The hidden news behind Bezos’s rockets
April 11, 2022
One of the mostly ignored elements of the Amazon Project Kuiper multi-rocket news – which in the words of Quilty Analytics “rightfully grabbed all the headlines” – might not be the most important story.
Quilty says that Amazon’s announcement that it can build an all-electronically-steered flat panel antenna (FPA) for about $500 represents an earth-shattering development for an industry that has long been accustomed to paying tens of thousands of dollars for an FPA.
Indeed, Bezos’s arch-rival Elon Musk has admitted that his Starlink FPA costs construction costs were nearer $2,500 per unit initially and only recently has claimed those costs have softened to nearer $1,000 per unit.
Quilty, in its note to clients, asks how have Amazon managed to achieve a $500 unit cost?
“Amazon first unveiled its antenna design in a December 2020 blog post,” says Quilty. “The post claimed that by reducing antenna size by an order of magnitude, production costs dropped ‘by an equal measure.’ Apparently, Amazon was serious,” states Quilty.
Indeed, Amazon’s past experience in producing high-volume and appealing market-leading chunks of technology, not least its popular Fire TV, Amazon Echos, Kindles and suchlike, is likely to help it achieve an appealing target price.
Amazon has made very clear that it intends to service “tens of millions” of customers with the Kuiper service, suggesting a scale advantage that all competitors will struggle to overcome, suggests Quilty.
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