Reaching everyone on Earth remains difficult for landline networks, which rely on undersea and underground cables. Satellite signals, on the other hand, can more easily reach remote areas. It also lets people get online in places where it used to be difficult or impossible, such as planes or ships in the middle of the ocean.

LEO satellites could be a boon for people who have to work in these hard-to-reach places or live in rural or remote areas. Even a large developed country like the US isn’t able to reach 100 per cent of its population with landlines.

Who are China’s biggest players?

While Starlink from Elon Musk’s SpaceX leads the US in LEO internet satellites, similar efforts in China come from both state-owned and private companies. But the two biggest players in China right now are state-owned.

China Aerospace Science and Technology Corporation (CASC) and China Aerospace Science and Industry Corporation (CASIC), China’s two major state-run aerospace companies, both have their own satellite internet programs.

CASIC has a bigger focus on serving the military and national defence. The company will launch two constellations named Hongyun (meaning “rainbow cloud”) and Xingyun (or “running cloud”), which will have 156 and 80 satellites respectively.

One of the most well-known and well-funded private internet satellite companies in China right now is Beijing-based GalaxySpace. The company started two years ago and launched China’s first commercial 5G satellite in January. It also plans to launch 650 satellites total, more than any other company in the country. GalaxySpace counts Xiaomi CEO Lei Jun as an investor.

Did the coronavirus slow China’s progress?

The Wuhan base is responsible for producing satellites for both the Hongyun and Xingyun projects. Some say that while the pandemic slowed things down, the industry is still moving along.

“I would expect 2020's launch schedule to be ‘pushed to the right’ a little bit,” said Blaine Curio, founder of Orbital Gateway Consulting, a Hong Kong-based consultancy focusing on space and satellite telecommunications. “However, in general, I think Chinese LEO broadband constellations will develop quickly this year.”

The bankruptcies have made some in China’s internet satellite industry wonder if similar business models will also fail in their country, Curio said. But others also think it presents an opportunity for China to catch up and become a leader.

“There are companies experiencing difficulties in any industry, and we can’t judge an industry’s trend based on one single company’s development,” a GalaxySpace spokesperson told Abacus, in reference to OneWeb’s bankruptcy. The startup also said that it will keep focusing on innovating its technology and mass-producing low-cost satellites to achieve commercial value.

Will China police its satellite internet?

China plans to eventually offer up its satellite internet to other parts of the world. But the country is notorious for being one of the most restrictive when it comes to internet freedom. China’s Great Firewall blocks many of the world’s most-visited websites like Google, YouTube and Facebook.

For its own satellite internet network, China controls the ground stations (or satellite gateways). These are the stations that transmit data to and from the satellites, so the government could control the entire system.

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Foreign satellite network operators hoping to serve Chinese internet users might have to build gateway stations in China or find another way to ensure the government has access to that data.

If companies don’t want a ground station in a country they want to serve, they will need to use intersatellite links, Curio said. These allow satellites to send data to each other, offering lower latency and higher speeds since it reduces how often satellites must communicate with the ground. But this solution is probably less appealing to countries that like to control and monitor internet access.

“Historically this has meant that some companies, most notably OneWeb, purposely did not [use] ISLs in their system architecture,” Curio said, “because they knew that it would be harder to get access to tough markets like China or Russia if they had ISLs.”

So when can we actually use it?

SpaceX promises that Starlink will be available to American users in 2020, and it’s aiming for global coverage in 2021.

But just having the satellites in orbit doesn’t necessarily mean smooth sailing for Chinese internet users going forward. One important obstacle might be potential conflicts of interest between satellite internet providers and telecom giants, according to Curio.

Like CASC and CASIC, China’s telecom giants are state-owned. And China Mobile, China Telecom and China Unicom don’t have much incentive to cooperate with new technology that could eat up their market share.

It’s different in the US, Curio said. While American telecom companies Verizon, AT&T and T-Mobile have a lot of market power, they don’t have so much political power, he said.

Using CASIC and China Telecom as an example, Curio explained, “I guess in this kind of situation, where you have two big, roughly equally powerful state-owned incumbents in different industries, you will get, at best, a really inefficient and badly-designed compromise.”