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A United Launch Alliance Atlas V rocket is shown on its launch pad carrying Amazon’s Project Kuiper internet network satellites in Cape Canaveral, Fla., in April, 2025.Joe Skipper/Reuters
Amazon.com AMZN-Q said on Tuesday it would acquire Globalstar GSAT-A in an US$11.57-billion deal, bolstering its fledgling satellite business as it tries to catch up with Elon Musk’s Starlink.
Tech companies are pouring in billions of dollars to capture the lucrative market for satellite-based connectivity, but it will be a tall order to match Starlink’s 10,000-unit-strong network. Through the deal, Amazon adds Globalstar’s two dozen satellites to its existing network of more than 200.
Amazon has been working to ramp up its network by deploying about 3,200 satellites in Earth’s low orbit by 2029, with roughly half required to be in place by a July regulatory deadline. It is also preparing to roll out its satellite internet services later this year.
Globalstar’s satellite network is designed for reliable, low-data connections directly to mobile devices, or Direct-to-Device (D2D). The technology removes the need for devices to connect to ground-based cellular towers, making them crucial in powering emergency services and delivering connectivity in areas with limited cellular coverage.
The deal will help Amazon deploy D2D from 2028, the companies said. Meanwhile, Starlink already serves more than nine million users globally. The SpaceX unit, which provides high-speed broadband through user terminals, is also developing D2D services through partnerships with telecom operators such as T-Mobile TMUS-Q.
“Amazon has been falling behind Starlink on satellite broadband. Acquiring Globalstar allows them to catch-up on their D2D spectrum position, and leap ahead on D2D deployment,” said Armand Musey, president & founder of Summit Ridge Group.
Shares of Louisiana-based Globalstar rose more than 9 per cent in early trading, after gaining over 6 per cent in the past two weeks on media reports of the companies’ discussions. Amazon stock rose 2.5 per cent.
SpaceX dominance
Amazon’s move comes closely on the heels of SpaceX moving forward with its plan for a stock market listing. Starlink contributes roughly 50 per cent to 80 per cent of revenue generated by SpaceX.
Musk’s SpaceX has been deploying Starlink satellites at a rapid pace, launching dozens at a time and building the world’s largest satellite constellation. “There has been continued consolidation in the sector in order to compete with SpaceX in the satcom market, given SpaceX’s scale… and virtually unlimited launch capacity. I expect this trend to continue,” said Austin Moeller, director of equity research at Canaccord Genuity.
The unconventional logic behind SpaceX’s $1.75-trillion price tag
Under the Amazon deal, the satellite firm’s shareholders can elect to receive either US$90 in cash or 0.3210 shares of Amazon common stock for each share of Globalstar they own, the companies said.
That represents a premium of more than 31 per cent to Globalstar’s closing price on April 1, the day before reports of deal discussions emerged.
Late last year, Globalstar said a new, Apple-backed network under development would expand to 54 satellites, including a small number of backups, from about two dozen in low-Earth orbit currently. Amazon has signed an agreement with Apple AAPL-Q – which invested about US$1.5-billion in Globalstar in 2024 – to continue powering satellite-based safety features, such as Emergency SOS and Find My, for iPhone and Apple Watch users.
The acquisition is expected to close next year, subject to regulatory approvals and achievement of specific deployment milestones by Globalstar.
