The Satellite Space Race Is a Corporate Turf War, Not a Consumer Win

Let’s be clear: the latest scramble for the stars isn't about making your life easier. It is a corporate turf war.

As reported by TechCrunch, Amazon has filed an application with the Federal Communications Commission (FCC) to operate a network of 5,105 satellites designed to provide service directly to mobile phones. This isn't a sudden whim; it follows Amazon's acquisition of the satellite operations of Globalstar, a company known for providing Internet-of-Things and emergency connectivity for Apple iPhones. Amazon's plan is to use Globalstar's radio spectrum to expand these services and integrate them with Leo, its broadband internet satellite network.

On the surface, the promise of 'seamless' coverage sounds appealing. In reality, it is a vanity project fueled by massive capital reserves. TechCrunch notes that as of the end of April, Amazon had $255 billion in current assets on its books. They are squaring off against SpaceX, which is spending $20 billion to buy spectrum from EchoStar to build its own mobile constellation, a strategy detailed in SpaceX's IPO filings.

But here is the part the carriers and tech giants won't emphasize: do we actually need this?

According to TechCrunch, most of these satellite-to-mobile connections offer limited bandwidth, making them useful primarily for emergency situations or simple text messages. The lack of consumer appetite is already evident. Srini Gopalan, the CEO of T-Mobile—which currently utilizes SpaceX satellites—revealed at a conference in May that satellite usage accounted for a staggering 0.0002% of the company's total network usage in May. Gopalan noted that the usage is largely concentrated in national parks.

Despite this negligible demand, the 'space race' continues. Amazon is currently struggling with logistics, as TechCrunch reports that the New Glenn rocket from Jeff Bezos' Blue Origin has been grounded following a May anomaly that destroyed its launch pad. This failure forced Amazon to request an extension on its FCC license deadline.

While Amazon and SpaceX fight over who gets to blanket the sky in hardware, the consumer is the one who will eventually foot the bill. We are being sold a vision of ubiquitous connectivity that is, for the vast majority of users, unnecessary. The carriers should have focused on reliable, ground-based infrastructure years ago. Instead, we get a high-stakes game of chicken between two of the wealthiest entities on Earth, promising 'innovation' that delivers little more than a text message in the middle of the woods.