It normally is a good practice to apply a sanity test to forecasts. By 2024, there will be 24 million Internet of Things connections made by satellite, according to ABI Research. That sounds reasonable.
Coverage over oceans and other isolated locations normally is the place where satellite connections shine, so IoT should be viable there as well. Oceans cover 71 percent of the earth's surface, and that is where satellite has almost no competition from other networks. So land represents 29 percent of the earth’s surface.
Where some of us might quibble is when the claim of full coverage of the earth’s surface is cited as a key advantage for IoT connectivity, compared to terrestrial networks of all kinds.
“Terrestrial cellular networks only cover 20 percent of the Earth’s surface, while satellite networks can cover the entire surface of the globe, from pole to pole,” says Harriet Sumnall, Research Analyst at ABI Research.
Essentially, satellite has its best use case over the 71 percent of earth’s surface that is ocean, and over the roughly nine percent of land surface where population is so thin mobile networks do not exist.
Of course, population density also correlates with the 20 percent of earth’s surface where mobile networks can be operated sustainably. Looking at current use cases for satellite, most--with the exception of maritime and other remote location connections--are for locations on land. Video entertainment backhaul is the overwhelming driver of service revenues.
The point is that even at 24 million connections, it is conceivable that revenues might be less than $6 billion in annual revenues. That is by no means insignificant. On the other hand, global mobile and fixed telecom revenues might be somewhere in the $1.4 trillion annual range by 2022 or so.
The point is that if satellite IoT follows the historic pattern, and adds most value in maritime and other use cases of low population density, it is going to be dwarfed by IoT connections supplied by mobile and fixed networks, simply because denser population areas are where most enterprises and people are located. And that is where most of the IoT demand will be as well.
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