The telecoms industry desperately needs competition with Musk's Starlink, so it has welcomed NBN Co's indication to use Amazon owner Jeff Bezos' low Earth orbit satellite system, writes Paul Budde.
A FEW YEARS BACK, I started to talk about how the rapid expansion of low Earth orbit (LEO) satellite constellations is reshaping the global digital communications landscape. With satellite numbers surging nearly tenfold in a decade, LEO-based connectivity has become a dominant force in space-based telecommunications.
A few months ago, I mentioned the Government’s initiative to also use satellites for voice-based services such as emergency calls (000). However, alongside this remarkable growth, I have also highlighted a set of challenges and considerations that will define the sustainability and effectiveness of these systems in the coming years.
Last time, I addressed a range of political issues. This time, I want to focus on some of the technical and strategic challenges, especially in light of a major new development in Australia’s satellite sector.
A step toward sovereign capability
This week, Optus announced that it will lead a consortium to build, launch and operate a sovereign Australian LEO satellite by 2028. This project, in partnership with Inovor Technologies, HEO, the iLAuNCH Trailblazer Universities Program and the Department of Defence’s DSTG, represents a significant shift in Australia’s approach to satellite-based infrastructure.
I see this as an encouraging move toward building space and digital sovereignty. As I’ve raised before, our current dependence on Starlink poses long-term strategic risks, made more urgent by recent geopolitical developments – such as U.S. President Donald Trump’s interference in allied defence communications – that have exposed how fragile reliance on foreign commercial systems can be.
However, execution will be key. Sovereignty is not achieved through local manufacturing alone. It must also involve full Australian control over data, robust cybersecurity frameworks, transparent governance and clear public-interest outcomes. Without these, we risk repeating past mistakes — investing in advanced technology without securing long-term national benefit.
Market drivers and technological advancements
In several of my previous articles on LEO satellite systems and initiatives like Starlink, I’ve pointed to how advances in satellite miniaturisation and the influx of venture capital have fuelled explosive growth. In Australia, Starlink now serves around 250,000 users, including many in rural and remote areas.
The shift from geostationary to LEO constellations is primarily driven by demand for high-speed, low-latency internet. Unlike traditional geostationary satellites, LEO systems orbit much closer to Earth, enabling dynamic, interconnected networks with reduced latency. Farmers and remote communities are among the key beneficiaries.
NBN Co has also flagged its intention to join this trend, announcing plans to adopt LEO connectivity via Amazon’s upcoming Kuiper system — a move that aligns with my long-standing view that Australia needs serious competition to Starlink.
Beyond civil use, the military is increasingly dependent on LEO capabilities. Starlink already supports ADF operations, highlighting the urgent need for sovereign alternatives that reduce strategic exposure.
Architectural complexities and spectrum management
LEO constellations are fundamentally different from traditional satellite networks. They demand intricate architectures to maintain seamless global coverage, cope with atmospheric drag and avoid collisions in crowded orbital lanes.
One of the biggest challenges is spectrum management. With a limited set of usable frequencies, coordination between satellite operators is essential to prevent interference.
The International Telecommunication Union (ITU) vital role here, balancing commercial ambition with equitable global access. But as more actors race to deploy LEO systems, spectrum congestion and operational conflict remain a real risk.
Sustainability and orbital congestion
While the promise of LEO networks is undeniable, sustainability risks are escalating. The growing number of satellites is contributing to orbital congestion and increasing the threat of orbital debris. Starlink alone has already retired 800 of its first satellites, burning them up in Earth’s atmosphere. This deorbiting process will become routine, given that most LEO satellites have a lifespan of just five years.
Yet we still don’t fully understand the long-term impact of these re-entries on the environment or atmospheric chemistry. Without international standards for deorbiting and debris mitigation, the risk of cascading failures – also known as Kessler Syndrome – becomes more likely.
Cybersecurity: the new battleground
On top of these challenges is the growing threat of cyber warfare. As more military and critical civilian infrastructure depends on LEO systems, the potential for attacks on satellite control networks, data links and ground stations grows exponentially. Robust encryption, zero-trust architectures and sovereign control of critical components are no longer optional — they are essential.
The road ahead — balancing growth with responsibility
The trajectory of LEO satellite constellations remains highly promising. They offer the potential to bridge the digital divide, enhance defence communications and support emerging applications across agriculture, disaster response and remote services.
But as I’ve consistently argued, this promise will only be realised if we balance growth with responsibility. Sovereign capability, long-term viability and security must guide development, not just commercial expansion.
The Optus initiative is a welcome signal that Australia is beginning to think strategically about its place in this evolving landscape. Now we need to ensure that these developments are governed wisely, executed transparently and aligned with the public interest.
If not, we risk letting LEO constellations become another technological wildcard — impressive, powerful and ultimately vulnerable.
Paul Budde is an IA columnist and managing director of independent telecommunications research and consultancy, Paul Budde Consulting. You can follow Paul on Twitter @PaulBudde.
This work is licensed under a Creative Commons Attribution-NonCommercial-NoDerivs 3.0 Australia License
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