The decrease in AST SpaceMobile's stocks by 8% happened on Monday.
The decrease in AST SpaceMobile's stocks by 8% happened on Monday.
Recently, I pointed out that SpaceX's expanding capacity for direct-to-cell (DTC) communications, enabling calls between standard cellphones using Starlink satellites without the need for cell towers, posed a significant threat to AST SpaceMobile's business model. This company, symbolized by ASTS (-4.06%), was the pioneer of this concept.
It appears now that the threat is even more substantial than initially anticipated.
Investors are starting to acknowledge this fact in the aftermath of SpaceX's latest Starlink launch, with AST SpaceMobile stock falling by 8.3% before 10:45 a.m. ET.
SpaceX's escalating DTC business
At the time of writing, SpaceX was reported to have 26 DTC-enabled Starlink satellites in orbit. While this may not seem like much compared to Starlink's total of 6,900 satellites, it was still five times more than AST SpaceMobile's satellite count.
However, upon further investigation, it was discovered that SpaceX had launched a total of 26 rockets carrying DTC Starlinks, not just 26 satellites aboard those rockets. SatNews.com revealed that as of November, there were 285 Starlink satellites with DTC capabilities in orbit. SpaceflightNow reported today that tonight's SpaceX launch could see 13 more DTC Starlinks added to orbit, bringing SpaceX's total to approximately 300 DTC satellites. This would surpass AST SpaceMobile's measly five satellites and allow SpaceX to initiate beta service before AST can.
The impact on AST SpaceMobile
Both SpaceX and AST SpaceMobile have announced plans to commence direct-to-cell service via satellite in 2025. Albeit, AST's five satellites might be sufficient to provide beta service within the U.S., SpaceX's completion of an entire orbital shell already enables them to offer at least DTC emergency text messaging worldwide.
To compete with SpaceX, AST will need to secure substantial funding and launch a substantial number of satellites in 2025. SpaceX, on the other hand, already has the required capital and is continuously launching satellites.
Edge: SpaceX.
Given the current situation, investors are reevaluating their investments in AST SpaceMobile, leading to a significant drop in its stock price after SpaceX's Starlink launch. With SpaceX's escalating direct-to-cell (DTC) business, they are projected to surpass AST SpaceMobile's satellite count and potentially initiate beta service before AST, providing a potential threat to AST's finance and business model.