Laser satellite communication sends data as beams of light, between satellites or between a satellite and a ground station, instead of as radio signals. It is also called free-space optical communication, or optical links. Light can carry far more data than radio in the same time.
Most satellites today send data by radio. Radio works well, but the amount of data it can carry is limited by the frequency band that each satellite is allowed to use, and these bands are shared and licensed. A laser uses light, at a much higher frequency, so it can carry many more bits each second. The amount of data carried each second is called bandwidth. A laser beam is also very narrow, so it is hard to intercept or jam, and it needs no radio frequency licence.
The narrow beam is also the difficulty. Two satellites hundreds of kilometres apart, each moving at about 7.5 km a second, must point their lasers at each other very precisely, and keep doing so. The laser terminal on each satellite has a small telescope and fine mirrors that steer the beam. The second problem is the weather, because clouds block light. So a ground station that receives laser signals is best placed in a dry area. Operators plan several stations in different regions, so that at least one has a clear sky.
Take, for example, an Earth observation satellite that photographs Indian farmland. In one day, it collects 400 gigabytes (GB) of images. It passes over its ground station for about 10 minutes at a time. With a radio link of 300 megabits per second, it can send about 22 GB in one pass. So most of the images wait for later passes, sometimes for a day. With a laser link of 10 gigabits per second, it could send about 750 GB in one pass, if the sky is clear. All the day's images would reach the ground in a single pass.
Lasers also link satellites to each other. A low-orbit constellation can pass traffic from satellite to satellite across space, without sending it down to the ground and back up. Such links help a satellite data relay network, and future direct-to-device constellations. Low and high orbits are compared in LEO and GEO satellites.
The largest users are Earth observation satellites. Their cameras and radar collect more data than radio can bring down.