SpaceX Will IPO Starlink

SpaceX COO Gwynn Shotwell says that SpaceX will likely spinoff the Starlink satellite network with an IPO.

SpaceX is launching 60 Starlink satellites with every Falcon 9 launch. They are four successful launches from minimum global coverage.

420 satellites are needed for minor broadband coverage of Earth and 780 of the first ~1600 for moderate coverage.

It would make sense to IPO after they have moderate coverage or full Northern hemisphere coverage. A spinout IPO would normally give current SpaceX owners shares of the spinout company. SpaceX would get cash from the IPO and SpaceX would retain shares in Starlink that were not sold in the IPO.

SpaceX expects more than US$30 billion in revenue by 2025 (or 2026) from its satellite constellation, while revenues from its launch business were expected to reach US$5 billion in the same year.

It Starlink achieves $50 billion per year in revenue in 2025-2027 then they would have revenue that is double the annual budget of NASA. Direct TV provides satellite TV services and it has $40 billion per year in revenue.

Internet traffic via a geostationary satellite has a minimum theoretical round-trip latency of at least 477 ms (between user and ground gateway), but current geostationary satellites have average latencies of 600 ms or more. Starlink satellites would orbit at ​1⁄30 to ​1⁄105 of the height of geostationary orbits, and will have Earth-to-sat latencies of around 25 to 35 ms. This latency will be comparable to existing cable and fiber networks. The latency will be lower for Starlink than any earth system for distances greater than 2000 miles. This is because light travels faster in a vacuum than in fiber. The system will use a peer-to-peer protocol simpler than IPv6. It will have end-to-end encryption natively.

Starlink satellites use Hall-effect thrusters with krypton gas as the reaction mass for orbit raising and station-keeping. Krypton Hall thrusters tend to exhibit significantly higher erosion of the flow channel compared to a similar electric propulsion system operated with xenon, but at a lower propellant cost.

SpaceX is going to four shifts for faster construction of the fully reusable Super Heavy Starship.

SpaceX has submitted requests to add 30,000 satellites for Starlink 3.0. They had 20 filings to the ITU (International Telecommunications for 1,500 satellites apiece in various low Earth orbits. SpaceX had originally filed for an initial Starlink network of 4425 satellites. Once the first 1000 satellites are up they will be able to start operation.

Low Latency Corporate Business for Financial Exchanges and Stock Trading Firms

It is worth New York and Chicago $100 million per year to put a premium microwave data connection between the two cities. This shaves 5% of the latency time from pricing updates and order placement. This has a lot of value when a big stock starts making a rapid move up or down.

Light travels about 50% faster in the vacuum of space than through a fiber. This would enable Starlink to provide lower latency than any ground-based fiber communication over distances greater than 2000 miles.

There would be 190 combinations of pairs of the top 20 financial cities. There are 435 combinations of pairs of the top 30 financial cities. If the top $100 million per year was paid by the top 20 cities, then this would be $19 billion per year. If the premium internet pairing for the connections to 21 to 30 was worth $10 million per year then this would be another $2.45 billion per year. Even with a half-price discount, the total would still be $10 billion per year.

The SpaceX Starlinks could save 30-50% of the latency time. The value for the Starlink financial latency reduction should be even higher. Let us say it is double the New York to Chicago price. This means the premium pairing of cities is worth over $40 billion per year.

Other industries may pay for premium pairing but there has to be a lot of money involved and value for shaving 30 milliseconds at some time in the year.

Internet Backhaul and 5G

SpaceX Starlink network will make money by helping improve the entire global internet. They will be able to provide a high bandwidth alternative to fiber.

90 percent of all internet traffic travels over wireline fiber, even if it ultimately goes on a wireless device.

It has been estimated that deploying 5G wireless speeds 10 to 100 times faster than 4G will cost $130 to $150 billion in fiber optic cabling alone over the next 5 to 7 years. There is a 28-page report from Deloitte on 5G and fiber. The Deloitte report was for the USA only. Europe and Asia will also build out 5G.

Consumer Service

Elon Musk described the looks of the Starlink Satellite receiver terminal. It will have motors.

The satellite receiver will need to be able track the low earth orbit satellites and shift to a different satellite. The satellites will be about 30 times farther than the altitude of a commercial passenger jet and they will be moving about 30 times faster. The apparent motion of the satellites relative to people on the ground will be like watching an airplane track across the sky.

There was a patent from SpaceX discussing the phased array shifters that will be needed.

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