Satellite Internet delivery has long been touted as the best solution for the last mile where there is no physical infrastructure, a solution best suited for (very) rural users. ViaSat's (News - Alert) Exede service is starting to challenge that thinking with its 12 Mbps Ka-band service and is looking at bundling its Internet-only offering with an optimized VoIP voice service.
"We've got more than 100,000 subscribers on the Exede 12 Mbps service," said Exede Vice President Lisa Scalpone. "We feel pretty good that people will make that trade for one, two, three megabits [wireline broadband] service. For people who need to do things with speed, 12 Mbps is decisive."
In various analytical models, including looking at the FCC's (News - Alert) national broadband map data, U.S. census data and random customer services, somewhere "north of 35 to 40 percent" of Exede's customer base are picking the ViaSat service over other available wireline options -- DSL or cable -- in the area. This may come to a bit of a shock to rural phone companies and cable operators who once assumed they had a lock on offering high(er) speed Internet service.
Scalpone says the company will never compete with "urban core" offerings and isn't trying to. However, Exede is offering a competitive priced high-speed broadband service against fixed wireless, 4G mobile and stock copper-based DSL offerings. She feels Exede sizes up well against lower-speed offerings in the 1 to 3 Mbps range and even against the lower end of 3 to 6 Mbps offerings.
"We offer 3 Mbps upstream," Scalpone said. "For some [users] with home offices, that conduct video chat, the upstream speed could be decisive."
Exede's next step is to offer a price-competitive "two-fer" bundle of broadband and voice services, but there are marketing and perception challenges to overcome.
"For the VoIP service, the biggest issue is proving lag does not matter," Scalpone stated. She said that VoIP calls -- optimized and prioritized within the broadband network -- sound the same to better than a typical narrowband cell phone call, but customers (and skeptics such as myself) wonder if the 22,500 mile up-and-back trip through a satellite will still be noticeable.
ViaSat is working on getting VoIP demonstration units out to retailers as quickly as possible, so customers can test the service for themselves and see there's little difference between Excede's voice service over satellite and what they might get via cell phone or even some landlines.
"We have to demo [VoIP satellite service] everywhere," said Scalpone. "If we can show people, I think it's going to be huge."
A future Exede Internet and voice bundle would include home number portability, 911, caller ID -- "all the bells and whistles" and offer price savings when compared to a conventional landline bundle. Scalpone wouldn't talk about how much a bundle might cost, but a stand-alone Internet offering is currently priced at $50 per month.
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Edited by Rachel Ramsey