Apple spends $450 million with Globalstar, the rest on satellite text messaging

Apple It said Thursday it will spend $450 million with U.S. companies to implement its new Emergency satellite SMS feature.

Most of that money will go away GlobalstarThe Louisiana-based company that operates the satellites that make this feature possible, Apple said.

Apple doesn’t take an equity stake in the company, but it spends money on equipment and service operations. The funding pays for satellites, as well as equipping ground stations with a new type of antenna designed by Apple.

In September, Apple announced Emergency SOS with Satellite A banner feature on the new iPhone 14 models. If users are out of range of a cellular tower while camping in a remote area, they can point their phone at the sky and connect to one of 24 Globalstar satellites in low Earth orbit to connect to emergency services. It will be launched later this month via an iPhone software update.

Thursday’s announcement underscores the significant costs of operating the service.

The feature is free for two years, but Apple is open to charging for it after that. The service isn’t fully automated, requiring human-staffed call centers — more than 300 GlobalStar employees will work on the service, Apple said.

This is an example of how much Apple spends on American suppliers. Apple likes to point out that many of the parts it uses in its devices come from the US, with final assembly almost entirely done in China.

Apple’s payment for Globalstar will come from Apple’s Advanced Manufacturing Fund, money the company uses to support US-based suppliers.

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Since the Advanced Manufacturing Fund was created in 2017, it has paid off $450 million to Corning for iPhone glass manufacturing, $390 million for Finisar To outfit a factory to make the laser components needed for FaceID, $100 million to XPO Logistics And $10 million for discovering Coban for Covid-19 Test equipment parts.

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