Amazon has revealed its plans to purchase Globalstar in a deal worth $11.57 billion, marking a significant move into satellite-based internet services to directly compete with Elon Musk’s Starlink. This acquisition bolsters Amazon’s ambitions in low Earth orbit through its Amazon Leo program and provides a quicker entry into space-based connectivity. Globalstar is recognized for supporting emergency satellite functions on Apple devices like iPhones and Apple Watches. The agreement ensures the continued availability of satellite support for Apple’s safety features. This development comes as SpaceX’s Starlink maintains dominance in the market with a vast satellite fleet and millions of users worldwide, setting a high standard for newcomers such as Amazon.
Amazon has been steadily advancing its satellite internet system as part of a strategic initiative to offer connectivity beyond traditional mobile networks. With over 200 satellites already in orbit under its Amazon Leo project, Amazon aims to expand its network to approximately 3,200 satellites by 2029. A regulatory mandate requires the company to deploy a significant portion of its satellite constellation by July 2026, adding pressure to its deployment timeline.
Through the Globalstar acquisition, Amazon secures access to an existing network of about two dozen low Earth orbit satellites, providing an immediate boost to its direct-to-device initiatives. This approach allows smartphones and other devices to connect directly to satellites without relying on mobile towers, thereby extending coverage to areas with weak or no terrestrial network availability.
Despite the fierce competition, particularly from SpaceX’s Starlink, which operates a massive constellation of around 10,000 satellites and serves over nine million users globally, Amazon aims to bridge the gap swiftly by combining its infrastructure development with the integration of Globalstar’s system. This strategy is crucial for enhancing connectivity in rural and remote markets worldwide.
Apple Inc. has been a key player in Globalstar’s growth, utilizing its satellite network to power essential emergency features on supported iPhones and Apple Watches. Apple’s investment of approximately $1.5 billion in Globalstar has been instrumental in expanding satellite capabilities. With the acquisition, Amazon commits to maintaining and enhancing these services, ensuring the continuity of existing iPhone satellite features and future enhancements. Devices like the iPhone 14 and newer Apple Watch Ultra models rely on Globalstar’s network in the absence of cellular coverage, serving as vital safety tools for users in remote areas.
Under the deal structure, Globalstar shareholders have the option to receive either $90 in cash or 0.3210 Amazon shares per stock, with cash payouts capped at 40% of the total transaction value. The transaction is anticipated to conclude in 2027, subject to regulatory approvals and the achievement of key satellite deployment milestones. Once finalized, Globalstar will become part of Amazon’s broader satellite ecosystem, aimed at expanding direct-to-device communication and strengthening partnerships with mobile operators. The transition for Apple users is set to be seamless, positioning Amazon for a more competitive edge in the evolving landscape of satellite communications and global connectivity.