A satellite town is a town that is located in the outskirts of a major city. What is the origin of this name, satellite town? What does "satellite" exactly mean here?
At OED.com* the 6th noun definition of satellite is firstly of a state (country, principality, etc.,) that is politically or economically dependant on and subservient to another. Their earliest quote:
[1776 T. Paine Wks. (1796) II. 24 In no instance hath nature made the satellite larger than its primary planet; and as England and America‥reverse the common order of nature, it is evident that they belong to different systems: England to Europe, America to itself.]
As you can see, satellite is being used in a metaphorical sense, so the origin is the astronomical definition of satellite. The meaning of satellite with regards to towns being:
A community or town that is economically or otherwise dependent on a nearby larger town or city.
Which you can see is parallel to the definition for states.
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In space, a satellite is something that orbits (or goes around) something else. Usually the smaller object orbits the bigger one.
Geographically, then, a satellite town is a community located near a big city. Typically, there is some "attachment" between the satellite town and the nearby city (for example, a large percentage of the workers in the satellite town are employed in the city).
'Satellite' simply means a 'follower' -- a smaller object or person following a bigger one.
1540s, "follower or attendant of a superior person," from M.Fr.satellite (14c), from L. satellitem (nom. satelles) "attendant" ...
The term was used in the astronomical sense by Kepler in the 1610s.
By extension, a thing dependent, and typically found around, a larger one of its like is a satellite.
Well, a "satellite" of a planet is an object in its orbit. As far as I'm aware, it's simply an analogy on that. Doing a quick unscientific Google Books search and looking at how "satellite" appears to be predominantly used in the 19th and early 20th century ("satellite town" appears to have been coined in the 1910s/1920s), this would seem to be how speakers have always conceived of the term.
It is true that "satellite" is occasionally used in other contexts to mean "adjoining"/"accompanying", e.g. the term "satellite vein", which apparently predates "satellite town" by some decades, but this usage appears to have been marginal compared to the use of "satellite" in the planetary context.