One of Amazon’s most aggressive projects right now is a plan to launch a home internet service. Recently Amazon has started to open up about its plans for its home internet service from Amazon, currently code-named Project Kuiper. Now Amazon’s CEO has given an update on the service and when it plans to start selling home internet in a letter to shareholders.
In a letter to shareholders, Amazon CEO Andy Jassy gave a quick update on the service that included when they plan to sell home internet and the rough cost of the starter kit.
According to Mr. Jassy, Amazon plans to start selling its home internet service in 2024 in a small beta market. Much like how SpaceX’s Starlink service started off beta testing the service to customers in just a few markets, Amazon seems to be planning the same thing as Amazon, slowly rolling out home internet across the United States and the world over the next few years.
Look for signups for Amazon Home Internet to start in 2024 but expect there to be a waiting list, much like SpaceX’s Starlink service.
Amazon has also given us a rough idea of the cost of the startup kit that will include the dish you need to receive internet. According to Amazon, the cost to make the standard residential dish will be roughly $400. If Amazon is able to keep the cost to the consumer around that price, it will be able to undercut SpaceX’s $599 residential startup costs significantly.
To make this all happen, Amazon plans to start launching test satellites later this year with the hope of quickly speeding up the launches in the years to come.
In October of 2022, Amazon announced their Project Kuiper would launch more than 3,000 satellites into low-earth orbit to offer this home internet service. To do this, Amazon has announced plans to build the required satellites in Kirkland, Washington.
Amazon has also secured a deal with ULA, Arianespace, and Blue Origin to launch these satellites into space starting in early 2023. With this deal, Amazon hopes to launch multiple prototypes into space to test the system before mass production starts.
Amazon is facing a deadline as the FCC has given it until mid-2026 to have 1,600 satellites in space or face losing its FCC approval for the project.
Here is what Amazon’s CEO said in the letter to shareholders:
Kuiper is another example of Amazon innovating for customers over the long term in an area where there’s high customer need. Our vision for Kuiper is to create a low-Earth orbit satellite system to deliver high-quality broadband internet service to places around the world that don’t currently have it. There are hundreds of millions of households and businesses who don’t have reliable access to the internet. Imagine what they’ll be able to do with reliable connectivity, from people taking online education courses, using financial services, starting their own businesses, doing their shopping, enjoying entertainment, to businesses and governments improving their coverage, efficiency, and operations. Kuiper will deliver not only accessibility, but affordability. Our teams have developed low-cost antennas (i.e. customer terminals) that will lower the barriers to access. We recently unveiled the new terminals that will communicate with the satellites passing overhead, and we expect to be able to produce our standard residential version for less than $400 each. They’re small: 11 inches square, 1 inch thick, and weigh less than 5 pounds without their mounting bracket, but they deliver speeds up to 400 megabits per second. And they’re powered by Amazon-designed baseband chips. We’re preparing to launch two prototype satellites to test the entire end-to-end communications network this year, and plan to be in beta with commercial customers in 2024. The customer reaction to what we’ve shared thus far about Kuiper has been very positive, and we believe Kuiper represents a very large potential opportunity for Amazon. It also shares several similarities to AWS in that it’s capital intensive at the start, but has a large prospective consumer, enterprise, and government customer base, significant revenue and operating profit potential, and relatively few companies with the technical and inventive aptitude, as well as the investment hypothesis to go after it.