Starlink price increase – Surprising Satellite News
Starlink Price Increase Alert!
It looks like the current economy is going to hit Starlink internet users. Badly. Starting in May the monthly price in the US will go up by $11 and the hardware price will increase from $499 to $599. Subscribers who already paid deposit of $100 (pre-order) will also face an increase although not so severe.
Their new price is $549. US customers have already been notified and we are sure they cannot be happier… well, if they are not happy they are able to cancel. And receive a partial refund of $200 on return of Starlink kit. Within the first year of service. If the customer is with Starlink satellite services for less than a month the full refund will be issued.
Starlink Price Increase – Why?
Why the increase? According to the communication released by Starlink on Tuesday excessive level of inflation is to blame. This goes in line with earlier statement of SpaceX CEO, Elon Musk who said that the company is “seeing significant recent inflation pressure in raw materials and logistics.” Another reason for the increase is the investment level cited by Starlink in their communication to customers. As stated by the company the number of satellites in orbit has tripled and the number of ground stations has quadrupled. That’s correct. Starlink has already launched more than 2,100 satellites with the plans to rise the number to some 42,000 in the nearest future. This means a very significant investment irrespectively of the last year’s announcement of 50% reduction of price for manufacturing Starlink terminals. The price reportedly went down from $3,000 to $1,500. With the customer paying only 3rd of that sum it is still a significant investment if we look at the acquired base of 250,000 customers (globally).
What about UK?
The question is, how will it affect customers in Europe? And in other regions? Should we expect a similar price increases? Should we expect Starlink price increase? Probably yes. Starlink services are already quite expensive but they also offer good quality so very likely whoever was planning to sign up will do it anyway.
This price increase invites another question though. In recent years we learnt to expect from satellite broadband companies to behave the way other operators, mobile and fibre, do. Decrease the prices, increase data allowance, wave additional costs. This is exactly what was happening. When we look at Spanish market as an example, due to better development of offering, we can see Viasat, a global satellite provider, doing exactly that. The prices decreased, hardware kit cost was waved and the plans were offered as unlimited even if with data priority. This started changing last year with the arrival of Starlink. Facing competition behaving differently Viasat also increased prices. Satellite companies face significantly higher costs of deployment and serving customers so that was an obvious move. Still, not what the customers are looking for. And yet, we have to face the facts. If we have any other option (LTE, fibre) we go with them. If we don’t have these options, we have to pay the price. Unfortunately.
Another question though. Over the past months Starlink did a pretty good job advertising without advertising. Meaning they didn’t put much into traditional advertising channels like digital marketing or even traditional ads and yet their services are well “advertised” by world of mouth. Amazing speeds, low latency, great service. No throttling of speeds. No congestion. Just a single price plan irrespectively how much you use. And yet, experts around the world were sceptical. After all it’s only a public beta. Earlier this year Starlink introduced its PRO plan with higher speeds and much higher pricing. This meant reduced speeds for other users but didn’t affect them much as the speeds are still great. The question is how will it look like in the future. Again, we are only in public beta. Once we have a full commercial release this may look much different. Customers, sooner or later, will start facing issues with service, will demand better customer service… preferably in their own languages, the services will need to be managed somehow what means throttling… so the service is going to change. Maybe not right away but soon. And we can see it happening already. We mentioned already the introduction of PRO plan and ensuing speed reduction to other users. The price increase is another sign. SpaceX invests a lot of money to get their 42,000 satellites into orbit… and someone is going to pay for this. Starlink has to start behaving like a normal business then. Meaning services will be more expensive and managed. Still, it’s a great service. Even if it’s going to became more realistic.
Looking for more info about UK satellite broadband market? Read our article on OneWeb deal with SpaceX!