FCC Reauthorizes Globalstar’s HIBLEO-4 Constellation

Rhea-AI Summary

Globalstar (NYSE American: GSAT) has received a 15-year license extension from the FCC for its HIBLEO-4 constellation. This reauthorization allows Globalstar to continue exclusive operations in the Big LEO Band and operate up to 26 replacement satellites. The extension is important for Globalstar's ongoing investment, operation, and innovation in satellite and communications solutions.

The FCC's order emphasizes Globalstar's role in providing essential voice and data communications services, including safety-of-life services. CEO Dr. Paul E. Jacobs stated that this milestone is imperative for Globalstar's mission of providing critical mobile satellite connectivity worldwide. The satellite refresh program is expected to improve performance and coverage for Globalstar's services, including Direct to Device satellite connections.

Positive

• 15-year license extension granted by FCC for HIBLEO-4 constellation
• Authorization to operate up to 26 replacement satellites
• Reaffirmation of exclusive operations in the licensed portion of the Big LEO Band
• Expected improvement in performance and coverage for mobile satellite services
• Positioning to meet commercial demand for products and services

Negative

• None.

Insights

Telecommunications Analyst

The FCC's 15-year license extension for Globalstar's HIBLEO-4 constellation is a significant development for the company's long-term operations. This reauthorization ensures Globalstar's continued exclusive access to its portion of the Big LEO Band, a important spectrum for satellite communications. The approval to operate up to 26 replacement satellites indicates a substantial infrastructure upgrade, likely leading to improved service quality and coverage.

From an investor's perspective, this news provides regulatory certainty and demonstrates the FCC's confidence in Globalstar's operations. The extended license and satellite refresh program should enhance Globalstar's competitive position in the growing satellite communications market, particularly in the emerging Direct to Device sector. However, investors should note that while this approval is positive, it also implies significant capital expenditure for satellite replacements, which could impact short-term financials.

Satellite Technology Expert

Globalstar's authorization to operate up to 26 replacement satellites represents a major technological refresh for their constellation. This upgrade is likely to bring enhanced capabilities, including improved data rates, lower latency and better coverage. The mention of "Direct to Device satellite connections" is particularly noteworthy, as it aligns with the industry trend towards seamless integration of satellite and terrestrial networks.

The improved performance could open up new market opportunities for Globalstar, especially in IoT and emergency services. However, the satellite replacement program will be a complex and costly endeavor. Investors should monitor the execution of this program closely, as delays or cost overruns could impact the company's financial performance. Overall, this technological upgrade positions Globalstar to compete more effectively in the rapidly evolving satellite communications market.

Financial Analyst

While the FCC's reauthorization is undoubtedly positive for Globalstar's long-term prospects, investors should consider both the opportunities and challenges it presents. The 15-year extension provides revenue stability and the potential for growth, particularly in emerging markets like Direct to Device and IoT. However, the satellite replacement program will likely require substantial capital investment.

Globalstar's financial position will be important in executing this upgrade. As of their last report, the company had $27.5 million in cash and equivalents, with a history of negative free cash flow. The cost of 26 new satellites could easily run into hundreds of millions of dollars. Investors should watch for potential equity offerings or debt issuances to fund this program. While the long-term outlook is improved, short-term financial pressures may increase. The market's reaction to this news will depend on how well Globalstar communicates its funding strategy for this significant undertaking.

15-Year license extension ensures continued exclusive operations in the Big LEO Band.

COVINGTON, La.--(BUSINESS WIRE)-- Globalstar, Inc. (NYSE American: GSAT), the next-generation mobile satellite and communications services provider, today announced that the United States Federal Communications Commission (“FCC” or “the Commission”) has issued an order granting Globalstar’s application to extend the term of its senior HIBLEO-4 authorization by an additional 15 years and operate up to 26 replacement satellites.

The Commission’s reauthorization enables Globalstar, with over two decades of providing mobile satellite services globally, to continue to invest in, operate, and innovate satellite and communications solutions. Significantly, the Commission has reaffirmed its prior decisions regarding Globalstar’s exclusive operations in its licensed portion of the Big LEO Band.

The Commission stated in its order, “This modification grant will enable Globalstar to continue to provide a variety of essential voice and data communications services to consumers, including safety-of-life services, through its global satellite network.”

“Globalstar appreciates the time and resources devoted by the Commission and its dedicated staff to consider and complete our application in such a timely manner. The satellite refresh program is expected to result in improved performance and coverage for Globalstar’s mobile satellite services, including Direct to Device satellite connections, around the world. Achieving this milestone is imperative to Globalstar to enable us to complete our mission of providing critical mobile satellite connectivity and lifesaving technology worldwide,” said Dr. Paul E. Jacobs, CEO of Globalstar. “The company is well positioned to meet the commercial demand for our products and services.”

To learn more about Globalstar, visit: https://www.globalstar.com/

About Globalstar, Inc.

Globalstar empowers its customers to connect, transmit, and communicate in smarter ways – easily, quickly, securely, and affordably – offering reliable satellite and terrestrial connectivity services as an international telecom infrastructure provider. The Company’s LEO satellite constellation ensures secure data transmission for connecting and protecting assets, transmitting critical operational data, and saving lives for consumers, businesses, and government agencies across the globe. Globalstar’s terrestrial spectrum, Band 53, and its 5G variant, n53, offers carriers, cable companies, and system integrators a versatile, fully licensed channel for private networks with a growing ecosystem to improve customer wireless connectivity, while Globalstar’s XCOM RAN product offers significant capacity gains in dense wireless deployments. In addition to SPOT GPS messengers, Globalstar offers next-generation IoT hardware and software products for efficiently tracking and monitoring assets, processing smart data at the edge, and managing analytics with cloud-based telematics solutions to drive safety, productivity, and profitability.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240819803049/en/

Alisa Moloney

Alisa.moloney@globalstar.com

Source: Globalstar, Inc.

FAQ

What did the FCC grant Globalstar (GSAT) in its recent order?

The FCC granted Globalstar a 15-year extension of its HIBLEO-4 authorization and permission to operate up to 26 replacement satellites.

How will the FCC's reauthorization affect Globalstar's (GSAT) operations?

The reauthorization allows Globalstar to continue exclusive operations in its licensed portion of the Big LEO Band and invest in, operate, and innovate satellite and communications solutions.

What improvements are expected from Globalstar's (GSAT) satellite refresh program?

The satellite refresh program is expected to result in improved performance and coverage for Globalstar's mobile satellite services, including Direct to Device satellite connections, around the world.

What types of services does Globalstar (GSAT) provide according to the FCC order?

According to the FCC order, Globalstar provides a variety of essential voice and data communications services to consumers, including safety-of-life services, through its global satellite network.