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$50M is the launch cost for SpaceX customers. Musk has said in an interview that the marginal cost of a reused Falcon 9 launch is $15 million. That means even t

$50M is the launch cost for SpaceX customers. Musk has said in an interview that the marginal cost of a reused Falcon 9 launch is $15 million. That means even the tiny subscriber base they have at the moment is already paying a significant chunk of the launches. That would make your numbers $420m every five years, or $84 million a year - slighly more than your average telecom CEO compensation. But the goal for starship is $2m per launch. Let's assume that is bullshit and go for $10M instead, and only 300 satellites per launch. That's already down to ~$10M/year to maintain the entire constellation. Now you have room for all the other costs you mention. If they reach the stated goals, it will cost peanuts... you can see where this is going. Starship will be a ridiculous leap in launch costs if it comes to fruition. The max capacity for the network, once at 42k satellites, is estimated to be around 50M people worldwide. Plus, you could have a downlink shared, say, among 50 people and spread the cost - 1-10mbps is still miles beyond 'no internet access'. You might think the plan is crazy, but the math checks out. If this whole thing works, they could charge $10/month and be in the green - the satellites themselves will be the cheapest part of the whole system. No rent, no right of way, no construction, no maintenance work, free energy and extremely low material costs.

ricardobeat 5y ago
To add on the costs (yeah I have nothing better to do) - ground station: must be negligible compared to everything else. They are literally planting giant routers out in a farm, need to pay rent, power and cabling to an exchange. Zero other infrastructure costs - internet bandwidth: despite Netflix's attempts, ISPs have peering agreements that are usually free, as does Starlink - satellite production: nobody knows, but they have said the payload is cheaper than the launch, so somewhere between $250-500k each at start - customer service: online only, seems like the dish is self-diagnosing, will likely end up being much lower than traditional broadband
- tsimionescu 5y ago
  > - ground station: must be negligible compared to everything else. They are literally planting giant routers out in a farm, need to pay rent, power and cabling to an exchange. Zero other infrastructure costs Fair enough, though you're neglecting the costs for building this all over the world, if they want to get access to any size of market. > - internet bandwidth: despite Netflix's attempts, ISPs have peering agreements that are usually free, as does Starlink Actually, according to Cloudlflare[0], you still need to buy a significant amount of traffic through transit agreements - cloud flare pays for 40% of its traffic in Europe (at a price they don't disclose), 60% in the USA (same price as in Europe), 40% in Asia (at 7 times the European price), 10% in Africa (at 14 times European price), 40% in South America (at 17 times European price), and 50% in Oceania (at 17 times European price). Only the Middle East region is 100% peered for them. So the cost to actually deliver internet is definitely not going to be 0. > - satellite production: nobody knows, but they have said the payload is cheaper than the launch, so somewhere between $250-500k each at start So that is another 15M$ per launch at their declared aspirational cost (or an extra 100M$ per launch if you believe the Starship numbers). Just maintaing the entire constellation today would cost ~100M$/year, assuming almost all satellites reach their 5 year life span (current failure rate is 6% after one year). > - customer service: online only, seems like the dish is self-diagnosing, will likely end up being much lower than traditional broadband You can't sell online only customer support for access to the Internet if you want to reach any kind of realistic market. Furthermore, customer service more broadly includes delivery, sales, marketing, training materials; and this will be required all over the world, since they must target customers in remote places with little or no acces to the internet today. [0] https://blog.cloudflare.com/bandwidth-costs-around-the-world/ https://blog.cloudflare.com/bandwidth-costs-around-the-world...
  - ricardobeat 5y ago
    Fair points. Though I’m not sure cloudflare is a good reference - they are a content provider and will pay for a competitive advantage (latency). The post mentions 50% of their costs come from 6% of traffic, they could simply choose to not pay for transit and let these be rerouted elsewhere. Once Starlink has the satellite “mesh” operational they would probably become a tier-1 ISP and have zero transit costs. Maybe even sell traffic to other ISPs.
    - tsimionescu 5y ago
      Sure, that's a good point, and the Cloudflare article is from 2016, so the market may have advanced as well. On the other hand, unless they somehow get the laser communication working, which is still a research problem despite their optimism, they have way too high latency to act as a tier 1 ISP - all traffic currently goes consumer - 1 satellite - ground station - Internet.
shaklee3 5y ago
Your math is way off. 50M subs with the coverage over land and total bandwidth will put their provisioning rate (Bps/sub) way below even the Geo satellite providers. They need to charge a lot more or provide slower service by having more people.
- ricardobeat 5y ago
  For the full network: 42000 sats 20gbps each ~1k users 2gbps @ 100:1 oversub 1gbps @ 50:1 oversub And that’s assuming next generations will not improve downlink speeds. It does assume satellites would be fully utilized which is wrong unless we populate the oceans, but that’s the theoretical max.
  - shaklee3 5y ago
    That's the entire point. They're mostly over the ocean/areas without high-paying customers 70-90% of the time. Because of that, it would be more like (in the best case): 42k sats@20G * 0.2 * 5 million subs target = 33Mbps/sub. However, that's not even close to realistic either because the high-paying subs are in the US and parts of Europe only, and you can't keep piling 42k satellites in the same plane. So in reality, that will be cut significantly from that.
- deleted 5y ago
  [deleted]
tsimionescu 5y ago
> Musk has said in an interview that the marginal cost of a reused Falcon 9 launch is $15 million. Musk has said many things in interviews that have little to do with reality. Even if that number is true launch costs are more than the rocket itself. Even if we accepted the number, to make economic sense, they would have to get more value from 60 satellites than the $35M of profit they would make on each launch if they were launching commercialy. > But the goal for starship is $2m per launch. Let's assume that is bullshit and go for $10M instead, and only 300 satellites per launch. Prices for rockets similar to Starship are in the $150-200M range, so that is more the ballpark I expect from Starship, if it does fly. Perhaps it can go down to as low as 75-100M range, half the current cost of similar rockets! $10M is fantasy. Not to mention, they are already being accused of breaking environmental regulations and other problems, so it wouldn't be surprising if launch costs actually go up if they are to maintain compliance.
- tigershark 5y ago
  There is no other fully reusable rocket similar to starship (or even different, it doesn’t simply exist). Please stop inventing numbers and lying. And for your information starship already fled and landed and there is an orbital launch attempt likely in the next 2-4 months.
  - tsimionescu 5y ago
    I'm talking about the costs for launching a rocket of similar size. And note that for Falcon 9, the difference in price for new rockets VS reused boosters is 62M -> 50M, not an almost hundred fold decrease.
    - tsimionescu 5y ago
      Reply, because I can't edit: so far, only the second stage stage of Starship has been flown. The SuperHeavy booster has not yet been flown at all,nevermind successfully landing, and ditto for the two-stage system.
- ricardobeat 5y ago

ricardobeat 5y ago

To add on the costs (yeah I have nothing better to do) - ground station: must be negligible compared to everything else. They are literally planting giant routers out in a farm, need to pay rent, power and cabling to an exchange. Zero other infrastructure costs - internet bandwidth: despite Netflix's attempts, ISPs have peering agreements that are usually free, as does Starlink - satellite production: nobody knows, but they have said the payload is cheaper than the launch, so somewhere between $250-500k each at start - customer service: online only, seems like the dish is self-diagnosing, will likely end up being much lower than traditional broadband

tsimionescu 5y ago
> - ground station: must be negligible compared to everything else. They are literally planting giant routers out in a farm, need to pay rent, power and cabling to an exchange. Zero other infrastructure costs Fair enough, though you're neglecting the costs for building this all over the world, if they want to get access to any size of market. > - internet bandwidth: despite Netflix's attempts, ISPs have peering agreements that are usually free, as does Starlink Actually, according to Cloudlflare[0], you still need to buy a significant amount of traffic through transit agreements - cloud flare pays for 40% of its traffic in Europe (at a price they don't disclose), 60% in the USA (same price as in Europe), 40% in Asia (at 7 times the European price), 10% in Africa (at 14 times European price), 40% in South America (at 17 times European price), and 50% in Oceania (at 17 times European price). Only the Middle East region is 100% peered for them. So the cost to actually deliver internet is definitely not going to be 0. > - satellite production: nobody knows, but they have said the payload is cheaper than the launch, so somewhere between $250-500k each at start So that is another 15M$ per launch at their declared aspirational cost (or an extra 100M$ per launch if you believe the Starship numbers). Just maintaing the entire constellation today would cost ~100M$/year, assuming almost all satellites reach their 5 year life span (current failure rate is 6% after one year). > - customer service: online only, seems like the dish is self-diagnosing, will likely end up being much lower than traditional broadband You can't sell online only customer support for access to the Internet if you want to reach any kind of realistic market. Furthermore, customer service more broadly includes delivery, sales, marketing, training materials; and this will be required all over the world, since they must target customers in remote places with little or no acces to the internet today. [0] https://blog.cloudflare.com/bandwidth-costs-around-the-world/ https://blog.cloudflare.com/bandwidth-costs-around-the-world...
- ricardobeat 5y ago
  Fair points. Though I’m not sure cloudflare is a good reference - they are a content provider and will pay for a competitive advantage (latency). The post mentions 50% of their costs come from 6% of traffic, they could simply choose to not pay for transit and let these be rerouted elsewhere. Once Starlink has the satellite “mesh” operational they would probably become a tier-1 ISP and have zero transit costs. Maybe even sell traffic to other ISPs.
  - tsimionescu 5y ago
    Sure, that's a good point, and the Cloudflare article is from 2016, so the market may have advanced as well. On the other hand, unless they somehow get the laser communication working, which is still a research problem despite their optimism, they have way too high latency to act as a tier 1 ISP - all traffic currently goes consumer - 1 satellite - ground station - Internet.

shaklee3 5y ago

Your math is way off. 50M subs with the coverage over land and total bandwidth will put their provisioning rate (Bps/sub) way below even the Geo satellite providers. They need to charge a lot more or provide slower service by having more people.

ricardobeat 5y ago
For the full network: 42000 sats 20gbps each ~1k users 2gbps @ 100:1 oversub 1gbps @ 50:1 oversub And that’s assuming next generations will not improve downlink speeds. It does assume satellites would be fully utilized which is wrong unless we populate the oceans, but that’s the theoretical max.
- shaklee3 5y ago
  That's the entire point. They're mostly over the ocean/areas without high-paying customers 70-90% of the time. Because of that, it would be more like (in the best case): 42k sats@20G * 0.2 * 5 million subs target = 33Mbps/sub. However, that's not even close to realistic either because the high-paying subs are in the US and parts of Europe only, and you can't keep piling 42k satellites in the same plane. So in reality, that will be cut significantly from that.
deleted 5y ago
[deleted]

tsimionescu 5y ago

> Musk has said in an interview that the marginal cost of a reused Falcon 9 launch is $15 million. Musk has said many things in interviews that have little to do with reality. Even if that number is true launch costs are more than the rocket itself. Even if we accepted the number, to make economic sense, they would have to get more value from 60 satellites than the $35M of profit they would make on each launch if they were launching commercialy. > But the goal for starship is $2m per launch. Let's assume that is bullshit and go for $10M instead, and only 300 satellites per launch. Prices for rockets similar to Starship are in the $150-200M range, so that is more the ballpark I expect from Starship, if it does fly. Perhaps it can go down to as low as 75-100M range, half the current cost of similar rockets! $10M is fantasy. Not to mention, they are already being accused of breaking environmental regulations and other problems, so it wouldn't be surprising if launch costs actually go up if they are to maintain compliance.

tigershark 5y ago
There is no other fully reusable rocket similar to starship (or even different, it doesn’t simply exist). Please stop inventing numbers and lying. And for your information starship already fled and landed and there is an orbital launch attempt likely in the next 2-4 months.
- tsimionescu 5y ago
  I'm talking about the costs for launching a rocket of similar size. And note that for Falcon 9, the difference in price for new rockets VS reused boosters is 62M -> 50M, not an almost hundred fold decrease.
  - tsimionescu 5y ago
    Reply, because I can't edit: so far, only the second stage stage of Starship has been flown. The SuperHeavy booster has not yet been flown at all,nevermind successfully landing, and ditto for the two-stage system.
ricardobeat 5y ago