Historically, satellite communications have been constrained by cost and scalability, but a new generation of satellite operators are transforming its clunky image by launching to market new, sleek hardware and constellations that enables direct-to-device communications and makes it the new norm.
Direct to device satellite communications refers to direct interaction between orbiting satellites (typically LEO or GEO constellations) and end user devices, like sensors or smartphones. Where terrestrial infrastructure may not be sufficient, the aim is for these devices to be able to switch over to satellites and enjoy uninterrupted coverage.
OQ Technology, who was established in 2016 in Luxembourg, wanted to translate the standards of mobile connectivity (for example 3G, 4G, 5G) into the satellite world. Traditionally, legacy satellite operators have had to build proprietary hardware from scratch without standards, which in turn has slowed the growth of the market.
Fortunately, 3GPP’s Release 17 in 2022 introduced support for non-terrestrial networks (NTN) and made it standardised.
“That is where the idea came from,” explained Omar Qaise, Founder and CEO of OQ Technology, in reference to how the company came about. “Let’s use the same technology that is used in mobile phones and in the cellular world, our LEO satellites, so that we can immediately access billions of people and devices that exist without a change.”
Taking this approach also means making satellites interoperable with terrestrial communication and therefore facilitating integration into existing cellular networks.
“You cannot put fibre and cell towers in the mountains and the deserts,” said Qaise. “This is why satellite plays a role in extending that coverage using the same technology, reducing the investment in infrastructure, reducing the cost on the end user, but also allowing for global coverage.”
Changing market dynamics
There is huge potential for the direct to device market, particularly when looking at the number of unconnected IoT devices or assets that move in and out of areas with cellular coverage.
“We are different, and we are using satellites,” said Qaise. “There is a difference in terms of scale and cost. If we look only at the hardware, a satellite chip from a legacy satellite operator may cost $90, while a cellular chip can cost $9; that’s 10 times cheaper. Now imagine that cellular chip can connect to satellites and have the same function as a satellite chip.” In other words, the significant reduction in cost is a clear winner.
As a consequence, legacy operators are waking up to the shifting market dynamics and the value of NB-IoT-based networks.
“If you go to the smartphone market, that’s even bigger,” said Qaise. “Because you have a lot of smartphones, a lot of people are connected. You need emergency communication, you need messaging.”
Given that legacy operators are embracing NB-IoT, how did Qaise see these changing market dynamics playing out? Did he think MNOs, which have traditionally used cellular infrastructure to provide connectivity, can coexist with new entrants and companies like OQ Technology?
“Big legacy operators have realised what they are missing,” said Qaise. “They may miss the opportunity and the training here if they stick with their legacy technology while you have a global standard coming.
“A lot of these operators are questioning whether to reinvest or to build their full LEO constellation themselves … They have 10-15 year old satellites that are not potentially programmable or limited in what you can do with them, and they still need to recoup their return on investment with these old satellites.”
The challenges are multifold for legacy satellite operators. MNOs, meanwhile, may not have the same capabilities as OQ Technology because of the investment required in the infrastructure, but it has partnerships with some MNOs where their users can access OQ’s services, including Deutsche Telekom and O2 Telefónica.
In November 2023, OQ and O2 Telefónica signed an MOU where OQ would contribute its NB-IoT satellite network and Telefónica would provide its cellular infrastructure to bridge the gap between terrestrial and satellite coverage.
Choosing NB-IoT
OQ Technology has its own satellite constellation and also works with its partners’. When it first began, it looked at three different connectivity technologies – LoRa, NB-IoT, and Sigfox – before it determined NB-IoT was the best choice for its network.
“We concluded a scalable, synchronised system like NB-IoT is the best way to go,” said Qaise. “This proved later to be correct, because Sigfox sort of disappeared. LoRa is more constrained now to private networks and does not scale as much in terms of over satellites.”
Once the company had decided it was going to use NB-IoT, it then built a payload and tested it in orbit, which was achieved in 2019 as part of its TIGER-1 Mission.
Since then, it has gone through several more mission iterations: Tiger-2 , its first commercial satellite, was launched aboard a SpaceX Falcon 9 rocket in 2021; and more recently, in 2024, it launched Tiger-7 and Tiger-8 satellites on SpaceX’s Falcon 9.
What was important for the company, from the get go, was to have priority access to satellite spectrum, so it could scale, and enjoy the benefits of standardisation. Currently it has access to the S band, a frequency spectrum between 2GHz and 4GHz.
This means that if companies like BMW, which are using satellites to fill in coverage gaps for connected cars, also have access to that band, then there is no need to change hardware and subsequently, no associated cost.
Qaise explained that this differs from another satellite company that may need to have a physical chip or hardware inside the car for it to work. Through direct to device communication, “we immediately access the same way a car accesses a cell tower”.
“Spectrum is very very important, and OQ is well positioned on that,” continued Qaise, noting that US-based AST SpaceMobile’s $64.5 million deal to acquire MSS spectrum rights shows how seriously MNOs are taking priority access of spectrum.
5NETSAT mission
Qaise was talking to me in the wake of the announcement that OQ Technology had launched the 5NETSAT mission, backed by a €2.5 million grant from the European Innovation Council (EIC), seeking to secure 5G satellite messaging and send emergency alerts to unmodified smartphones.
OQ Technology beat out 4,000 other deeptech companies to win the grant from the EIC.
The grant for 5NETSAT represents a wider ambition for Europe to have its own sovereign infrastructure, particularly as satellites have been identified as critical infrastructure susceptible to cyber attacks. The European Commission has launched the Infrastructure for Resilience, Interconnectivity and Security by Satellite (IRIS²) programme, one that will draw on the advantages of MEO and LEO satellites to provide secure connectivity services.
“Dependence on one satellite network is not the approach that a lot of people realise we should have,” noted Qaise. “OQ stepped in to fill that void and be the first European company to offer direct to smartphone connectivity.
“It’s always good to have more than one player, but also to have a sovereign European player that can offer such a service.”
Commercial access, technology maturity, spectrum access and its patents were all put forward by Qaise key differentiators for OQ when comparing it with other players.
“We’re very confident we’ll reach our objective,” he concluded.
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