AST SpaceMobile Secures AT&T Direct-to-Cell Agreement

Image: AST SpaceMobile

AST SpaceMobile ($ASTS) clinched a deal with AT&T to provide satellite-to-cell connectivity through 2030, the two companies announced Wednesday. 

Public markets cheered the definitive commercial agreement signed with the country’s largest cellular provider, propelling AST’s stock up nearly 70% yesterday and pushing its market cap to $1B+. 

Customers will be able to opt in to the service, which will complement AT&T’s robust network by beaming down connectivity in wilderness areas, rural highways, and other dead zones. 

“This agreement is the next step in our industry leadership to use emerging satellite technologies to provide services to consumers and in locations where connectivity was not previously feasible,” said AT&T COO Jeff McElfresh.

Old friends: The relationship between the two companies dates back to 2018. In January, AT&T participated in a $110M AST financing round and committed $20M in revenue. To further solidify the alliance, the company announced AT&T’s head of network Chris Samber will soon be added to AST’s board of directors. 

Largest birds around: The albatross is the largest flying bird on Earth. But in commercial LEO, that title belongs to AST’s BlueWalker 3 prototype satellite. 

  • BlueWalker 3, deployed in 2022, boasts a mind-boggling 693-sq-ft comms antenna—a size that has received considerable tsk-tsks from astronomers blinded by the light. 
  • The massive antenna enabled the company to demonstrate satellite-to-smartphone 5G connectivity in September, a first for the industry. 

The high throughput capability allows the company to provide connectivity service beyond text. However, big antennas require big bucks. Last quarter, the company reported -$87.7M of free cash flow.  

The company is planning a 168-satellite constellation, with its first five Block 1 satellites slated for launch this summer. 

Starlink + T-Mobile: Similarly, Starlink is partnering with T-Mobile to provide direct-to-device connectivity. The company is rapidly deploying dozens of satellites to support the capability and plans to begin text service this year before expanding to voice, data, and IoT in 2025. SpaceX has reported Starlink-to-cell download speeds as high as 17 Mbps.

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