But considering the large number of satellites needed and these will need to be replaced on regular basis, I'm doubtful that this project will make money. Iridium satellite network was ground breaking with the first satellites launched in 1997. But it went bankrupt in 1999, eventually it recovered with the help of contracts from the pentagon
Iridium is still going strong, it has been generating enough revenue to replace its entire fleet over the past couple of years. The new fleet includes a receiver to help track civilian aircraft globally. Their new fleet flew on Falcon 9s.
The economics here is two fold, one is the flight hardware and whether they can attract enough customers to break even.
The other is the launch system. In the eyes of many people the "cadence" or how often a rocket flies is a huge part of the economic barriers to space travel.
You have a fixed cost for the development of the rocket. So many million human hours designing the bugger. You have a broadly fixed cost for the manufacture, rents on facilities, human labour hours, machine tools etc.
The variable costs are material to build the rocket, fuel etc.
The more units you fly the more you spread the fixed costs over while the variable costs, material are surprisingly small. The fuel for a big rocket like Flacon 9 is mostly RP1 which is just very refined kerosene. It is surprisingly cheap. So by generating launch manifests you spread you fixed costs over a much larger number of flights thus reduce the costs per flight.
This is where the Starlink comes in. If it can come close to breaking even, then this will mean you have a lot of paid for flights to spread the fixed costs over. This will reduce the costs of all Falcon flights for Space X thus make their other launches cheaper and bring in profit on their £70ish million they charge customers. This is where previous disposable rockets failed in their promise to bring down costs, (Ariane 5 and the EEVL launch vehicles) they never generated the launch cadence originally envisioned to spread fixed costs across. Its ironic that the 90s generation of commercial rockers failed to deliver their promised lowers of space costs due to the innovations in computer technology that reduced the need for new satellites to replace the existing ones. So they never got an anticipated number of flights to spread the costs. The previous effort to reduce costs had been reusable, the shuttle. But there the fixed costs of the refurbishment of the flight vehicle was just huge and brought no savings vs a new built rocket. Also, for the shuttle, the improvement technology meant the economics of building a new satellite vs bringing one back to Earth meant Shuttles cargo bay was an economic dead end. It only brought one satellite back to Earth.
STS-51-A - Wikipedia
A huge cost for Starlink will be the flights and as stated above the more of them there are the less it will cost per flight, so the cheaper the network will be.
The space industry world wide was estimated at about £300 billion year, but of that about £3 billion is the actual launch of the hardware and about half of that is US military and recon. So the biggest block for the industry and much of humanity is the costs of launch but ironically they are such a small part of the industry there is little drive to innovate and bring costs down. Doubly so for the big US aerospace conglomerates as they have the deep deep pockets of Uncle Sam and its fixed cost of military satellites. Thus what little innovation there has been has come from Europe and Ariane and this is why they have dominate the commercial sector, much lower margins (The Russians are just living of USSR investment into space and the Chinese are "leveraging" there low labour costs and very dated tech to get market share ) What SpaceX has done is be able to be innovative enough to gain commercial market share while being American and able to get those very fat government contracts. Which brings us round to where we started, the more Starlink flights, the cheaper it is for SpaceX to launch US government hardware (ISS Dragon resupply and National Reconnaissance Office type flights) so the more profitable those fat fixed price flights are.
If all of that sounds a little too clever for Elon Musk, this is why people in the space industry tend to focus on Gwynn Shotwell instead. She is the COO at SpaceX and the big difference between SpaceX and its very commercially successful operations and the endless array of space launch start ups we have seen over the decades. She is the bridge between "imagineers" and people with spanners.
Sorry for the ramble.
