Space Exploration Technologies (NASDAQ: SPCX) launched its first experimental Starlink satellites in February 2018, followed by a full launch of 60 operational satellites in May 2019. At the time, the plan was for Starlink to form a constellation of satellites that could provide broadband internet to users with stationary terminals on Earth.
But that was just the start of SpaceX’s ambitions.
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Soon after SpaceX began building Starlink in 2019, tiny AST SpaceMobile launched its first test satellite. In 2023, AST proved the concept of cellphone-to-cellphone mobile calls connected directly via satellite, a concept now known as “direct-to-cell” — “DTC” or sometimes “D2C” communications.
SpaceX was quick to take the hint.
Image source: Opensignal.com.
SpaceX does D2C, too
SpaceX launched the first Starlink satellites capable of supporting cellphone-to-cellphone-via-satellite calls in January 2024 — months before AST got its first five commercial BlueBird satellites into orbit.
Two years later, the race seems won. SpaceX reports that it now has 650 DTC satellites in orbit (and just won FCC approval to launch 15,000 more). AST is stuck at just 13 satellites. (It needs at least 45 to begin offering service in “select” markets.)
But how big a deal is this for SpaceX, really? After all, SpaceX has more than 10,000 Starlink satellites in orbit today. If only 650 of them are DTC, then that’s just 6.5% of the total. How big a difference can growing this business make to the rest of Starlink — which is already growing revenue at 66% annually, and profit at 79%?
Tracking the progress of DTC
Turns out, that’s no longer a rhetorical question, because thanks to the good folks at Opensignal.com, there’s now a near-real-time tracker of where users are connecting to satellites — mostly Starlink satellites — for DTC phone calls. The interactive tracker, updated monthly, takes the form of a global map pinpointing satellite connections, which you can find here.
And what does it show us?
Unsurprisingly, the vast majority of DTC phone connections are happening in the United States, where Starlink was born, and in Canada, our neighbor to the north. Other global hotspots are a bit more surprising.
Puerto Rico, the British Virgin Islands, and the U.S. Virgin Islands show surprisingly active satellite phone connections, for example — the rest of the Caribbean, however, not so much.
Similarly, there’s a lot of activity in Costa Rica and Venezuela, and up and down the western coast of South America — primarily in Peru and Chile — but almost nowhere else on that continent.
Africa is almost barren of Starlink phone connections, as is most of Europe, the Middle East, and Asia. Japan, on the other hand, is lit up like a proverbial Christmas tree, as are the coastal areas of Australia and New Zealand — top to bottom.
What it means to investors
What does this all mean to investors? It could be that Starlink’s highly concentrated usage in just a few countries is a function of how many (or how few) DTC satellites are currently in service. As more satellites are added — 15,000! — I see a lot of room for growth in SpaceX’s newest Starlink business.
How much that translates into revenue growth and earnings growth, of course, remains to be seen. But I, for one, fully intend to keep an eye on Opensignal’s tracker and see whether more “dots” on the map correlate with revenue and profit growth in SpaceX’s money-printing connectivity division — which houses Starlink.
A second possible use for the Opensignal data — for investors who take a much more granular approach to investing than I like to — might be to note the specific countries where the most Starlink DTC connections are occurring, and track the exchange rate of the dominant currency in each such country. Potentially, as Starlink DTC generates revenue in those countries, and that revenue is translated into U.S. dollars, there may be an effect on SpaceX’s own revenue and profit based on the relative strength or weakness of those currencies.
As I say — this is a much more detailed view than I tend to take with my investments. But for investors with a real love for research, it may provide an edge — and an angle that Wall Street analysts haven’t yet picked up on.
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Rich Smith has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends AST SpaceMobile. The Motley Fool has a disclosure policy.
