{"id":17171,"date":"2024-09-11T17:55:00","date_gmt":"2024-09-11T09:55:00","guid":{"rendered":"https:\/\/wp-productionenv-bjg9h2g2bgg5b8aa.southeastasia-01.azurewebsites.net\/news\/market-study-says-amazon-is-spending-up-to-20b-on-project-kuiper-satellite-network\/"},"modified":"2024-09-11T17:55:00","modified_gmt":"2024-09-11T09:55:00","slug":"market-study-says-amazon-is-spending-up-to-20b-on-project-kuiper-satellite-network","status":"publish","type":"post","link":"https:\/\/starpath.global\/news\/market-study-says-amazon-is-spending-up-to-20b-on-project-kuiper-satellite-network\/","title":{"rendered":"Market study says Amazon is spending up to $20B on Project Kuiper satellite network"},"content":{"rendered":"
\"Atlas
United Launch Alliance\u2019s Atlas V rocket lifts off with two prototype Amazon satellites in October 2023. (ULA Photo)<\/figcaption><\/figure>\n

A newly published market analysis of Amazon\u2019s Project Kuiper effort to create a global satellite broadband network estimates the cost of getting the project off the ground at $16.5 billion to $20 billion \u2014 which is significantly higher than the $10 billion figure cited by the company four years ago.<\/p>\n

Although the expense is significant, the payoff could be even higher, according to this week\u2019s analysis from Florida-based Quilty Space. The report suggests that revenue from the project could amount to tens of billions of dollars annually.<\/p>\n

Project Kuiper aims to put 3,232 satellites into low Earth orbit to support a high-speed internet network that could serve tens of millions of users around the world \u2014 and, not incidentally, provide infrastructure for Amazon Web Services and for other current or future offerings from Amazon. Under the terms of Amazon\u2019s license from the Federal Communications Commission, half of those satellites must be launched by mid-2026.<\/p>\n

Amazon is well behind SpaceX and its Starlink satellite broadband network, which has more than 6,000 satellites in orbit. Quilty\u2019s financial analysis says Starlink \u201cwill exit 2024 with 3.9M subscribers, revenues of $6.6B, and positive free cash flows.\u201d But Quilty suggests there\u2019s still plenty of room in the market for Project Kuiper.<\/p>\n

\u201cIf Amazon can reach 100 million [subscriptions] at an average monthly ARPU [average revenue per user] of $30, Kuiper would generate $36B in annual revenues, rivaling Amazon\u2019s current subscription revenues,\u201d the report says.<\/p>\n

First, the constellation has to be placed in orbit. Two prototype Kuiper satellites were successfully launched on United Launch Alliance\u2019s Atlas V rocket last year, and Amazon says another Atlas V is due to send the first operational satellites into orbit by mid-2025. The current schedule calls for broadband services to be offered to customers starting later in 2025.<\/p>\n

The Quilty report projects that launch costs alone will eventually amount to $10 billion or more. Most of those launches are to be done by ULA\u2019s Vulcan Centaur rocket, which has executed only one space launch to date; and by Blue Origin\u2019s New Glenn rocket, which is still in development. Other launches will be taken on by the Atlas V and SpaceX\u2019s Falcon 9 (which are tried and true), plus Arianespace\u2019s Ariane 6 (which had its debut liftoff in July).<\/p>\n

Quilty says one of the project\u2019s biggest uncertainties has to do with Amazon\u2019s ability to deliver on its launch schedule. \u201cAmazon\u2019s alarmingly high reliance on all-new launch vehicles poses the biggest impediment to getting Kuiper off the ground,\u201d according to the report.<\/p>\n

In order to meet the FCC\u2019s mid-2026 deadline, Amazon\u2019s partners would have to speed their early launch rates \u201cto a level not seen before in the history of private space launch,\u201d Quilty says.<\/p>\n

\u201cThe reality is, barring a miracle, Amazon will need a waiver from the FCC, but we don\u2019t see this as a major roadblock,\u201d the report says.<\/p>\n

The report also cites what it calls Amazon\u2019s \u201cshaky\u201d track record on consumer devices. \u201cIf Kuiper\u2019s expenses spiral and milestones are missed, it risks becoming another costly misstep, similar to unprofitable Amazon ventures like Alexa and the Halo fitness trackers,\u201d it says.<\/p>\n

Other highlights from the report:<\/strong><\/p>\n