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In reality, I dont think $100/m for high speed internet is too insane for for even low income rural homes. The competition costs more or at least similar to sta
by Beached 6y ago
In reality, I dont think $100/m for high speed internet is too insane for for even low income rural homes. The competition costs more or at least similar to starlink, but delivers a lesser product, i know from my own hellish experiences of living in rural America. I honestly think all but the most impoverished rural homes will considered starlink affordable and reasonable.
That being said, your question sparked my interest, so here is some back of the napkin math.
Currently spaceX launches 60 satellites per launch.
Each satellite is estimated to be roughly $250k (Exact cost not known),
An estimated rocket cost of $50m (for used)
So roughly $65mil per 60 sats, or 1.08mil per sat cost.
Each sat has an estimated lifespan of 5 years
So 65mil / 60 / 5 = ~$217,000/y per sat, not including personal costs for support, ground base stations, etc.
Currently there are 900 sats in orbit, I believe they are currently approved for 12,000 sats, but want to go up to 30,000 sats.
So for the current constellation they need $195mil/y or just under 165,000 customers at the $99/m (165,000 * 99 * 12)
For the 12,000 cluster, they would need to make 2.6bil per year, or 2.2mil customers at the $99/m (2,200,000 * 99 * 12)
For the 30,000 cluster, they would need to make 6.5bil per year, or 5.5mil customers at the $99/m (5,500,000 * 99 * 12)
For comparison, comcast has roughly ~28mil customers for internet.
Rural america is ~60mil people in total (census.gov) (not counting vacation or secondary houses from non rural americans)
so starlink's break even on rural subscribers only would be just under 10% of rural America. (lets call the cush government contracts a wash for operational costs for people and hardware on the ground?)
Note that ONLY 5.5mil Americans ( <2% of Americans) would fund all of the hardware cost and launch costs. Every other person in every other country around the world would theoretically be profit?
- elihu 6y agoAnother unknown (at least, it's unknown to me; I don't know if SpaceX has said enough publicly to figure it out) is how many users can they support with a given satellite cluster? I mean, if 10% of rural customers want to buy their service but actually they can only support 2% of rural customers due to uplink/downlink limits and the degree of oversubscription they're willing to do, then the economics of it is a lot harder to make work. I suppose it also matters a great deal how geographically distributed those rural customers are.
- nickik 6y agoSome nice math there. 55M$ is the price to buy a lunch, Spacex internal price will be much lower, likely below 40m. Some stats are launch with rideshare, those can make cost better. More importantly this is quite a temporary cost, soon they will start launching with Starship, witch should make the cost far, far lower. To get anywhere close to 30 or even 12k sats Starship will certainty be used. Once they hit production rates making standing constellation of 30k sats possible the price of the sats should come down much further. SpaceX really has put together a beautiful puzzle here. Literally nobody can replicate this anytime soon. Rural costumers are only one small branch, transportation, military, cloud computing, ISP backbone, backup net connection.