Amazon's Costly Race for Satellite Dominance

Amazon considers acquiring Globalstar for $9B to accelerate its Project Kuiper satellite network, but must navigate FCC deadlines and a complex partnership with Apple.

The competition to build a global satellite internet network is pushing Amazon to consider a major acquisition. According to reports, the tech giant is in talks to acquire satellite network operator Globalstar for approximately $9 billion. This potential deal is seen as a strategic move to accelerate its lagging Project Kuiper initiative and close the gap with the dominant market leader, SpaceX. However, the transaction introduces a complex third party to the negotiations: Apple.

A Regulatory Clock is Ticking

Amazon faces a pressing deadline from the U.S. Federal Communications Commission (FCC). The regulator requires that at least half of Amazon's planned 3,232 Project Kuiper satellites be operational in orbit by July 2026. As of early April 2026, only about 212 satellites have been launched, hampered by technical challenges. In stark contrast, SpaceX’s Starlink constellation already boasts over 10,000 satellites and serves nine million customers.

Acquiring Globalstar would provide Amazon with immediate access to valuable radio frequency licenses and an existing ground infrastructure network. This shortcut could save years of development time, allowing Amazon to rapidly deploy services and compete more effectively.

The Apple Complication

The deal’s structure is far from straightforward due to the involvement of another technology behemoth. In 2024, Apple invested roughly $1.5 billion in Globalstar. In exchange, it secured 85% of the network’s capacity to power satellite-based features on the iPhone, such as Emergency SOS.

Should Amazon proceed with the purchase, it would effectively gain control over critical safety infrastructure for hundreds of millions of Apple devices. Therefore, reaching a comprehensive agreement with Apple on shared system access and future technology roadmaps is an absolute prerequisite for the acquisition to succeed.

Market Reaction and Financial Strain

News of the potential deal elicited a mixed response from investors. Globalstar’s stock surged by 18% on Wednesday, while Amazon’s shares experienced a slight decline of nearly 2%. Amazon’s equity, already down around 9% for the year 2026, has been underperforming the broader market.

This pressure is largely attributed to the company’s massive capital expenditures, particularly in artificial intelligence infrastructure. Amazon has elevated its investment spending for 2026 to $200 billion, following significant outlays of approximately $131 billion on property and equipment in 2025. An additional $9 billion commitment for Globalstar would further intensify this substantial capital allocation. A routine, pre-scheduled insider sale by Amazon executive Douglas J. Herrington, worth about $210,000 in early April, is minor in this context but underscores investor scrutiny of the company's spending.

The urgency for Amazon cannot be overstated. The company has already signed agreements to provide satellite internet services to airlines including JetBlue and Delta Air Lines, with services slated to begin in 2027 and 2028, respectively. A functional network is needed imminently. Failure to secure an agreement with both Globalstar and Apple risks missing the FCC deadlines and would represent another significant setback in its race against SpaceX.