Verizon has committed $100 million toward satellite-based communication services from AST SpaceMobile, putting the carrier in partnership with rival AT&T in using the nascent satellite broadband provider as a proxy to extend 5G coverage to hard-to-reach geographies.
The “strategic partnership” will see Verizon provide AST with access to some of its 850 MHz spectrum holdings to help power the direct-to-device (d2d) satellite service. This use of traditional cellular spectrum will allow that service to work with basically any current Verizon device supporting that spectrum band.
Verizon is committing $65 million in commercial prepayments for AST service, with $45 million of that “subject to certain conditions.” The remaining $35 million investment is in the form of convertible notes that will provide Verizon a stake in AST.
“By entering into this agreement with AST, we will now be able to use our spectrum in conjunction with AST’s satellite network to provide essential connectivity in remote corners of the U.S. where cellular signals are unreachable through traditional land-based infrastructure,” Srini Kalapala, SVP of technology and product development at Verizon, said in a statement.
AST is scheduled to launch its first commercial satellite into low-Earth orbit (LEO) this summer, with plans to eventually have five satellites in orbit. LEO satellite constellations typically operate relatively close to Earth at a height of less than 1,000 kilometers and are able to make a full Earth orbit in around 90 minutes. This allows a constellation to provide relatively low latency compared to satellites that operate in medium-Earth orbit (MEO) at the expense of coverage per satellite.
Verizon’s deal with AST is significant as it’s Verizon’s first big push into the satellite-based d2d space.
The carrier several years ago did partner with Amazon on its Project Kuiper effort that is targeted at using LEO satellites to push connectivity to unserved and underserved communities. That $10 billion project involves plans to launch more than 3,200 LEO satellites, which Amazon plans to start shooting off into space beginning next year with the target of having at least half of those satellite’s operational by mid-2026. Amazon has stated early testing has shown downlink speeds of up to 1 Gb/s using its largest customer terminal.
Verizon and AT&T partner with AST satellite
The Verizon deal with AST is also similar to one AT&T struck with AST earlier this month. That “definitive commercial agreement” calls for AT&T to tap into AST’s soon-to-launch commercial satellites to provide broadband connectivity to what are basically standard AT&T devices. The deal is set to run until 2030.
AT&T has been working with AST for more than a year, including an agreement to lease some of its 850 MHz spectrum to the satellite provider. AT&T also backed the latest Verizon agreement.
“AST SpaceMobile’s news today reinforces the shared commitment to providing nationwide space-based broadband direct to everyday cell phones,” Chris Sambar, head of network at AT&T and recently appointed to AST’s board of directors, said in a statement. “Together with AST SpaceMobile we have agreed to welcome another mobile operator in the U.S. to bring in more spectrum and more coverage to create an even better solution and enhance service capabilities. With AST and the other partners around the globe we are shaping the future of connectivity for all.”
AT&T and AST last year announced a successful 5G-based connection of voice and data services between a pair of unmodified smartphones linked by AST SpaceMobile’s BlueWalker 3 test satellite. The test used 5G technology based on the 3GPP Release 16 specification.
In a separate test, AT&T, AST SpaceMobile, Vodafone and Nokia were able to stream a 5G download data link between the satellite and a terrestrial terminal at speeds up to 14 Mb/s. This surpassed a previous 4G LTE-based connection test that resulted in a 10 Mb/s space-to-ground link.
The speed mark is significant as it expands the broadband capabilities of satellite-based connections, especially as they are being looked at to support bridging the digital divide and supporting high-throughput enterprise applications like SD-WAN services. It also further opens up the possibility of traditional cellular operators tapping satellite systems to expand their 5G coverage.
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