With Subscriber Counts Decimated by Starlink, Hughesnet Files for Bankruptcy
pcmag.com • • business
Key Points:
- Hughes Network Systems, the US satellite internet provider, has filed for Chapter 11 bankruptcy due to cash shortages and subscriber losses to Starlink, but will continue serving customers during restructuring.
- The company plans to address its debt, strengthen its capital structure, and shift focus from consumer broadband to enterprise, government, and defense markets.
- Hughesnet has lost over half its subscriber base since Starlink's beta launch in late 2020, with EchoStar reporting a decline to 622,000 broadband subscribers in Q2 and expecting the trend to continue due to structural competition from low-Earth orbit satellites.
- As part of the restructuring, Hughesnet is laying off 400 employees and has seen the departure of COO Paul Gaske, with Robert Del Genio appointed as Chief Restructuring Officer.
- EchoStar, Hughesnet's parent company, previously partnered with SpaceX by selling licensed spectrum in exchange for cash and stock, but Hughesnet has struggled with outstanding debts and liquidity despite the deal.
