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StarBand Launches Internet Via Two-Way Satellite

It looks like the first round in High-Speed War II has begun, with StarBand Communication's pricey two-way satellite Internet option going public Monday.

StarBand, a joint venture between Gilat-To-Home Inc., Microsoft Corp., EchoStar Communications Group and ING Furman Selz Investments Inc., beat out companies like Hughes Networks and Iridium with its always-on high-speed Internet access.

So-called two-way satellite Internet service has been offered for several years, but none offered true two-way satellite service. Until StarBand's launch, the downstream came from a satellite in geosynchronous orbit around the Earth, and upstream from a land-based telephone line.

The new technology, which is being marketed by StarBand for an initial price tag of $1,300 a home, promises speeds of up to 500kbps downstream and 150kbps upstream from the GE-4 and Telstar 7 satellites. The company's goal is to provide 150kbps downstream and 50kbps upstream during peak hours.

Consumer beta trials are underway right now and the first non-beta installs begin later this week.

The service begins to answer the question asked by many rural and underserved consumers who don't have access to digital subscriber line or cable Internet options because of their distance from big cities.

It's sure to start a two-way satellite fight on the scale of the present-day cable/digital subscriber High-Speed War I. Except that this time, the battle lines will be drawn in the rural and small-city landscapes instead of America's metropolitan areas.

Zur Feldman, StarBand co-chairman and chief executive officer, said consumers don't have to wait for DSL or cable providers to come to them now.

"We are excited to bring the reality of high-speed Internet service to the millions of Americans across the country who have been denied access because their homes are located in neighborhoods not served by DSL or cable," Feldman said. "Thanks to the innovative technology provided to us from Gilat Satellite Networks, consumers no longer have to worry about how far away they live from the telephone company's central office or if their cable company has upgraded the cable in their neighborhood. All they have to do is look up. If they can see the southern sky, they can get StarBand service.

Like any new technology, it comes with a price tag. StarBrand has co-marketed its product with Gilat's DISH Network, Microsoft and Compaq Computer Corp. to form an exclusive triumvirate.

The service is promoted two ways: as an add-on to current EchoStar DISH Network satellite television customers and for PC-only customers.

For current DISH Network subscribers, a USB-connected satellite modem is hooked up to the customers PC, and runs concurrently with the satellite TV service.

According to a sales representative at a Radio Shack store in Green Bay, WI, there's a $300 equipment and satellite dish installation fee in addition to the $59.99 a month service for the PC-only service. Add to that the cost of a special-assembled Compaq PC ($950-1,000), which is the only computer outfitted with the modem and hardware required for the service. Radio Shack is the only distributor of the PC-only broadband service.

The whole package is special ordered, and self-installation "is not an option at this time," the sales rep said.