Legacy Satellite ISPs Are Struggling To Survive Since Starlink Took Over

Starlink is the satellite internet service provided by SpaceX, and its success is pushing longtime satellite internet service providers out of business. HughesNet, the satellite ISP that first launched in 1996 under the name DirecPC, recently filed for bankruptcy after losing over half of its subscribers since Starlink became publicly available in 2020. Viasat is another casualty; the company built its first satellite in 2008, but has lost more than 80% of its subscribers in the Starlink era.

Users say Starlink is reliable — or at least as reliable as satellite internet can be. The reality is that Starlink still suffers from many of the inevitable disadvantages of satellite internet. However, reviewers have noted that Starlink provides higher speeds, lower latency, and fewer data limitations compared to the likes of HughesNet. Starlink also offers portable satellites, making it a more compelling choice for travelers and nomads.

With consumers overwhelmingly moving toward Starlink, other satellite ISPs are pivoting toward enterprise or government contracts to stay afloat. Earlier this year, Viasat secured a contract with the U.S. Space Force to provide a fleet of satellites as part of the Protected Tactical SATCOM-Global program. Whether or not this contract model is enough to end the company's struggles remains to be seen.

The main thing that sets Starlink apart from legacy satellite ISPs is its method of deploying satellites. Starlink operates more than 11,000 satellites in low Earth orbit (LEO), approximately 340 miles above Earth. HughesNet and Viasat each use just a few geostationary (GEO) satellites that hover in place at an altitude of around 22,000 miles. The close proximity and sheer number of LEO satellites in Starlink's constellation make it a faster, more reliable, and more widely available service by comparison.

There are some distinct perks of switching to satellite internet, such as rural availability and always-on connectivity, and you can get these perks by subscribing to a legacy satellite ISP too. But Starlink is on track to be the better option for most consumers. The introduction of the Starlink Direct-to-Cell phone network will make Starlink a convenient one-stop service for mobile phone coverage in addition to satellite internet. Not only are legacy satellite ISPs in danger, but Starlink is getting upgrades to compete with T-Mobile and AT&T as well.