Apple Invests $1.5 Billion in Globalstar for Mobile Satellite Service, SpaceX to Launch

Apple’s $1.5 billion investment in satellite communications firm Globalstar will fund a new mobile satellite service (MSS) network. The network, powered by Globalstar’s new satellite constellation, will be launched by SpaceX rockets, with the first satellites expected to deploy in 2025 to enhance iPhone connectivity.

Apple’s $1.5 Billion Investment to Fund Globalstar’s Satellite Network Development and Expansion

In addition to purchasing a 20% share in the satellite communications company, Apple has invested $1.5 billion in Globalstar to develop a mobile satellite service (MSS) network powered by a new constellation of satellites deployed on SpaceX rockets, per Wccftech.

Initially announced in November 2022, Apple’s MSS investment attracted further attention last month following a Globalstar SEC filing that confirmed Apple’s substantial financial commitment and acquisition of a 20% interest in a Globalstar subsidiary.

Additional filings from Globalstar with the FCC and SEC detailed how the funds will be allocated. Part of the $1.5 billion deal will pay down debt, while a significant portion will go toward developing Globalstar’s new MSS satellite constellation. This next-generation network will leverage the MSS spectrum in the L and S bands, forming a critical component of Apple’s satellite-enabled features.

Apple will make a $1.1 billion prepayment to Globalstar as part of the agreement, covering launch and construction expenses for the satellite firm's "Extended MSS Network." This prepayment arrangement enables Globalstar to manage construction costs while addressing existing financial obligations. The remaining $400 million comprises Apple’s equity purchase, which grants it a 20% stake in Globalstar Licensee LLC, the entity responsible for Globalstar’s MSS satellite network. Following the transaction, Jay Monroe, Globalstar’s executive chairman, saw his equity interest in Globalstar Licensee LLC decrease from 55.65% to 44.52%, though he maintains a majority voting control of 57.77%.

Globalstar Partners with SpaceX for Satellite Launch, Enhancing Apple’s iPhone Connectivity in 2025

Through a series of holdings, Monroe retains a controlling interest in Globalstar, Inc., ensuring continued oversight despite the strategic shift resulting from Apple’s significant investment. The Updated Services Agreement, outlined in Globalstar's most recent Form 10-Q filing with the SEC, indicates that SpaceX will serve as the launch services provider for this Extended MSS Network. According to the filing, Apple's payment includes costs for the MSS network, fees for additional services, related expense reimbursements, and performance-based bonuses, with some payments tied to specific licensing, service level, and milestone requirements.

Under the 2023 agreement with SpaceX, Globalstar plans to launch the new satellites in 2025, with a designated launch window spanning from April to September. So far, Globalstar has incurred $22.6 million in expenses related to its SpaceX contract. Once deployed, these satellites will integrate with Apple’s satellite capabilities for the iPhone, enhancing low Earth orbit (LEO) connectivity for smartphone users. SpaceX, a key player in this sector, continues to lead in satellite-based communication solutions, frequently launching Starlink direct-to-cell satellites as part of its broader Starlink mission.