It’s been a big week for Loon. Just eight days ago, it was one of Alphabet’s moonshot projects, launching antennas attached to giant balloons into the stratosphere to beam internet down to Earth. Now it has announced its first commercial agreement: working with Telkom Kenya to provide internet service to parts of central Kenya, starting next year, and helping connect the citizens of a country where coverage hardly extends beyond major population centers.
Loon began life in 2011 as a Project Loon, inside Google X, the search company’s arm dedicated to incubating moonshot ideas. (In 2015, when Google restructured and formed parent company Alphabet, Google X became X.) After seven years in the incubator, Loon “graduated” this month and became an Alphabet company in its own right. That means it’s time to start making money, and this first deal (whose financial particulars have not been revealed) is a good early step.
Instead of building networks of ground-based cell towers that provide coverage spanning a few miles, Loon hangs antennas from tennis court-sized, helium-filled balloons flying 60,000 feet above Earth, far higher than commercial airliners, birds, and the weather. Each polyethylene balloon can provide internet coverage over 2,000 square miles and stay aloft for months, making them well-suited to connect areas where low population density or difficult terrain prohibits building out cell tower networks.
The balloons have no propulsion system and rely on riding the wind to get to where they need to be. (Loon has launch sites in Puerto Rico and Nevada, and while its balloons can circumnavigate the globe, it will likely consider setting up shop in Kenya.) In the early years of the project, the Loon team anticipated having many balloons in the air, each steadily moving around the planet. Then, around 2014, they realized they could direct the balloons where they wanted, and thus keep a few over a specific area.
The trick is that air currents at different altitudes head in different directions. Loon took mountains of data (gathered from various government agencies and the flight patterns amassed during their own tests) and a lot of machine learning (an Alphabet specialty) to turn those air currents into a new sort of map. Say a balloon is drifting east, away from where it wants to be. Its software will look for a current to take it west. If it’s a few thousand feet down, it uses a fan named Franz (for the SNL character who just wants to pump you up) to ingest air, which goes in a layer surrounding the bit filled with helium. The extra air works like ballast, dropping the balloon until it finds the west-bound highway. To go back up again, the fan pulls air out, making the balloon lighter. This sort of navigation meant that Loon didn’t have to start with hundreds of balloons covering an entire band of the globe. It could provide service to a specific area—like central Kenya.
Not that the folks checking Facebook on the ground know anything about it. Loon’s business strategy hinges on making deals with telecoms, and using its balloons to augment the service they provide their users. “You would have no concept that it was a different signal,” says Loon CEO Alastair Westgarth. “You’re just getting a standard LTE 4G signal, from the balloon.”
During its seven-year stay at X, Loon mastered a horde of problems. It developed a system that can launch a balloon every 30 minutes and keep them aloft for the better part of a year—right where they want. It built an 80-foot-long flatbed scanner that can spot microscopic defects in the balloon’s plastic. They trained flight engineers, designed their own shipping crates, and steadily improved the strength and speed of their signal (with no plans to offer 5G right now). In other words, they tackled all the things that make the idea of providing internet with high-flying balloons not just crazy, but nearly impossible.
But Loon’s departure from X brings a new, different sort of challenge: operating as a successful business. “Infrastructure plays are very complex,” says Westgarth, a telecom industry veteran who came aboard in early 2017. (When the recruiter who hired Westgarth said they were calling about Loon, he replied, “That still exists?”)
Along with a network of stratospheric balloons, he’ll have to build out and manage legal, policy, HR, and marketing teams—all the stuff X provided. He’ll have to strike deals with other companies, deliver the kind of service that actually augments their existing networks, negotiate with foreign countries, and work with regulators who manage telecoms and aviation.
“That ecosystem of partners is probably the single most complex thing,” Westgarth says. “It’s also what allows you to provide service.”
Loon hasn’t revealed any plans beyond this first deal in Kenya, but the CEO doesn’t expect to stop there. And he doesn’t expect to monopolize this new way of connecting the world. “Whenever there’s a large opportunity, other players will show up,” Westgarth says. But for right now, it’s just Loon, bobbing silently along, and headed for Africa.
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