Wed. 5 May 2021, 1:16am ETBenzinga
In: News, Retail Sales, Tech

Elon Musk-led SpaceX has secured more than 500,000 orders for its super-fast, satellite-based internet service Starlink, the company said on Tuesday.

What Happened: Starlink, which is currently in the beta phase, is a SpaceX venture designed to beam down the internet, especially in remote areas from satellites in orbit to Earth. 

SpaceX offers the service at $99 a month and an additional $499 one-time cost for the kit that includes a user terminal and Wi-Fi router to connect to the satellites.

See also: How to Invest in Tesla Stock

"To date, over half a million people have placed an order or put down a deposit for Starlink," said Siva Bharadvaj, a SpaceX space operations engineer, during a broadcast of SpaceX's latest launch of Starlink satellites.

At those rates, and if the 500,000 orders go through, that will add up to $594 million in revenue per year and $249.5 million more if the one-time $499 cost is thrown in as well.

SpaceX has previously said the orders are “fully refundable,” and service, which is designed to reach anywhere on the earth may have limitations, is not guaranteed on placing a deposit.

See Also: Starlink Begins Taking Preorders, Musk Eyes IPO When Cash Flow Predictable

Why It Matters: Musk, who also leads Tesla Inc (NASDAQ:TSLA), on Twitter said, "most likely," all of the 500,000 pre-orders will be served, adding that it is when the number of users runs to several million that Starlink will face "more of a challenge."

Interest in the space-based internet network is on the rise as more companies are looking into the capabilities. Defense contractor  Lockheed Martin Corp’s (NYSE:LMT) space unit has tied up with Omnispace LLC to roll out something similar and in direct competition with SpaceX.

The space-based network would eliminate the need for ground terminals and provide 5G capabilities direct from space to telecommunication devices.

Price Action: Tesla shares closed 1.65% lower at $673.60 on Tuesday.

Photo by JD Lasica on Wikimedia