Amazon (AMZN) is aiming to ramp up the roll-out of its Kuiper satellite broadband services and keep challenging tech rival Elon Musk by going live in Vietnam.
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According to the Asian country’s Ministry of Science and Technology, the decision to launch in Vietnam was taken following a meeting between the government and Gonzalo de Dios, head of Global Licensing and Project Kuiper at Amazon.
Infrastructure Investment
Amazon’s Kuiper initiative aims to deliver broadband internet services via low-Earth-orbit satellites, targeting underserved areas in remote regions and on islands.
Under the agreement, Amazon has pledged to spend $570 million by 2030 to build the necessary infrastructure to zoom off into space.
That includes up to six ground stations and terminal manufacturing in Bac Ninh province through local partnerships.
Amazon has also established a Vietnamese entity, Amazon Kuiper Vietnam, and applied for approval to provide low Earth orbit satellite services in a five-year pilot program targeting consumers, businesses, and government subscribers.
Starlink Rivalry
Rival Starlink has also been given the go-ahead by the government to operate a similar scheme in Vietnam over the same five-year period. The two companies have an intriguing relationship in the satellite sector.
Back in April, the first 27 Kuiper satellites were launched into space from Florida. In early August, a Falcon 9 rocket, operated by Starlink owner SpaceX, carried Amazon’s latest batch of Kuiper satellites into low-Earth orbit. The Falcon 9 rocket successfully placed 24 Kuiper satellites into space, which can now provide internet connections on Earth.
Analysts believe that Project Kuiper could ultimately generate $7.1 billion for Amazon by 2032, assuming it gets just 30% of the 2.6 billion people who do not have high-speed broadband access right now.
This would mean another key revenue stream in the broad Amazon empire.
However, privately held SpaceX’s Starlink is currently the dominant provider of low-Earth orbit satellite internet, with a constellation of nearly 8,000 satellites and about five million customers.
Is AMZN a Good Stock to Buy Now?
On TipRanks, AMZN has a Strong Buy consensus based on 45 Buy and 1 Hold ratings. Its highest price target is $300. AMZN stock’s consensus price target is $263.74, implying a 15.32% upside.
