Hello everyone. Today’s update kicks off with Neil’s thoughts on Apple lending $250M to Globalstar. The discussion then expands to talk about Apple getting into the satellite business itself. We conclude with a closer look at the EU narrowing its Apple probe to focus on anti-steering.

Let’s jump right into today’s update.

Apple Lends $250M to Globalstar

Over at SpaceNews, here’s Jason Rainbow:

“Globalstar said Feb. 28 that Apple is lending the company $252 million to help cover upfront costs for replenishing its low Earth orbit (LEO) constellation.

Apple is providing the funds as a prepayment for using the network to upgrade satellite services launched last year for its latest iPhone, which can connect with one of Globalstar’s existing 24 satellites in LEO for emergency services outside cellular coverage.

Globalstar picked MDA and Rocket Lab in February 2022 to supply an initial 17 satellites for launch by the end of 2025 in a contract worth $327 million. The contract includes an option for up to nine additional satellites at $11.4 million each.

The satellite operator intends to fund any upfront costs not covered by Apple’s prepayment with its own cash.

Apple has already agreed to reimburse Globalstar for 95% of the constellation; however, it previously required the satellite operator first to raise third-party financing to fund the manufacturing contract.

Removing the need to raise this financing amid challenging macroeconomic conditions clears a significant degree of uncertainty for Globalstar’s constellation plans.”

With interest rates continuing to rise and prospects of securing third-party financing getting dim, Globalstar was in trouble. Apple decided to jump in and loan Globalstar the required cash to keep moving forward (to construct and deploy satellites for Apple). The use of “decided” may be charitable as Apple probably didn’t have much choice other than to step in and bail Globalstar out. Without the loan, Globalstar may not have been able to launch the satellites that Apple needs.

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Hello everyone.

Happy Thursday.

One quick update regarding Dark Sky, the popular paid iOS weather app acquired by Apple in 2020.

The app will be shut down on January 1st, 2023. The following message is now posted within the app:

Apple's acquisition set off a wave of worries and angst in weather app land. Check out the daily update from April 1st, 2020 for my detailed thoughts on the acquisition.

Since then, Apple announced that it was including Dark Sky’s tech within its own weather app while making the Dark Sky API available to third-party app developers via WeatherKit. This matched my expectations for what Apple would do. Dark Sky is looking like a very intelligent acquisition at what was likely a very attractive price.

Apple Buys Satellite Capacity

Here’s Reuters:

“Apple Inc on Wednesday selected Globalstar Inc as its partner for a feature that would allow iPhone 14 users to send emergency messages from remote locations.

The tech giant said it was dedicating $450 million from its advanced manufacturing fund toward satellite infrastructure to support the feature. GlobalStar will receive the majority of the funding, but the iPhone maker did not specify which other players will receive the rest and in what form.

While Apple will pay for 95% of the approved capital expenditure for the new Globalstar satellites needed to support the service, Globalstar said it would still need to raise additional debt to construct and deploy the satellites.

Globalstar, which makes low-earth orbit (LEO) satellites, said it had tapped investment bank Goldman Sachs & Co and expects to complete a financing in the fourth quarter of 2022.

LEO satellites operate 36 times closer to the earth than traditional ones and hence take less time to send and receive information, leading to faster broadband service even in remote areas."

According to Globalstar, which has dozens of LEO satellites and 24 ground stations, its deal with Apple is “transformational.”

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Apple Lends $250M to Globalstar, Why Doesn’t Apple Get Into Satellites?, EU Narrows Apple Probe (Daily Update)

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Apple Buys Satellite Capacity, Apple and Starlink, Apple’s Satellite Ambition (Daily Update)

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