TerreStar teams with Nokia on Vermont satellite broadband test

With big technology and government partnerships, hundreds of millions of dollars in funding, and a 2008 launch date now in hand, TerreStar is convinced that 4G satellite services aren't just "pie in the sky" of any flavor.

NEW YORK CITY (BetaNews) - "2008 will be the 'Year of the Pilot,'" said Robert L. Brumley, chairman of the board of TerreStar Corp. (formerly known as Motient), a company that hopes to test its emerging satellite-based 4G "end-to-end solution" with multiple state governments in the US if the first two LoStar units launch as planned next August.

The State of Vermont, for one, has already signed on to test TerreStar's satellites and Nokia-built PDA (personal digital assistants), according to Brumley.

TerreStar envisions its forthcoming IP-enabled wireless network -- now under development with assistance from systems integrator Accenture -- as streaming broadband video, voice, and data to consumers, businesspeople, and government workers throughout the nation, particularly in pockets untouched by either competing wireless technologies or wired approaches such as cable and FioS.

Speaking at the USB Global Media & Communications Conference in New York this week, Brumley told financial investment analysts that if they've ever gone skiing in Vermont, they already know that cellular networks, for instance, don't fare all that well in mountainous environments.

The board chairman contended that Vermont officials are so enthused about the satellite plan that they're drumming up interest among other state governments, which face their own sets of issues around getting broadband access to some of their citizens and workforces.

Meanwhile, Canadian carrier BCE (Bell Canada Enterprises) has licensed TerreStar's technology, and so has a European provider based in Austria, according to Brumley. Licensing efforts are underway, too, for the Asia-Pacific.

TerreStar also wants to be able to link up the satellite-driven service with other network. To that end, the TerreStar satellite service will initially support UMTS, a 3G technology which is upgradeable to LTE -- the same wireless protocol that Verizon named in an announcement around its own 4G services a couple of weeks ago.

"I'm pleased to welcome Verizon [to LTE]. They will be a great addition," Brumley joked.

TerreStar has put a lot of planning into its own network over the years, Brumley maintained, adding that the vendor has avoided support for WiMax because of concerns over that technology's widespread availability.

The TerreStar network will use 20 MHz of S-band frequency in the 600 MHz band, won at FCC auction.

At this point, TerreStar is eyeing link-ups to other providers' services -- especially those of smaller carriers -- for extending wireless broadband across warehouses, oil and gas pipeplines, and other hard-to-reach work places, Brumley said.

In the government market, the vendor is targeting its services at "filling in the gaps" -- location-based and otherwise -- on first-responder emergency networks by supplying a satellite backup service.

But for any of these plans to happen, TerreStar needs to first meet FCC milestones. These call for putting not just one satellite into the sky on the launch date, but two of them-- at an estimated pricetag of around $350 million -- as well as for buying "satellite insurance" to the tune of some $50 million.

There's also the matter of putting the finishing touches on the mobile devices which consumers and workers will rely on for accessing the streaming content while roving about.

Brumley held up a non-working prototype of one of these slick new PDAs for the audience to see, and then passed it around the room for further inspection. The prototype looked virtually indistinguishable from a cell phone.

However, for the satellite PDA to do the intended job, developers need to reduce current communications requirements -- from six microchips and two antennae to two chips and a single antenna, according to Brumley.

Brumley also told the audience that TerreStar received $500 million in additional funding last year, after its first appearance at a UBS conference.

Right now, the company's financial balance sheet is healthily in the black, according to Neil L. Hazard, TerreStar's treasurer and CEO.

Privately, some investment analysts attending the conference expressed some reservations about satellite services in general, due to factors that include strong broadband competition on both the wireless and land-based sides, a legacy of failed satellite attempts in the past, and the high cost of entry into the satellite space.

"But TerreStar has better [financial] backing than most," one analyst told BetaNews.