Space42 and Viasat have signed a binding agreement to establish Equatys, a shared satellite and ground infrastructure platform designed to support global direct-to-device and advanced mobile satellite connectivity.
The two companies plan to commit up to $1 billion of combined equity to the venture.
Upon formation of Equatys, Space42 and Viasat will initially contribute $400 million each.
Space42 is expected to contribute an additional $200 million through a future equity financing round open to third-party investors, bringing the founding partners’ combined potential contributions to $1 billion.
Equatys is intended to operate as an independent and neutral infrastructure platform allowing mobile operators and satellite service providers to share satellite and ground infrastructure.
Viasat is expected to serve as the company’s prime technology contractor.
The platform is designed to extend mobile connectivity into locations where terrestrial networks are unavailable, have limited coverage or are uneconomic to deploy.
Equatys will enable smartphones, Internet of Things devices and other terminals to connect directly to satellites for services including voice, text and data.
The technology is being developed around 3GPP non-terrestrial network standards that allow conventional smartphones and connected devices to access satellite networks without specialized satellite hardware.
Equatys’ business model draws from the tower company structure used in terrestrial mobile communications.
Rather than requiring every operator to build its own satellite infrastructure, multiple participants will be able to use a shared satellite and ground network while maintaining their individual spectrum rights, customers and commercial relationships.
Space42 and Viasat believe that model can reduce capital requirements, accelerate deployment, improve network availability and produce greater spectrum efficiency.
The platform will be open to additional satellite operators and spectrum licensees.
The initial constellation represents the first phase of an architecture that could eventually scale to as many as 2,800 satellites across 60 orbital planes and three altitude layers.
Space42 and Viasat collectively have commercial agreements with more than 400 mobile operators worldwide.
The companies also have access to more than 100 MHz of globally coordinated Mobile Satellite Services spectrum that can support direct-to-device deployments.
Space42 holds coordinated L-band spectrum rights across more than 160 markets, while Viasat holds coordinated MSS spectrum rights in the L-band globally and S-band in Europe.
The companies estimate that the global direct-to-device satellite connectivity market could reach between $30 billion and $70 billion by 2040.
Formation of the venture and procurement of the constellation remain subject to customary closing conditions and regulatory approvals.
KEY QUOTES:
“With the signing of this agreement, Equatys takes off. For the first time, the satellite industry is building infrastructure the way the mobile industry thinks: shared, interoperable, standards-based, and designed for billions of devices rather than millions of subscribers. Space42 and Viasat have each brought what the other could not, and together we have assembled a differentiated capabilities system unique to the space industry.”
Karim Michel Sabbagh, Managing Director of Space42
“We are creating a new infrastructure category for global D2D and advanced MSS connectivity, backed by unique spectrum assets, significant committed capital, and a business model proven to scale the mobile industry. Finalizing the formation of Equatys reflects our collective confidence in the strategic value and long-term financial merits of this venture to support a rapidly growing non-terrestrial market for emerging D2D NTN and advanced Mobile Satellite Services. By creating a system with state of the art technology, and mechanisms for neutral, shared, and trusted infrastructure access, Equatys will accelerate innovation in space-based connectivity, establish a scalable and interoperable architecture designed to support a full ecosystem of participants with choice and economies of scale, and deliver meaningful growth opportunities with attractive returns for investors and partners.”
Mark Dankberg, Chairman and CEO of Viasat
