Amid questionable demand, some D2D players change course

Demand for satellite-based emergency text messaging services is proving difficult to find. As a result, companies including Iridium and Bullitt are modifying their direct to device (D2D) strategies.

Satellite operator Iridium announced a new D2D effort called Project Stardust after its partnership with Qualcomm fell apart late last year, with Qualcomm saying that device manufacturers "indicated a preference towards standards-based solutions." Project Stardust promises to support both standardized and proprietary satellite connection technologies.

Separately, British ruggedized handset maker Bullitt confirmed it is restructuring its business. Company officials said Bullitt's satellite business and assets are being acquired by a new company whose shareholders include Bullitt's existing stakeholders, but they declined to provide any further details.

Despite those developments, some service providers continue to argue that there is demand for D2D connectivity. For example, T-Mobile recently cheered "another step forward" in its efforts to connect its customers' phones to SpaceX's Starlink satellites. And AT&T has been a vocal champion of AST SpaceMobile, another player in the sector. (For its part, Verizon has not disclosed a D2D strategy.)

Some analysts remain bullish as well. "NSR, an Analysys Mason company, is still optimistic on the long term potential [of D2D], once voice and data capabilities are unlocked," analyst Lluc Palerm Serra wrote on social media.

But the sector largely remains in a state of upheaval as companies look for funding, partners and – ultimately – paying customers.

Supporting the standards

Iridium said Project Stardust would support 3GPP 5G standards-based Narrowband Internet of Things (NB-IoT) connections.

"The industry is moving quickly towards a more standards-based approach, and after surveying the field, we found that we're the best positioned to lead the way using our own network, particularly given our true global coverage," Iridium CEO Matt Desch said in a release. 

Iridium said its customers can "choose a proprietary, standards-based, or dual- solution integration approach for added network redundancy." The company added that it will work with mobile network operators as well.

The move represents a step back from Iridium's initial D2D deal with Qualcomm, first announced a year ago. That deal paved the way for Qualcomm to sell Iridium's proprietary satellite connections to its smartphone customers like Samsung. But Qualcomm backed out of the deal in November 2023.

Analysts argued that a big part of the problem in the original Iridium/Qualcomm deal was that it only targeted smartphone makers and didn't leave space for mobile network operators. Iridium may be looking to address such concerns with Project Stardust.

Iridium officials said the company's new D2D project would cost several million dollars and would be available starting in 2026. Customers interested in deploying Iridium's Project Stardust offerings will need to install new hardware into their gadgets.

On the brink

Separately, while Bullitt confirmed restructuring, it's not clear what that will mean. The Telegraph reported earlier this week that Bullitt was "on the brink."

According to another report, the smartphone maker has been building ruggedized smartphones under various brand partnerships, including with CAT and Land Rover, since 2009. But Bullitt hasn't released any new products in recent years – except for ones that support satellite messaging.

Almost exactly a year ago, Bullitt released a phone and a Bluetooth accessory for phone to satellite messaging services. According to SpaceNews, Bullitt's satellite service runs on technology developed by startup Skylo with chips from MediaTek and satellites operated by companies such as Inmarsat.

It's unclear whether Bullitt's insolvency stems from lackluster demand for its ruggedized phones in general or apathy toward its newer satellite messaging offerings specifically. Either way, the company's restructuring doesn't reflect well on D2D overall.

"The initial stages of D2D are going to be very complex as the value that can be extracted from emergency services and messaging is not great," NSR's Serra wrote. "This explains recent headwinds such as Qualcomm terminating the deal with Iridium or Bullitt facing insolvency."

Lack of interest

Interest in the satellite-based emergency messaging service on Apple's iPhone 14 is "surprisingly dormant," analyst Cliff Maldonado with BayStreet Research told Light Reading last year. The firm closely tracks smartphone sales trends in the US market. Apple's iPhone 14 sparked the rush toward D2D services.

It's also worth noting that Apple's satellite partner for its iPhone service – Globalstar – has not indicated any interest in further pursuing the D2D market. The company instead has discussed plans to pursue the private wireless networking sector.