Battle for satellite broadband: Elon Musk’s Starlink eyes India, Reliance Jio opposes

Elon Musk is keen to bring his Starlink satellite broadband to India, but the world’s richest man is facing strong resistance from Asia’s richest man Mukesh Ambani, who runs Indian telecom giant Reliance Jio.

After a meeting with Indian Prime Minister Narendra Modi in the US on Tuesday, Musk said he is keen to launch Starlink in India, which could be “incredibly helpful” in remote villages with no internet or There is a lack of high speed services.

He did not talk about how Starlink is at loggerheads with Ambani’s Reliance over distribution of the government’s satellite broadband spectrum, leading to a battle between the world’s two richest people for satellite services in the world’s most populous country. The stage has been set.

Starlink has been lobbying India not to auction spectrum but allocate licenses in line with the global trend, saying it is a natural resource that should be shared by companies. Company papers made public by the Indian government this month said geographic restrictions could be imposed on the auction, which would drive up costs.

Reliance disagrees and has called for the auction, making a public submission to the government that foreign satellite service providers can provide voice and data services and compete with traditional telecom players, and therefore at par There must be an auction to get the opportunity.

In signs of deepening rivalry, an industry source with direct knowledge said Reliance would continue to push the Indian government to auction satellite spectrum, and would not agree to the demands of foreign companies.

The stakes are high for Musk. His push comes after his attempt to launch Starlink in India in 2021 drew criticism from local regulators for taking bookings without a license, and as he is in talks with India to set up a Tesla factory .

For Ambani, keeping away foreign competition in satellite broadband will be another blow in the arm — his Reliance Jio already has 439 million telecom users, making it the market leader, and 8 million wired broadband connections, up 25%. is market share.

Starlink’s view on the auction is shared by Amazon’s satellite internet initiative, Project Kuiper, and British government-backed OneWeb.

Amazon declined comment. The Telecom Regulatory Authority of India, OneWeb and Starlink’s parent company SpaceX did not respond.

Asked for comment, Reliance referred to its and Starlink’s government presentations to Reuters.

auction vs licensing

According to India’s Coan Advisory, of 64 responses from companies, industry groups and others to India’s public consultation on satellite spectrum, 48 supported licensing, 12 voted for auction, the rest neutral.

A second industry source said Reliance believes that opening the doors to established foreign players like Starlink without auctions will make them “overwhelmingly successful” like Amazon, which will hurt Indian companies and create an uneven playing field. Will be ready

Ambani’s Reliance Retail competes with Amazon but lags behind its US rival in terms of market share in the e-commerce sector.

Deloitte says India’s satellite broadband service market will grow 36% per year to reach $1.9 billion by 2030.

Starlink says it is already authorized in 84 administrations around the world and has 1.5 million active users of its low-latency broadband services. Amazon plans to launch its first set of satellites in 2024.

An Indian consultant to a foreign company, one of the sources said, foreign satellite internet companies are concerned that an auction by India will make other countries more likely to do the same, driving up costs and investments.

An industry source said, if India decides to hold the auction, OneWeb will find it difficult to do business in the country. Another source said Starlink is awaiting clarity on spectrum allocation from India before firming up its business strategy.

Tim Farrar, an analyst at US-based consultancy TMF Associates, said it would set a “bad precedent” for Starlink to pay a substantial auction amount in India when it is securing low-cost licenses in several other countries.

“I expect Starlink to launch high-profile freebies elsewhere to demonstrate what India has got to lose,” he said.

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