SpaceX is the champion of integration: the company builds its own rockets, with its own engines, it launches them, it works on a moon landing module, sends tourists into space… and it put Starlink into orbit , the largest constellation of low-altitude satellites, intended to connect underserved regions to the Internet.
Starlink is not an activity like any other in the portfolio of SpaceX: central pillar of its economic model, it is a bit of the fuel which must finance its activities and the dream displayed by its boss: to go to Mars.
An unlisted company, SpaceX does not publish its accounts… But as of 2015, an internal document that leaked into the wall street journal shows the extent of its ambitions for Starlink, then in the state of a simple project: a launch was to be planned for 2018, and its revenues were to exceed those generated by rocket launches by 2020, and reach 30 billion dollars in 2025 (about 28.4 billion euros), with 40 million customers, for an operating profit of 15 to 20 billion… In comparison, SpaceX only forecast 1.8 billion dollars in total turnover for 2016.
A quick calculation
Gwynne Shotwell, SpaceX’s number two, confirms the centrality of the constellation, with a quick math: “The global market for space launches weighs 6 to 8 billion dollars per year. That of the Internet connection can be evaluated at 1,000 billion dollars. Imagine that SpaceX obtains 60% of the launcher market and only 3% of the connection market… Starlink is indeed our biggest potential source of income”, she explained in September in front of journalists in Paris.
Indeed, according to this scenario, launchers (for satellites, astronauts, equipment, etc.) would generate 4 to 5 billion dollars in turnover per year, compared to 30 billion for the constellation, i.e. 6 to 7.5 times more… It is better to have a very small slice of a very large cake than a large slice of a small cake, SpaceX reasons. “Starlink is a huge monetization opportunity. And we are seeing more and more synergies with SpaceX,” also deciphers the financial analyst Dan Ives, of the bank Wedbush Securities.
The small antennas necessary for reception are now sold at a loss: billed at 600 dollars, they cost more than 1,000 dollars to produce.
In Elon Musk’s mind, Starlink is therefore a “crucial stepping stone” to realize his dream of establishing a city on Mars and a base on the Moon, as he explained in 2019 to the Space.com site. “We think we can use Starlink to fund Starship,” he added, referring to his giant rocket designed to go to the Red Planet. “If we want to take people to the Moon and Mars, we have to make sure that they can communicate there and with the Earth,” also affirms very seriously Mme Shotwell.
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