How Much Will Amazon’s High-Speed Satellite Internet Cost Compared to Elon Musk’s Starlink?
Amazon announced it was “one step closer to deploying its full satellite constellation” on July 21, with construction underway on a new satellite-processing facility at NASA’s Kennedy Space Center in Florida — Project Kuiper. Amazon indicated it was investing $120 million in new construction and high-value equipment for the facility and creating up to 50 new jobs on the Space Coast.
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Project Kuiper is a low Earth orbit (LEO) satellite network initiative to increase global broadband access through a constellation of 3,236 satellites. The project aims to provide fast, affordable broadband to unserved and underserved communities around the world, per a company statement.
As Bloomberg noted, Project Kuiper is similar to Elon Musk’s Starlink — SpaceX’s satellite internet service — which uses thousands of satellites in low orbit to beam broadband internet to Earth. As of July 2023, there are 4,519 Starlink satellites in orbit. An estimated 4,487 are operational, according to astronomer Jonathan McDowell, per Space.com.
In terms of how the two services will compare price-wise, it’s not yet clear. Amazon hasn’t specified what it will charge for its service. In March, Amazon said it had “an ambitious goal at the start of the project: design a customer terminal that costs less than $500 to build.”
And in April, CEO Andy Jassy said in a letter to shareholders that the company “recently unveiled the new terminals that will communicate with the satellites passing overhead, and we expect to be able to produce our standard residential version for less than $400 each.”
In comparison, Starlink charges $90 to $120 per month for residential service, with a $599 equipment fee. For businesses, it charges $250 to $1,500 a month with a $2,500 equipment fee.
CEO Andy Jassy said in a April 2023 earnings call that the number of potential customers for its service is “very large”: “It’s hundreds of millions of households and businesses and government entities that today have limited to no connectivity to the internet,” he said, according to the transcript of the call.
Experts Suggest Kuiper To Be Cheaper Than Starlink
Peter Cohan — associate professor of management practice, Babson College — said that while he doesn’t know how much Amazon will charge for the service, his estimate of $1,000 per subscriber-year is significantly below Starlink’s price.
“At $400 each, Amazon’s standard terminal costs 33% less than Starlink’s $599. Starlink charges about $1,500 per subscriber-year — 2 million subscribers generating about $3 billion in revenue in 2023,” he said. “So, I would not be surprised if Amazon charges $1,000 per subscriber per year. This low price would be attracting new subscribers in the $1 trillion market. What’s more, Amazon is likely to offer a range of prices for different tiers of service.”
Amazon also said it’s set to launch two prototype satellites in the coming months, and expects to begin production launches and early enterprise customer pilots in 2024.
When Amazon first announced in 2019 it was working on the project, Musk tweeted back: “@Jeff Bezos copycat.”
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