- Strand Consult thinks Starlink could enter the over-the-top service game in the coming years
- OTT features may include streaming/gaming add-ons or premium services on X
- But there’s really no need for Musk to create OTT services on Starlink when he can do it on X, said Mobile Expert’s Joe Madden
Elon Musk’s Starlink is shaping up to be a sizable force in the low earth orbit satellite space. In time, it may even go beyond providing broadband to get a leg-up on its fixed competitors. But is the juice worth the squeeze?
Strand Consult predicted Starlink will morph into an over-the-top (OTT) service in the coming years, much like how other ISPs now bundle broadband with value-added features. If Starlink follows their lead, it would “[create] another risk for broadband incumbents,” the firm said.
One possible route is Starlink could offer subscribers discounts or premium services on X, said Mobile Experts principal Joe Madden. But there wouldn’t be much upside to that, given Starlink’s network has limited capacity in urban areas and “cannot exploit a dense subscriber base.”
Indeed, lack of spectrum remains an impediment for Starlink, especially if it wants to get into the OTT game. “That spectrum is not becoming available in the next few years,” said Recon Analytics principal Roger Entner.
The X factor
In Madden’s view, “Starlink doesn’t need to create any new OTT service” when Musk can keep building up X to include additional consumer services, like streaming or artificial intelligence (AI).
“It’s not likely that he would offer these OTT services under the Starlink brand, when he already has a separate legal entity and platform to monetize Internet services,” he told Fierce.
And it’s probably in Musk’s best interest to keep Starlink and X separated, “as he can expect his companies to be subjected to many legal barriers in various countries,” said Madden. The EU for instance just stepped up its probe into X over content moderation.
But if Starlink does decide to take the OTT plunge, it can potentially disrupt both the broadband and content delivery markets, said Arun Menon, lead analyst at MTN Consulting.
He said Starlink has the infrastructure to launch a variety of services, like video streaming, gaming, live TV, augmented/virtual reality experiences, etc.
“This would challenge traditional cable broadband providers by bypassing the need for terrestrial infrastructure, accelerating cord-cutting, particularly in underserved regions,” Menon said.
If Starlink goes so far as to integrate exclusive content into its platform (through partnerships with content creators, studios or existing OTT giants), it could even disrupt established players like Amazon and Netflix, he said.
Starlink already got a head start on Amazon with satellite broadband, as the latter has yet to begin deploying its Project Kuiper constellation. Though Amazon is plotting a commercial Kuiper launch in the U.K. later this year, plus it’s already won a Broadband Equity, Access and Deployment (BEAD) grant in Nevada.
Running an OTT service can be “a very expensive economic proposition,” said Mario Di Dio, GM at Nova Labs. While he’s not convinced that Starlink will take that path, “it may make more sense to strike a partnership with one of the incumbents and get a revenue share agreement in place.”
It’s worth noting T-Mobile unveiled in December a beta direct-to-cell Starlink service, which is already available on some Samsung devices. Perhaps Starlink may consider creating “a branded mobile device that has differentiated text and voice services,” Di Dio said.