In news that is likely to be relevant to developing world markets where coverage of remote areas remains a problem, iPhone maker Apple has announced that it will invest up to US$1.5 billion in Globalstar, a provider of satellite and terrestrial connectivity services, to fund the expansion of its iPhone communication services.
Under the funding agreement, Apple will commit US$1.1 billion in cash. The remainder of the US$1.5 billion will be used to purchase 20% equity in Globalstar for US$400 million. Globalstar has said it will use a portion of the funds to pay down debt.
Reuters reports that Globalstar has said it will allocate 85% of its network capacity to Apple. The deal is expected to close this week.
We’ve reported regularly on the growing trend for mobile service providers to partner satellite operators to allow them to use satellite connectivity to reach customers in regions with limited network access and, as Reuters points out, Apple partnered with Globalstar in 2022 for a feature that would allow Apple users to send emergency messages from remote areas.
It’s not clear whether this new deal is part of a satellite-to-phone play. However, that is where a lot of investment is now going. In August we reported that Lynk Global, a satellite-to-phone telecoms provider, and operator Vodafone Kiribati, were beginning initial satellite direct-to-mobile phone services to subscribers.
More recently, satellite communications provider Viasat was reported to be testing direct-to-device (D2D) satellite connectivity in India in collaboration with state-owned operator BSNL.
All this activity should be no surprise, as we reported at the start of this year, according to Northern Sky Research, a major name in satellite and space market research and consulting services, the direct satellite-to-device market is the single biggest opportunity in satellite communications history.
