. In contrast, a LEO satellite signal travels a substantial distance to reach Earth (e.g., Starlink satellite is at an altitude of 550 km). While the terrestrial signal propagates through the many obstacles it meets on its earthly path, the satellite signal’s propagation path would typically be free-space-like (i.e., no obstacles) until it penetrates buildings or other objects to reach consumer devices. Historically, most satellite-to-Earth communication has relied on outdoor ground stations or dishes where the outdoor antenna on Earth provides LoS to the satellite and will also compensate somewhat for the signal loss due to the distance to the satellite.
Let’s compare a terrestrial 5G 3.5 GHz advanced antenna system (AAS) 2.5 km from a receiver with a LEO satellite system at an altitude of 550 km. Note I could have chosen a lower frequency, e.g., 800 MHz or the PCS 1900 band. While it would give me some advantages regarding path loss, the available bandwidth is small and insufficient for state-of-the-art 5G services. Independently of frequency, we need to overcome an almost 50 thousand times relative difference in distance squared in favor of the terrestrial system. If all else is equal, the signal would be 50 thousand times weaker than that of a terrestrial signal at the same frequency. This is, of course, why the satellite system’s specifications are not equal to that of the terrestrial communications system.
Traditional satellite communications systems, such as Starlink’s Ku-band service to a ground-based dish, typically rely on excellent ground-based antennas placed outdoors with high gain and sensitivity, connecting to consumer equipment indoors and guaranteeing near-free-space propagation characteristics. However, we are not interested in the traditional satellite setup for this work. The Direct-to-Cell design requirement is to deliver a decent or good quality directly from the LEO satellite antenna to consumers’ unmodified normal cellular devices (e.g., smartphones).
Based on simple considerations and the physics of electromagnetic wave propagation, it appears unreasonable that an LEO satellite communication system can provide 5G services at parity with a terrestrial cellular network to unmodified 5G consumer devices without very aggressive satellite-optimized modifications. The satellite system’s requirements for parity with a terrestrial communications system are impractical (but not impossible) and, if pursued, would significantly drive-up design complexity and cost, likely making such a system uneconomical.
However, 80% or more of our mobile cellular traffic happens indoors, in our homes, workplaces, underground transport systems, and public places. If a satellite system had to replace existing mobile network services, it would also have to provide a service quality similar to that of consumers from the terrestrial cellular network. As shown in the above figure, this involves urban areas where the satellite signal will likely pass through a roof and multiple floors before reaching a consumer. Depending on housing density, buildings (shadowing) may block the satellite signal, resulting in substantial service degradation for consumers suffering from such degrading effects even if the satellite signal would not face the same challenges as a terrestrial cellular signal, such as with vegetation, terrain variations, and the horizontal dimension of urban topology (e.g., outer& inner walls, coated windows,… ), the satellite signal would still have to overcome the vertical dimension of urban topologies (e..g, roofs, ceilings, floors, etc…) to connect to consumers cellular devices.
Until now, we have only explored the direction everyone focuses on (while ignoring the other direction): the downlink connection from the D2C-capable LEO satellite to the unmodified cellular device. With the right satellite antenna specifications (aperture, transmit gain, output power, beam stability, …), it is possible to connect to the consumer’s unmodified device under favorable conditions (e.g., outdoor, very simple building structures without extensive blockage, such as several floors), even if the distance that needs to be bridged is enormous compared to the conditions a cellular network would be working under.
LEO satellite services that provide direct to unmodified mobile cellular device services are getting us all too focused on the downlink path from the satellite directly to the device. It seems easy to forget that unless you deliver a broadcast service, we also need the unmodified cellular device to communicate meaningfully with the LEO satellite directly, at least if no cellular network is available to support the uplink signal path. Alternatively, an indoor repeater system could bring the signal in and out of the indoor environment using an outdoor ground-based satellite antenna to bridge both signal paths to the LEO satellite. The challenge for an unmodified cellular device (e.g., smartphone, tablet, etc.) to receive the satellite D2C signal has been explained in the previous section.
In the satellite downlink-to-device scenario, we can optimize the design specifications of the LEO satellite to overcome some (or most, depending on the frequency) of the challenges posed by the satellite’s high altitude (compared to a terrestrial base station’s distance to the consumer device). In the device direct-uplink-to-satellite, we have very little to no flexibility unless we start changing the specifications of the terrestrial device portfolio. Suppose we change the specifications for consumer devices to communicate better with satellites. In that case, we also change the premise and economics of the (wrong) idea that LEO satellites should be able to completely replace terrestrial cellular networks at service parity with those terrestrial cellular networks.
The premise that LEO satellite D2C services would make terrestrial cellular networks redundant everywhere by offering service parity appears very unlikely, and certainly not with the current generation of LEO satellites being launched. The altitude range of the LEO satellites (300 – 1200 km) and frequency ranges used for most terrestrial cellular services (600 MHz to 5 GHz) make it very challenging and even impractical (for higher cellular frequency ranges) to achieve quality and capacity parity with existing terrestrial cellular networks.
Some Takeaways.
Direct-to-Cell LEO satellite networks face considerable technology hurdles in providing services comparable to terrestrial cellular networks.
- They must overcome substantial free-space path loss and ensure uplink connectivity from low-power mobile devices with omnidirectional antennas.
- Cellular devices transmit at low power (typically 23–30 dBm), making it very challenging for uplink cellular signals to reach satellites in LEO at 300–1,200 km altitudes, particularly if the cellular device is indoor.
- Uplink signals from multiple devices within a satellite beam area can overlap, creating interference that challenges the satellite’s ability to separate and process individual uplink signals.
- Must address bandwidth limitations and efficiently reuse spectrum while minimizing interference with terrestrial and other satellite networks.
- Scaling globally may require satellites to carry varied payload configurations to accommodate regional spectrum requirements, increasing technical complexity and deployment expenses.
- Operating on terrestrial frequencies necessitates dynamic spectrum sharing and interference mitigation strategies, especially in densely populated areas, limiting coverage efficiency and capacity.
On the regulatory front, integrating D2C satellite services into existing mobile ecosystems is complex. Spectrum licensing is a key issue, as satellite operators must either share frequencies already allocated to terrestrial mobile operators or secure dedicated satellite spectrum.
- Securing access to shared or dedicated spectrum, particularly negotiating with terrestrial operators to use licensed frequencies.
- Avoiding interference between satellite and terrestrial networks requires detailed agreements and advanced spectrum management techniques.
- Navigating fragmented regulatory frameworks in Europe, where national licensing requirements vary significantly.
- The high administrative and operational burden of scaling globally diminishes economic benefits, particularly in regions where terrestrial networks already dominate.
The idea of D2C-capable satellite networks making terrestrial cellular networks obsolete is ambitious but fraught with practical limitations. While LEO satellites offer unparalleled reach in remote and underserved areas, they struggle to match terrestrial networks’ capacity, reliability, and low latency in urban and suburban environments. The high density of base stations in terrestrial networks enables them to handle far greater traffic volumes, especially for data-intensive applications.
The regulatory and operational constraints surrounding using terrestrial mobile frequencies for D2C services severely limit scalability. This fragmentation makes it difficult to achieve global coverage seamlessly and increases operational and economic inefficiencies. While D2C services hold promise for addressing connectivity gaps in remote areas, their ability to scale as a comprehensive alternative to terrestrial networks is hampered by these challenges. Unless global regulatory harmonization or innovative technical solutions emerge, D2C networks will likely remain a complementary, sub-scale solution rather than a standalone replacement for terrestrial mobile networks. Request the free report: “Will LEO Satellite Direct-to-Cellular Networks Make Traditional Mobile Networks Obsolete?”