Elon Musk said that his private rocket company SpaceX is ready to spend 30 billion US dollars to establish Starlink, its satellite internet network Now has 70,000 users in 12 countries.
Musk said that Starlink is expected to provide global coverage by August-“all places except the polar regions”-and plans to have 500,000 users in “12 months.”
Musk said that SpaceX currently has 1,500 satellites in low orbit to provide broadband Internet services for Starlink, which fills the geographic gap between terrestrial fiber connections and 5G coverage areas. When operating at full capacity, the service will have 12,000 satellites.
“This does apply to sparsely populated areas,” Musk said in a video interview at the Mobile World Congress in Barcelona, California. “We have really reached the hardest part in the world-the hardest to reach 3%, maybe 5%.”
The $30 billion investment figure cited by Musk is new and several times higher than the previous forecast, but it is not clear whether this forecast can be directly compared with the previous estimate. Musk said that these figures will vary depending on whether the development of the Falcon 9 rocket is included.
In a 2018 TED talk, Chief Operating Officer Gwynne Shotwell stated that the establishment of 12,000 satellites would cost “about 10 billion U.S. dollars or more.”
Musk said that SpaceX expects to invest US$500 million to US$10 billion in Starlink before its cash flow turns positive. He estimates that the overall cost is between US$20 billion and US$30 billion. “Basically a lot,” he said.
Musk did not comment on Starlink’s revenue potential, but in the past predicted that by 2025, its annual revenue could reach 30 billion U.S. dollars.
Musk admitted that as early as the 1990s, all attempts to provide constellation-based broadband services failed. He joked that a few years ago, his goal was just to avoid bankruptcy.
The cost of the Starlink “terminal” or satellite antenna is US$499, plus a monthly subscription fee of US$99. Musk said that the current cost of the hardware is about twice the fees it charges customers.
The billionaire entrepreneur also said that Starlink has signed two large-scale telecommunications partnerships, but he declined to disclose the specific names.
In December last year, the Starlink project received nearly US$900 million in US federal subsidies to support rural broadband connections. The award accounts for about one-tenth of the $9.2 billion auction held by the Federal Communications Commission and will be distributed monthly for ten years.