Back in 2022, Elon Musk made tech giant Apple (AAPL) an offer. According to The Information, Musk pitched a deal for SpaceX’s Starlink service to power satellite connectivity for iPhones. He proposed an 18-month exclusive partnership for $5 billion upfront, followed by $1 billion in annual payments. He also warned that if they rejected the offer, he would launch a similar satellite messaging feature that would still work with iPhones. Apple declined and instead partnered with Globalstar (GSAT), which likely angered Musk and led to a collaboration with T-Mobile (TMUS) to offer satellite messaging services.
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It is worth noting that Apple had already been exploring satellite internet for years. Starting in 2015, the company launched “Project Eagle,” a plan to deliver full satellite internet to iPhones and homes through thousands of Boeing satellites. The project was shut down by 2016 over financial and regulatory concerns, but Apple didn’t abandon satellite plans entirely. It later partnered with Globalstar and invested more than $1.5 billion to expand satellite coverage for its Emergency SOS feature.
Today, that feature is available in 17 countries and can handle emergency messages, location sharing, and roadside help. However, tensions between Apple and SpaceX have continued. SpaceX has tried to block Globalstar’s access to key radio spectrum via regulatory filings, which could affect Apple’s service. Separately, some executives at Apple question whether it’s worth continuing the satellite project altogether due to its high cost and limited performance. Others also worry that charging users for the service could trigger new regulations, as it would classify Apple as a telecom provider.
Is Apple a Buy or Sell Right Now?
Turning to Wall Street, analysts have a Moderate Buy consensus rating on AAPL stock based on 17 Buys, eight Holds, and four Sells assigned in the past three months, as indicated by the graphic below. Furthermore, the average AAPL price target of $228.22 per share implies 14.2% upside potential.
