Starlink: 69,420 subs and growing

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June 30th saw a routine SpaceX launch lifting 88 smaller satellites into orbit on its Transporter-2 special flight. The Falcon 9 rocket booster landed some 10 minutes later back onto its concrete launch pad.

It was yet another success for the Elon Musk concept of reusable rockets. But the news was somewhat overshadowed by a comment from Musk that he was prepared to pump up to $30 billion into the satellite broadband Starlink venture.

Musk was speaking in a video message to the Mobile World Congress (MWC) event in Barcelona. He again repeated that there was a backlog of more than 500,000 would-be subscribers waiting for Starlink’s service to be enabled. He told delegates that Starlink’s actual subscribers now stood at 69,420. He said that Starlink was looking to serve a “couple of hundred thousand” users and again that 500,000 figure “possibly” within a year.

“The total investment is basically at least $5 billion, maybe $10 billion and then maybe over time it’s a multiple of that — $20 billion or $30 billion. It’s a lot,” admitted Musk.

Musk said that the combined power of the current fleet of over 1500 satellites was “over 5 megawatts of solar” and capable of generating about 30 terabits/second of data. The aim was to achieve latency of sub-20 milliseconds so as to enable game playing on the system.

As to the investment needed in Starlink, he said that he was anticipating a total of $20 billion to $30 billion over time. He said that Starlink was now operating more than a dozen countries and was adding more every month. He also said that Starlink had two “significant partnerships” [for backhaul connectivity] in place with major telcos that could help plug gaps in 5G coverage. Starlink was in discussion with other potential telcos.

Musk admitted that today’s Starlink subscribers were getting their equipment at around half-price but that he expected to bring those costs down from (terminal) costs of more than $1000 to $300-$500 over the next 12 months and then $250 [or] “something like that,” he suggested.

There were more good news comments. He told delegates that its Starlink 1.5 version (with inter-satellite direct links) were launching imminently. “Next year,” he said, “we are going to start launching version 2 of our satellite, which will be significantly more capable.”

Sami Kassab, an analyst from investment bank Exane/BNPP put out a note on the MWC comments, saying that Musk’s disclosure is consistent with the bank’s Starlink financial forecasts.

Kassab added: “[Musk’s] statements also underpin the idea that Eutelsat, Viasat and other GEO satellite consumer broadband have a cost advantage (although they lack the low latency benefits of LEO). Musk references and focus was largely on consumer-broadband rather than government or enterprise markets although rolling out inter-Satellite links will help broaden Starlink’s reach in those markets. Overall, we find his statements consistent with our industry outlook. We continue to prefer SES (+) over Eutelsat (-) and see the next quarterly results as underpinning SES Networks acceleration and improvement in SES Video while we are concerned that Eutelsat’s FY22 revenue outlook, especially in Video could prove conservative.”


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