Original title: Musk: Starlink plan is still considering going public when the cash flow is predictable
The number of users of Starlink, the satellite Internet program of the US Space Exploration Technology Corporation (SpaceX), is expected to grow to 500,000 in the next year, but this program may need to continue to invest tens of billions of dollars to be finalized.
SpaceX CEO Musk said at the Mobile World Congress (MWC) in Barcelona on Tuesday that the Starlink project already has more than 70,000 active users, and the number of users hopes to exceed 500,000 in the next 12 months.
The goal of the Starlink project is to form an Internet network composed of tens of thousands of satellites to provide high-speed Internet services for users anywhere on the planet.
According to SpaceX’s plan, between 2019 and 2024, a “starlink” network consisting of approximately 12,000 satellites will be built in space, of which 1,584 will be deployed in low-Earth orbit 550 kilometers above the earth.
Starlink is currently the world‘s largest satellite constellation. So far, more than 1,500 satellites have been launched into low-Earth orbit. Musk said that Starlink is now operating in about 12 countries and regions and will add more users every month. He also revealed that SpaceX is working with telecommunications companies in major countries to provide them with access to Starlink.
Musk emphasized that, compared with traditional satellite services, SpaceX’s low-orbit satellites reduce the latency of its network services. “The delay of the Starlink system is similar to the delay of terrestrial fiber and 5G, so we hope to reduce the delay to less than 20 milliseconds.” Musk said. Latency and download speed are key metrics for Internet service providers.
SpaceX initially launched a test plan for specific users at a price of $99 per month, charging users $499. The company has also sought regulatory approval in the past year to test the network in flight and expand the service to large mobile devices such as ships and trucks.
However, Musk admitted that Starlink is a capital-intensive project. He said that the company is providing network terminals to customers at a loss-making price. The cost of each terminal hardware is close to 1,300 US dollars, but SpaceX charges users only 499 US dollars. “We are developing next-generation terminals, which provide the same level of capability, roughly the same level of capability, but at a much lower cost.” Musk said.
Musk predicts that Starlink will cost 5 billion to 10 billion U.S. dollars to fully put into operation. In the long run, the total investment of this plan will be as high as 20 to 30 billion U.S. dollars. But he believes that SpaceX can open up a larger market, making Starlink generate up to 30 billion U.S. dollars in annual revenue in the future, which is about 10 times the annual revenue of its rocket launch business.
According to Musk’s plan, Starlink’s commercial operation will provide more chips for the rocket launch business. SpaceX investor and founder of Singularity University Peter Diamandis told China Business News: “Starlink will officially enter the commercial operation stage this year. Musk’s idea is to keep SpaceX private, so By splitting and listing the profitable Starlink, SpaceX shareholders will be able to obtain shares in Starlink.”
Dimandis believes that Musk’s Mars plan is a longer-term plan that requires a lot of funds. “Keeping the company private means that you can invest your money on Mars regardless of costs, without disclosing detailed economic data, and without worrying about profits.” Dimandis told the CBN reporter.
In response to when SpaceX will go public, Musk recently responded: “Only when the cash flow of Starlink satellite broadband services becomes reasonably predictable, will it be considered for public listing.”
After SpaceX completed a round of $1.9 billion in financing in August last year, its valuation exceeded $46 billion; after SpaceX’s latest round of financing in February this year, its valuation has now jumped to $74 billion.
Zhang Lu, a Chinese investor in SpaceX, told CBN reporters that in the future, any company that needs space information can use Starlink’s services. “This is a brand-new commercial service. It has good technical parameters, low latency, and is no different from the current optical fiber information transmission.” Zhang Lu told China Business News reporter, “We were optimistic about it when SpaceX launched the Starlink project. Commercialization potential.”
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