Starlink for Ukraine may cost SpaceX US$380 million more as Elon Musk says the Pentagon should take over the 2023 payments
This year is shaping up to be the most expensive one for SpaceX's Starlink satellite Internet service in terms of deployment expenses, with operating costs in the red to the tune of around US$1.4 billion. Starlink is expected to turn a profit next summer as it zeroes in on the two million subscribers number, but in the meantime Elon Musk wants the Pentagon to pick up the tab for his satellite Internet expenses in Ukraine.
At the beginning of the conflict, Elon Musk reacted to requests by local officials by extending coverage over Ukraine and starting to send terminals. Many individuals as well as charity or government organizations started buying up terminals and sending them to Ukraine, too, while plenty of locals are paying for the service. Still, after a recent controversy around his ideas about a peace deal with Russia, Elon Musk reminded everyone that so far SpaceX has spent US$80 million on Ukraine's satellite Internet project, and the cost is expected to hit US$100 million for the year.
The letter, which SpaceX sent to the Pentagon in September, shows that Ukraine's top military commander - General Valerii Zaluzhniy - requested 8,000 more Starlink terminals from SpaceX, in addition to the more than 20,000 donated through various channels so far. Thus, SpaceX projects that next year its expenses for operation Starlink-in-Ukraine may mount up to the staggering US$380 million, throwing its operating costs entirely off-kilter. It has allegedly asked the Pentagon to start lumping Starlink satellite Internet with the total military assistance tab for Ukraine which now exceeds US$17.5 billion just from the beginning of President Biden administration's tenure.
The terminals that SpaceX donated are up to US$2,500 apiece and Starlink is providing its US$4,500/month commercial level of Internet service to them despite that most are signed up for the US$500/month tier. "SpaceX is not asking to recoup past expenses, but also cannot fund the existing system indefinitely *and* send several thousand more terminals that have data usage up to 100X greater than typical households," advised Musk.
"We’re just following his recommendation," he also commented on a tweet noting that the Pentagon move comes shortly after the Ukrainian ambassador in Germany used an expletive to address Musk's Russia-Ukraine peace deal idea. SpaceX already refused Ukraine's request to provide Starlink coverage in Crimea. Elon Musk is reportedly worried that helping coordinate drone or other attacks there would only prolong the conflict and may result in a tactical nuclear strike if Ukraine advances enough to take on the Russian troops there.
Very interesting statement from @elonmusk re Ukrainian StarLink and how damaging it is for @SpaceX economics.— Dimko Zhluktenko ???????? (@dim0kq) October 14, 2022
Being Ukrainian actually in the topic of StarLinks, I want to tell you some based facts re starlinks in Ukraine.