The reports that emerged earlier this month have come true. Amazon is actually digging deep into its pockets to take over the satellite provider Globalstar. Reuters puts the financial volume at $11.57 billion. Under the deal, Globalstar shareholders can choose either $90 in cash or 0.3210 Amazon shares per Globalstar share. Completion is not expected until 2027 and is still subject to regulatory approvals and the achievement of certain milestones. Amazon wants to operate the network under the “Leo” brand. What happens to Apple as an investor?
This in turn immediately raises questions about the extent to which Apple users are affected – after all, Apple is involved in Globalstar as part of a billion-dollar investment. However, something needs to be made more precise here because there is misleading information circulating about this. Apple did not, as is often claimed, own 20 percent of Globalstar as a whole company, but rather held a 20 percent stake in the company through which the expansion of the satellite network was carried out.
Amazon and Apple respond…
When reports emerged about Amazon’s buying interests, there was speculation that Apple might say goodbye to Globalstar and switch to Starlink. But today’s announcement contains the answer to that directly. Amazon and Apple agreed that Amazon Leo would continue to operate and even expand the satellite functions for the iPhone and Apple Watch. This means continuity for users; only Apple’s contractual partner changes.
…and want to work more closely together
At the same time, Amazon and Apple want to work more closely together on future satellite services. For the next few years, this could bring significantly more potential than just securing the current emergency call functions. If Apple gradually relies on Amazon’s larger satellite network instead of a comparatively small special partner, more capacity, higher reliability and, above all, additional services would be conceivable in the long term. Amazon itself expressly presents the takeover with the aim of expanding direct connections to everyday devices.
