Direct-to-Device: The next big opportunity for MNOs?

Using LEO (low Earth orbit) satellites, the possibilities for satellite communications have grown, as launching satellites is cheaper and simpler than ever. With this technology, implementing satellite technology into regular mobile phones is an increasing possibility and is already starting to take place in new phone releases. Connectivity gaps in hard-to-reach areas have already been able to be shrunk as global coverage increases with the proliferation of direct-to-device technology. 

But how is this technology actually impacting both the satellite and mobile telecoms industries, and how can operators use this development to their advantage?  

How satellite telecoms is bridging the connectivity gap  

Compared to traditional telecoms networks, satellites don’t require cables or masts. Typically, if people are out of range of masts, this means that they’re unable to connect to a network. As satellites don’t rely on this, they can help deliver telecom services by boosting network resilience and minimizing outages. 

However, achieving this through GEO (geostationary Earth orbit) satellites has always been more difficult. The far distance they orbit at (around 35,800 km, the same length as running 848 marathons) makes them less reliable, as latency issues prevent GEO satellites from truly bridging connectivity gaps.  

The proliferation of LEO satellites has changed the game. As they operate at a much lower distance (between 100 km–1,600 km), they’re able to provide stronger and more reliable connectivity. Achieving a lower latency means providers can confidently turn to LEO satellites as a reliable alternative to traditional telecoms networks in hard-to-reach areas. There has been a huge growth in the number of LEO satellites, not only due to their success but also to the fact that satellites are now much cheaper to launch, meaning many are already exploring the opportunities satellite telecoms has to offer. 

The new frontier in satellite telecom 

Through LEO satellites, direct-to-device technology has become a possibility. Direct-to-device (D2D) works by connecting directly with satellites, bypassing the need for cellular connectivity through networks. For those in under- and non-served areas, it means being able to connect with people and devices despite a lack of coverage. 

Satellite phones were already in existence before, but they were expensive, niche, and largely inaccessible to the everyday consumer compared to a regular mobile phone. What has helped in making this possible for more people to access is the recent 5G standards from 3GPP on NTN (non-terrestrial networks). Through these new standards, NTNs are being developed and standardized to integrate with 5G across mobile broadband to IoT. This is a big development, as it lays the groundwork for operators to integrate satellite into their offerings across the board.  

This has already started to come to fruition, with Apple’s iPhone 14 being the first standard mobile phone to offer satellite connectivity. In Apple’s application, satellite communications can be used for emergency SOS, where calls can be made to emergency services without cellular or Wi-Fi coverage. This marks a huge step towards the integration of satellite telecoms into mainstream cellular connectivity. 

The impact of direct-to-device on operators 

D2D technology surpasses traditional satellite communications by seamlessly integrating with ordinary mobile phones, significantly expanding access and revolutionizing the satellite telecom industry. This transformation unlocks new opportunities and substantial growth potential. The number of subscribers to D2D is expected to soar from 25 million in 2023 to 330 million by 2030. 

This widens the market and creates new customer segments for operators, as well as offering additional connectivity to existing customers when roaming out of range of terrestrial signal. D2D also offers reduced costs and greater operational efficiency, as it removes the need and expense of installation and operation of satellite backhaul equipment. For most telcos, this means no new infrastructure is required, making investing in this technology more accessible and promising. 

What direct-to-device means for satellite telecoms 

D2D offers satellite telecom providers a big opportunity to expand their revenue streams. Previously, satellite telecoms were a much smaller market, as GEO and MEO satellites meant geopositioning was crucial, with use primarily by military and government services. The proliferation of LEO satellites means that providers now have a real chance to partner with MNOs and expand their customer base hugely to standard mobile devices. 

Not only does this stretch to consumer mobile devices, but there are further opportunities in partnering with emergency services and IoT operators, as D2D technology can help erase issues that plague these industries, such as poor coverage or roaming restrictions. As D2D doesn’t require ground-based gateways or specialized terminals, this also reduces the need for costly infrastructure, meaning satellite telcos can expand into LEO and D2D without a huge up-front investment. 

The opportunity for MNOs and MVNOs 

On the other side, MNOs have the opportunity to expand their offering and global reach through strategic partnerships with satellite providers. As the growth of D2D continues, MNOs and MVNOs stand to benefit through making these partnerships and incorporating satellite telecoms into their offerings: 

• D2D can increase revenue from new customers in previously unserved areas and add-ons from existing customers. 

• Operators can expand globally without growing infrastructure costs.  

• D2D offers growth beyond mobile phone users but also in IoT, as the technology can help solve common challenges with global deployments. 

The need for a BSS solution 

For MNOs and satellite telcos in the process of launching, managing, and scaling new direct-to-device services and offerings, a return on investment isn’t guaranteed without the right structures and systems in place. To ensure they gain the most value, operators need robust back-office systems in place. The right BSS partner can make sure new product offerings are deployed at speed, meaning MNOs and satellite telcos can make their mark in this increasingly competitive market.  

Through ZIRA’s comprehensive suite of solutions, we can help MNOs and satellite telcos achieve rapid deployment, see ROI faster, and enjoy enhanced flexibility. By automating and simplifying complex processes, we can help deliver seamless operations so that you can reap the rewards of D2D technology.