Most of the customers that use Starry are using it for the broadband service that the company offers, and they use traditional wireless for their voice services.
Starry is strictly a fixed wireless provider, and it doesn't offer mobile or cellular voice services. But there’s one consumer group that Starry is interested in serving with a voice product, and that’s the small and medium business (SMB) segment.
“SMB is a new kind of customer that we are planning to target where we will bundle in voice,” because it’s relevant and needed for their businesses, said Komal Misra, CFO at Starry Group, during a Credit Suisse communications conference on Tuesday. “That’s where we will come in and offer that solution.”
It’s not technologically complicated to integrate at all, said SVP of Strategy and Chief of Staff Brian Regan. “There are lots of managed VoIP providers out there that can plug into an existing network” without a lot of additional operational or technological lift, he said.
In terms of what kinds of SMB they’re going after, “think of the dry cleaner or the coffee shop,” Misra said. Beyond that, in terms of mid-size businesses and so on, the company has enough going on with the apartment buildings and structures that it’s currently going after, so it doesn’t see a need to add larger businesses into the mix.
“We will probably target them in the future, but currently I think they will probably need a lot more capabilities than we offer today,” and if they do target them, Starry will partner with other entities, she said.
Right now, Starry is laser-focused on the customer experience, which is why it does a professional install on all of its deployments today, but there probably will come a time when a subset of its customers will be served without a truck roll, according to Regan. Currently there are some buildings where Starry is already built in, avoiding the additional site visits.
Starry uses 24 GHz millimeter wave (mmWave) spectrum and IEEE-based 802.ax technology. It also has authority to use 37 GHz spectrum.
From a total addressable market (TAM) standpoint, Starry has enough spectrum to accomplish its goals, according to Regan. Conceptually, particularly for fixed wireless, spectrum in the 7 to 12 GHz range is really interesting, he said. It propagates a little bit farther and can go through some materials in ways that mmWave cannot.
If you can get enough bandwidth – say 300, 400 or 500 MHz – in enough clear channels, there’s “an interesting opportunity” for fixed deployments in the future, he said.
“I think 12 GHz is a good example of that. If the parties fighting there can sort it out between themselves we can get some clarity there,” he said. The 7 GHz spectrum might take more work to clear, but that would provide even wider channel bandwidth and better propagation.
Starry went public on March 19, raising about $155 million in net proceeds through de-SPAC transaction. It’s got enough to support its goal of serving 100,000 customers by the end of this year, but beyond that, it needs more capital and it’s investigating sources of new funding.
In a report earlier this week, MoffettNathanson calculated that Starry needs to raise $1 billion in additional capital in the next five years in order to pass 13 million serviceable homes and to connect 650,000 subscribers. (Starry last year estimated reaching 1.4 million subscribers by 2026.)
Starry’s standard fee is $50 per month for internet service, which currently is available in Boston, Los Angeles, New York City, Denver, as well as Washington, D.C., and Columbus, Ohio. The company is expanding into one new market this year.