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Hyperscalers use 5G to make an edge play into space

As telecom providers struggle to monetize 5G, hyperscalers like AWS, Google Cloud and Microsoft Azure are betting big on LEO satellites to extend 5G connectivity.

In an effort to monetize 5G, telecom operators and their hyperscaler partners often promoted edge computing. Edge computing could facilitate innovative -- and vertically specific -- applications for industries such as entertainment, healthcare, transportation and retail.

The idea was to extend cloud resources closer to the point where devices create and consume data, which supports cutting-edge applications that require low latency and are bandwidth-intensive. Some innovative edge computing applications emerged in areas like gaming and autonomous vehicles, but edge computing hasn't become the savior financial engine providers expected.

Although telecom carriers have struggled to make 5G pay off, hyperscalers have found their footing in edge in new ways. For example, hyperscalers provide platforms for telecom operators as customers begin to modernize their core networks. But they're also seizing on 5G as a connectivity engine for low earth orbit (LEO) satellite technology. LEO satellites deploy near Earth, usually between 500 and 2,000 kilometers from the surface.

Hyperscaler initiatives target LEO satellites

Major hyperscalers are using 5G to enable LEO satellite connectivity. Here's a look at some of the initiatives from AWS, Google Cloud and Microsoft Azure.


AWS has decided to build and launch satellites itself. The hyperscaler plans to invest $10 billion through its Project Kuiper to develop and deploy a network of LEO satellites. These satellites can help provide mobile and cloud connectivity to remote and underserved areas.

Amazon launched the first prototype pair of its planned 3,236 satellites in October 2023. However, because the Federal Communications Commission enforced a tight timeline, Amazon needs to launch at least 1,618 satellites by 2026.

Google Cloud

SpaceX's Starlink uses a network of LEO satellites that connect to ground stations running inside Google data centers. Google Cloud has a similar relationship with Leaf Space, an Italy-based ground station network operator, in which Google Cloud hosts Leaf Space's ground stations in its facilities. Leaf Space's LEO satellites monitor various applications in weather conditions and critical infrastructure tracking.

Microsoft Azure

SpaceX also has a relationship with Microsoft in which it uses Azure Orbital Cloud Access to transmit prioritized network traffic through Starlink's network and Azure edge devices. This extends cloud services to isolated locations and places cut off from internet or mobile communications due to natural or humanmade disasters.

Hyperscalers use 5G to expand connectivity

In some ways, the previous edge computing effort from telecom operators paralleled the carrier experience in cloud, specifically IaaS. In the late aughts, carriers, including AT&T and Verizon, wanted to expand beyond their connectivity businesses to offer higher-margin services.

They took a big swing with on-demand compute and storage services that could compete against AWS but failed to capitalize on those investments. The lackluster result of their efforts saw many telecom carriers retreat from IaaS and opt to stay focused on the secure cloud connectivity piece.

While telecom carriers were unable to find a compelling edge computing use case, hyperscalers have decided to use its capabilities to facilitate satellite network technology. In addition to LEO satellites, they've also decided to construct nonterrestrial data centers.

Nonterrestrial networks rely on the following for connectivity:

  • Medium earth orbit devices.
  • Geostationary orbit.
  • High-altitude platforms.
  • Drones.

As more investment goes into space exploration, the need for powerful processing capabilities on space stations and other vehicles and connectivity to resources on Earth continues to expand.

Amy Larsen DeCarlo has covered the IT industry for more than 30 years, as a journalist, editor and analyst. As a principal analyst at GlobalData, she covers managed security and cloud services.

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