• Viasat and Space42 have signed a binding agreement to establish Equatys, with up to $1 billion in founder equity commitments
  • The first satellite tranche is due to be awarded after formation, with Viasat expected to serve as prime technology contractor

The fact

Viasat and Space42 said on 14 September that they had signed a binding agreement to establish Equatys, a shared satellite and ground infrastructure company for direct-to-device and mobile satellite services. Each company plans to contribute $400 million when Equatys is formed. Space42 is expected to provide another $200 million in a later funding round, taking the founders' combined planned contributions to as much as $1 billion. The venture also expects to raise third-party equity and debt.

Viasat is expected to become Equatys's prime technology contractor. The first satellite tranche is due to be awarded after the company is formed. The planned network will use 3GPP non-terrestrial-network standards to connect compatible smartphones and connected devices. Viasat and Space42 say they have commercial relationships with more than 400 mobile operators and access to more than 100MHz of coordinated mobile-satellite spectrum.

The assessment

For mobile operators, the appeal of Equatys is fairly simple. Instead of financing a satellite network alone, several operators or spectrum holders could use the same space and ground infrastructure while continuing to manage their own customers and services.

The $1 billion commitment gives that idea much more substance than last year's plans, but there is still a sizeable gap between funding a company and putting satellite coverage on a phone. Equatys has to be formed, satellites have to be ordered and launched, regulatory approvals have to be secured and mobile networks have to be connected to the platform.

For BTW readers, the first operator contracts will tell us much more than the headline funding figure. They should show where Equatys will offer capacity, how operators will buy it and which markets are likely to receive service first.

What to watch

Watch for the formal establishment of Equatys, the first satellite order and named mobile-operator customers. Deployment dates, regulatory approvals and details of capacity agreements will show when the venture starts moving from committed capital towards usable direct-to-device coverage.