Last year we spoke of the promise – and difficulties – of Ka-band in Latin America. Now, we see the technology start to become a reality, with the region’s first Ka-band payload now in operation. The nine spot beams on Hispamar’s Amazonas 3, directed at Latin America’s largest cities, were a special order from Media Networks. The company is a B2B unit of Spanish telco Telefónica, and plans on pioneering Ka-band satellite Internet access in the region through wholesale offers to traditional satellite broadband providers.

This is a somewhat tentative approach compared to the mass-market style we’ve seen so far in developed markets, with specially-built Ka-only High Throughput Satellites (HTS) and where the satellite operator manages the offer to the end-consumer, such as in the case of Eutelsat’s Tooway consumer broadband service.

And it seems things will continue to be done differently in Latin America, with no plans for a Ka-band HTS covering the region in the near future. This apprehension may be due to concerns over Ka-band’s susceptibility to the region’s tropical weather, but also due to the emergence of new business models more appropriate to the Latin American market, and the technologies that enable them.

The movement isn’t limited to Latin America, as global players have expressed doubts over the HTS business model. In early 2012, SES president Romain Bausch stated the company would not be investing in “a dedicated Ka-band satellite. We do not believe [that consumer satellite broadband] is a sustainable business over the life of the satellite. A satellite takes about three years to build and then is in operation for about 15 years. You need a good feeling about the business for 18 years. The last mile for broadband for consumers is best done by terrestrial, not by satellite.”

Despite Latin America’s low broadband penetration levels (36.9 percent in 2011, according to Frost & Sullivan analysis) and large territorial extensions, the satellite industry hasn’t rushed to offer a mass-market satellite broadband service in the region, either in Ka-band or other technologies.

Indeed, the Latin American Ka-band business does seem to be more promising in the backhaul segment instead of the last mile. While SES, one of the largest satellite operators in the world, has no plans for its own Ka-band satellite, they have invested in O3b Networks’ innovative business model that hopes to offer lower-latency satellite broadband to underserved regions, especially in developing countries (the “Other 3 billion”), through a constellation of mid-Earth orbit Ka-band satellites, the first four of which were launched in June.

O3b’s business model reduces the cost of building the satellites, which are also more flexible than GEO Ka-band in adapting to different applications, but the high cost of the dual tracking terminals used, as the satellites aren’t geostationary, will limit their applicability to end-user service. Intelsat has also moved away from the Ka-band HTS end-user approach with its multi-band Epic satellites, the first of which is expected to be launched in 2015.

And even as dedicated Ka-band satellites begin to operate in the Latin American market, this B2B business model is likely to remain with the Brazilian government’s BR-SAT and Hispamar’s Amazonas 4B, both of which are expected to be launched in 2015. The trouble with this B2B approach to Ka-band is the tendency to focus on densely populated regions, especially given the growing interest in using Ka-band to provide backhaul for LTE wireless networks, which are likely to remain a luxury service in Latin America for several years still.