Once you get to this size, the whole business model changes," said Gedmark, a former executive director of the Commercial Spaceflight Federation. "The satellite is just big enough to serve one country or a large U.S. state like Alaska, which is our first customer. Youre providing capacity for one country instead of a whole continent, and it changes the game.

Astranis' Alaska satellite will launch at the end of the year on a SpaceX Falcon 9 rocket and start providing internet services in early 2021.

Gedmark, who was also director of flight operations for the X Prize Foundation, spoke about how Astranis approach will lead to lower prices and why hes initially focusing only on commercial customers and not government agencies.

This transcript has been edited for length and clarity.

We started this company with a very simple thesis, which is that there is just a huge amount of good we could do in the world with small satellites specifically for telecommunications. When I say small satellites, I mean microsatellites that we launch up to geostationary orbit. GEO is this unique orbit. The satellites there are orbiting the Earth at the same rate the Earths surface is orbiting. To an observer on the ground ... the satellite appears to be at a fixed point in the sky and appears to never move. For satellite TV, you can have a fixed dish on your house. ...Thats why this orbit is so special. It means you can have the simplest possible off the shelf equipment on the ground and its very easy to roll out to people.

The satellites built for GEO have been these huge goliath satellites. Theyve gotten bigger over time, not smaller unlike literally all other electronics we know and love. Now theyre the size of a double decker bus. That can make sense in some cases because they are designed to cover an entire continent with satellite TV or some satellite internet. The challenge is it takes many years to build them, theyre very expensive and you have to build your business case around serving an entire continent.

We saw the boom happening with small satellites. My co-founder and I are both aerospace engineers by background. We wondered why isnt anyone using small satellites for GEO telecoms. It doesnt make any sense. The answer is that its hard. There are real technology challenges there. We had to do the math and decide we could tackle those challenges and build a real working satellite in the microsatellite class.

Once you get to this size, the whole business model changes. The satellite is just big enough to serve one country or a large U.S. state like Alaska, which is our first customer. Youre providing capacity for one country instead of a whole continent, and it changes the game.

The orbit is the biggest key difference in the execution. If youre comparing us to the low-Earth orbit constellations, their satellite is orbiting the Earth once every 90 minutes or so, so you need thousands of satellites to provide a commercially viable service that doesnt have gaps. We can get started with one satellite and have a satellite dedicated to that country or region.

The oher big difference is our models show well be able to get to a lower cost of ultimate capacity. That matters to these customers. They just want to know how much do i have to pay to get a gigabyte of data. Getting that number down as low as we can to really start getting more of the unconnected online is the ultimate goal. Our approach of building many of these small satellites for GEO will get us to the absolute lowest cost per byte.

We have launched a satellite into space. It was a technology demonstrator satellite, not the one were building for Alaska. That was four and a half years ago. The satellite were building for Alaska is slated to launch at the end of this year. We signed a launch contract with SpaceX to launch on a Falcon 9, and well be providing internet in the early part of next year.

There are many parts of Alaska where there is no internet connectivity at all. The places where there is service, its very common to pay $300 a month for internet we would call DSL speeds. Thats what were going to change. Right off the bat for the people that will get service starting next year, they will be able to get true broadband speeds for less than $99 a month. Thats five times the speed at one-third the price.

We are targeting a variety of customers. A lot of what were most excited about are rural areas or more extreme terrain, where its that much more expensive to try and run fiber. There are a lot of places around the world that have deserts, jungles, mountains, glaciers. Its just not economical to run fiber everywhere and it wont be for a very long time.

Is there government interest in this?

Weve certainly seen a lot of interest in what were doing because what were doing is very unique, but we really are focused on commercial missions and specifically right now executing on this mission for Alaska. Thats our focus right now.

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