From...

January 21, 2000
Web posted at: 10:17 a.m. EST (1517 GMT)

by Tom Spring

(IDG) -- Upstart satellite firm iSky has announced it will offer two-way, high-speed Internet access using a new satellite technology. The firm is only the latest player to plan the service, but could be the first to market.

If it begins service as scheduled in late 2001, iSky could beat Goliath competitors Hughes Electronics and EchoStar to market. Both have announced rollouts of competing services by 2003.

Satellite service from iSky will be available nationwide, offering high-speed Web surfing to an estimated 30 million people who are now unable to obtain broadband Internet access. To receive the service, you'll need the company's satellite dish, which is no larger than a standard TV satellite dish.

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The iSky service supports 2-megabit download speeds and fast 1-megabit upload rates. In some cases, speeds will beat what's available with today's broadband services, cable modem and Digital Subscriber Line, says Tom Moore, iSky president and chief executive officer.

Moore says that iSky will compete with cable modem and DSL providers by offering competitive prices, including a monthly flat rate for always-on service. That option is not offered by satellite Internet access providers today.

Experts say iSky sounds compelling, if it can stick to its timeline.

"Satellite access will always trail substantially behind broadband and DSL. But if iSky can deliver what it promises, then it stands a chance at laying a claim to the consumer market," says Joe Laszlo, an analyst with Jupiter Communications.

A one-way reality

Satellite access to the Net is a mixed bag for consumers, who love its fast download speeds but loathe its slow upload speeds, which travel over dial-up modems. By affixing a small receiver on the end of satellite dishes, iSky and its competitors will allow upload speeds nearly as fast download speeds.

The first of iSky's five van-sized satellites is scheduled to launch into space in mid-2001. The company expects to offer nationwide service the following month. Loral Space and Communications is partnering with iSky to launch the satellites into low Earth orbit.

Competition is in the wings, however. Satellite behemoth Hughes Electronics has announced its Spaceway service, promising persistent two-way broadband connections. And Lockheed Martin is developing a multi-billion dollar Astrolink satellite project.

Microsoft's Bill Gates and cellular pioneer Craig McCaw have also teamed to offer services to be known as Teledesic services, which will use the Ka-band frequency. Ka-band is a newly opened high-frequency part of the radio spectrum that allows instant communications and exchange of high volumes of data among locations.

However, none of iSky's possible competitors expect to have services available before 2002.

It may be first to offer service, but iSky faces competition with some deep pockets, says Amy Harris, analyst with International Data Corporation. iSky's ace in the hole could be its capability to carry traditional satellite television programming over its network, she says.