Growing numbers of UK households are already using satellite broadband, most of them in rural areas, new research has revealed.
Satellite broadband can offer a more reliable service for people in locations that are poorly served by traditional connections and are unlikely to have access to full fibre internet.
However, despite the appeal of the new type of connection, set-up costs of about £500 deter two thirds of potential consumers from trying the technology, according to data from Uswitch.
This is Money takes a look at exactly what satellite broadband is, if it could be beneficial for you and how expensive it really is.
Some customers are said to be put off having satellite broadband due to the cost of installation
How does satellite broadband work?
Much like satellite TV, satellite broadband is beamed from space to a satellite dish that’s installed on the property. It then gets hooked up to a Wi-Fi router like normal broadband.
As it doesn’t rely on a network of cables going into every home, it’s expected to become a favourable option for people living in rural areas in the years to come.
The new satellite internet technology that’s currently being introduced is expected to completely replace the older, slower system that currently exists.
Firms like Tesla billionaire Elon Musk’s SpaceX and OneWeb are revolutionising the technology with satellites now able to provide internet speeds of up to 300Mbps.
This is much faster than the UK’s average speed which currently stands at 64Mbps.
To put this into perspective, you could use satellite broadband to download a two-hour HD film in around four and a half minutes but it would take roughly 18 minutes with a speed of 64Mbps.
Is it expensive?
Customers looking to benefit from satellite broadband will have to pay to have a satellite installed at the side of their home, along with a transmitter.
This costs around £500 but could be even more expensive which might put many off.
However, users of the technology say they pay £29.70 a month on average for the service, compared to an average £33.60 for all broadband customers.
If sticking with satellite broadband, whilst the upfront cost is high, it could mean you make savings over the long term.
Elon Musk’s Starlink is one of the two firms in the UK offering consumers satellite broadband
Who would benefit from satellite broadband?
Almost 200,000 UK homes are currently struggling with speeds lower than 10Mbps — the level that Ofcom considers a decent service.
This means for rural households, satellite broadband could be a lifeline due to their unreliable or slow existing connections.
Coverage from satellite broadband is set to become universal with Elon Musk beginning a UK trial of his Starlink satellite broadband system in January.
It is hoped this will have 500,000 users worldwide within a year while BT has joined forces with operator OneWeb to provide connections to people in remote areas.
Other existing UK satellite broadband providers include Broadband Everywhere, Freedomsat, KONNECT and Satellite Internet.
Whilst there is the option of full fibre broadband, which can in some cases provide similar speeds to satellite internet, those in rural areas are unlikely to see any infrastructure built in their area for some years due to the difficulty and expense of the operation.
Holly Cox, head of digital at Compare the Market, said: ‘If you live in a remote rural area then satellite broadband could be a good option to get online.
‘The main advantage of satellite broadband is that is available wherever you are in the UK, reaching places that cables can’t. All you need is an outside wall to install a satellite dish that has a clear view of the sky to the south.
‘That makes it ideal for areas where fixed-line broadband is painfully slow or even non-existent.’
According to Ofcom, which received data from providers and estimates for providers who haven’t submitted data to the watchdog, there were around 27,000 fixed satellite broadband connections at the end of 2020.
Satellite broadband could be a ‘lifeline’ for rural customers struggling to get decent internet
What are the downsides?
Aside from the high set up cost of around £500, extreme weather can also affect a satellite broadband connection with heavy rain and wind potentially reducing speeds or even causing an outage.
Another issue is the latency which is the delay, or lag, between requesting online information and receiving it, according to Compare the Market.
Satellite broadband suffers from high latency because of the time it takes for a broadband signal to travel to Earth from the geostationary orbit, 22,200 miles up in space.
This means it could prove problematic if you’re live streaming, gaming or video calling on VoIP services such as Skype.
However, there are plans to launch Low Earth Orbit satellites in the next few years which will orbit closer to Earth and could help resolve the latency issue for satellite broadband users.
Cox added: ‘There are some significant drawbacks to using satellite broadband. The biggest issue for most households will be the set-up cost which can be around £600.
‘Also, unlike the range of fibre optic packages that offer unlimited data, most satellite broadband packages have a monthly data usage cap or might only give you a certain amount of data at top speed.
‘This means you’ll need to work out how much you’re likely to download each month before taking out a contract. For context, it takes about 1GB of data to stream Netflix at standard definition for an hour.
‘Some satellite broadband providers do offer contracts with an unlimited off-peak period, which can be used for larger downloads.
‘Prices range from around £20 per month up to around £87, the cost can be higher depending on how much data is needed.’
Satellites now able to provide internet speeds of up to 300Mbps – similar to full fibre options
Are there many good deals?
Whilst there are several firms offering the older, slower version of satellite broadband, there are only two companies giving customers the new, speedier alternative.
Starlink and OneWeb are the two firms offering the service in the UK, however, not everyone will be able to join.
Only customers in select rural locations can access Starlink services with OneWeb still not available to households just yet.
However, consumers will not have long to wait as the expansion is happening rapidly with hopes for OneWeb to launch in October 2021, with a global operation available by June 2022.
Similarly, Starlink is expanding its offerings to more customers as time goes on.
Ernest Doku, broadband expert at Uswitch, said: ‘Satellite broadband is improving all the time, and with big players like Starlink entering the UK market, connections are only going to get faster and more reliable.
‘Satellite broadband offers hope to residents in rural areas who have struggled to get a decent connection from traditional providers, and we’ll be watching to see how BT’s partner with OneWeb grows over the coming years.
‘While it’s tempting to think that one technology can solve the problem of the digital divide, there is no single solution to rural broadband.
‘Many households are still on ADSL connections and enduring slow speeds unnecessarily, unaware that in many cases they could upgrade to fibre broadband and still save themselves money.
‘Anyone who is still battling with slow broadband should run a speed test to find out how reliable the connection really is.
‘If you’re not happy with the results, run a comparison online and see if you can get both a better deal and a faster service.’
Cox added: ‘Before installing satellite broadband, it is a good idea to check if alternatives options are available, even if you can’t get access to fixed line broadband.
‘If your area is covered by a 4G mobile network, mobile broadband could offer a cheaper and faster way to get connected.
‘It works using the same data networks you connect to on your smartphone, and you’ll be able to take your internet connection with you wherever you go.’
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