Author & Audience
Who am I?
Hello, my name is Saeid, and I am the new leader of Starlink. I’m originally from the Middle East and have been a Training Manager in the Canadian Oil & Gas industry for several years. I have completed an MBA which provided me with the foundational skills and education needed in risk management, trading, and investment. Additionally, I have had the opportunity to volunteer with a number of international non-profit organizations that advocate universal and affordable access to the internet, particularly in countries with authoritarian regimes. As part of this open educational resource (OER), I will conduct literature reviews, utilize my business background, and apply my knowledge as an educator to explain why Starlink satellite internet should primarily focus on offering its services in countries with authoritarian regimes. Furthermore, a recommendation will be provided from an income and capital growth perspective, as well as from a humanitarian viewpoint.
Who am I writing for?
The following analyst report was created for the Assignment # 3 in ETEC 522: Ventures in Learning Technology, in UBC’s Master of Educational Tech program. For this report, we will be looking at the internet censorship as a problem in dictatorship regimes, the capabilities of Starlink, its strong business model, marketability, and how it can improve lives in developing countries. The intended audience for this analysis would consist of investment firms and/or organizations that are committed to providing free access to the internet on the global scale, and for those investors looking for a profitable venture to invest in.
The Problem
What is the problem?
On-going internet freedom monitoring activities reveal that internet censorship is frequently imposed by dictatorships, totalitarian, and anti-democratic regimes seeking to suppress citizens’ freedom. The degree of censorship fluctuates with the peak being around elections, protests, and demonstrations. Internet censorship goes against the United Nations' declaration that disconnecting people from the internet is a human rights violation and against international law. This is where the opportunity lies for Starlink.
How severe is internet censorship?
Freedom House’s official statistics show that in 2021, 30 of 70 countries assessed, experienced a deterioration in internet freedom. Countries like Russia, Iran, China, Saudi Arabia, Egypt, Sudan, and Belarus, were ranked as “Not Free” meaning that access to the internet was regularly disrupted by government or in case of China, it led to the creation of a parallel Chinese internet, also known as the “national intranet”.
Literature Review
The global digital population is ever increasing with more than 4.66 billion active internet users, 4.32 billion mobile internet users, and 4.2 billion social media users (Johnson, 2021). The rapidly growing number of internet users and the emerging mobile technologies have enabled faster flow of information and easier access to the latest news. Additionally, easier access to information has quite often translated to online social campaigns, cyber activism, and even political movements being triggered. As a result, a number of authoritarian regimes have imposed different levels of internet censorship, sometimes causing an entire blackout for an entire country.
2021 World Press Freedom Index ranks Norway, Finland, and Sweden as the top three (3) countries with having the highest levels of internet freedom among the 180 countries that were part of the report (World Press Freedom Index, 2021). The same report ranks Russia as 150, Turkey 153, Belarus 158, Saudi Arabia 170, Syria 173, Iran 174, North Korea 179, and Eritrea as 180 (World Press Freedom Index, 2021).
Reporters Without Boarders confirms that on various levels, countries that rank in the bottom 25% of the 2021 list, see the internet with alarm and have attempted - quite often successfully - to limit, control, or remove access to the internet to silence dissidents (World Press Freedom Index, 2021).
Literature
Infrastructure-Level Censorship
Existing literature collectively reveals that internet censorship happens at three (3) different levels; infrastructure, network, and application level (Keremoğlu & Weidmann, 2020). The infrastructure level censorship of internet has been ranked as the foundational and the most dangerous step towards limiting access to free information, and it quite often involves having some level of infrastructure in place that can easily be disabled, or temporary disabled, if ever needed by the authoritarian governments (Deibert & Rohozinski, 2010). Dainotti et al., (2014) termed this as having censorship mechanism at infrastructure level ready for “just in time” delivery and deployment (Dainotti et al., 2014). For instance, dictatorship regimes “throttle bandwidth to the extent that browsing of either the internet or specific applications become nearly impossible” (Keremoğlu & Weidmann, 2020, p. 4).
Network-Level Censorship
The second level of censorship, which has been heavily deployed by countries like China, is the network-level censorship. This type of censorship involves using filtering mechanisms based on keywords, that are often deemed “too political” to the ruling political party, to filter the content (Hellmeier, 2016). Network level censorship also involves blocking specific websites under the false claims of “national security”, thus, creating a full or semi-intranet form of connection for the users (Kalathil & Boas, 2003). Another form of network-level censorship involves governments and ruling parties of totalitarian regimes directing government-funded cyber-units to attack “hostile websites” to the point that the servers are swamped, and the website cannot be reached anymore. (Lutscher et al., 2020)
Application-Level Censorship
The last internet censorship level is the application level where authoritarian regimes approach it in a few different ways. The most common app-level censorship involves visiting social media websites to “screen” messages. Instances have been reported were a government-affiliated cyber unit later followed up and intimidated the users who initiated or even engaged in what was deemed “too sensitive” on some social media websites and threatened the users to remove the messages or refrain from repeating the behaviour (Keremoğlu & Weidmann, 2020). Another common tactic as Roberts (2018) reports, is that totalitarian governments, impose some sort of tax on users and make them pay money or spend more time if they want to access the censored material (Roberts, 2018, p. 4). The next method for app-level censorship is having government cyber agents spread disinformation or discrediting information on online platforms to derail discussions and stop any meaningful communication from forming. (Tucker et al., 2017).
Censorship Statistics
The available data on authoritarian interference with the internet reveals that in 2021, in at least 55 countries “government authorities investigated, arrested, or convicted people for their social media posts” (Freedom on the net, n.d., p. 1). The aforesaid government intervention to limit the provision and functionality of internet access and infringing the ability of citizens to have access to free information, is where the opportunity lies for Starlink under my leadership. This opportunity will be discussed in further details, as part of the next section of this OER.
The Totalitarian Regimes
Ukraine
Russia’s invasion of Ukraine in Feb 2022 had Ukrainians fearing that country’s internet access would be cut off through cyberattacks or by the destruction of the infrastructure. The full or partial blackout of the internet would mean that citizens would be unable to plea for help and show the world what they are going through as a result of the aforementioned war. As a result, Ukraine’s prime minister, Mykhailo Fedorov, appealed to Elon Musk to turn on Starlink’s space internet service for Ukraine (Morrison, 2022). Elon Musk sent a number of satellite dishes, called “Dishys” to the country and enabled the Starlink service (Morrison, 2022).
Iran
Ukraine’s internet disruption was not the first and will certainly not be the last. During November 2019 uprisings in Iran, the government deliberately shut down the internet with the goal of hiding the true scale of unlawful killings by security forces and killed over 1500 Iranians in three days. Amnesty International was able to verify at least 304 of those death (Iran Internet Deliberately Shut Down, 2021). The internet blackout by the theocratic and authoritarian Iranian government served two purposes during the aforesaid uprising. First, it infringed the ability of the protestors to communicate with one another, and second, protestors were unable to broadcast to the world the heinous crimes that were happening across the country in more than 100 cities (Iran Internet Deliberately Shut Down, 2021).
China
Let’s look at another example and see how the Chinese Communist Party (CCP), has instituted a digital repression agenda through content filtering and mass internet monitoring in order to control citizens’ dissatisfaction and prevent any meaningful political opposition from forming. For instance, when Google was reluctant to adhere to CCP’s censorship controls, the Chinese government nurtured national alternatives—Baidu, Weibo, WeChat, Alibaba, which were willing to abide by the CCP’s rules (Council on Foreign Relations, n.d.). Additionally, in this case, CCP’s parallel internet (e.g., national intranet) in fact flourished, thanks to the country’s population of 1.5 billion people and its highly advanced tech industry.
North Korea
North Korea is another example where internet censorship is part of the government’s agenda to cut off access to the outside world to maintain an authoritarian control over all media. This level of censorship enables the ruling party to be the exclusive medium for releasing news about the country and the outside world. North Korea, however, has a “walled garden” which is an intranet service where 1000-5000 websites are available that merely mimic and broadcast the national propagandic news of the ruling party (Internet Censorship in North Korea, 2017). This level of internet censorship has allowed the country’s authoritarian regime to tightly control and prevent political opposition from forming any sort of alliance.
Starlink Solution
Starlink History
Starlink is a satellite internet constellation venture that was officially announced in 2015, and the fist satellites were launched on May 23, 2019. Starlink has been developed by SpaceX and is leveraging company’s experience in building rockets and spacecrafts. Starlink provides high-speed, low-latency broadband internet across the globe and is currently available in United States, Canada, Australia, New Zealand, Denmark, Austria, Belgium, France, Germany, the Netherlands, the United Kingdom, and Ukraine.
Starlink Target Market
Starlink orders are fulfilled on a first-come, first-served basis and Starlink is capable of supporting video calls, online gaming, streaming, and other high data rate activities that historically have not been possible with satellite internet. As a result, the target audience has been defined as anyone that is interested in activities such as online gaming and video streaming, to customers that are in remote and rural places. Starlink Users can expect to see download speeds between 100 Mb/s and 200 Mb/s and latency as low as 20ms in most locations. Starlink’s main focus and target till this point has been “rural and remote communities”.
The Investment Opportunity
Through this OER, I, as the new leader of Starlink would like to propose and outline a new direction for the venture. Starlink has currently been focused on providing satellite internet services to rural communities and remote places. Nevertheless, under my leadership, the focus would shift to providing the same service to citizens in countries with totalitarian regimes, where access to the internet is regularly restricted to cut off citizens from communicating with the outside world. By investing in Starlink during its IPO (initial Public Offering), the investors would be dedicating capital to a profitable market where all projections are pointing to a strong return on investment.
Market projections reveal that “by 2025, SpaceX will be generating $36 billion in annual revenue, of which more than $30 billion would be satellite internet revenue” (Smith, 2021, para 5). By 2025, the company aims to have 12,000 Starlinks in orbit (Smith, 2021). SpaceX has confirmed that the project completion of Starlink would most likely see the total number of satellites closer to 42,000 (Starlink, 2021). The increased traction and spike in investment is a sign that satellite internet is becoming more popular among investors. Space Capital reported that $1.9b was invested in space companies in 2021 alone (Starlink, 2021). Additionally, Forbes forecasts that Starlink will grab 2.3% of all new internet users by 2025.
The aforementioned financial statistics further confirm why Starlink has received positive interest from governmental agencies, including major contracts from NASA and the US Department of Defense (Starlink, 2021). Additionally, in late 2020, the FCC (Federal Communication Commission) awarded $900m to Starlink to provide satellite internet to rural areas in the US (Starlink, 2021). Moreover, the humanitarian aspect of the aforesaid investment would make the financing even more appealing.
The following graph shows SpaceX's forecast with regard to revenue from its rocket launches versus revenue earned from its satellite internet (i.e. Starlink). (click to enlarge)
Reflection
Strengths
Starlink has received positive attention from the general public on the global scale, government agencies in Europe and US, and has constantly maintained a competitive advantage against competitors such as Virgin Galactic and Boeing. The aforementioned new direction of Starlink, can further strengthen its financial position and would be aligned with how Elon Musk envisioned the internet for everyone when he was creating Starlink. Additionally, SpaceX’s total number of launches continue to grow, and the increased number of space travel would mean that Starlink gets more publicity and higher revenues. Lastly, the number of oppressed citizens in countries with authoritarian regimes easily surpasses hundreds of millions of people, which has opened a great window of opportunity for Starlink’s satellite internet.
Weaknesses
The biggest weakness of Starlink is that it requires hardware installation for its satellite dishes. Totalitarian regimes have proven to regularly raid neighborhoods and confiscate satellite TV dishes from rooftops (e.g. Iran, etc..) to stop citizens from accessing outside information. This drawback could mean that customers lose their satellite dishes, however, replacing the dishes is fairly easily and moderately priced.
References
2020 World Press Freedom index: Reporters without borders. RSF. (n.d.). Retrieved March 12, 2022, from https://rsf.org/en/ranking
Council on Foreign Relations. (n.d.). How the dictator's Digital Dilemma Constrains Leaders' choices. Council on Foreign Relations. Retrieved March 9, 2022, from https://www.cfr.org/blog/how-dictators-digital-dilemma-constrains-leaders-choices
Dainotti, A., Squarcella, C., Aben, E., Claffy, K. C., Chiesa, M., Russo, M., & Pescapé, A. (2014). Analysis of country-wide Internet outages caused by censorship. IEEE/ACM Transactions on Networking, 22(6), 1964–1977.
Deibert, R., & Rohozinski, R. (2010). Liberation vs. control: The future of cyberspace. Journal of Democracy, 21(4), 43–57.
Freedom on the net 2021: The global drive to control Big Tech. Freedom House. (n.d.). Retrieved March 12, 2022, from https://freedomhouse.org/report/freedom-net/2021/global-drive-control-big-tech
Hellmeier, S. (2016). The dictator’s digital toolkit: Explaining variation in Internet filtering in authoritarian regimes. Politics & Policy, 42(5), 635–657.
Internet censorship in North Korea. Le VPN. (2017, September 26). Retrieved March 8, 2022, from https://www.le-vpn.com/internet-censorship-north-korea/
Iran: Internet deliberately shut down during November 2019 killings – new investigation. Amnesty International. (2021, August 17). Retrieved March 14, 2022, from https://www.amnesty.org/en/latest/news/2020/11/iran-internet-deliberately-shut-down-during-november-2019-killings-new-investigation/
Johnson, J. (2021, September 10). Internet users in the world 2021. Statista. Retrieved March 11, 2022, from https://www.statista.com/statistics/617136/digital-population-worldwide/
Kalathil, S., & Boas, T. C. (2003). Open networks, closed regimes: The impact of the internet on authoritarian rule. Carnegie Endowment for International Peace.
Keremoğlu, E., & Weidmann, N. B. (2020). How dictators control the internet: A review essay. Comparative Political Studies, 53(10-11), 1690–1703. https://doi.org/10.1177/0010414020912278
Lutscher, P. M., Weidmann, N. B., Roberts, M. E., Jonker, M., King, A., & Dainotti, A. (2020). At home and abroad: The use of denial-of-service attacks during elections in nondemocratic regimes. Journal of Conflict Resolution, 64, 373–401.
Morrison, S. (2022, March 2). Does Ukraine really need Elon Musk's help? Vox. Retrieved March 10, 2022, from https://www.vox.com/recode/22958373/ukraine-russia-starlink-spacex-elon-musk
Roberts, M. E. (2018). Censored: Distraction and diversion inside China’s great firewall. Princeton University Press.
Smith, R. (2021, February 21). Elon Musk predicted Starlink would generate $30 billion in revenue. don't believe it. Nasdaq. Retrieved March 10, 2022, from https://www.nasdaq.com/articles/elon-musk-predicted-starlink-would-generate-%2430-billion-in-revenue.-dont-believe-it.-2021
Starlink IPO. Starlink IPO: Everything You Need to Know | CMC Markets. (n.d.). Retrieved March 10, 2022, from https://www.cmcmarkets.com/en/ipo/starlink-ipo
Tucker, J. A., Theocharis, Y., Roberts, M. E., & Barberá, P. (2017). From liberation to turmoil: Social media and democracy. Journal of Democracy, 28(4), 46–59.