Elon Musk's plan to turn SpaceX into a company capable of transporting people to the moon and Mars rests of the profitability of the company's Starlink product, which took a huge step towards making money Wednesday.
The company debuted Starlink Premium early Wednesday morning, an internet broadband service that costs five times its standard service.
A multi-tiered subscription service is a proven business model for many businesses and now Starlink is one of those businesses.
Starlink's premium service, which will include a dish, a WiFi router and a tripod, will cost users a total of $2,500 for the hardware and another $500 a month for the service.
The standard service costs $499 for the hardware and $99 a month.
Premium will offer download speeds between 150 to 500 megabits per second compared to maximum speeds of 150 mbps on the standard service.
Starlink also says its Premium service will perform better in "extreme weather conditions" and feature prioritized 24/7 tech support.
SpaceX to the Moon
Musk has clearly laid out the plan for his civilian space venture.
Build up Starlink into a business that generates around $30 billion in annual revenue by 2025 before either selling the unit or having it go public. SpaceX will then use those funds to finance SpaceX's Starship system.
SpaceX will then ferry people to the moon, and eventually Mars where still hopes to build colonies.
To fund those lofty plans, Starlink is aiming to bring broadband to rural communities that are often neglected when it comes to internet service.
However the low-orbiting satellite network that powers the service is off to a rough start.
Testing of the company's base tier service last May by The Verge found that while speeds were sometimes in excess of 100mbps, the connection would "frequently slow down and drop out."
Current Broadband Landscape
Last week, when Comcast (CMCSA) reported its fourth quarter results, the company revealed curious numbers for its broadband service.
Comcast added 212,000 subs in the quarter, a more than 60% decline from the same quarter a year prior. The company added a total of 1.33 million broadband subs in 2021, down 33% year over year.
“Our net adds this quarter reflect a continuation of lower overall marketplace activity, particularly move activity, compared to historical trends,” said Comcast CFO Mike Cavanagh said during the company's conference call.
“While this resulted in lower connect volumes, it also contributed to high levels of customer retention with broadband churn improving to the lowest rate for any fourth quarter on record.”
Chairman Brian Roberts went on to say that competition from Starlink and AT&T (T), one of its primary rivals, were negligible.
“So in competition, really hasn’t been a notable shift in the competitive environment from either, you know, fiber or fixed wireless," Roberts said.
Meanwhile, AT&T and Verizon's (VZ) decision to delay the launch of their 5G near airports could also be an opening for Starlink, which presumably would not have the same issues of operating near airports as the cell tower 5G service offered by those two broadband giants.
Even with the concession by the telecommunications companies, federal officials said there could be some cancellations and delays because of limitations of equipment on certain planes, in particular those made by Boeing (BA).
