Tuesday, September 26, 2023

Apple’s Emergency SOS link puts it in the satellite battle with SpaceX and more

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After Apple’s announcement that the iPhone 14 and 14 Pro can send emergency messages via satellite, it becomes clear that the company has not just introduced a new feature. Typically, it has also practically overnight become a major player in a new industry by becoming deeply involved in satellite communications by adding Emergency SOS via satellite.

Apple is partnering with Globalstar for its satellite business and plans to use the company’s 24 satellite constellation to run its service, confirming long-running rumors of its plans for Band 53/n53 communications. In practice, that means Apple has joined the litany of companies trying to “eliminate dead zones,” as T-Mobile put it when it announced a partnership with SpaceX last month to create its own emergency communications service. Like that service, Apple’s Emergency SOS via satellite will initially only be available in the US. (Even there, there are a few caveats — it may be less reliable in northern parts of Alaska, and not all international travelers can use the feature during their visit.)

Considering the physical, financial and regulatory effort involved in launching satellites into space, there are a surprising number of players in the field. A company called Lynk Global is trying to build a global emergency communications network that works with unmodified phones, and it claims it was the first to send a text message from space during a 2020 test of its satellite. Meanwhile, a company called AST SpaceMobile hopes to use satellite-to-phone communications for 4G and even 5G internet and plans to deploy a test satellite by the end of this week. Amazon is even involved in its Project Kuiper, but so far the similarities we’ve heard for that system involve beaming the Internet to cell towers rather than directly to phones.

During the “Far Out” iPhone 14 launch event on Wednesday, Apple made it clear that it will be involved in the satellite emergency response system. “We have set up relay centers with highly trained emergency response specialists who are ready to receive your text messages and call an emergency service provider on your behalf,” said Ashley Williams, the company’s satellite modeling and simulation manager. And while the company has hinted that it has been involved in “infrastructure innovation” for the position in recent years, that doesn’t quite represent the magnitude of its investment.

According to a report of ReutersApple is investing $450 million in satellite infrastructure, most of which will go to Globalstar. Apple also agreed to pay 95 percent of the cost for new satellites associated with the feature, according to an SEC filing.

Image of a satellite floating in space above the Earth

Apple showed a few animations of satellites during the presentation – a photo of the kind of thing it pays for.
Image: Apple

Based on Globalstar’s revenue estimates in the filing, Tim Farrar, an analyst at satellite and telecom-focused consulting and research firm Telecom, Media and Finance Associates, said he expects those satellites to cost Apple up to $50 million by 2026. cost. Farrar also noted that Apple appears to be paying a “relatively low price” for the service. “Globalstar had revenue of $124 million last year. This is expected to rise to $185-$230 million by 2023,” he said, saying Apple would pay about $110 million to Globalstar next year. Apple has announced that the service will be free to users for the first two years, but didn’t say how much it will cost after that.

That price could put pressure on other satellite operators. “T-Mobile may not be willing to pay more than $100 million a year,” Farrar said, referring to the carrier’s recent announcement that it is partnering with SpaceX to provide emergency SMS services in the US and plans to is to test the service next year. Lynk and AST already have a number of agreements with airlines around the world and have said they’re working on others — it’s hard to imagine Apple’s official announcement won’t affect those talks in some way.

That’s especially true as Globalstar doesn’t seem interested in working alone with Apple. As analyst Harold Feld points out, the company’s filing includes a list of other partners who might be interested in using the terrestrial spectrum. That list includes “cable companies, legacy or fledgling wireless providers, systems integrators, utilities, and other infrastructure managers.” (It also appears that other satellite operators are interested in that spectrum, but not through a partnership with Globalstar. On September 6, SpaceX submitted an application with the Federal Communications Commission requesting the regulator to allow it to share the Band 53 and n53 spectrum that Apple’s partner uses.)

Feld thinks the inclusion of major airlines and their competitors indicates that “Globalstar hopes this will become a popular feature.” However, he points out that Apple’s agreement with the satellite provider gives it the right to “veto any decisions that would adversely affect Globalstar’s ability to meet its obligations to Apple.” In other words, if Apple thinks an agreement with another carrier would put too much strain on the network, the proposal could be dropped.

This power creates an interesting regulatory situation. According to Feld, once a company has a sufficiently high level of investment or control over a company licensed to use spectrum, the FCC considers it “attributable interest,” essentially saying it is a co-owner. So far, Feld says, Apple hasn’t reached this level — but if Apple wants to increase its investment in or control Globalstar much more, it may need regulatory approval.

Apple introducing a satellite communications feature on the iPhone would always have a big impact on the market as a whole — and even more so for any company it works with to make that happen. We’ve seen it in fitness, fashion, entertainment and other fields, and now space comes on the list. The details show how committed Apple is now to Globalstar and its satellites. As with so many other things, it’s obviously not satisfying to just have a partner doing their own thing while providing a service.

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