I remain convinced that the main successful business model in the satellite communications industry is to wait for the first incarnation of the satellite company to fail / go bankrupt / flounder, and then be part of the 2nd round of financing or ownership that comes in to buy it out and operate it... I don't know why this is the pattern but it seems to have played out several times over the last 2 decades that I've casually watched this syndrome.

If you haven't read Eccentric Orbits: The Iridium Story you should. The system was operational, but Motorola's dysfunction and impossible sales goals leading to disillusionment meant that Dan Colussy & team was able to pick it up for $25 million (development price: $5 billion)

They were about $3 billion in the hole when they went through bankruptcy in 2002 and the new owners bought it for $43 million (from Wikipedia). In 2025 they earned a return of $-8 million on that investment (plus any other money raised since then, such as $1 billion from Apple). So even the second incarnation doesn't seem to be a good business model even with free satellites.

The business model that works seems to be spectrum gambling. Do the minimum amount of satellite investment for decades until someone with a real business plan comes along and has to go through you to get it.

Or become a major investor on a largely public funded project with commitments set to start at a delayed time in order to benefit from R&D before bearing financial burden. (See [1].)

[1] https://www.ft.com/content/8e75ed31-0c72-4160-b406-1ca6aa36a...

> I don't know why this is the pattern but it seems to have played out several times over the last 2 decades that I've casually watched this syndrome.

This is a pretty common pattern in capital intensive businesses. It's often the case that revenue is inline with operating costs, but revenue can't really ever pay for the start up costs. That dooms the initial business, but after bankruptcy it can be viable.

Depending on circumatances, the very visible bankruptcy also helps deter other businesses from joining the market. But if the cost was high due to technology, doing the same business 10-20 years later can work out because the start up costs may be significantly less.

The only real viable long-term business model for these constellations are for the military or other socialized use.

They are completely unprofitable otherwise. Eventually even Starlink will lose money, as more and more rural regions around the world are wired for fiber.

You see the same pattern with railroads from 1860 to 1900.

Iridium was first. It was a cautionary lesson. Listen to Patrick Boyle regarding Starlink. Not everyone was paying attention in class.

> to fail / go bankrupt / flounder

This is exactly what "the Internet" said about spacex when they announced Starlink. Oh, it never worked. LEO constellations were tried in the 90s, ALL of them failed. Haha, it will never work. 14k satellites, that's insane, dreams, lies, hahaha.

... and yet, they are now at ~10k satellites launched, and are serving 9+mil customers, for some unknown billions/year in revenue (should become clear in a few months when they IPO).

Or also owning a rocket company that launches your satellites at low cost.

It is of course what happened to Iridium. But not all of them go bankrupt.

Clayton M. Christensen (The innovator's dilemma) would agree.