Amazon In Space
Every day it seems that Amazon is trying to open up a new store or offer a new service. In the Amazon Prime package, they offer movies, music, photo storage, and more. They have also been trying to open up brick and mortar stores that are all self check out, but I am sure you already knew all of that. So why am I writing an article on Amazon? Because they are going to try and take over space as well.
Amazon Webservices
Something you may not have known is that 12% of Amazon’s revenue comes from its service called Amazon Web Services. That means that in Q2 of 2020 AWS made $10.8 billion in net sales and $3.4 billion in operating income.
So what does AWS do? They provide cloud computing for companies. Basically, a company can hire/use Amazon as their server infrastructure. That way, the company itself does not have to invest in getting the hardware or setting it up or maintaining it.
So again, why am I telling you this? The next section will start to explain Amazon’s future plans.
Aerospace and Satellite Solutions
Aerospace and Satellite Solutions is the name of Amazon’s new business segment that is dedicated to the space industry. That is why I am writing about Amazon. June 30th, 2020, they released information about this new business segment saying, “AWS is committed to supporting our customers’ missions, even those outside the Earth’s atmosphere,” and then continued to say, “The Earth and space-based systems that we build now will inform nearly every decision we make in the years to come. We want to bring all those AWS tools to bear to help our customers succeed in space.”
As of 2018, the satellite industry is worth $260.5 billion and is only getting bigger. Amazon has already been working on some other projects related to space, which I will discuss later, but starting a new business segment shows that they see the potential of the commercial space industry.
There are some good and bad things about Amazon joining this pool of competitors.
Pros
- Satellite companies can focus on building instead of the service side
- Satellite data may be more affordable because there will be more competition
- Companies may take more risks since Amazon is well established in the cloud computing field, so they do not have to worry about services failing
Cons
- Amazon is so huge that they make take out all the small providers and make it a market of only large providers
- Since they will be getting all the data, there could be privacy issues or an unfair advantage over other companies
- If they do take over the market they can then raise the price later on
All in all, there is a lot of potential benefit for Amazon and the companies they may work with.
Ground Stations
As of August 4th, 2020, Amazon has 6 ground stations set up. These ground stations are the infrastructure needed for the AWS to be able to do business in space. They actually planned on building 12 but have only made 6 so far, which tells me 2 things, one that they are ready to go full blast production and get these things built, and two that already had customers lined up.
The reason they have only built 6 so far is the customers wanted the station in different locations than what they had originally planned for. I find this part interesting because it means that they didn’t initially talk to the market to see what they would want, and Amazon was going to blanket build ground stations and hope for the best. Honestly, that probably would have worked, but it is better that they talked to some people and saved some money.
They have also mentioned that they already have customers, and some of those customers are Spire, NSLComm, Maxar Technologies, HawkEye 360, BlackSky, Open Cosmos, Myriota, and Capella Space. It is impressive that not only do they have a line of customers, but some of those customers are big names in the industry.
Kuiper Constellation
The Kuiper constellation is really how Amazon is going to extend its reach. A satellite constellation is a network of multiple satellites that are connected. The Kuiper constellation is going to be a mega constellation that will have 3,200 internet satellites in low Earth orbit, and on July 30th, 2020, Amazon got approval from the U.S. Federal Communications Commission to put up the constellation.
How serious are they? Well, the plan on putting $10 billion into this program, so basically %12 of their revenue or what they make from AWS.
The reason they are building this constellation is to provide high-speed broadband around the world. That comes with some pros and cons.
Pros
- Amazon internet may be cheaper and faster than most providers
- If they start a phone service, it can all be in one hub
- They have the resources to make everything work
Cons
- They can take and use all the data from people using the internet
- They start to monopolize the internet market
- They push out other providers
Another plus is that they will be competing with SpaceX’s Starlink, another mega constellation that is going to have 12,000 satellites in it.
I mentioned earlier that they already have customers for their ground stations, but they will not need customers for the ground stations when the constellation is up. Customers will just be the cherry on top for them.
Wrap up
Amazon has already started to complete the circle for space. They have a satellite constellation going up, ground stations to run them, a dedicated business unit to make them run smoothly, and they have Blue Origin to launch the satellites. If you didn’t know, Blue Origin is a small launch company owned by Jeff Bezos, and will most likely be the main launcher for these satellites.
Amazon is shaping up to be a self-sufficient space company. They have satellites that need to be launched, and they have a rocket ship(New Glenn) that needs to launch.
Even if the government tries to break up Amazon’s hold on the retail business, they will not be able to stop their space development. You probably already knew it was a good idea to invest in Amazon but if you were on the fence. I would say it is probably a good idea to invest in Amazon. They are only going to get bigger*.
*Assuming that all of their satellites get launched, and they stay on track with their timeline.