A new report from Oxford Economics highlights the transformative potential of low Earth orbit (LEO) satellite broadband services, illustrating how they could significantly boost global GDP and create millions of jobs over the next decade. Aimed at small business owners, the findings stress not only the economic implications but also the practical applications and challenges posed by this emerging technology.
The report, commissioned by Amazon, projects that by 2035, expanded LEO services could add between $32 billion and $863 billion to global GDP, supporting anywhere from 800,000 to 21 million jobs. "LEO satellite broadband has the potential to become an important complement to terrestrial networks by extending internet access to communities that have long been underserved by traditional infrastructure," said Henry Worthington, Managing Director at Oxford Economics.
For small business owners, the implications are clear: improved broadband access could lead to enhanced productivity, expanded market reach, and access to essential digital tools. As Brian Huseman, VP of public policy and community engagement at Amazon, pointed out, "Behind every statistic in this report is a person—a student who will be able to participate in online learning, a small business owner that will be able to grow their business, a rural health clinic that will be able to access a specialist."
Currently, 2.6 billion people worldwide lack internet access—a stark gap identified by the International Telecommunications Union (ITU). In many low-income regions, fixed broadband subscriptions can represent more than a quarter of the average income, limiting affordability. This lack of access not only hampers educational opportunities but also restricts businesses from leveraging digital tools that could enhance their operations.
LEO satellites are designed to bridge this gap. Orbiting significantly closer to Earth than traditional satellites, they offer low-latency internet connections, enabling functionalities essential for today’s digital demands. This includes video calls, telemedicine, and real-time digital payments, all critical tools for modern businesses.
These satellites can reach areas that conventional terrestrial networks cannot serve, such as remote islands or rugged terrains, making them a viable option for business owners in isolated regions. They offer rapid deployment—minimizing the need for extensive ground infrastructure—and can even be self-installed by subscribers, reducing costs and logistical hurdles.
The report outlines three scenarios for LEO adoption by 2035: incremental, intermediate, and transformative. Each presents a different level of user adoption and economic impact. The transformative scenario could see up to 421 million users and an economic impact of $863 billion in global GDP while supporting as many as 21 million jobs.
However, these economic opportunities come with potential challenges. Small business owners must consider:
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Infrastructure Limitations: While LEO satellites can extend service to remote regions, some may still lack the necessary digital literacy or technical support to make the most of this technology.
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Market Competition: As LEO services grow, local businesses might find themselves competing with larger, established companies that can leverage high-speed internet better.
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Coastal and Regional Disparities: The impact of LEO may not be uniform. As highlighted in the report, remote areas in North America and parts of Latin America stand to benefit significantly, while other regions may experience slow adoption rates.
- Cost-Benefit Evaluation: Small business owners will need to assess whether the investment in new technology aligned with LEO broadband provides a positive return in productivity and revenue growth.
The regional analyses provide additional insights for small business owners. For instance, North America could see productivity gains leading to a GDP rise of up to $297 billion by 2035. Similarly, in Latin America, LEO could connect millions and create substantial economic returns by fostering better digital inclusion.
As LEO satellite services begin to promise greater connectivity globally, small business owners may find themselves at a pivotal crossroads. By engaging with these technologies, they can unlock new opportunities while contending with the economic and technological shifts that accompany this digital revolution.
For those interested in a deeper dive into the numbers and further insights on the topic, the full report from Oxford Economics can be found here.
