SpaceX has been selling Starlink dishes at loss despite $499 price tag.
SpaceX has been selling Starlink dishes at loss despite $499 price tag
The satellite dish SpaceX has been shipping to Starlink customers is actually worth far more than the $499 it's charging its customers.
On Tuesday, SpaceX President Gwynne Shotwell revealed at a satellite industry forum that the company has been selling the satellite dish to subscribers at a sizable loss. It initially cost the company $3,000 to produce each satellite dish, according to CNBC.
The company has since reduced the manufacturing cost to $1,500, and then down to $1,300 through a new version of the satellite dish, which just rolled out. (A December report from Insider previously pegged the cost at $2,400 per dish.)
The manufacturing costs are expected to fall even further to “the few hundred dollar range within the next year or two,” Shotwell reportedly said. That's good news for users on a budget.
“I don’t think we’re going to do tiered pricing to consumers," she added. "We’re going to try to keep it as simple as possible and transparent as possible, so right now there are no plans to tier for consumers."
The other financial hurdle facing SpaceX is the cost of building and launching Starlink satellites, which beam internet data to the dish equipment. The company's goal is to eventually operate thousands of such satellites in orbit to supply 1Gbps and higher broadband speeds.
“SpaceX needs to pass through a deep chasm of negative cash flow over the next year or so to make Starlink financially viable,” CEO Elon Musk tweeted in February. “Every new satellite constellation in history has gone bankrupt. We hope to be the first that does not.”
To recoup the investment, SpaceX is working to make Starlink available across the globe to tens of millions of subscribers in rural and remote areas where broadband access is slow or nonexistent. The $499 for the Starlink dish and Wi-Fi modem is a one-time fee. Users must also pay $99 a month to receive the internet service.
To sign up for Starlink, you can go to the official website, which will let you know if it's available in your area. It currently can deliver median download speeds at around 80Mbps, according to data from Ookla's Speedtest.
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ReplyDeleteI'll pay the $100 per month once the speed is over 1Gbps
ReplyDeleteThe dish equipment for Starlink initially cost $3,000 to produce.
ReplyDeleteI have one reserved. We shall see how it works.
ReplyDeleteLikewise. Saying Mid to late 2021. Can't wait. I can hardly hit 16 megs with my current provider.
DeleteYay! It sounds awesome and the monthly bill is about what I pay anyway. I will look to you to comment on the technical details.
DeleteEconomies of scale will bring the price down. Once the design is fixed they can tool up for mass production.
ReplyDeleteSpaceX is just talk nowadays. Let’s go NASA Rose
ReplyDeleteI'm not surprised - any subscription is going to sell the big ticket item at a loss and bank on making up the difference in the subscription.
ReplyDeleteIt's the razor and blades model that a lot of companies rely on.
razor and blades model
Deleteprinter and ink
Smartphone and charging cable
DeleteGillette popularized the business model at least 60 years before consumer printers were common.
DeleteI know. I was using printer and ink as another example. Some inks cost more than what you would have paid for the printer in a Black Friday sale.
DeleteOften those cheap new printers only have half full ink cadriges.
DeleteShoes & laces
Delete