Elon Musk’s Starlink satellite business is set to boom if Trump wins
The cutting-edge satellite system stands to gain billions of dollars more in contracts and subsidies as Trump favors space investment.
Elon Musk’s fast-growing satellite business Starlink could be poised to gain billions of dollars more in federal contracts and subsidies under a Donald Trump presidency, industry experts say, in a reflection of the world’s richest individual’s deepening financial stake in Washington politics.
Trump has cast himself as a space patron, pledging to unleash funds for national-security installations in orbit and slash red tape for Musk. Other Republicans have also telegraphed business upsides for Starlink, including pushing for the company to get a slice of a $42 billion pot of federal internet subsidies.
A presidential vote of confidence could help the standing of Starlink and its parent company, SpaceX, as they vie for billions of dollars in national-security contracts against rivals like Amazon in the coming years. Musk has struggled to reassure parts of the defense community that he is a trustworthy partner, even as industry experts say Starlink is rapidly building out an advanced satellite surveillance system on track to be the most powerful one in history.
Starlink, which is managed day-to-day by SpaceX president Gwynne Shotwell, currently has some 6,400 working internet satellites in orbit, 10 times more than its nearest rival, and separately a quiet but fast-growing surveillance satellite business.
One former SpaceX executive, speaking on the condition of anonymity to discuss matters involving a onetime employer, said a Trump administration would also be disposed to assist in green-lighting new launch sites for SpaceX, helping Starlink to continue rapidly expanding its satellite network to stay ahead of rivals.
“I think that’s one area where a Trump administration will be a little more sympathetic,” the executive said.
Musk’s shift to supporting Trump appears to be driven largely by conviction on social issues, according to people familiar with him who spoke on the condition of anonymity to discuss his thinking. But the tech executive’s business empire also stands to benefit if Trump wins the election — potentially by a far larger amount than the billionaire has splashed out to support Trump’s campaign.
Musk has donated $75 million to his own super PAC supporting Trump’s reelection efforts and about $1 million more to another pro-Trump PAC. He also announced over the weekend that he would give away $1 million a day to a registered swing-state voter who signed a petition. Federal satellite contracts often run in the hundreds of millions of dollars or higher.
There is further revenue potential in the broader space contracting boom that Trump has promised, which could bring billions of dollars to SpaceX’s rocket business. Musk’s other companies, Tesla and X, could also benefit if Trump follows through with appointing him to lead a new “government efficiency commission.”
The satellite sector is notorious for thin margins, so it is unclear how profitable any new contracts would be for SpaceX. And Democrats and Republicans tend to be more aligned on space policy behind closed doors than public bluster would suggest. Still, the difference in tone on space and Musk has been marked.
Trump vowed at a rally over the summer to “make life good” for Musk, while President Joe Biden and Vice President Kamala Harris have been cool toward the entrepreneur. And while the Republican candidate’s election platform includes a pledge to promote investments in “near earth orbit” — the satellite realm dominated by Starlink — Harris’s campaign and the Democratic Party have not highlighted space policy beyond a general commitment to NASA and the International Space Station.
Space defense booster
Musk’s Starlink bloomed under Trump’s presidency. Republican officials took a chance on the mercurial tycoon and his newfangled satellites, which promised not only a new internet option for consumers but also a military and intelligence-gathering edge for the government.
As president, Trump was a booster for the space defense industry, signing the Space Force — a new military branch specializing in space operations — into existence in 2019 and elevating security hawks who urged the United States to militarize space ahead of rival nations. He also expressed personal admiration of Musk, trekking out to Cape Canaveral to watch a SpaceX rocket launch, and praising Musk as “a brilliant guy.”
Musk, for his part, initially expressed mixed views of Trump’s presidency. The SpaceX founder, who had leaned Democratic, quit two of Trump’s advisory councils in 2017 to protest the president’s withdrawal from the Paris climate accord. But he praised Trump’s establishment of the Space Force as “sensible,” saying it would help civilization expand into space.
Trump’s Federal Communications Commission authorized a fledgling Starlink in 2018 to launch a first tranche of 4,425 internet satellites, despite protest from rivals that such an unprecedented number would clutter the skies. It was an audacious decision: Starlink, an untested vendor, got a green light to nearly double the total number of satellites orbiting Earth.
“We were pushing the envelope,” said Evan Swarztrauber, a policy adviser to then-FCC Chairman Ajit Pai and now a senior fellow at the Foundation for American Innovation. “We were just trying to create the conditions for various technologies to be able to be rolled out. We didn’t know exactly how things would go.”
A satellite system like Starlink was revolutionary. Satellites were traditionally large and expensive, with the world’s largest constellations consisting of only a few hundred satellites. SpaceX’s breakthrough in developing rockets that could be reused for multiple launches made it possible to create a much larger network.
While Starlink was marketed as an affordable internet option for rural residents, defense officials appreciated its military utility from the early days. A strong data connection in previous dead zones opened new capabilities like streaming battlefield drone video back to headquarters or course-correcting missiles midflight.
“It doesn’t take a wizard to understand the military implications,” remarked the former SpaceX executive, who said Musk sometimes invoked China’s competitive threat in meetings with Pentagon officials.
The Pentagon was soon a customer, and before long Starlink was given the opportunity to dip its toe into surveillance work.
The Space Development Agency, a newly formed defense office, awarded SpaceX a $149 million contract in 2020 to build a first generation of tracking satellites that could detect hypersonic missile launches. SpaceX also began working on prototype spy satellites for the National Reconnaissance Office, the Pentagon’s spy satellite division, during the Trump administration, Reuters reported this year. The Wall Street Journal reported the classified contract was valued at $1.8 billion.
The NRO declined to confirm the contract, citing national security considerations. Troy Meink, principal deputy director of the NRO, said in a public talk this month that the agency does not procure directly from Starlink, but did not say whether it works with the company indirectly.
Meink said rockets like SpaceX’s have made it feasible for the agency to build its largest spy satellite fleet ever, with more than a hundred payloads launched in the past 18 months.
“Why didn’t you do this earlier?” Meink said people sometimes asked him. “Well, launch costs were high, right? … Now it’s just come way down.”
Globe-girding surveillance
There’s been much hushed discussion in the space industry this year over Starlink’s plan to supplement its satellites for the internet with a second type in its secretive “Starshield” unit dedicated to surveillance.
Five industry experts told The Washington Post that Starlink appears to be the front-runner in building the first satellite system able to see all places on Earth continuously in high-definition, even as many details of the project remain unclear.
“You’re approaching a near real-time capability to see any spot on Earth,” said Michael Brown, former director of the Defense Innovation Unit, a Pentagon technology unit, of this next wave of satellites led by Starlink.
Alexandre Najjar, a consultant at Novaspace, forecasts that Starlink’s new earth-observation system will become the world’s largest next year.
Chris Quilty, founder of the research firm Quilty Space, estimates that state-of-the-art satellite systems today have a roughly 15-minute lag time — still long enough for a military target to relocate completely after being photographed.
If Starlink can build a system that provides closer-to-real-time global surveillance in the next few years, it could become an irreplaceable federal contractor. Its rivals fear SpaceX has the deep pockets to accept short-term losses until it runs them out of business.
“He could sustain a deficit for ages,” Najjar said. “They could do that long enough until the competition is gone.”
Such a reliance on Musk unnerves officials across party lines.
There’s been debate across the U.S. government over Musk’s reliability as a federal partner since 2022, when he declined a request from Ukraine to activate Starlink over Crimea to support an attack on a Russian fleet, saying it would make his company “explicitly complicit in a major act of war.” While Musk has since come around to more vigorous support of Ukraine’s military, U.S. defense officials ever since have foregrounded a goal of “diversifying” their satellite supply.
There’s a political dimension to the debate as well. After Musk endorsed Trump in July, the Harris campaign called Musk one of the “arrogant billionaires only out for themselves” and said such tycoons were “not what America wants or America needs.” One of the people familiar with Musk said he developed something of a “persecution complex” after repeated attacks and snubs from prominent Democrats.
Despite Starlink having no close rival right now in low-earth-orbit satellites in terms of technical capabilities, the Space Development Agency announced Wednesday that it has picked 18 other satellite makers along with SpaceX for its next military project. One of them is Kuiper, Amazon’s satellite division, which has not yet launched a functional network. (Amazon founder Jeff Bezos owns The Washington Post.)
Clare Hopper, head of the U.S. Space Force’s Commercial Satellite Communications Office, said the Pentagon is working to put another $12 billion in low-earth-orbit satellite contracts on the table, up from her office’s current authorization of $1 billion. She said these contracts would not only go to Starlink but to a range of companies.
“We anticipate there to be more diversity of business,” Hopper said.
As for consumer internet, Starlink’s bread and butter, the company is fighting to be considered for tens of billions of dollars in federal subsidies alongside established internet providers. The Biden administration has been wary, saying they must be judicious with taxpayer dollars and that Starlink has yet to reliably meet FCC-defined “broadband” speeds.
Republicans have accused the Biden administration of being biased against Musk. House oversight committee chairman Rep. James Comer (R-Kentucky) has launched a probe into whether the FCC withheld a grant from Starlink improperly. Republican FCC Commissioner Brendan Carr called his Democratic colleagues’ decision to keep Starlink from the grant “nothing more than regulatory lawfare against Elon Musk.”
Swarztrauber, the former FCC official, said Starlink is more likely to land federal internet subsidies under a Trump administration. Democrats traditionally view broadband more like a utility in which everyone deserves the same service, he said, while Republicans are more willing to let an eclectic patchwork of technologies shake out through market competition. The largest of these federal subsidy programs, the $42 billion Broadband Equity Access and Deployment Program, has only just begun, with the next administration getting a say in fund distribution.
“I think there would be more willingness to incorporate Starlink into broadband expansion initiatives” under Trump, Swarztrauber said.
In a move that would ready the company for such an opportunity, Starlink this month filed another request with the FCC to expand its fleet to 29,988 satellites. There are around 10,000 satellites orbiting the Earth right now. Most of them are Starlink’s.
Total Posts: 9597