Starlink in India: Will Elon Musk’s company disrupt the price-sensitive Indian market?

Internet has changed the primary means of our very existence over the past few decades. Over the recent years, especially in the past one decade, it has traversed past greater advancements from mobile internet, provided by telecom service providers, to broadband services, espousing internet surfing through WiFi systems in your house. Now, the new phenomenon on the horizon, that is catching speed is satellite internet.

The Age Of Internet
In India, the advent of internet and its forms may have been delayed, but its proliferation and subsequent consumption have expanded at an exponential speed. Each change has been marked by some marquee moments, from the days of BSNL and MTNL to the competitive game of throne between private telecom players.

Another major marquee event came to pass when Reliance Jio introduced a disruption in the market with the company’s ultra-cheap mobile internet plans in 2016. This disruption resulted in a complete overhaul of the sector, leaving just three main players, namely Vodafone Idea, Airtel, and Reliance Jio.

Today another disruption is en route: the storm of Elon Musk’s Starlink and Satellite Internet Access. Satellite Internet Access is not an old idea, but it has gathered pace over the past few years.

Unlike the internet generated through extensive cable networks, Satellite Access Internet, as the name suggests, provides the internet through communication satellites. And this system is known to be able to sustain the internet at higher speeds.

Will Starlink Make A Dent?
In India, these satellite services are not new, as we have had business-to-business activities carried out in remote locations, including ATMs, in rural areas. But this time, the scale and the ambition are far greater. Starlink is not all alone in this race, as it has competition in India as well.

This new phase of changing internet consumption has the old players, just as before. Reliance and Airtel are active participants in this race as well. In fact, Airtel took the lead in the matter, as Airtel-backed London-based Eutelsat OneWeb in March, claimed, that it would introduce its first service in India, by June. Meanwhile, Reliance is also in the process of establishing India’s first satellite internet system.

Starlink has its task cut out in this mix. Elon Musk’s company currently has this service available in different countries across all the continents on earth. Starlink is available in all of North America, including Canada, Mexico, and the US. Its services are available in South America as well, with the exception of Bolivia. Starlink currently boasts of being able to render services in a 100 countries.

It is also available in most of Europe as well. In addition, according to the company, it also has a set of countries on the waiting list where the service is currently not in place. India happens to be one of them.

Now, apart from the red tape and regulatory issues, it is also about the viability of establishments and services and most importantly, the price and economics of them.

Firstly, the average price for 1 GB of telecom or mobile data, according to cable.com, stands at USD 0.16 or Rs 13.37 (for 2023). This very tranche of data, before Jio’s disruption, stood at Rs 300–500 or on; in other words, 1GB of data was once priced in the range of Rs 300–500.

The transition is dramatic, especially if you were to compare the current rates to the biggest economy in the world, the average price of 1 GB of data stands at USD 6.00 or Rs 501.

Starlink Monthly Charge: Rs 10,026.9
When it comes to broadband or WiFi internet connection, the average price of a monthly package of a basic 100 Mbps broadband connection by Airtel stands at around Rs 800. When it comes to JioFiber, it offers the basic 100 Mbps at around Rs 700.

Now, when we look at Starlink, the price on offer in the city of Los Angeles, California, stands at USD 120 or a massive Rs 10,026.9, along with USD 300 or Rs 25,068 for hardware. Meanwhile, in London, the price stands at GBP 75 or Rs 7,985.32. There was a clear price adjustment that was brought in by Starlink as it moved from LA to London. Despite this, the difference, as one can see, is staggering. Starlink reportedly has a speed band of 25–220 Mbps.

Therefore, from prima facie, from a primary, conservative lens, Starlink, apart from logistical and bureaucratic impediments, would also run into roadblocks from a business and economic point of view, as pricing, would remain an Achilles heel for Elon Musk, similar to his conundrum with Tesla. Free Press Journal