Overview: Echo Restart

Amid the flurry of transactions that Charlie Ergin’s EchoStar hit the market with on Monday, one item stuck out to me that I’ve hardly seen anyone on Wall Street discuss: the company’s direct-to-device satellite tease.

That’s understandable, given the near-term and vast financial debt engineering that’s happening. (For more on the Dish-DirecTV-TPG intricacies, I recommend reading my colleague Alex Sherman’s Seinfeld post-mortem and the debt-bagholding-hot-potato analysis by Matt Levine ).?

But direct-to-device satellite connectivity is seen as a nascent but potentially vast market opportunity for both traditional space players and new disruptors alike. I’ve written about the D2D tech players and partners before , but EchoStar’s leadership hasn’t discussed it much – until now.

After the Dish deal announcement, I spoke to Hamid Akhavan, EchoStar president and CEO, about why D2D matters for his company’s future:

“I think that the single biggest opportunity remaining in space is direct-to-device,” he said. “We believe the most capable company to bring it together would be us, simply because we are a telco, we are a satellite company, and we have the spectrum — the three ingredients.”

Hamid noted that low-Earth orbit satellite broadband used to feature “the biggest opportunities,” but the rise of SpaceX’s Starlink and EchoStar’s OneWeb, plus the coming systems of Amazon’s Kuiper and Telesat’s Lightspeed, mean that vertical has become quite competitive.?

With that in mind, Hamid called D2D a game changer, since “from a satellite provider perspective, you don't have to worry about the devices” on the ground. He thinks it’s the next growth market and noted EchoStar is confident that “demand is not the issue.”

“Let's pick a number, say 250 million of the 8 billion people that live on Earth. 250 million pay a dollar a month for [D2D service]. That's 250 million a month times 12 — that pays for the satellites altogether in one year,” Hamid said.

Others have been publicly talking about and building D2D systems for years – most notably AST SpaceMobile, which has seen its stock rip from $2 to $20 a share this year on excitement around deals with AT&T and Verizon, as well the launch of its first commercial satellites. But Hamid said EchoStar has in fact been preparing to build, even though it hasn’t talked specifically about its D2D plan. The company has “not been sitting our hands doing nothing,” he added, noting that EchoStar’s been working on its D2D satellite designs since early 2023.

“Satellites need at least a year, year-and-a-half worth of design before you get to the point that … you say: ‘This is what I want built,’” Hamid said.

Now, Hamid said EchoStar is at the stage where it can “choose to issue orders and contracts in the next two to three months.” He also sketched out how EchoStar would aim to “start with a minimum viable coverage,” whether that’s 100 to 200 satellites or possibly less, depending on how much of the Earth the company tries to reach when service goes live.

“About those timelines … as early as the back half of 2027 you could be in market with your initial service, by 2028 you could be full coverage,” he said.

So, to recap, here’s the back-of-the-napkin EchoStar D2D satellite architecture: Spend $2 billion to $3 billion to build initial global coverage with 100 to 200 satellites in low Earth orbit, with launches beginning in about three years. There's no understating that's a herculean effort for a company with a poor recent track record of executing grand plans (e.g., the Seinfeld strategy).

As for EchoStar starting years behind others in D2D satellites, Hamid isn’t worried because of his belief that the company’s ownership of S-Band spectrum gives it a key advantage:

“There are two classes of people … the group that says you have to have dedicated spectrum all around the world for this, and the ones who try to reuse the terrestrial. We are absolutely sure that the ones who want to reuse terrestrial does not work,” Hamid said.

”Our [spectrum] is entirely unused, both in the U.S. and abroad,” he added.

Talking about Echostar’s D2D plan before Monday’s announcement would have been premature, given the debt cliff the company faced. But now, Hamid said, Echostar is ready to get a move on.

“Now we have the financial ability to actually go and make it happen.”

WHAT'S UP

• High-profile government interplanetary missions moving forward despite Falcon 9 grounding: European Space Agency leadership say preparations for SpaceX to launch the Hera asteroid mission next week are moving forward, despite the upper stage issue last weekend that grounded the rocket for a third time in three months. While SpaceX has not provided public updates on its Falcon 9 investigation, an ESA official said “we are very happy with the progress they are showing to us, which proves their commitment to launch us.” Similarly, NASA is sticking to its plan to soon after have SpaceX launch the Europa Clipper mission to Jupiter on a Falcon Heavy rocket. – SpaceNews / NASA
• Rocket Lab shows off footage of Archimedes engine test firings, as CEO Peter Beck notes that the company is “rotating engines in and out as we put them through their paces, find limits and make tweaks.” He added: “Sorry, no explosions so far but we are working on it. That’s normal too.” – Rocket Lab
• SpaceX is not expected to fly commercial customers on Starship 'for maybe another five years,'??according to Impulse Space CEO Tom Mueller, who previously led rocket engine development at SpaceX for nearly two decades. He noted that his company is focused on Falcon 9 and other rockets as, for Starship, "there’s not a lot of information yet on what the arrangements will be" for companies looking to hitch a ride once the monster rocket begins orbital launches. –?CNBC
• Office of Space Commerce debuts orbital traffic management system, known as Traffic Coordination System for Space (TraCSS). The system “provides warning notifications for satellites potentially in danger of collision” and features nine satellite operators: NOAA, Maxar, Telesat, Intelsat, the Georgia Institute of Technology, Planet, OneWeb, Iridium, and the Aerospace Corporation. –?Commerce Department
• SpaceX makes Starlink service free for 30 days in areas devastated by Hurricane Helene, as part of broader disaster relief efforts to multiple Southern states swamped by catastrophic flooding and wind. – Nicolls
• Aircraft with in-flight connectivity surpassed 11,000 last year, according to a report from consultancy Novaspace, which found that low Earth orbit satellite connectivity are “rapidly gaining traction” in the market that was traditionally dominated by geosynchronous orbit systems. In-flight connectivity services were an estimated $2.5 billion in 2023 and are expected to nearly triple in the next decade, with commercial aviation making up about 60% of total revenue. – Novaspace
• Astrophysicist calls NASA’s SLS rocket ‘a national disgrace’: Casey Handmer, an entrepreneur with previous stints at Caltech and NASA’s JPL, wrote in a detailed blog that “by continuing to humor this monstrosity, NASA has squandered its technical integrity and credibility.” Of note, Handmer called out the SLS program’s staggering $12 million per day burn rate and dissects “NASA’s inability to specify or justify a physically possible architecture for crewed Lunar exploration.” – Casey Handmer
• Uncertainty surrounds NASA’s plan to replace the ISS with private space stations, with concerns ranging from the relatively low Commercial LEO Destinations program funding to the development risks faced by companies trying to build their habitats. – Ars Technica
• Former NASA head of science Dr. Z argues the U.S. is losing in the ‘lunar marathon’ versus China, writing in a column that, unlike the Apollo era, the current moon race is not a sprint. Thomas Zurbuchen writes: “Recent launch delays and cuts to our lunar exploration efforts, combined with a rapid series of remarkable engineering and scientific feats from China’s space program, mean that the U.S.—and its partners—are sliding into second place right now.” – Scientific American
• Varda CEO joins the fray calling for FAA space licensing overhaul, writing in an opinion piece that the soaring number (a 1,500% increase in a decade) of space-related license applications means, in Will Bruey’s view, the regulator must establish “standard safety metrics that are easy to check, so FAA analysts don’t have to start from scratch with every application.” – Payload
• FCC opens more communications spectrum to low Earth orbit constellations, with the regulator’s leadership voting unanimously to give satellite operators like SpaceX’s Starlink access to frequencies in the 17.3-17.7 gigahertz band. – SpaceNews
• Smithsonian documents reveal how the FBI tracked down missing Apollo 7 astronaut watch, an Omega Speedmaster worn by astronaut Donn Eisele valued at $400,000. – Bloomberg
• CSIS report ranks commercial remote sensing systems, largely focused on stacking up how U.S. and Chinese efforts compare across optical imagery, synthetic aperture radar, and more. – CSIS
• Ukrainian open source intelligence group alleges that spacecraft deployment company Exolaunch is hiding Russian ties, in an analysis of the German-based startup that has provided services for upward of 300 small satellites. The OSINT group, Molfar, argues that Exolaunch is an example of “how Russian citizens and supporters are attempting to establish businesses in Europe” to circumvent sanctions. – Molfar
• NASA turns off a Voyager 2 spacecraft instrument as the probe, which is 12.8 billion miles from Earth, has a dwindling electric power supply. Voyager 2 still has four science experiments in use for studying space outside our solar system’s heliosphere, with the agency estimating it will continue operations and science into the next decade. – NASA
• Europe’s Iris2 constellation headed for approval from the European Commission, with development of the €10.6 billion program funded by €2.6 billion from the region’s governments. – Le Point

INDUSTRY MANEUVERS

• Tom Mueller's Impulse Space raises $150 million?in a round led by Founders Fund and joined by Airbus Ventures, Alumni Ventures, Balerion Space Ventures, Lux Capital, RTX Ventures, Spring Tide, Tamarack Global, 137 Ventures, DCVC, Elysium, First Principles Group, Island Green, Overmatch and Trousdale Ventures. –?CNBC
• GoGo acquiring Satcom Direct in deal worth upward of $600 million when including add-ons, as the former would pay $375 million in cash, plus 5 million shares of Gogo stock that currently trades near $6 a share, plus as much as $225 million in performance-tied payments over the next four years. William Blair analyst Louie DiPalma noted that the companies together will cover almost 90% of the business jet connectivity market, with about 8,200 planes, in a merger that likely only clears antitrust regulations due to the rise of SpaceX’s Starlink. – Gogo / SpaceNews
• AST raises $153.6 million from public warrants redemption, exercised at a price of $11.50 a share of common stock. – AST SpaceMobile
• Italian space tug company D-Orbit raises $55 million (€50 million) as an add-on to its previous €100 million round of fundraising, led by Marubeni Corporation and joined by CDP Venture Capital, Seraphim Space Investment Trust, Indaco Venture Partners, Neva SGR, and Primo Ventures, Avantgarde, Iberis Capital, the European Innovation Council Fund, and Terna Forward. –?European Spaceflight
• Spacecraft servicing startup Starfish raises nearly $21 million according to a securities filing, from unidentified investors. – GeekWire
• BlackSky awarded $6 million contract expansion from an unnamed international defense customer, which the company notes brings that customer’s annual commitment to nearly $18 million for satellite imagery services. – BlackSky
• German court orders Rivada pay OHB over unpaid bill dispute, totaling $2.4 million (€2.2 million) after interest. – The Irish Times
• Anduril?orders small satellite buses from Apex and disclosed that the companies previously collaborated on Apex’s first mission, Aries SN1, which hosted an Anduril?payload. – Anduril

MARKET MOVERS

• Oppenheimer begins coverage of BlackSky with buy-equivalent rating of outperform and a $10 price target, saying “to date no peer has come close” to BlackSky’s imagery and analysis “capabilities at this cost.” The firm believes BlackSky “can grow revenues to the $500M range in the next seven years.” – Oppenheimer
• Momentus faces Nasdaq delisting: The company is not in compliance with the exchange’s minimum listing standards and is not eligible for another extension due to falling below requirements. The company intended to request a hearing from Nasdaq to review, and potentially delay, its stock delisting.?–?Momentus

BOLDLY GOING

• Josh Cassada retiring from NASA after 11 years of service as an astronaut, with missions that included three spacewalks. – NASA
• Troy Toman and James Mason promoted at Planet to chief product officer and chief space officer, respectively. Toman previously led the company’s software engineering and product and design teams, while Mason has focused on developing and optimizing its space operations. – Planet
• Karen Dacres appointed as chief legal officer and corporate secretary of LeoLabs, joining after previous legal leadership roles at software company Rebellion Defense and ocean data collection company SAILDRONE. – LeoLabs

ON THE HORIZON

• Oct. 4: ULA Vulcan launches Cert-2 mission from Florida.
• Oct. 7: SpaceX Crew-8 undocks and returns?from the ISS.
• Oct. 7: SpaceX Falcon 9 launches ESA's Hera mission?from Florida.
• Oct. 9: SpaceX Falcon 9 launches OneWeb satellites?from California.
• Oct. 10: SpaceX Falcon Heavy launches NASA's Europa Clipper mission?from Florida.

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