Apple recently announced a groundbreaking $1.5 billion investment in Globalstar, a satellite communications company. This investment marks a significant step towards advancing direct-to-device satellite services. This investment comprises $1.1 billion for satellite infrastructure and $400 million for a 20% equity stake in Globalstar.
Emma Mohr-McClune, a Chief Analyst at GlobalData, offers her perspective:
"This strategic alliance strengthens Apple's role in the connectivity ecosystem, affecting carriers and original equipment manufacturers (OEMs). It represents the enormous low Earth orbit (LEO) satellite deal with a consumer OEM, positioning Apple as a leader among Western OEMs in offering enhanced direct satellite messaging and calling, particularly for emergencies and remote areas.
"According to the updated agreement, Globalstar will continue to dedicate 85% of its network capacity to Apple. The $1.1 billion will fund a new satellite constellation, expanded ground infrastructure, and the acquisition of more global mobile satellite services (MSS) licenses. This builds on their 2022 collaboration, which initially enabled iPhone 14 users to utilize Globalstar's L-band satellites for emergency text messaging. The service has since evolved to support more remote functionalities with the latest iOS updates.
"The partnership between Apple and Globalstar diminishes the likelihood of mobile network operators entering similar satellite connectivity agreements. As a result, iPhone users may gain expedited access to advanced direct-to-device services independent of their wireless provider.
"Apple's initiative underscores its dedication to the connectivity sector, although its business-to-consumer monetization strategy remains undefined. While premium plans are not anticipated in the near term, Apple is expected to continue offering complimentary satellite services with iPhone purchases through at least 2025, extending the original complimentary service period for iPhone 14 users."
