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Started by Lowrate-News-Bot, Oct 12, 2022, 09:09 PM
I took the summer off to move with my family from California to Virginia, thus escaping the inevitable fires of doom. I deliberately left my Apple/Globalstar column up so it would be still staring at readers when Apple made its eventual announcement, which was yesterday. That was a gutsy move on my part, but clearly I was correct. Today's column — my first from our new home in Virginia — looks at specifics of the Apple satellite announcement, placing it in a more informed context.
Apple spent only five out of 65 minutes in yesterday’s product announcements talking about satellites, yet the title of the event — Far Out — and the starry logo suggest those were very important minutes to Apple.
The satellite part starts at 59:30 in the video.
From what we already knew going into yesterday’s event, Apple downplayed the satellite news. They limited their usage case to emergency SOS texts in the USA and Canada, sorta said it would be just for iPhone 14s, and be free for only the first two years. They showed a satellite app and very deliberately tried to make it look difficult to use. They gave no technical details and there was no talk of industry partners.
Yet there were hints of what’s to come. We (you and I, based on my previous column) already knew, for example, that ANY iPhone can be made to work with Globalstar. We also knew the deal was with Globalstar, which Apple never mentioned but Globalstar confirmed, more or less, later in the day in an SEC filing. But Apple DID mention Find My and Air Tags, notably saying they’d work through the satellites even without having to first beseech the sky with an app. So the app is less than it seems and Apple’s satellite network will quickly find its use for the Internet of Things (IoT) as we already knew.
Apple very specifically said nothing about the global reach of Find My and Air Tags. There is no reason why those services can’t have immediate global satellite support, given that the notification system is entirely within Apple’s ecosystem and is not dependent on 911-type public safety agreements.
Maybe it will take a couple years to cover the world with SOS, but not for Find My, which means not for IoT — a business headed fast toward $1 trillion and will therefore have a near-immediate impact on Apple's bottom line.
But Apple needs more satellites, that’s clear. Either 17 or 24 more are already on their way depending who is telling the story, but over time Apple will need hundreds more. Apple doesn't need spectrum, which was the main value of Globalstar to Cupertino and is Apple’s key advantage over all of the mobile carriers.
It will take Apple SEVEN YEARS to build-out its constellation (that's Cupertino's plan), which is to say the incumbent carriers have something less than seven years before their businesses are to at least some extent ceded to Apple.
Two things could happen to slow down Apple’s success. They could lose their Globalstar exclusive or lose Globalstar entirely. Apple needs that exclusive because Samsung phones are just as good as iPhones for Globalstar connectivity. That’s why I keep assuming Apple will buy Globalstar.
It’s sure SOMEONE will buy Globalstar. If not Apple, maybe Elon Musk.
Elon made a deal to buy Twitter, so he knows how the game is played. And he needs spectrum as much or more than Apple if his T-Mobile satellite strategy is to have a hope. Why not buy Globalstar? So I expect a tender offer from Elon as an individual or from SpaceX, forcing Apple to respond. The game is afoot!
As the owner of SpaceX and Starlink, Musk is more likely than Apple to face antitrust problems with acquiring Globalstar. Still, I think Apple has been too coy in this deal and should move quickly to get 'er done. After all, some third-party (even a private equity firm or hedge fund) could be inspired by Elon to make its own tender offer for Globalstar.
If Elon can’t get Globalstar, he and his partners will push for the regulatory expansion into space of terrestrial 5G licenses, which will probably be successful. This will happen, frankly, whether SpaceX and T-Mobile are successful or not, because AST&Science and its investors AT&T, Verizon and Zodafone need 5G in space, too, to compete with Apple. So there WILL eventually be satellite competition for Apple and I think the ITU will eventually succumb to industry pressure.
Apple has money but doesn’t have time. The SpaceX/T-Mobile announcement two weeks ago took away from Apple its ability to control the pace of change for cellular in space. Cupertino needs 600-1000 satellites in orbit ASAP, because in that same time SpaceX will launch 3000.
If Apple is going to compete, Apple will have to COMPETE, which means adding not just satellites but new satellite designs and manufacturers. The typical satellite four year design-manufacture-launch cycle doesn’t happen at SpaceX so it can’t happen at Apple, either, if Cupertino is serious about space.
This is a story that will take a couple years to play-out (but not seven) and the eventual winner is not at all clear, at least not to me.