National Harbor, Maryland – SpaceX’s Chief Financial Officer offered some more information on the company’s Starlink division. The company is currently producing 5,000 per week and anticipates starting up a second production line with a next-generation dish design in the fourth quarter of this year to drive down production costs. However, the $499 user pricing for equipment isn’t going to change anytime soon.
Speaking on the “Satcom Growth Strategies: The Operators Speak” panel at Satellite 2021, SpaceX CFO Bret Johnson said the company is focused on delivering Starlink as a “very compelling service.” Most of the Starlink’s customer acquisition cost is built into the cost of the dish itself, with the company focused on bringing down the production cost of the dish as well as increasing overall production to fulfill the current backlog of 500,000 dishes – and then some.
“We’re on point where we want to be from a cost perspective verses what we’re charging,” Johnson said. “We’re not passing on the cost reduction yet, we certainly hope to do that in the not too distant future… We’re still in a situation where the dishes costing more than what we’re charging
The Starlink dish is currently produced at a price point of around $1300, according to comments made by SpaceX President and COO Gwynne Shotwell last month at the Space Symposium in Colorado Springs, Colorado, with the price expected to drop by half when the company starts producing the next-generation consumer terminal by the end of the year. SpaceX expects to cut that $650ish fall price by half again sometime next year.
Johnson went on to say that changing over to the new dish design along with the start up of another production line would put SpaceX at a point where it will be able to produce enough dishes to meet the current backlog as well as to service new orders as it expands the service offering more globally. “I don’t think that [dish production] will be that much of a constraint in the next couple of months.”
Starlink is currently delivering broadband service to over 100,000 users today. SpaceX will start launching its Gen2 satellites equipped with laser cross-links from Vandenberg Air Force Base in California into polar orbits within the next few weeks and will ultimately replace all its Gen1 satellites with the newer version.
Laser cross-links enable Starlink to avoid the use of ground stations as intermediaries in moving data, increasing network session speed for end-users and lowering cost since fewer ground stations are needed to relay data.