Travelling to space is hard and expensive and the risks taken by Elon Musk are now paying off. After securing many contracts with NASA and private companies to send things to space, SpaceX has just announced their latest round of funding. A combined $1 Billion has been invested in the company by Google and Fidelity Investments. This investment means the combined companies now own 10% of SpaceX, valuing the company at US$10 Billion.
If you’re puzzled why an internet company, Google would invest in a company that’s firing things into space, there is a very solid reason. Google wins when more users are online. They have that recipe down, so adding users to the internet will make Google money in the long run.
This new partnership (and funding) is likely targeting the new development of SpaceX satellites which could distribute internet to hard to reach locations that aren’t currently connected. As we’re seeing in Australian’s rollout of the NBN, satellites are a way of connecting remote areas that don’t provide a financial model that makes sense for traditionally wired rollouts. It is expected this will take more than 5 years to achieve and the total cost of the project to be in excess of $10 Billion, more than the total (current valuation) of the SpaceX.
To turn on internet to billions of new users is expensive, but where there’s an opportunity to make income from new online users, we’re seeing extraordinary efforts being made to achieve it.