The world of satellite broadband is about to see the results of a revolution in satellite capacity. In Europe, Ka-Sat is getting ready to enter service. In North America, ViaSat-1 is expected to be launched before the end of 2011, and the similar Hughes Network Systems’ Jupiter satellite is planned for launch early in 2012. These satellites are immensely capable, with throughputs in the 70 Gbps for Ka-Sat and 100 Gbps-plus of bandwidth for ViaSat-1 and Jupiter.

In North America, this is an important development, as it will improve on the speeds and capabilities offered by ViaSat’s WildBlue-1 and Hughes’ Spaceway 3 satellites that already have been operational for years over North America providing a considerable amount of Ka-band capacity for the satellite broadband offerings.

The advent of Ka-Sat service is even more important for Europe. Up until now, European Ka-band capacity for satellite broadband was limited to a few transponders on Eutelsat’s Hotbird 6, with Avanti Communications’ Hylas 1 Ka-band satellite going into service around when you see this column. With the addition of Ka-Sat to these offerings, Ka-band service, which has revolutionized the North American satellite broadband market, should do the same for Europe. Meteorological conditions allowing, Ka-band seems to be a necessary technology to truly enable satellite broadband. For Europe, however, there will be two revolutions in quick succession. The first is the availability of any large amount of Ka-band capacity. With luck this should accelerate the growth of Eutelsat’s Tooway service to a more robust and successful business venture as has already occurred in North America with WildBlue and with HughesNet.

Beyond basic service, however, these high throughput satellite offer the possibility of actually competing with slower terrestrial broadband offerings. Hughes has been mentioning this possibility for a couple of years when it discussed the Jupiter satellite. Eutelsat’s Tooway is more directly trumpeting download speeds of up to 10 Mbps and upload speeds of up to 4 Mbps, calling their upcoming service “DSL-comparable” broadband service.

On its face, these numbers are better than much available DSL service, but there is a catch — bandwidth caps. Terrestrial broadband providers have been unsuccessful, thus far, in linking price and usage. Time Warner, for example, made an attempt with a test in Port Arthur, Texas, but backed down in the face of strong customer resistance. Satellite broadband, however, is built around such limitations, though they are not absolute. Hughes, for instance, has a late night “Download Period” between about 2 a.m. and 7 a.m. Eastern in which these caps are relaxed, but satellite usage is never unmonitored.

This distinction in pricing strategies speaks to the difference between industries where capacity is relatively cheap and easy to add (DSL, cable) and the satellite world, where one simply cannot lay another fiber-optic cable to add capacity. Satellite companies are not rapacious bandits, but they do have to make a profitable business on the basis of a smaller bandwidth pool. As a result, satellite broadband has the usage caps that terrestrial broadband providers seek. This makes it difficult to predict how the competition between slow DSL and fast satellite will develop.

This is where the new generation of high throughput satellites really matter. With the growing importance of the Internet as a source of software downloads and video programming, for satellite broadband to maintain its appeal, the download caps will have to be structured in such a way as to allow for relatively large downloads relatively often, or satellite broadband will become satellite dial-up. High throughput satellites could allow this sort of usage. It is no longer a technological question but a market question.

With a race on just to maintain the current position, ViaSat already has announced plans to build a ViaSat-2 satellite as soon as the company studies the demand for ViaSat-1. Eutelsat says it can get a Ka-Sat 2 satellite from manufacturer EADS Astrium two years after the order is placed.

The success of satellite broadband as a DSL replacement rather than an option of absolute last resort will depend on decisions made in board rooms, not developments in labs. With high throughput satellites, broadband technology has come of age. What remains unclear is how the balance between better service and more subscribers will be set. No service ever gives capacity away for free, but for the broadband satellite industry to grow beyond being the service of last resort it will have to walk a delicate line between capacity and pricing.