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What he doesn’t talk about is how Starlink is at odds with Ambani’s Reliance over the government’s distribution of satellite broadband spectrum, setting the stage for a battle between two of the world’s richest men for satellite services in the world’s most populous country.
Starlink is pressing India not to auction spectrum but only assign licenses in line with the global trend, saying it is a natural resource that companies should share. The company said in company letters published by the Indian government this month that the auction could impose geographic restrictions that would increase costs.
Reliance disagrees and has called for an auction to be held in a public bid for the government, saying that foreign satellite service providers can offer voice and data services and compete with traditional telecom operators, and so there should be an auction to level the playing field.
In signs of deepening competition, an industry source with first-hand knowledge said Reliance will continue to urge the Indian government to auction off satellite spectrum, and not accede to demands from foreign companies.
The stakes are high for Musk. His endeavor comes after an attempt to launch Starlink in India in 2021, which has caused conflict with local regulators for taking reservations without a license, just as he is in talks with India to set up a Tesla factory.
For Ambani, keeping foreign competition at bay in satellite broadband would be another shot in the arm — Reliance Jio already has 439 million telecom users, making it the market leader, and 8 million wired broadband connections, with a 25% market share. .
Starlink’s view on auctions is shared by Amazon’s satellite internet initiative, Project Kuiper, and British government-backed OneWeb.
Amazon declined to comment. Telecom Regulatory Authority of India, OneWeb and SpaceX parent Starlink did not respond.
Asked for comment, Reliance referred Reuters to its own reporting and the Starlink government.
Auction for licence
Of the 64 responses from companies, industry groups and others to India’s public consultation on satellite spectrum, 48 favored licensing, 12 voted in favor of an auction, and the rest were neutral, according to India’s Koan Consulting.
A second industry source said Reliance believes opening the gates to established foreign players like Starlink without an auction would allow them to “run wild” just like Amazon, hurting Indian companies and creating an uneven playing field.
Ambani’s Reliance Retail is battling Amazon but trailing the US rival in market share in the e-commerce space.
Deloitte says the market for satellite broadband services in India will grow 36% annually to reach $1.9 billion by 2030.
Starlink says it is already licensed in 84 jurisdictions around the world and has 1.5 million active users for its low-latency broadband services. Amazon plans to launch its first batch of satellites in 2024.
One of the sources, an Indian consultant to a foreign company, said that foreign satellite internet companies are worried that an auction by India will increase the likelihood that other countries will follow suit, increasing costs and investments.
An industry source said if India decides to hold an auction, OneWeb will find it difficult to do business in the country. Another source said that Starlink is awaiting clarification on spectrum allocation in India before furthering its commercial strategy.
It would set a “bad precedent” for Starlink to pay a large auction amount in India when it would acquire low-cost licenses in many other countries, said Tim Farrar, an analyst at US-based consulting firm TMF Associates.
“I would expect Starlink to offer high-profile freebies elsewhere to try and show what India can miss,” he said.
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