The company’s Block 1 BlueBird satellites undergo thermal vacuum testing in preparation for launch.
AST SpaceMobile
Satellite-to-phone service provider AST SpaceMobile The stock rose after announcing a partnership with Verizon on Wednesday, complementing the company’s recent deal AT&T Providing long-distance coverage throughout the United States.
AST SpaceMobile is building satellites to provide broadband services to unmodified smartphones in the emerging direct-to-device communications market.
The company’s chairman and CEO, Abel Avellan, touted AST’s deals with Verizon and AT&T as “essentially eliminating dead spots and empowering remote areas of the country with space-based connectivity.”
AST shares rose 69% in trading to close at $9.02 per share. The jump was the biggest single-day rise in the company’s shares since it went public via a SPAC in 2021, and shares have quadrupled so far this month, according to FactSet.
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The deal with Verizon also effectively includes a $100 million raise for AST in the form of $65 million in commercial services upfront payments and $35 million in debt via convertible notes. The companies said the $45 million upfront payments are subject to “certain conditions,” such as required regulatory approvals and the signing of a definitive commercial agreement.
The Verizon partnership follows a similar pattern to AT&T’s collaboration with AST. In January, AT&T was already a co-debtor of the company alongside Google and Vodafone. The companies then reached the commercial agreement earlier this month, which “sets out in much greater detail how we will ultimately provide services together,” Scott Wisniewski, AST’s chief strategy officer, said in a statement to CNBC.
AT&T told CNBC on Wednesday that it welcomes AST’s partnership with Verizon.
“[It] “reaffirms our shared commitment to delivering space-based broadband nationwide directly to everyday cell phones,” said Chris Sambar, head of network at AT&T, in a statement.
A variety of key players are pursuing the direct-to-device, or D2D, opportunity, seeing an opportunity to expand the mobile communications market to any location on earth where “cellular signals are not accessible via traditional land-based infrastructure,” according to Srini Kalapala, senior Verizon’s vice president of technology and product development described it in a statement on Wednesday.
A view from onboard the satellite, taken after deployment of the 693 square meter array.
AST SpaceMobile
Smartphone manufacturers, service providers and satellite companies alike are working on or collaborating with D2D projects. The competitor to AST’s deals is SpaceX’s Starlink, which has partnered with the company T Mobile. Additionally, Apple spent a lot of money to provide it Globalstar-supported “Emergency SOS with Satellite” service introduced with iPhone 14 models.
AST expects to launch its first five commercial satellites this year. SpaceX, which has more than 3 million Starlink customers, plans to launch its T-Mobile-backed phone service later this year. Elon Musk’s company conducted what it said was the “first video call” over social media earlier this month, connecting its satellites to unmodified phones.
Correction: Apple has invested heavily in providing its Globalstar-powered Emergency SOS with Satellite service. A previous version misstated a company name.
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2024-05-29 20:54:24
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