TAMPA, Fla. — Verizon plans to invest $100 million in AST SpaceMobile after joining its cellular rival AT&T to partner with the direct-to-smartphone satellite operator.
AST SpaceMobile founder, chair and CEO Abel Avellan hailed the deal as a “transformational commercial milestone” for the venture’s proposed constellation, paving the way to fully cover the continental United States with radio waves both telcos have in the 850 megahertz band.
Srini Kalapala, Verizon’s senior vice president of technology and product development, said the telco plans to use AST SpaceMobile’s satellites to provide “essential connectivity in remote corners of the U.S,” where its cellular signals do not reach customers via traditional land-based infrastructure.
The $100 million commitment comprises $65 million in commercial prepayments and $35 million in debt that pays interest to Verizon but could later be converted into AST SpaceMobile shares.
AST SpaceMobile chief strategy officer Scott Wisniewski said $45 million of the prepayment commitment is tied to conditions that include regulatory approvals and entry into a definitive commercial agreement.
“This is the beginning of what we see as a long relationship with Verizon,” Wisniewski told SpaceNews via email.
In January, AT&T agreed to make a $20 million prepayment tied to the successful operations of the first five commercial BlueBird satellites AST SpaceMobile is building in-house, collectively known as Block 1.
AT&T, Google and British telco Vodafone have also banded together to provide $110 million in funding to AST SpaceMobile via convertible debt.
The Texas-based satellite venture says it has agreements with over 45 mobile network operators worldwide, serving more than 2.8 billion subscribers.
Evolving partnerships
AT&T has worked closely with AST SpaceMobile for six years, and has helped lobby the Federal Communications Commission for the permission…
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