Starlink - July 2022 - Paying the Piper
In July 2022 Ukrainian commanding general, General Valerii Zaluzhniy, made a direct request made to Musk for almost 8,000 more Starlink terminals. An outside consultant working for SpaceX wrote, “SpaceX faces terribly difficult decisions here. I do not think they have the financial ability to provide any additional terminals or service as requested by General Zaluzhniy.”
In September 2022 SpaceX sent a letter to the Defense Department stating it can no longer fund Starlink service as it had to date. The letter requested that the Pentagon take over funding for Ukraine’s government and military use of Starlink, which SpaceX claimed would cost more than $120 million for the rest of 2022 and could cost close to $400 million for the next 12 months. “We are not in a position to further donate terminals to Ukraine, or fund the existing terminals for an indefinite period of time,” SpaceX’s director of government sales wrote to the Pentagon in the September letter.
By October 2022 roughly 20,000 Starlink satellite units had been donated to Ukraine, with Musk tweeting the “operation has cost SpaceX $80 million and will exceed $100 million by the end of the year.”
Musk raised the possibility of ending the company’s donations of Starlink services to Ukraine, citing the financial burden on the company, unless the Defense Department stepped in to cover those costs. "In addition to terminals, we have to create, launch, maintain & replenish satellites & ground stations & pay telcos for access to Internet via gateways. We’ve also had to defend against cyberattacks & jamming, which are getting harder. Burn is approaching ~$20M/month."
Musk on 14 October 2022 said that asking the Pentagon to pay for Starlink in Ukrainee was following the advice of the Ukrainian diplomat who responded to Musk’s pro-Russian peace plan with: “F*** off.” Ukraine’s ambassador to Germany, Andrij Melnyk, responded to Musk’s peace plan by saying: “F*** off is my very diplomatic reply to you @elonmusk.” Musk said “We’re just following his recommendation”.
Deputy press secretary Sabrina Singh during a briefing at the Pentagon 14 October 2022 said the Defense Department “has been in communication with SpaceX regarding Starlink” but declined to comment on the substance of the discussions. Singh said DoD “recognizes the advantages that any satcom capability has and allows the Ukrainians to use not just on the battlefield, but within the country itself. And we understand the fragility in those communications.” The Pentagon is “working with our partners and allies and trying to figure out what’s best,” she said. Singh declined to confirm whether the Pentagon will pay for Starlink specifically, and insisted it will examine other options. “There are certainly other satcom capabilities that exist out there. I’m not going to show our hand right now on exactly what those are, or who we’re talking to. But we do know that there are others,” Singh said. “There’s not just SpaceX, there are other entities that we can certainly partner with when it comes to providing Ukraine what they need on the battlefield.”
A Senior Military Official held a Background Briefing on Ukraine 14 October 2022. "Q: Want to take a -- another crack at -- at Starlink. If you could speak more broadly just to the advantage is there has been provided and -- and what might be lost if it is turned off or turned off in some circumstances. And -- and then from a policy perspective, what the Pentagon is doing at this point to kind of address this issue, the concerns that Mr. Musk has raised, et cetera. Thank you.
"SENIOR MILITARY OFFICIAL: I'll leave the second one, certainly, to (inaudible). In terms of its employment, I mean, well, I don't think you can overestimate or overemphasize the impact that being able to communicate has. You know, one of the first things you try to do in a fight is to reduce your opponent's ability to communicate, and in this case, you know, Starlink has proven exceptionally effective on the battlefield because it's allowed the Ukrainians multiple connections, and in that regard, has been very, very helpful in their efforts at the tactical and strategic level.
"DEFENSE OFFICIAL: Yeah, thanks, (inaudible). I'm happy to take the Starlink question. The department, along with the Ukrainian Minister of Defense, we've identified the need for a SATCOM capability to ensure stable communications that remain and allow Ukrainian forces to contact or to use. And we're working with our partners and allies to look at all options on how we can best support the needs that the Ukrainians have right now. And I'm happy to go into more detail on that later."
As a senior U.S. defense official told The Washington Post 14 October 2023, SpaceX “sticks the DoD with the bill for a system no one asked for but now so many depend on.” In reaction to critics, Musk backtracked on 15 October 2022 and tweeted: “The hell with it … even though Starlink is still losing money & other companies are getting billions of taxpayer $, we’ll just keep funding Ukraine govt for free.” Musk saying the company would continue offering the service “even though Starlink is still losing money and other companies are getting billions.”
Starlink now had a Defense Department contract to buy those satellite services for Ukraine, the Pentagon said 01 June 2023. "We continue to work with a range of global partners to ensure Ukraine has the resilient satellite and communication capabilities they need. Satellite communications constitute a vital layer in Ukraine's overall communications network and the department contracts with Starlink for services of this type," the Pentagon said in a statement. “However, for operational security reasons and due to the critical nature of these systems, we do not have additional information regarding specific capabilities, contracts, or partners to provide at this time,” the Pentagon said.
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