Elon Musk has more than a few challenges on his plate. He has problems with the powerful Securities & Exchange Commission over comments he made about his Tesla electric car. He is also busy developing the immense ‘Big Falcon Rocket’ (BFR) to take at least one paying passenger around the Moon, and ultimately to take colonists to Mars. The there’s his ‘Boring Company’ and ‘Hyperloop’, projects that would tax even the bravest of billionaires.
His ‘day job’ might still be his highly successful SpaceX rocket business, winning NASA contracts and loyalty from satellite operators. But according to a report from acknowledged satellite and telecom experts at TMF Associates, one area of focus which has gone very quiet is his ‘Starlink’ mega-constellation of satellites designed to bring affordable broadband to a global market. Back in 2016 the Wall Street Journal reported that Musk’s team were forecasting $30 billion in revenues by 2025 and 40 million subscribers for Starlink.
The TMF report states bluntly that the project has for all intents and purposes been put on hold. “We already knew that there was a significant reduction in hiring in early July, but I’m told the cutbacks went much deeper, with a significant fraction of the Starlink team departing.”
TMF says the forecasts were “ludicrous” and that funding for Starlink has been switched to the ‘BFR’ project. TMF says: “Without Starlink to support the [overall] business plan, SpaceX will face significant challenges in sustaining its reported $27 billion valuation, as it grapples with an expected reduction from 28 to 18 launches next year, which will very likely cause overall revenues to decline in 2019.”
TMF adds: “It’s only natural that SpaceX would look for a replacement market that can be projected to generate billions of dollars of profitable revenue, and the company now appears to have settled on space tourism, as previewed by Gwynne Shotwell last week, when she suggested that it “will probably be the majority of our business in the future, flying people” with “7 billion potential payloads”.