Amazon’s Project Kuiper Might Take On SpaceX In The Satellite Internet Business
Amazon's Project Kuiper might have 3,236 small satellites delivering internet from space. The company signed a multibillion-dollar contract last April for launches of its Kuiper satellites with three different entities: Jeff Bezos's Blue Origin, United Launch Alliance (a joint venture of Boeing and Lockheed Martin), and Europe's Arianespace.
"In many ways, it's a response and a competition to Elon Musk and SpaceX with its Starlink network," said CNBC space reporter Michael Sheetz. Amazon first revealed Project Kuiper in 2019, but the company's announcement last month gave it new momentum.
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At the moment, SpaceX's Starlink already has about 2,000 satellites in orbit, serving around 250,000 total subscribers. SpaceX has been approved by The Federal Communications Commission to launch a total of 12,000 satellites. On the other hand, Amazon has yet to launch a single satellite but could prove to be a significant pace industry player in the future.
"The satellite communications market is one that's valued at a few tens of billions of dollars," said Caleb Henry, a senior analyst at Quilty Analytics. "No one in this industry believes that it's a one-system-take-all kind of environment. We expect to see at least two and probably more constellations go forward, serving not only the residential consumer, but any type of business or organization that relies on internet connectivity."
According to data from the International Telecommunication Union, it is estimated that 37% of the world's population has never accessed the internet, with 96% of those people living in developing countries. The United Nations agency said that poverty, illiteracy, limited electricity access, and a lack of digital skills continued to challenge the "digitally excluded".
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"Amazon is known as the everything company, and it's hard to have an everything company without internet," expressed Henry. "Amazon's fastest-growing segment has been its AWS cloud service. And in support of that, they've built out a tremendous amount of internet infrastructure, whether it's data centers or fiber."
Henry explained that space is a "very natural expansion" of Amazon's data business and its consumer business, "providing goods and electronics and resources to people around the world."
