No plan for tiered Starlink Internet pricing

SpaceX President Gwynne Shotwell does not believe the company will add “different pricing” to its Starlink direct-to-consumer satellite internet service, which is currently offered for $ 99 a month in limited advance access.

“I don’t think we’re going to make different pricing for consumers. We’re going to try to keep them as simple and transparent as possible, so at the moment, there are no different pricing plans for consumers,” said Shotwell. , speaking at Satellite 2021 “LEO Digital Forum” on a virtual panel on Tuesday.

In a tiered pricing system, what the customer pays is based on the level of service he chooses.

Starlink is the company’s capital-intensive project to build an interconnected internet network with thousands of satellites, known in the space industry as a constellation, designed to provide high-speed internet to consumers anywhere on the planet.

The company has launched more than 1,200 satellites in orbit so far.

In October, SpaceX began launching the early Starlink service in a public beta version that now extends to customers in the US, Canada, the United Kingdom, Germany and New Zealand – with service priced at $ 99 per month in the US, in addition to an initial cost for the equipment needed to connect to the satellites.

Elon Musk’s company continued to expand Starlink’s services, with the public beta winning over 10,000 users in the first three months. Shotwell noted that SpaceX does not “have a deadline to exit beta,” saying the company still has “a lot of work to do to make the network reliable”.

The Musk company plans to expand Starlink beyond homes, asking the FCC to extend its connectivity authorization to “moving vehicles” so that the service can be used with everything from aircraft to large ships and trucks.

For now, SpaceX is focused on serving customers in rural and hard-to-reach areas, with Shotwell saying that Starlink “will be able to serve all rural homes in the United States”, or “about 60 million people”. While SpaceX is adding service to other countries, Shotwell said that SpaceX is initially focused on the United States “because they speak English and are close and, if they have problems with their antenna, we can send one quickly”.

“But we definitely want to expand that capacity beyond the US and Canada,” added Shotwell.

A major obstacle for Starlink, as well as for any broadband satellite service, is the cost of user terminals: the terrestrial equipment that connects customers to the network.

Shotwell said that SpaceX “has made great progress in reducing the cost” of the Starlink user terminal, which originally cost about $ 3,000 each. She said the terminals now cost less than $ 1,500 and SpaceX “just launched a new version that saved about $ 200 in cost”.

This means that SpaceX is absorbing about two-thirds of the cost of the terminals, as the company is charging beta customers $ 499 in advance for a user terminal. Musk said earlier this year that Starlink “needs to go through a deep abyss of negative cash flow”, a significant part of which must be due to the cost of user terminals.

Although SpaceX is not charging customers the full cost of the terminals so far, Shotwell said the company expects its cost to drop to “the range of a few hundred dollars in the next year or two”.

Shotwell again emphasized previous comments from SpaceX’s leadership that Starlink is not looking to replace the “giant AT&T providers, Comcast, etc.” service, as she noted that its satellite internet is “very complementary to the services they provide” .

“The Starlink system is best suited for highly distributed rural or semi-rural populations,” said Shotwell.

In the meantime, Shotwell said that SpaceX’s challenge is to learn how to scale to consumer customers while “making sure that we can build a reliable network”. But, she added, none of these are “challenges that we can’t solve”.