Satellite innovation surges, but risks abound

Satellite innovation offers a potential path to Universal Service Obligation reform, but high capex and financial risks remain.

David Kennedy · Venture Insights13 March 2023Period: Q1 20234 min read

Last updated 8 June 2026

95,000↑

Active Starlink services in the Australian market

1 million↑

Global Starlink subscribers as of December 2022

Locked

Companies covered:StarlinkAppleLynkBullitt GroupInmarsatEchoStarIridiumQualcommHonorMotorolaNothingOppoVivoXiaomi

Abstract

This report analyses the rapid expansion of satellite connectivity services in Australia, highlighted by Starlink's growth to 95,000 active services. It examines the emergence of direct-to-handset technologies from operators like Lynk, Bullitt Group, and Iridium, while weighing these innovations against the industry's historical volatility. The brief evaluates whether satellite can realistically replace current Universal Service Obligation (USO) arrangements given the significant capital requirements and ongoing business model uncertainties that are expected to persist until at least 2030.

Key Takeaways

Starlink has achieved a significant footprint in Australia with 95,000 active services, suggesting the region is a priority market.
Direct-to-handset satellite services are expanding rapidly with Lynk, Bullitt, and Iridium all launching new connectivity solutions.
Despite high adoption rates, Starlink remains cashflow negative, echoing historical industry struggles with high capital expenditure.

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Frequently Asked Questions

Starlink has rapidly scaled to 95,000 active services in Australia, positioning the region as a primary growth market. This local expansion contributes to a global footprint of 1 million subscribers as of December 2022, though the provider remains cashflow negative.

Direct-to-handset services are accelerating, with Lynk projecting multi-megabit speeds delivered to standard smartphones within the next three to four years. Current market entrants including Bullitt Group and Iridium are already deploying initial connectivity solutions to bridge this gap.

Universal Service Obligation (USO) reform is unlikely to occur before 2030 due to persistent business model uncertainties and high capital requirements. Policy-makers require proof of financial sustainability before pivoting, especially given historical precedents like Iridium’s US$5 billion bankruptcy.

Satellite innovation surges, but risks abound

Abstract

Key Takeaways

Frequently Asked Questions

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