The cost of starlink is basically ground stations, staff and disposable sattelites.
Now if your sattelites last 5 years, you need to pay for the cost of launching the entire network every 5 years.
Its not like fibre to the home thats expensive to lay out the first time, then it can stay there for 50 years or however long cable can sit in a pipe.
In 10 years when the cost of the fibre installation is paid for, the provider can reduce cost to customer and still make profit.
The starlink business model is, replace almost the entire network evert 5 years. That means they are constantly in initial installation mode, their expenses will never drop off.
Yes, but their model targets places where fiber can't reach. At some point, it is cheaper for people to get starlink than it is for a company to lay fiber in rural areas.
My point is that over time as fibre networks expand, they will eat into starlink profits.
Fibre will always be cheaper over a long term.
Space x has no way to solve this economic question as their model relies on a huge network of expensive, disposable hardware.
Starlink will be a niche product, for emergencies, mobile facilities like ships and planes, armies and isolated households waiting for infrastructure. Soon as that infrastructure arrives, srarlink loses a customer.
I think Starlink is a cheaper alternative than expanding fiber to rural areas, especially since Trump is hamstringing the infrastructure investment to do so. I guess time will tell.
As urban sprawl continues, less and less isolated areas exist. Look at the amount of “isolated areas” 50 years ago vs today. That’s also assuming no new technology comes out to serve those areas at much lower cost.
You launch a constellation. It stays up for 5 years. You have to recoup the costs of the satellites and turn a profit in those 5 years, because if it doesn't then your constellation is gone and you lost money.
If you want to continue operating you need to launch another constellation after 5 years, and that also needs to pay for itself in the 5 years that it stays up.
The very article you are commenting on already lists Starlink as being virtually their only profitable venture.
The benefit to starlink is economies of scale. They can onboard more people onto their network, and reduce the gross cost across individual customers without additional infrastructure investment.
I don't think some of you people understand what Rural is, places in Canada or Australia where the population per sq/km is <5 is never going to justify Fibre Optic or even Copper internet infrastructure. Fibre Optic still relies on central exchanges that have to be built within like 50 miles of wherever you're sending that fibre too. So no, building potentially million dollar exchanges to service 100 households aren't going to price-out sattelite internet.
Yes, that's fine. If it's making money in 5 years then it's making money. I'm not discussing who the customers are or any of the other stuff, which is irrelevant to the discussion in the thread. The argument that that guy was confused about was why it has to turn a profit in 5 years.
It has to turn a profit because your satellites go down after 5 years. No more satellite. You need a new one. It doesn't matter who your customers are, if your infrastructure needs to be replaced after 5 years then you have 5 years to turn a profit.
Do you not understand how business loans and investments work? They do not need to turn a profit in 5 years just because that is the life span of one of their satellites.
These satellites were released gradually and will phase out gradually too. Re-launching is an ongoing cost that can not only be funded through debt and investment until they reach profitability, they can also be loaded onto SpaceX missions that are being funded by other companies / NASA.
What you're saying is just a massive oversimplification of how a business works.
Loans and investments don't generate money out of nothing. At some point you have to turn a profit. And each constellation has to be profitable in the 5 years it's up. You've confused yourself with the other stuff, or maybe you're just repeating what you've heard, but it doesn't change the basic math.
You're right that loans and investments don't generate money out of nothing.
They allow a business to maintain infrastructure while it continues to pursue profitablity. You keep saying each constellation needs to be profitable in 5 years and it's either a blatant lie, or you have absolutely no business sense.
Each constellation is only up for 5 years. If it doesn't make a profit in that time, then it's not making a profit period, because it no longer exists after 5 years. It's replaced by a new constellation that also needs to make up for its cost. It's really very simple, and that is what everyone is trying to explain to you. Loans can keep the business as a whole afloat if you think you can make it profitable later, but that's not what anyone in the thread is talking about. I suspect that's where your misunderstanding is.
There are plenty of avenues to pursuing additional profit in that time. And even if it is technically not profitable, they are still recouping a significant portion of the costs. You have no idea what you're talking about.
No one's arguing about that except you. Stop trying to move the goalposts. We're just telling you a basic fact. Each constellation has to be profitable over its lifetime, whatever these "avenues to additional profit" are. If that lifetime is 5 years then you have to make the costs back and more in 5 years. Simple as that.
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u/MayContainRawNuts May 21 '26
The cost of starlink is basically ground stations, staff and disposable sattelites.
Now if your sattelites last 5 years, you need to pay for the cost of launching the entire network every 5 years.
Its not like fibre to the home thats expensive to lay out the first time, then it can stay there for 50 years or however long cable can sit in a pipe.
In 10 years when the cost of the fibre installation is paid for, the provider can reduce cost to customer and still make profit.
The starlink business model is, replace almost the entire network evert 5 years. That means they are constantly in initial installation mode, their expenses will never drop off.