(Credit: T-Mobile)
T-Mobile has been offering SpaceX’s satellite-to-phone service since last year, but usage hasn’t been as high as the carrier originally expected, CEO Srini Gopalan said in a Tuesday earnings call.
“Our partnership with SpaceX is very strong. We worked closely with them to really invent an entire category. That’s been putting an end to dead zones. We’re pleased with that,” Gopalan said.
Still, T-Mobile’s CEO suggested that the large footprint of its ground-based cellular network is meeting customer needs. In contrast, T-Satellite only activates for users in select rural and remote areas, outside the carrier’s traditional coverage zones.
“Most of the [T-Satellite] usage we’re seeing is in national parks. And if anything, courtesy of the great network that [T-Mobile CTO Dr. John] Saw has built, we’re seeing a lot less usage than we were originally thinking. But it's a great complementary product,” he added.
T-Satellite did create some hype last year, attracting about 1.8 million sign-ups during the free beta. Since then, T-Mobile hasn’t revealed an exact subscriber count. T-Satellite is free only for the most premium plans; all other users must pay $10 per month for the service.
(Credit: PCMag/Michael Kan)However, Speedtest.net’s parent, Ookla, published data last week showing that the number of US and Canadian users accessing satellite-to-phone services such as T-Satellite declined in recent months. It’s possible the winter weather, and T-Satellite moving from a free beta to largely a paid service, were the driving factors. Ookla’s data also only looked at Android usage, even though most US users are on iPhones, which already offer free satellite messaging in dead zones through Apple partner Globalstar.
Whether consumers will pay for satellite-to-phone services, and how much, is an ongoing debate. The technology is also poised to improve; SpaceX is aiming for 5G, 150Mbps download speeds per user via next-generation satellite upgrades; current speeds are closer to 4Mbps.
Despite the lower-than-expected usage, T-Mobile’s CEO also views T-Satellite as an important competitive offering that helps it stand out from rivals. Both AT&T and Verizon have been betting on rival satellite provider AST SpaceMobile. Verizon also offers emergency satellite messaging through partner Skylo. But for now, T-Satellite has been offering access not only to satellite messaging but also to data for select mobile apps, including video calling.
Gopalan added: “And as you look at the future, we’re seeing multiple other space providers show up, and the way that this will evolve, we think as a complementary product, it will become more and more of a standard feature of a whole set of offerings. So in some sense, less differentiated, and we’re good with that at the Un-carrier [T-Mobile], because this is our history. We go out there, innovate, create a breakthrough, solve a customer problem, and then the others follow, and while they’re following, we’re on to our next big thing.”
Still, T-Mobile’s CEO doesn’t plan to create a mobile virtual network operator (MVNO) partnership with SpaceX/Starlink for cellular connectivity. In the earnings call, Gopalan reiterated that T-Mobile resorts to MVNOs only if it can help expand the company’s total addressable market; for example, targeting a new customer base or sales channel.
“It’s not obvious to me how an MVNO with SpaceX, or any other LEO [low-Earth orbit satellite] operator, fulfills those conditions,” he said. But on Tuesday, T-Mobile announced a partnership with SpaceX to use the home broadband-focused Starlink service to deliver high-speed internet to businesses in remote areas.