A link budget starts with transmit power, adds antenna gains at both ends, subtracts cable losses, path loss over distance and attenuation from walls, rain or foliage, and compares the result with the receiver’s sensitivity. If the received signal sits above that threshold with some margin, the link works; if not, no amount of software will fix it.
Engineers use it to compare technologies and to plan deployments. LoRa achieves kilometers of range not by shouting louder but by lowering the sensitivity threshold with a high spreading factor. Dropping from 2.4 GHz to sub-GHz improves the budget because path loss is lower. A practical trade-off: a few extra decibels of margin can cost a larger antenna, a slower data rate or a shorter battery life, so the budget is always balanced against the rest of the design.
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