Starlink Can Earn $6 Billion With 12k Satellites Says Cathie Wood's Ark Invest

Space Exploration Technologies Corp.'s (SpaceX) Starlink satellite internet constellation volition have an addressable market of $half dozen billion, believes Cathie Woods'due south investment management firm, Ark Invest. Ark's projections for Starlink were shared by its analyst Sam Korus through a Medium post, with the annotator modeling the data based on a significant number of Starlink satellites deployed. His models reveal that SpaceX can target two singled-out user sets with Starlink, with both having a roughly equal addressable market globally. Starlink currently has roughly 1,600 satellites in orbit after SpaceX took a breather from its aggressive launch cadency, which it had maintained until May this yr.

Starlink Can Serve Upwardly To 30 1000000 Users With 12,000 Satellites Believes Ark Invest

The data analyzed by the investment firm uses a couple of key assumptions. Offset of all, information technology bases its conclusions on a 12,000 Starlink satellite constellation, which will have years for SpaceX to deploy through its Falcon 9 rocket. Notwithstanding, its new rocket, Starship, which is currently nether development in Boca Chica, Texas, will vastly aggrandize its ability to launch the satellites. SpaceX'due south executives have hinted that Starship can carry every bit many as 400 satellites, and due to the new rocket's powerful second or upper phase, information technology can as well evangelize them faster to their orbits than the Falcon nine can.

Ark's gauge of 12,000 satellites for Strlinnk is based on the number of satellites that the Federal Communications Commission (FCC) has currently authorized SpaceX to deploy. The FCC's start approval for the deployment came in March 2019, when information technology allowed the deployment of four,425 Starlink satellites. In Nov, eight months after, this was followed past another order that authorized the deployment of another 7,518 satellites to bring the total tally up to roughly 12,000 spacecraft.

In addition to these, SpaceX has as well requested the Commission to let it deploy 30,000 spacecraft at significantly lower altitudes than the original spacecraft. These second-generation satellites are idea to form the backbone of Starlink'due south global connectivity aims. They volition characteristic major changes such as higher capacities and manufacturing cost-effectiveness than the first two batches approved by the Committee.

Ark Investment's market place model for Starlink concludes that the service tin earn roughly the same revenue from two different user categories with unlike budgets. Prototype: Sam Korus/Medium

Using monthly broadband prices, boilerplate download speeds and cost of internet globally, adjusted by gdp (Gross domestic product), Korus came up with two ranges of prices that users volition exist willing to pay for Starlink. I of these, the $75 - $100 range, is the i Starlink is currently targeting as the monthly subscription fees for its beta users sit at $99. The 2d range is the $10 - $twenty subscription fee, with both having roughly the same full addressable market (TAM).

Equally is natural in demand and supply economics, the annual addressable acquirement for the lower subscription fee band is slightly higher, crossing $vi billion. However, this comes with the natural uptick in the number of users using Starlink, and it will be a pregnant constraint for the internet service to overcome.

The analyst follows upward his acquirement approximate with a model of the users belonging to each category, and the difference is quite stark.

Starlink will have to serve roughly six times the users for the lower price bracket to earn the same revenue from the 2 major addressable revenues. Image: Sam Korus/Twitter

Matching the monthly subscription fee with the addressable user count, the annotator reveals that the lower cost subclass ($10 - $twenty) will require Starlink to service more than than thirty million users to gain access to the $vi billion revenue pie. This is 5 times the boosted users for the $75 - $100 bracket, which requires serving a picayune over 5 million users.

SpaceX has also requested the FCC to increase its license potency of ane one thousand thousand user terminals to five meg. This request was made in August last year, and it came presently after the company received the potency for deploying the ane 1000000 dishes.

Starlink has shipped 100,000 user terminals so far, revealed SpaceX main Mr. Elon Musk late last month. Musk'southward company as well plans to manufacture "millions" of these terminals in a new mill in Austin, Texas, as it scales up its plans for global coverage to fund interplanetary space exploration.