Elon Musk wants to bring his Starlink satellite broadband to India, but is facing strong resistance from Mukesh Ambani who runs telecom giant Reliance Jio.
Musk said he was keen to launch Starlink in India which “can be incredibly helpful” in remote villages that have no internet or lack high-speed services.
Starlink is at odds with Ambani’s Reliance over the government’s distribution of satellite broadband spectrum, launching competition between two of the world’s richest men for satellite services in the country.
Anti auction
Starlink is lobbying India to not auction the spectrum but just assign licences in line with a global trend, saying it is a natural resource that should be shared by companies.
It is against an auction since it may impose geographical restrictions that will raise costs.
Pro auction
Reliance disagrees and has called for an auction.
It said that foreign satellite service providers could offer voice and data services and compete with traditional telecom players.
Hence an auction will help achieve a level playing field.
Reliance vs Starlink
Musk had attempted in 2021 to launch Starlink in India, an attempt which failed due to local regulators who were against the company taking bookings without a license.
On the other hand, Reliance intends to continue pleading with the government to auction satellite spectrum, and not agree to the demands of foreign companies.
Ambani’s view
For Ambani, keeping foreign competition at bay in satellite broadband works because his Reliance Jio already has 439 million telecom users, making it the market leader.
It provides 8 million wired broadband connections, a 25% market share.
He also believes that allowing established foreign players to enter the market without an auction will allow them “runaway success” just like Amazon, which will hurt Indian firms and create an uneven playing field.
What might happen going forward
If India decides on holding an auction the British government-backed OneWeb will find it difficult to do business in the country.
Meanwhile Starlink is waiting for clarity on India’s spectrum allocation before firming up its commercial 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 already obtaining low-cost licenses in many other countries.
“I’d expect Starlink to make high-profile free offers elsewhere in order to try and demonstrate what India could be missing out on,” he said.
