Starlink Ditches Caps, But Congestion, Price Hikes, And Slower Speeds Remain A Problem

Analysts had been quietly noting for a while that Starlink satellite broadband service would consistently lack the capacity to be disruptive at any real scale. As it usually pertains to Musk products, that analysis was generally buried under product hype. A few years later, and Starlink users are facing obvious slowdowns and a steady parade of price hikes that show no signs of slowing down.

Last November, Starlink announced it would be implementing one terabyte per month usage caps in a bid to tackle growing network congestion.

The problem: usage caps generally aren't a great fix for network congestion. While companies like Comcast use them to nickel-and-dime captive customers under the pretense of managing congestion, actual congestion is commonly tackled by far more sophisticated network management tech that prioritizes or deprioritizes traffic depending on local network load.

Starlink appears to have belatedly figured this out, and has been sending users a notice saying the company has already backed away from monthly usage caps entirely, for now:

The problem: users continue to see service speed declines while consistently paying more:

Speeds have dropped as Starlink attracts more users. As recently as late September, Starlink said that residential users should expect download speeds of 50Mbps to 200Mbps, upload speeds of 10Mbps to 20Mbps, and latency of 20 to 40 ms. Business service at the time was said to offer 100Mbps to 350Mbps downloads and 10Mbps to 40Mbps uploads. The expected speeds were lowered by early November, Internet Archive captures show.

As one Starlink user wrote on Reddit, It's not exactly a win. They're only promising 25-100Mbps for residential now. I've noticed some pretty significant speed issues lately, so I think this has been implemented before it was announced."

There's a reason this particular business segment (low earth orbit satellites) have been peppered with failures: it's hugely expensive and capacity constraints (and the laws of physics) are a major nuisance that makes scaling the network extremely difficult. It's why the feds have increasingly prioritized subsidizing future-proof fiber builds instead of Musk's pet project.

Musk wants to maximize revenue and keep the service in headlines despite capacity constraints, so he keeps on expanding the potential subscriber base, whether that's a tier aimed at boaters (at $5,000 a month), the specialized tier aimed at RVs ($135 a month plus a $2,500 hardware kit), or the new plan to sell service access to various airlines to help fuel in-flight broadband services.

To try and manage this growing load, the company has consistently raised prices while speeds decline. Now the company offers two basic options: a Standard" tier (25Mbps to 100Mbps, a $600 up front hardware charge, and $90-$120 a month depending on how congested your neighborhood is) and a Priority" tier (40Mbps to 220Mbps, requiring a $2,500 up front hardware charge and $250 a month).

This is before you get to the year+ long waiting list that greets many users upon signing up, something else you can pay extra to avoid. That's increasingly expensive given broadband affordability remains one of the biggest hurdles to widespread adoption in a country dominated by monopolies.

Starlink remains a great option for users in regions with absolutely no service or stuck on a DSL line from 2002. But steadily increasing prices, slower speeds, and comically terrible customer service (often a trademark of most Musk companies) means the service will never actually be as disruptive at scale as much of the initial early press hype suggested (also often a trademark of most Musk companies).