Spacex Ceo Elon Musk Canadian Government Funding Starlink Rival Satellite Internet Musk Offer Less Half Amount Own System
SpaceX CEO Elon Musk Criticizes Canadian Government for Funding Starlink Rival Despite Cheaper Alternative
In a recent exchange, SpaceX CEO Elon Musk has criticized the Canadian government for investing heavily in a rival satellite internet project, Telesat's Lightspeed, despite his offer to provide similar services through Starlink at a significantly lower cost.
The controversy began when Conservative MP Michael Barrett questioned the federal government's decision to invest $2.14 billion in Telesat, a Canadian satellite company, to support its low-Earth-orbit satellite program. Barrett asked Musk on social media how much it would cost to provide Starlink to every Canadian household without high-speed internet, to which Musk replied, "Less than half that amount".
This response sparked a defensive reaction from the Liberal government, with Minister of Innovation, Science, and Industry François-Philippe Champagne arguing that the investment in Telesat was necessary to support Canadian industry and jobs. Champagne stated that the loan to Telesat was a better deal than paying for a foreign service, emphasizing the importance of national security and the protection of Canada and the Arctic.
However, Musk's assertion highlights the cost disparity between the two projects. Starlink, which has been operational since 2019 and currently serves over 400,000 active Canadian customers, offers a direct-to-consumer model that has proven popular in rural and remote areas. In contrast, Telesat's Lightspeed project, which has yet to launch its new satellites, will be sold through service providers rather than directly to consumers.
The Canadian government's investment in Telesat is not the first; in 2021, the Trudeau government provided Telesat with $1.4 billion, including a $790 million repayable loan and $650 million as a preferred share equity investment. Despite this significant financial support, Telesat's progress has been slower than Starlink's, with the first Lightspeed satellites not scheduled to launch until 2026. Ironically, these satellites will be launched into orbit by SpaceX, the parent company of Starlink.
Musk's criticism also touches on the issue of national ownership and control. While Telesat is headquartered in Ottawa, it is majority-owned by U.S.-based investors, including GAMCO Asset Management and Gabelli & Company Investment Advisers. This has raised questions about how "Canadian" the company truly is.
The debate underscores the complexities of investing in national infrastructure versus leveraging existing, cost-effective solutions. As the Canadian government continues to support Telesat, it faces criticism for potentially overlooking a more affordable and already operational alternative in Starlink. The situation highlights the ongoing competition between different satellite internet providers and the political considerations that influence such investments.