Amazon is making significant strides in the orbital mobile connectivity sector, an area currently dominated by Elon Musk’s Starlink. Recently, the tech giant announced it has reached an agreement to acquire satellite company Globalstar for $11.57 billion in cash. This transaction, valued at $90 per share, will provide Amazon with all of Globalstar’s satellite operations, infrastructure, and various mobile satellite services spectrum licenses. This acquisition is intended to bolster Amazon Leo, its burgeoning satellite venture, which is set to launch direct-to-device services later this year.
The announcement follows Amazon CEO Andy Jassy’s recent emphasis on Amazon Leo’s growing customer base, which includes major players such as Delta Airlines, AT&T, Vodafone, Australia’s National Broadband Network, and NASA. Amazon also showcased a new satellite internet antenna designed for commercial aircraft, promising high-speed internet connectivity during flights.
Despite ambitious plans for a satellite constellation comprising over 3,200 satellites in low-Earth orbit, Amazon has encountered delays, having launched only about 200 satellites to date. The company has petitioned the Federal Communications Commission (FCC) for an extension on a deadline requiring approximately 1,600 satellites to be operational by July.
In contrast, Starlink has successfully deployed over 10,000 satellites, providing internet services across around 150 countries, focusing on both retail consumers and businesses, including maritime and aviation sectors.
Globalstar currently operates 24 satellites in low-Earth orbit and has plans to acquire more than 50 additional satellites, along with an existing agreement with SpaceX for launching replacements within the year. Additionally, as part of the deal, Amazon will continue to collaborate with Apple, ensuring that Globalstar remains a provider of satellite connectivity services for iPhones and Apple Watches. Globalstar is instrumental in offering critical services like emergency text messaging, roadside assistance, and location sharing for Apple devices from the iPhone 14 onwards in certain regions.
Looking ahead, Amazon Leo is poised to deploy its own direct-to-device satellite system by 2028 that will integrate seamlessly with its existing broadband and satellite operations. The overarching goal is to establish a network of thousands of advanced satellites in low-Earth orbit to support hundreds of millions of customer endpoints globally. This strategic move highlights Amazon’s ambition to establish a formidable presence in the competitive satellite communications landscape, challenging established players like Starlink.
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