Alphabet, the parent company of Google, has concluded its exploration into utilizing a network of balloons to deliver high-speed internet access to geographically isolated regions.

The company announced on Thursday that it is ceasing operations of Loon, a project spanning nine years and its subsequent two-and-a-half-year-old independent entity, due to its inability to establish a viable business model and secure necessary partnerships for this ambitious undertaking.

The conclusion of the Loon project, which gained prominence after successfully restoring cellular communication following a hurricane in Puerto Rico, follows Google’s decision last year to discontinue Google Station, another significant initiative aimed at expanding internet access to a broader global audience.

Google Station previously offered internet connectivity at more than 400 railway stations throughout India and aimed to replicate this approach in various public locations across additional countries.

Nevertheless, today’s announcement from Alphabet is unexpected. Only recently, Loon received authorization from the Kenyan government to deploy balloons for commercial internet service—a deployment it successfully completed, suggesting positive progress.

Loon, which secured $125 million in funding from a SoftBank affiliate in 2019, consistently articulated its objective as: “Loon is dedicated to extending connectivity to communities globally that are currently unserved or underserved. We are actively engaged in discussions with telecommunication providers and governments worldwide to offer a solution for broadening internet access to these areas.”

The increasing involvement of SpaceX and Amazon in this sector may have played a role in Alphabet’s decision—and if not, these companies will likely encounter similar challenges regarding practicality in the future.

“Our focus has often been on connecting the next billion users, but in reality, Loon has been addressing the most challenging aspect of connectivity—reaching the final billion users,” explained Alastair Westgarth, CEO of Loon, in a blog post.

“These are communities in locations that are either too remote or too difficult to access, or where providing service using conventional technologies is simply too costly for the average person. Despite finding several potential collaborators, we have not been able to reduce costs sufficiently to create a sustainable, long-term business. Pioneering new technologies is inherently risky, but that does not diminish the difficulty of sharing this news.”

The blog post presented Loon’s connectivity efforts as a positive achievement.

“The Loon team is pleased to have fostered an environment of organizations working on stratospheric connectivity solutions. A multi-faceted approach to connectivity—ground-based, stratospheric, and space-based—is essential, as each layer is best suited for different aspects of the challenge. In this field, Loon has made several important technological advancements,” Westgarth stated.

What happens next

The company announced through a separate blog entry that it has committed $10 million in funding to assist nonprofit organizations and businesses concentrating on connectivity, internet access, entrepreneurial ventures, and educational initiatives within Kenya.

Alphabet intends to integrate certain aspects of Loon’s technology into future projects and disseminate the knowledge gained from this ambitious undertaking to the wider community.

Furthermore, “elements of Loon’s technology – notably the high-capacity (20Gbps+) optical communication systems initially employed to establish a link between balloons operating in the stratosphere – are now being utilized within Project Taara. This team is collaborating with partners in Sub-Saharan Africa to deliver cost-effective, high-speed internet access to communities currently lacking or with limited connectivity, beginning with deployments in Kenya,” the company stated.

Numerous companies, including Google and Facebook, have noticeably reduced the scope of several of their connectivity initiatives in recent years, as many developing countries, such as India, that were initially targeted have independently addressed their internet infrastructure needs.

It has also been demonstrated that providing subsidized internet access to vast numbers of potential users may not represent a viable long-term strategy for customer acquisition.