Alphabet’s Project Loon Faces Strong Headwinds

Scottsdale, Arizona - 23 Nov 2015

As a dominating force in society, the Internet brings a great deal of value to the people who can access it, which is why Alphabet (Google) recently teamed up with leading Indonesia Telecom Operators to announce a test project to determine the feasibility of Project Loon. In a recent analysis, ABI Research , a leader in technology intelligence, aims to address the potential benefits and challenges that the implementers of this innovative feat are bound to face.

Read ABI Research’s Alphabet’s Project Loon Facing Strong Headwinds.

By strategically releasing solar-powered helium balloons into the stratosphere to create an aerial wireless network, Project Loon’s test system will operate on commercial 900 MHz spectrum, allowing users to gain access to coverage through commercial LTE smartphones.

“The mission of Project Loon is to reach the next five billion people in our world who currently don’t have Internet access, providing coverage to emerging markets, rural and remote regions,” says Joe Hoffman, Vice President of Strategic Technology at ABI Research. “If Project Loon is economically successful, it may have a five to ten year project lifetime as the worldwide population continues to urbanize and 4G networks migrate outward.”

ABI Research predicts that Project Loon will face a number of challenges in the initial execution stages, each addressed in detail within the analysis:

• Price Points : Alphabet will need to determine how to make this project economically feasible for low density, economically constricted areas. How can this project aim to deliver mobile broadband service at ordinary mobile cellular service prices or lower?
• Power Wattage : Project Loon’s systems are currently set to generate 100 watts from solar power and will impose strict power limits on both the transmitter and the on-board electronics, making viability even more challenging.
• Subscriber Density : The fundamental challenge lies in gaining enough subscribers per balloon for economic viability without overloading the system.
• Operational Obstacles : Challenges include developing algorithms to appropriately map balloon positions, determining a good strategy to deal with inclement weather and addressing the concern of relying on the non-renewable resource, helium, among other challenges.

“In all, I think it’s a creative approach and an intriguing proposition to help serve emerging markets,” concludes Hoffman. “Reaching the unserved will be technically and economically challenging, but if there is one company that can break through those barriers and be successful, it is Alphabet.”

These findings are part of ABI Research's Network Market Tracker Service, which includes research reports, market data, insights and competitive assessments.