Starlink Back From Outage Soon After SpaceX Strikes $17 Billion EchoStar Deal

In a bid to strengthen internet and mobile network connectivity, network service providers have been turning to the stars over the past couple of years.

No, they’re not looking to bounce signals off the moon, other natural satellites, or planets, but instead opting for man-made satellites—and one of the leading names in the satellite internet game is SpaceX’s Starlink.

Starlink has grown leaps and bounds in popularity, tying up with various network service providers around the world. One of the more recent developments includes Starlink's partnership with Airtel and Jio, two leading Indian telcos.

Now, SpaceX is looking to further grow its offerings in a mega deal with EchoStar, a premier provider of technology, networking services, television entertainment and connectivity.

SpaceX has entered into a definitive agreement with EchoStar to purchase its 50 MHz S-band spectrum in the U.S. (bands known as AWS-4 and PCS-H), in a deal totaling around $17 billion. This will be broken up into $8.5 billion in cash and up to $8.5 billion in SpaceX stock.

The two bands are set for satellite and mobile communications.

The deal—which is subject to relevant regulatory approvals—will also see SpaceX fork out around $2 billion of cash interest payments payable on EchoStar debt through November of 2027.

The two companies will also enter into a long-term commercial agreement that will see EchoStar's Boost Mobile subscribers gain access to SpaceX's next-generation Starlink Direct to Cell service. The company also owns spectrums in other parts of the world, meaning that Starlink could soon become a global carrier.

“For the past decade, we've acquired spectrum and facilitated worldwide 5G spectrum standards and devices, all with the foresight that direct-to-cell connectivity via satellite would change the way the world communicates,” said Hamid Akhavan, President & CEO, EchoStar.

On the flip side, Starlink will be able to develop and deploy a constellation of satellites that will “be capable of providing broadband service to cell phones globally.”


The move would allow SpaceX's Starlink to offer 5G and broadband connectivity, making it a competitor to many companies, including Verizon.

However, Verizon's CEO remains unfazed by this move, and in fact thinks Starlink's entry will be complementary to the veteran company.

“They can, of course, compete in broadband to consumers. We have many other competitors there. So, of course, I'm not naive, they can and they will compete with us in some areas, but I also see them as very complementary and adding to my opportunity to serve my customers even better,” said Verizon CEO Hans Vestberg.

Although Elon Musk, SpaceX CEO, might have different plans.

While appearing as a guest on the All-In podcast, Musk didn’t dismiss the possibility of purchasing Verizon, in a bid to own more spectrum. Of course, Verizon isn’t for sale.

Musk, though, did speak about the deal with EchoStar, addressing a key concern about its timeline.

The frequencies that SpaceX bought aren’t currently compatible with current chipsets, and the expectation is that it would take around two years for phones that support those frequencies to hit the market.

However, SpaceX also needs time to build satellites that can beam down the frequencies, which will happen concurrently.

“So, the phones that are able to use the spectrum that was acquired probably start shipping in around two years,” said Musk in the podcast. “And then we also need to build the satellites that are going to communicate on those frequencies. So, in parallel, we're building the satellites and working with the handset makers to add these frequencies to the phones.”

Once the deal goes through, the satellites are in orbit, and phone makers have upgraded their chips, users will be able to conduct data-intensive tasks anywhere with ease.

That is, if Starlink can keep its services up.

The company recently experienced a major outage that affected over 45,000 users at its peak, according to Downdetector.

While the outage was a brief one, Starlink’s website also blared a message acknowledging the service drop. The message, which was removed once services were restored, read as, “Starlink is currently experiencing a service outage. Our team is investigating.”

Prior to this, on July 24, Starlink confirmed a global network outage, one that lasted for approximately 2.5 hours and affected over 60,000 users—as per Downdetector, the peak number of reports was 64,004.

Despite these minor inconsistencies and inconveniences, Starlink has proven to be useful in desperate times, bringing life-saving connectivity to over 1.5 million people affected by hurricanes, severe flooding and wildfires in the U.S.

At the same time, the company keeps racking up partners around the world to help propel connectivity in remote areas, including a deal with United Airlines for in-flight connectivity.

Do you think such partnerships will help SpaceX’s Starlink capture a leading position in the satellite internet sector amid rising competition?

Let us know in the comments below!