AT&T, Google and Vodafone invest US$155m in AST SpaceMobile

AT&T, Google and Vodafone invest US$155m in AST SpaceMobile

Aspiring LEO satellite operator AST SpaceMobile has secured US$206.5 million in new financing for its direct-to-satellite mobile network, including a US$155 million strategic investment from existing investor Vodafone and new investors AT&T and Google.

The strategic investment – which will go towards funding the commercial roll-out of AST SpaceMobile’s network – is a mix of equity-linked capital and non-dilutive commercial payments. AST SpaceMobile also plans to draw up to $51.5 million from its existing senior-secured credit facility.

Under the deal revealed on Friday, AT&T, Google and Vodafone will invest $110 million of 10-year subordinated convertible notes. Also, AT&T has committed to $20 million in revenue payments after the launch and successful initial operation of AST SpaceMobile’s first five BlueBird LEO satellites, which are scheduled to be launched sometime in the first quarter of this year. Vodafone has pledged a $25 million minimum revenue commitment, subject to a definitive agreement.

In addition to the investment deal, Vodafone and AT&T have placed purchase orders for an undisclosed amount for network equipment from AST SpaceMobile to support planned commercial service. Meanwhile, Google and AST SpaceMobile agreed to collaborate on product development, testing and implementation plans for SpaceMobile network connectivity on Android and related devices.

“This investment comes alongside prior investments by other leaders in the wireless ecosystem, including Rakuten, American Tower, and Bell Canada, all of whom are not only part owners of AST SpaceMobile but also serve as our technology partners and customers,” said AST SpaceMobile chairman and CEO Abel Avellan in a statement. “Each new partnership signifies that market leaders worldwide have tremendous confidence in our vision."

AST SpaceMobile plans to enable mobile connectivity from space using standard mobile devices, filling in coverage gaps in underserved and unserved areas. It has been testing the technology with its prototype BlueWalker-3 satellite, which has successfully completed 2G, 4G LTE and 5G voice calls. AST SpaceMobile  says the satellite has also achieved 14 Mbps download speeds using 5 MHz channels. The BlueBird satellites will feature beams supporting capacity of up to 40 MHz, potentially enabling data transmission speeds of up to 120 Mbps.

Operators in developing markets have been increasingly looking at upcoming LEO satellite networks to connect the unconnected. AST SpaceMobile has signed over 40 agreements and understandings with mobile network operators, including NOW Corp, Globe Telecom and Smart Communications in the Philippines, TIM in Brazil, ZainKSA in Saudi Arabia, Safaricom in Kenya, and Uganda Telecom, among others.

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