Last week, during our inaugural Ars Live event, Quilty Space director of research Caleb Henry joined Ars space editor Eric Berger for a discussion of SpaceX’s Starlink and other satellite internet systems. We discussed Starlink’s rapid road to profitability—it took just five years from the first launch of operational satellites—and the future of the technology.
One of the keys to Starlink’s success is its vertical integration as a core business at SpaceX, which operates the world’s only reusable rocket, the Falcon 9. This has allowed the company not just to launch a constellation of 6,000 satellites—but to do so at relatively low cost.
“At one point, SpaceX had publicly said that it was $28 million,” Henry said of the company’s target for a Falcon 9 launch cost. “We believe today that they are below $20 million per launch and actually lower than that… I would put it in the mid teens for how much it costs them internally. And that’s going down as they increase the reuse of the vehicle. Recently, they’ve launched their 20th, maybe 21st, use of a first-stage rocket. And as they can amortize the cost of the booster over a greater number of missions, that only helps them with their business case.”
SpaceX was founded as a launch company in 2002, first with the Falcon 1 and then the Falcon 9 and Falcon Heavy rockets. But it is clear today that a significant portion of the company’s revenue, if not a majority, comes from its Starlink satellite internet business. So is it still primarily a rocket company?
“I think today they’re a satellite communications company,” Henry said of SpaceX. “I think it’s interesting that Stéphane Israël from Arianespace—in the early days, like 2015, 2016 when Starlink was just announced—would try to court customers and say, ‘Do you want to fund your competitor?’ And no one really took him seriously. Now people are taking him very seriously. [SpaceX is] the largest satellite operator in the world. They have literally more than doubled the number of consumer subscribers for satellite internet in the world.. This is a humongous, nearly unrivaled impact that they’ve had on the industry.”
Please find our entire discussion in the video above, complete with a transcript.
Listing image by SpaceX