NTN is scaling faster than its business case

CCS Insight, Qualcomm and Elveo on how satellite reaches commercial scale

Non-terrestrial networks have moved from proprietary islands to early commercial direct-to-device services in dozens of countries in the space of a few years — and the economics have not kept pace. Operators under pressure to find growth beyond a maturing 5G cycle, consumers and governments that now expect coverage everywhere, falling launch costs and a 3GPP roadmap that has absorbed satellite access are all pulling satellite connectivity in the same direction. CCS Insight’s Luke Pearce laid out the numbers behind that gap at RCR Tech’s NTN Integration Forum.

Consumer willingness to pay is real but modest, the add-on model does not travel to low-ARPU markets, and the constellations required for continuous broadband coverage are enormously capital intensive. A panel at the forum featuring Qualcomm’s Sabrina Stanislas-Boumier and Elveo Mobile’s George Giagtzoglou argued over how open standards, partnership structures and regulatory alignment turn technical possibility into commercial scale.

The state of the NR-NTN market

Luke Pearce, principal analyst at CCS Insight, opened the forum’s market analysis by acknowledging the mood of the sector. “There’s a lot of excitement in this space, but there’s also quite a lot of uncertainty,” he said, and the questions the industry keeps asking are consistent — where is the market going, who do we partner with, and where is the actual return in terms of business case, addressable market and marketable propositions.

His explanation of why NTN has become such a big topic rested on demand and supply converging. “There’s a constant demand for new features, especially as operators have struggled to monetize 5G and smartphone updates are mostly incremental,” and traditional connectivity is mature enough that satellite offers something new. Expectations of ubiquity have hardened at the same time: “Consumers have come to expect coverage everywhere. Enterprises increasingly depend on it, and governments are now mandating it.” On the supply side, reusable rockets have cut launch costs, satellites have become smaller and cheaper, LEO constellations can be scaled and 3GPP has standardized NTN into the mobile roadmap. “All of these are aligning at the same time.”

Pearce framed the trajectory as three eras. In 4G, satellite and mobile were entirely separate ecosystems with different devices and networks, which meant satellite was a proprietary stack with very high cost. In 5G, satellite is becoming part of the broader mobile ecosystem. In 6G, “the ambition is truly seamless connectivity — devices moving between terrestrial and satellite without the user even noticing.”

Today there are two main approaches to serving mobile devices from space. Supplemental coverage from space uses existing 4G waveforms and operators’ own spectrum, “essentially turning satellites into cell towers in the sky.” Its advantage is scale, because it works with existing smartphones and MNO infrastructure, but “new regulation frameworks are needed, and interference is causing significant issues, as well as the need to build entirely new constellations.” The alternative is the Release 17 narrowband NTN standard, which uses dedicated mobile satellite spectrum in L and S band and largely leverages existing constellations for messaging, SOS and IoT, but “is limited to those narrowband applications and still has an immature ecosystem.” Toward the end of the decade, Pearce sees convergence on NR-NTN through Releases 18, 19 and beyond. “Most vendors are now converging on this approach,” because it brings standardization across devices and infrastructure purpose-built for space, true broadband via satellite and interoperability across device types and applications — “but it requires new infrastructure, new devices, and some new economics.”

Narrowband is already delivering value with tracking sensors and messaging over existing GEO or a limited number of LEO satellites; complete LEO constellations running NR-NTN would expand that into streaming, real-time applications and richer enterprise services. Pearce grouped the opportunity into four categories: universal connectivity, spanning emergency and safety services, underserved populations and mobility across remote roads, oceans and air; new value creation, through consumer upsell, business-critical connectivity for off-grid industries and IoT in agriculture, mining and environmental monitoring; cost efficiency, by using satellites instead of towers, fiber backhaul and infrastructure “in areas where the economics simply don’t work,” which can help operators meet rural coverage obligations or replace 2G and 3G coverage as those networks are switched off; and resilience, a connectivity layer that persists when terrestrial networks fail.

The opportunity is not uniform. Measured by landmass rather than population coverage, markets such as Brazil, Canada and Australia are about extending basic coverage across vast territory, while well-covered markets such as the U.K., Germany and South Korea are about infill and resilience. Traction is nonetheless building. Pearce cited GSA figures of more than 23 direct-to-device services launched, 27 in trial and a further 73 planned for later in 2026 or beyond, and CCS Insight data showing more than 16 million subscribers now have access to satellite services, which is “being used as a fantastic marketing tool and also driving real value.” But he added a caution. “We must be careful to manage expectations and avoid overpromising with some of these early propositions.” Some recent industry studies show “momentum is slowing a little in some of these markets, and usage is dropping in some areas,” which is why the industry has to keep building toward NR-NTN and true mobile-satellite broadband convergence.

Three hurdles stand in the way. The first is technical: “switching between Wi-Fi and cellular is hard enough,” and propagation delay, handover, Doppler, power consumption and antenna size all have to be worked through on the device. “These are solvable challenges, but certainly not trivial.” The second is ecosystem. “Current device support is quite limited. The standards are still evolving, and geographical approaches are also quite fragmented,” and as of the first quarter of this year only a small portion of phones can access the frequencies needed for NR-NTN. The third is economics. New constellations are a huge capital expenditure set against “quite an unclear willingness to pay for consumer services with limited scope today for material recurring revenues.” CCS Insight’s research found just under half of U.K. consumers would pay a small fee for satellite services, in line with other industry studies. That works in markets with high monthly ARPU — around $50 in the U.S. and $32 in Japan — but in Brazil, Indonesia or India, where ARPU is below $5, “the business case then begins to fall apart.” The answer, Pearce argued, is to think creatively about business models and to pursue “a growing number of stackable vertical opportunities across smartphones, automotive, IoT, government and defense — all of which comes with scale.”

Demand is accelerating, solutions are evolving from messaging to voice and data, and NTN is becoming integral to 5G Advanced and, in the future, 6G. Commercial momentum is building, but the market remains shaped by business-case uncertainty and technical roadblocks that show no sign of clearing as the market’s first real capacity wave approaches.

Scaling commercial opportunities: redefining strategies and partnership ecosystems

Moderating the forum’s first panel, Opensignal principal analyst for the Americas Fiona Armstrong-Mills described the industry as being at an inflection point, and quantified it. As of August, GSA reports that 64 operators in 38 countries and territories have some form of commercial satellite service live — a count of operators rather than of the services Pearce cited. “But those services are pretty limited for the most part” — basic texting, perhaps a select number of apps — at the same time as some vendors talk about 100 Mbps. “I think that creates a really interesting tension for a consumer.” A recent Opensignal poll found most respondents would use direct-to-device services if available, but only about 47% were willing to pay more; GSMA research puts willingness closer to 60%. Where the revenue comes from, and how the ecosystem balances investment, competition and customer demand, “is very much sort of an open problem.”

Sabrina Stanislas-Boumier, head of government affairs for France at Qualcomm, answered the standardization question with the history of mobile itself: global scale comes from open standards, interoperability and a broad ecosystem working together, and Qualcomm sees the same opportunity in NTN through its engagement in 3GPP. Standards “create predictability across the ecosystem” and let satellite networks, terrestrial networks, devices, chipsets and services evolve within a shared framework. “Qualcomm’s vision is to make satellite connectivity a natural extension of the global mobile ecosystem,” she said, and an open, interoperable approach “gives the mobile network operator a central role in shaping the consumer experience.” Her summary line: “Standards are the bridge between technological leadership and commercial reality.”

George Giagtzoglou, VP of strategy and global marketing at Elveo Mobile and strategy committee chair at the Mobile Satellite Services Association, brought the satellite operator’s view. The short history of direct-to-device includes companies that started by reusing terrestrial mobile spectrum and others, including Elveo predecessor Omnispace, that focused on MSS spectrum and the regulation and standards around it. “What we’re finding now in the industry is the answer is really not one or the other, but both.” Every MNO he has spoken with expects the long-term answer to be a 5G or 6G solution, but most phones and networks in the world are not yet 5G, so Elveo is looking to deploy “a system that is optimized for 5G NTN, but also capable of operating to legacy devices, be they 2G or LTE devices, and in both cases this is operation to unmodified devices.” Release 17 was a foundation rather than an end point, with “elements of capabilities, of performance, of economics that need to be evolved and iterated and refined through current and future releases” — part of why MSSA was founded.

On the relationship with MNOs, Giagtzoglou was unambiguous. Elveo has already signed up more than 50 of them, and “we are not looking to compete with mobile network operators. They are the owners of the customer.” Deploying the service is a matter of establishing Elveo in the roaming tables so that a subscriber roaming out of terrestrial coverage connects to the satellite “in a way that they may not even realize” that it has happened. The partnership also yields something operators lack today: visibility of who is using the network beyond the terrestrial edge, what they consume and which users sit adjacent to them. That becomes “a ready-made business case” for whether usage in a given area justifies a small cell, replacing what today is “guesswork around the edge of a mobile network of when to invest and how much to invest.”

The economics of a global constellation shape everything downstream. Satellites are over the ocean 70% of the time and only about a third of the remaining landmass is populated, so “you’re basically building out a system that’s really only going to be used somewhere between 10 to 30 or possibly 40% of the time.” Market needs diverge sharply. Developed regions have highly competitive networks and few uncovered locations, but users with high expectations when they are off-network. In developing markets, “one of the first questions they often ask me is, how can you help me turn off my 2G network?” — an expensive coverage obligation where messaging, voice and modest data would meet most of the need. “The exact same satellite that serves Western Europe will serve Sub-Saharan Africa a few minutes later,” so the network has to adapt to the economics of all of those markets, and regulation should enable the greatest diversity of options for consumers while also allowing satellite network operators to “generate a return off of the 10 or 20 or 30% of the Earth that they can serve at any instant.”

Stanislas-Boumier saw the regulatory challenges “more as opportunities for modernization than as obstacles.” Satellite connectivity is global by design while regulatory authority is national or regional, so alignment has to grow with the services. She named three priorities — greater international harmonization of spectrum policy, more efficient and transparent authorization, and continuous dialogue between industry and policymakers — and insisted “this is not about reducing the regulation, but it’s about creating a smart, future-oriented regulation” that protects the public interest while supporting innovation. For Europe specifically, she set out four pillars: championing global standards, closer cooperation between the space and telecom communities, a clear and coordinated spectrum framework across European institutions and national administrations, and leveraging European R&D and international partnerships.

Giagtzoglou closed on timing. Intermittent coverage may suit IoT devices in agriculture or metering, but “you can’t have a voice call if you don’t have continuous coverage,” and “the real game starts once all of the satellite network operators have enough satellites to provide continuous coverage.” Elveo plans to start commercial service in 2028 and move rapidly to continuous coverage for voice, texting and data, and he expects the rest of the field to land in the same window: “a lot of capacity hitting in that sort of 2028, 2029 timeline.” MSSA, now 25 organizations, has just released version two of its reference architecture white paper. On the spectrum-reuse debate he was measured: Qualcomm has been quoted as saying standards-based NTN is, in many cases, four to 10 times as capable as terrestrial spectrum reuse for the same spectrum and power. His engineers would dispute the size of that gap — “my engineers will contend the point” — but not that a purpose-designed 5G NTN system is the more capable option. Even so, serving the billions of devices that will not be replaced any time soon “is extremely important for a mobile network operator and for the consumers that they serve.” And that puts a date on what Armstrong-Mills called the industry’s “open problem.”