Satellite Direct-to-Device (D2D) technology is redefining the boundaries of global connectivity. This market is quickly emerging as one of the most promising developments in satellite communications. By enabling smartphones and IoT devices to connect directly to satellites, without terrestrial infrastructure, this innovation is poised to fill long-standing coverage gaps and open up new markets. Driven by new constellations, spectrum strategies, and mobile partnerships, D2D is moving from concept to reality. As demand for seamless mobile connectivity and resilient communications grows, so too does interest in D2D’s commercial potential.
Expanding Mobile Coverage Where Terrestrial Networks Fall Short
Satellite direct-to-phone enables standard mobile devices, like smartphones, to connect directly with satellite constellations in GEO or NGSO orbits. These services bypass traditional terrestrial infrastructure, allowing users to access emergency services, send text messages, or even make voice calls in areas without cellular coverage. Satellite direct-to-phone connectivity also has strategic potential for government use, from improving emergency communications and disaster response to enhancing national security and defense communications in remote or high-risk areas. Novaspace projects the market to grow tenfold over the next decade, reaching over $10 billion by 2033, driven by rapid advancements in technology and expanding satellite networks.
Growing demand is driven by two key underserved markets: out-of-coverage users who travel or live outside areas with reliable terrestrial connectivity, and unconnected individuals who remain offline despite network proximity. D2D is positioned to serve both groups representing a combined addressable market of nearly 5 billion people today. Novaspace projects this market will grow to service over 425 million monthly users by 2033, as safety, accessibility, and device compatibility improve.
Spectrum Strategies Define the Competitive Landscape
The D2D market is shaped by two distinct spectrum approaches. Terrestrial spectrum players (e.g. AST SpaceMobile, SpaceX) use spectrum traditionally allocated to Mobile Network Operators (MNOs), allowing for backward compatibility with standard smartphones. Their constellations are anticipated to deliver broadband speeds, and integrate with existing mobile ecosystems, making them attractive to MNOs and OEMs. However, they face significant capital requirements and regulatory challenges, including the need to secure spectrum approvals country by country, factors delaying time-to-market.
MSS Spectrum players (e.g. Globalstar, Iridium) use satellite-allocated L- and S-band spectrum and often rely on pre-existing infrastructure, enabling earlier service deployment. However, adoption is constrained by device compatibility, as devices require custom chipsets or certification to function on existing networks. Services are also limited and tend to be narrowband, focused on SOS emergency and text messaging.
D2D Meets IoT: Network Convergence and New Use Cases
Beyond smartphones, D2D technology is advancing satellite-enabled IoT. Satellite-cellular IoT, a subset of the growing market, connects cellular-compatible IoT chipsets to satellites without any hardware modification. This market considers all IoT devices that can seamlessly roam onto both satellite and terrestrial networks through a single, integrated IoT chipset and is expected to significantly penetrate the adoption of applications like connected cars and wearables. It could also play a key role in the future management of automated assets, like drones, by enabling seamless, low-latency communication in areas beyond the reach of traditional networks.
Satellite (MSS) new entrants (e.g. OQ Technology, Sateliot) are more narrowly focused on serving IoT markets, notably through LEO-based constellations of low-cost, low mass small satellites (e.g. nanosatellites). Some new entrants (e.g. AST SpaceMobile, SpaceX) initially plan to offer direct-to-phone services as their primary target markets. However, given the fact that their systems are theoretically compatible with the cellular IoT frequencies used by partner MNOs, they are likely to address both segments. As standardization advances, particularly through initiatives like 3GPP, device compatibility is expected to improve, driving broader adoption across the D2D market.
Subscriber and Revenue Growth Forecasts
According to Novaspace estimates, over the next decade the direct-to-phone market is forecasted to generate cumulative service revenues of nearly $42 billion across the value chain. Majority of users are expected to come from the out-of-coverage segment, who are seeking affordable access to safety services like SOS and emergency messaging.
The distribution of revenue is expected to evolve as the market matures. In the early stages, most revenue is expected to flow from mobile network operators (MNOs) to satellite providers, largely through wholesale agreements and introductory service offerings. As the ecosystem develops, the revenue split is anticipated to become more balanced, with service providers capturing a greater share through tiered offerings such as broadband, voice, and low-data applications. The future revenue mix will be shaped by pricing models, device compatibility, and the maturity of satellite-MNO partnerships.
D2D’s Defining Decade Begins Now
Satellite D2D is more than a technological breakthrough—it’s a commercial opportunity that’s reshaping how we think about global mobile access. As services expand and device compatibility improves, new partnerships, business models, and applications are emerging to meet rising demand. With regulatory and spectrum frameworks evolving, and market momentum building, satellite operators, service providers and investors face a critical window to define their strategies, secure a competitive position, and help shape the next era of truly global connectivity.
Want to Know More About the Prospects of D2D?
The satellite D2D market is entering a transformative phase, with both challenges and breakthrough opportunities ahead. For a deeper dive into forecasts, competitive dynamics, and strategic insights, explore the 2024 Prospects for Direct-to-Handheld & IoT Markets report. Stay ahead of emerging trends by subscribing to In the Loop for the latest trends from across the space and satcom sector.
