Starlink in talks with Vodafone

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Elon Musk’s Starlink broadband-by-satellite team is reportedly in discussions with UK cellular telco Vodafone and the “advanced talks” are looking to share spectrum which would help Starlink to deliver broadband services to rural and other underserved areas within the UK.

Vodafone has previously confirmed that they are in talks with “multiple operators” and “close to striking a deal”, noting in a separate filing that the 28 GHz spectrum is well suited for terrestrial broadband coverage. It is not clear at this stage whether the deal would include just spectrum or also access to Vodafone’s ground-based infrastructure; Starlink are reportedly also in talks with Arqiva (Cellnex) on the latter.

Starlink already has ground stations at Arqiva’s UK Chalfont Grove site.

A note to clients from investment bank Exane/BNPP says that the news is a “small positive” for Vodafone, adding: “However, we would be careful not to overestimate the impact on company financials in the near term. Similar satellite-based initiatives (e.g. the Deutsche Telekom/ Inmarsat ‘European Aviation Network’ for in-flight wi-fi) have not have a meaningful impact on telco P+L, and in the UK Starlink will also face competition from the BT/OneWeb partnership which was announced in June.”

The bank continues: “Our expectation at this stage is that satellite-based broadband will remain a niche service across most of developed Europe as cheaper alternatives such as 5G fixed-wireless-access become available. Perhaps more interesting however is what opportunities a Starlink tie-up could unlock for Vodafone in emerging African markets should the UK partnership prove successful.”


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