Opinions divide over whether Globalstar’s acquisition will give Amazon Leo the boost it needs
The bidding war is over. It’s official. Amazon is acquiring Globalstar for $11.6 billion, adding direct-to-device (D2D) services to its low Earth orbit (LEO) satellite network.
“There are billions of customers out there living, traveling, and operating in places beyond the reach of existing networks, and we started Amazon Leo to help bridge that divide,” said Panos Panay, senior vice president of devices and services, in a statement. “By combining Globalstar’s proven expertise and strong foundation with Amazon’s customer-obsession and innovation, customers can expect faster, more reliable service in more places—keeping them connected to the people and things that matter most,” he added.
The deal is a two-parter, as RCR explained in a previous post: first, the e-commerce giant inherits Globalstar assets — spectrum, satellites, and all; second, it signs an agreement with Apple, which owns 20% stake in Globalstar, to provide satellite services for iPhones and Apple Watches. The latter is even more interesting, as, reportedly, rival company, Starlink, failed to secure a contract with Apple in 2022. With Amazon, many expected the negotiation to run much longer than it did.
Under the deal, shareholders will have the option to receive $90 per share or 0.3210 Amazon shares, capped at $90 each. Globalstar shares popped 10% and Amazon’s 3% after the announcement.
Many believe the takeover will put Amazon Leo in a head-to-head competition with Starlink, and others, not so much.
According to one analyst, the deal is a win-win for all parties involved. “With Leo still in early deployment, acquiring an operational network with licensed L- and S-band spectrum, existing ground infrastructure, and direct-to-device capability gives Amazon an immediate foothold it would otherwise take years to build,” said Pravin Pradeep, senior consultant and program manager at Frost & Sullivan,. He added that Globalstar’s LEO constellation come optimized for low-bandwidth, D2D connectivity in coverage-constrained environments, a market Amazon is aiming is penetrate with mobility and emergency services.
Mohit Mohan, independent advisor, wrote in a brief. “Unlike Starlink, which currently depends on partnerships with mobile carriers like T-Mobile to leverage terrestrial spectrum, Globalstar operates globally authorized mobile-satellite spectrum, providing Amazon a faster and more controlled path to D2D services.”
Pradeep said, “For Globalstar, the deal would shift it from a niche operator to part of a broader digital infrastructure ecosystem. Under Amazon, its assets could integrate with Leo, AWS, and edge connectivity, expanding its addressable market.”
However, the acquisition still does not address the 800-pound gorilla in the room, which is Amazon’ launch capacity problem. “Amazon has struggled to remain on track with the production and launch of its own constellation and these challenges won’t get solved by the deal,” said Pablo Tomasi, principal analyst of future wireless at Omdia.
Instead, he argued, “Globalstar’s LEO play is also quite different from Amazon’s and this will create strategic and technical challenges to align and/or integrate the two,” noting that the telco’s narrow D2D play will not allow Amazon to catch up with Starlink with what it’s done so far — and is planning over the next few years.
Nevertheless, Globalstar’s two dozen operational satellites, engineering expertise, and established ground infrastructure are now Amazon’s. That could provide the eCommerce giant some boost in terms of meeting FCC deployment milestones, which it is behind on, as it works toward its LEO constellation timelines.
Furthermore, the fact that Amazon is to be a critical infrastructure provider for Apple through this deal will establish it as the provider of emergency SOS and messaging services across millions of devices. That, Mohan said, will provide it immediate and predictable cash flow. Apple currently accounts for roughly two-third of Globalstar’s revenue.
It is also worth noting that Globalstar owns XCOM RAN, a 5G radio access network (RAN) offer known for its supercell technology. That could potentially give Amazon a re-entry into the private 5G space which AWS exited in 2025. Zahid Ghadialy, principal analyst and consultant at 3G4G, commented: “It will be interesting to see how Amazon chooses to use XCOM RAN following its move around Globalstar. Selling private networks could easily become a distraction, and if that is the case, XCOM RAN may well be offloaded at some point.”
Conversely, Amazon could also choose to repurpose it. “Amazon has no shortage of warehouses and fulfillment centers. Using XCOM RAN’s supercell technology to solve its own ‘metal box’ challenges feels like a far more natural fit. If that approach works, it is likely to remain an internal capability, and we may not hear much about XCOM externally going forward,” Ghadialy mulled.
Ghadialy’s bet is on the latter. “This could quietly turn into a major advantage, helping Amazon build some of the most efficient and robot-friendly warehouses anywhere,” he said.
With all said and done, was such a big investment justified? “This is a relatively small investment compared to Amazon’s $2.7 trillion market valuation,” Mohan said. “Its perfectly financially manageable for a company with roughly $100 billion in cash reserves.”
Maybe it is actually a small gamble in the larger scheme of things. As Pradeep said, “This signals a shift from standalone satellite networks to vertically integrated infrastructure plays.”
The transaction is expected to close in 2027, subject to regulatory approval.
