Elon Musk to invest up to $40b in his Starlink satellite Internet service

BARCELONA • Billionaire entrepreneur Elon Musk said on Tuesday he plans to invest up to US$30 billion (S$40.3 billion) to develop his ambitious Starlink satellite Internet service.

Starlink plans to deploy thousands of low-orbit satellites to provide high-speed Internet to isolated and poorly connected areas.

It has so far deployed over 1,500 satellites and by next month it will be able to provide coverage everywhere in the world except the North and South Poles, Mr Musk told the Mobile World Congress, a telecoms industry conference under way in Barcelona, by video.

The Tesla chief said he expects to invest "at least five billion dollars, and maybe as much as ten billion" in Starlink before the service has a positive cash flow.

"Then over time it is going to be a multiple of that, and that would be 20 or 30 billion dollars. It is a lot basically," he added.

Starlink is currently operating in about a dozen countries, with more being added, and it currently has just over 69,000 active users, Mr Musk said.

"We are on our way, I think, to having a few hundred thousand users, possibly over 500,000 users, within 12 months," he added.

"There is a need for connectivity in places that don't have it right now, or where it is very limited."

Mr Musk said Starlink sells its terminals for US$500 even though they cost the company over US$1,000 to make. He hopes to come up with a terminal that costs the company just US$220 to US$250. "Obviously selling terminals at half price is not super compelling," he said.

Mr Musk said Starlink had two partnerships with "major company telcos" and was "in discussions with a number" of others, without giving further details.

He said Starlink could help telecom firms meet rural connectivity requirements contained in licences for the new 5G cellular networks which are being deployed around the world.

Mr Musk's SpaceX firm, which operates Starlink, has requested authorisation from the Federal Communications Commission to deploy up to 42,000 satellites to provide the satellite internet service.

Starlink faces competition from a number of rivals including OneWeb, a broadband satellite communications company acquired by a consortium of investors comprising the British government and Bharti Global, and Amazon subsidiary Kuiper.

By the end of last year some 5.2 billion people, or 67 per cent of the global population, had subscribed to mobile services, according to the GSMA, the industry body which organises the annual mobile congress.

REUTERS