(Credit: Krblokhin via Getty Images)
As SpaceX’s Starlink and AST SpaceMobile race to roll out competing cellular satellite services, a new company is looking to enter the market: Hughesnet parent company EchoStar.
EchoStar is selling off its Dish TV business to DirecTV, so it can focus on bolstering its emerging 5G cellular business through the Boost Mobile brand. In a press release, EchoStar also said it’s preparing to leverage its satellite assets to develop a “direct-to-device solution,” an industry term for beaming satellite connectivity to unmodified phones.
In an investors call, EchoStar CEO Hamid Akhavan added that his company has global rights to “highly desirable” radio spectrum in the S-band, which company satellites could use to deliver 5G data from space to phones on the ground. “So we do intend to use that strategic asset to its fullest,” he said. “To this day, we have spent greater than $30 billion in spectrum assets.”
Hughesnet has lost about 500,000 subscribers since 2020 — right when SpaceX began offering Starlink, which has since grown to just over 4 million users across the globe.
SpaceX is also expanding into the nascent cellular satellite market. It's launched over 200 satellites, which can beam high-speed data to phones, including those from T-Mobile. The plan is to kick off beta tests by the end of this year. Meanwhile, rival AST SpaceMobile is aiming to start beta tests for its own first five commercial satellites around the same time.
Now EchoStar’s CEO wants a piece of the market too. “I think direct-to-satellite to us is very dear to our heart,” Akhavan told investors during the call. “We have the spectrum rights and the opportunity to make direct-to-device a global business.”
The big question is how EchoStar will develop its own cellular satellite business, which will likely require a new fleet of low-Earth orbiting satellites and the ground infrastructure to pull it off. In the call, Akhavan conceded the business would be a “very large undertaking” involving significant amounts of technology and investment.
“It is expensive to start,” he said. “There’s nothing cheap about the satellite business, so it is capital intensive. As a result of that, we do expect to work with partners. If we want to do it all on our own, it’s something that we can… But we do believe it’s better for us to work with partners.”
EchoStar plans on sharing more details in the future. Although its plan to sell Dish TV to DirecTV still needs regulatory clearance, Akhavan said the deal frees up EchoStar to raise more than $5 billion from its existing stakeholders.