Apple and Amazon form alliance in a $11.57 billion deal, Starlink's dominance challenged

Apple and Amazon have agreed to form an alliance through a deal valued at $11.57 billion that will bring Globalstar’s low Earth orbit (LEO) satellite network under Amazon’s control. The transaction is expected to strengthen Amazon’s satellite ecosystem and could intensify competition with SpaceX’s Starlink in providing smartphone connectivity beyond traditional mobile coverage.

Deal terms and what Amazon will acquire

Under the agreement, Amazon will acquire Globalstar’s low Earth orbit satellite network, including all licenses, assets, and operations. Apple currently holds a 20% stake in Globalstar, making the deal more than a straightforward acquisition and indicating Apple’s indirect involvement in the development of space-based connectivity infrastructure.

Amazon says it will continue to maintain and support existing satellite services, including Emergency SOS on iPhone and Apple Watch, while developing new services connected to its LEO network.

The deal is expected to close in 2027, subject to regulatory approvals.

Globalstar’s network and current smartphone integration

Globalstar operates about 25 active satellites that provide direct-to-device connectivity. The service includes emergency messaging, location sharing, and basic communications when mobile coverage is unavailable.

Globalstar’s platform has been integrated into iPhone since the iPhone 14, positioning satellite features as part of Apple’s core smartphone differentiators.

Amazon’s satellite strategy and scale

Amazon is also developing its own satellite constellation, with a goal of more than 3,200 satellites. To date, the company has launched over 200 satellites and aims to double its launch rate each year.

Acquiring Globalstar is intended to shorten the timeline for building out Amazon’s infrastructure and to provide an existing customer base across hundreds of millions of Apple devices.

How this compares with Starlink

SpaceX’s Starlink is currently the leading global satellite connectivity provider, with about 10,000 satellites in orbit. By the end of 2025, more than 650 satellites are expected to support mobile connectivity.

Starlink has rolled out Direct-to-Cell service in partnership with operators such as T-Mobile in the US and other operators globally. Unlike Globalstar’s direct-to-device model, Starlink’s approach integrates with mobile operators to deliver messaging and data connectivity, which can enable faster scaling but relies more heavily on telecom partners.

Amazon’s stated approach indicates an intention to combine elements of both models—direct-to-device connectivity through Globalstar and additional coverage delivered in collaboration with mobile network operators.

Potential impact on Apple and the broader mobile ecosystem

For Apple, maintaining its relationship with Globalstar—now part of Amazon—supports its competitive advantage in smartphones. Satellite capabilities such as Emergency SOS, off-grid messaging, and emergency support have become clear differentiators for iPhone.

At the same time, Amazon’s entry could shift the balance by positioning Amazon as a potential platform operator in the future. Scale is a key factor: Globalstar has 25 active satellites, while Amazon’s planned constellation exceeds 3,200 satellites, suggesting the gap could be closed quickly.

The deal also raises questions about how the ecosystem may evolve, potentially combining Apple devices, Amazon infrastructure, and mobile operators as connectivity intermediaries.

Key hurdles and unresolved business questions

Despite the strategic fit, the transaction and the broader satellite buildout face significant obstacles, including regulatory hurdles, spectrum licensing, launch costs, and the operational challenges of running a global network.

The business model also remains unresolved: it is unclear whether users will pay directly for satellite connectivity or whether carriers will integrate satellite services into existing offerings to maintain competitiveness.

Why the agreement matters now

Satellite connectivity is increasingly becoming part of the mobile ecosystem rather than a fallback option, moving toward a new standard. The Apple-Amazon deal signals that competition for global connectivity infrastructure has entered a new phase, with tech firms challenging the idea that Starlink is the only dominant player.

Source: TechCrunch.