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Long-Term Business Model For Hughesnet

New Member

Long-Term Business Model For Hughesnet

As high bandwidth applications become more and more dominant, does Hughesnet have a business plan that will adapt to these changing times - or is it the corporate "mantra" that the current offerings are consistent with both near and long-term customer needs and expectations?

There is a large discrepancy in general functionality between Hughesnet and its competitors (and the discrepancy does not favor Hughesnet).  As time progresses, the "gap" between Hughesnet and it's competitor set increases. If the current trend continues, Hughesnet will soon become an anachronism, if it is not one already.

The modern internet is not text based and depends heavily on streaming services. All of the growth is in the ability to deliver these services to the end user. The demand for more bandwidth will not reverse direction and will in fact increase over time.  This seems to present a problem for you!

Realistically, what would it cost to offer a more practical solution to providing real broadband service to rural customers.  Have you considered that some of us would pay more to receive a product that actually worked.

On a related note, why is it that satellite television is able to fully compete with all competing technologies?  The download bandwidth there is enormous?

Peter
27 REPLIES 27
Assistant Professor

Re: Long-Term Business Model For Hughesnet

First, satellite TV is not like satellite internet. One-way communication is much different from two-way.

Second, the only way they increase available bandwidth is to launch more high capacity satellites. They are planning to launch one the end of next year. Not like they can send one of those suckers up whenever they feel like. Ask your nearest cable company why they won't lay a cable to your house.
New Member

Re: Long-Term Business Model For Hughesnet

My point is that current performance levels are marginal at best.  If they want to survive in this business, they will have to better adapt to customer needs.  Is there any way to know the impact that one additional satellite will have on the "typical" user? 

I realize that this form of data transmission is inherently more costly than than competing technologies and certainly do not object to Hughesnet making a profit.  Since performance scales inversely with the number of users and profit scales proportionally with the number of users ... I think you get my point.

The upload speed of Hughesnet is already slower than the download link.  They could keep it at current levels.  The two-way communications could be heavily weighted towards download.  After all, for most of us the need for increased throughput is for data consumption not transmission.  The uplink is needed only to "initiate" the data stream and need not be blindingly fast.  If your point is that two-way communication makes this significantly different than satellite TV we disagree.   They simply can not or will not bulk up the download capability to better suit customer needs.

Peter
Assistant Professor

Re: Long-Term Business Model For Hughesnet

(sigh)

If your point is that two-way communication makes this significantly different than satellite TV we disagree
Advanced Tutor

Re: Long-Term Business Model For Hughesnet

As high bandwidth applications become more and more dominant, does Hughesnet have a business plan that will adapt to these changing times - or is it the corporate "mantra" that the current offerings are consistent with both near and long-term customer needs and expectations?
Here's part of your answer: http://spaceflightnow.com/2015/07/01/oneweb-launch-deal-called-largest-commercial-rocket-buy-in-hist...
There is a large discrepancy in general functionality between Hughesnet and its competitors (and the discrepancy does not favor Hughesnet).  As time progresses, the "gap" between Hughesnet and it's competitor set increases.
The "competitor-set" varies greatly, depending on where you live. HughesNet's "sweet spot" is the under-served and non-served rural market, who don't have access to high-speed cable, DSL or even cell data services, estimated at about 10 million US households. There, HughesNet competes with one competitor, Exede, whose product and pricing is similar. 
On a related note, why is it that satellite television is able to fully compete with all competing technologies?  The download bandwidth there is enormous?
There is a huge difference in costs and the way satellite data must be managed and delivered in a two-way "One to One" distribution scheme like satellite Internet, as opposed to a one-way "One to All" distribution scheme like satellite TV.

At 35+ years, Satellite TV is a more mature technology than Satellite Internet. With a much larger market of over 40 million customers, the economics of scale are much greater. 

Both Satellite TV and Satellite Internet are priced commiserate with their costs and what the market will bear, a lynch-pin of a free-market economy. If you have cheaper, faster, better alternatives for either TV or Internet, then buy them.
Have you considered that some of us would pay more to receive a product that actually worked.
If your system isn't working, you've come to the right place. There are many users here to help, if you'll start a new post with the details about the specific problem you're having.
El Dorado Networks |Diamond Springs, CA | eldoradonetworks.com
Advanced Tutor

Re: Long-Term Business Model For Hughesnet

 They simply can not or will not bulk up the download capability to better suit customer needs.
You have one data satellite with a total throughput of around 100 Gbps. On that one satellite, you have at least 600,000 customers transmitting and receiving data. Let's assume 1/3 of them are online at the same time. Do the math as to how much data that averages per customer. 

How do you propose they "bulk up" the download capability on a satellite 22,000 miles out in space? They can't. Instead, they build and launch another satellite.
El Dorado Networks |Diamond Springs, CA | eldoradonetworks.com
Assistant Professor

Re: Long-Term Business Model For Hughesnet

And once more, ask your nearest cable provider why no cable to your house. Personally very happy HughesNet is providing what they are.
New Member

Re: Long-Term Business Model For Hughesnet

Alan and sgoshe, thanks for taking the time to respond to my post(s) with very informative responses.   I live in a rural location where other options are unavailable.  The population density is not high enough to entice cable or phone companies to venture here.  As such, I am trying to deal with the limitations of satellite sourced internet service. 

Based on the article provided by Alan, it seems that the satellite based providers may eventually be able challenge or displace their competitors.  Now that would be a rags to riches story!  It seems that the trick is to "find" a potential user base and take market share from competing technologies.  I suspect this is not easy, since the cost of the satellite infrastructure is generally higher than ground based systems. 

I like the approach employing a "boat load" of small 300 lb satellites.  If the cost point is significantly lower than current methodologies, my hope may eventually become a reality.

Peter
   
Assistant Professor

Re: Long-Term Business Model For Hughesnet

You're welcome. To be clear though, there are only two satellite internet providers in the US right now that directly compete. Other providers like cable, fiber, WISP are not really competitors. Satellite is for those of us who have no other options or competitors as you put it.
Honorary Alumnus

Re: Long-Term Business Model For Hughesnet

Not much to add other than reiterating the fact that Hughes and Brand Ex serve a niche market. Namely those that have no other high speed (as compared to "broadband") Internet options.

Their cost and infrastructure requirements are vastly different than ground based ISP providers.

Hughes has made drastic improvements in their service offerings from past years.

In 2004 I had service limits of 250 MB/day data allowance with a max DL speed of 1.6 Mbps and that was on one of the higher tiered plans.

Today I have a 100 GB/month total allowance and rated speeds of 15 Mbps but typically get 20% to 40% above that.