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India sides with Musk on satellite spectrum allocation

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Ambani's Jio faces potential customer loss to Starlink

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Starlink may price aggressive in India with unlimited data

By Munsif Vengattil, Aditya Kalra and Aditi Shah

NEW DELHI, Oct 17 (Reuters) - Having just lost a battle

with Elon Musk over how India's satellite spectrum is awarded,

Asia's richest man Mukesh Ambani could face a bigger challenge

if Musk's Starlink launches services in India and the two go

head-to-head on price.

India's government said on Tuesday it will allocate spectrum

for satellite broadband administratively and not via auction,

hours after Musk criticized the auction route being sought by

rival billionaire Ambani as "unprecedented".

Musk's Starlink, a unit of SpaceX which has 6,400 active

satellites orbiting earth to provide low-latency broadband to 4

million customers, has publicly expressed interest in launching

in India, but its plans faced repeated regulatory roadblocks.

Ambani, who runs India's biggest telecom company, Reliance

Jio, had tried since last year to seek a "balanced competitive

landscape" and wanted to keep Musk at bay, as experts say a

spectrum auction would have required much more investment and

deterred foreign players.

Reliance, which has dominated India's telecom sector for

years, is now concerned that after spending $19 billion in

airwave auctions it risks losing broadband customers to Musk,

and potentially even data and voice clients later as technology

advances, a person with direct knowledge said on Thursday.

The Indian government says its decision to allocate spectrum

administratively to whoever applies for it is in line with

global trends.

It has not set a timeframe for when the process will start

but Musk's Starlink has already applied for necessary permits.

Starlink's entry into the Indian market would create a new

battleground between the two billionaires: pricing.

Musk has thousands of operational satellites, while

Reliance has partnered with Luxembourg-based SES Astra, which

non-profit CelesTrak says has 38 satellites that Reliance plans

to use.

"Starlink can price aggressively because it doesn't need to

add more satellites," said Tim Farrar, a satellite industry

analyst at U.S.-based TMF Associates.

Ambani once gave data for free on his mobile plans, but Musk

is no stranger to such tactics which can unsettle local players.

In Kenya, Musk priced Starlink at $10 per month, versus $120

in United States, with rental plans available for higher

hardware cost. Kenya's Safaricom in July complained to

local regulators, calling for players like Starlink to be

required to partner with mobile networks, and not operate

independently.

INDIA POTENTIAL

In India, a Reliance Jio fibre-based, high-speed broadband

plan costs $10 per month, with router free on long-term plans.

It has a 30% market share in the wired broadband market.

Starlink has plans to offer an unlimited internet data plan

in India initially and target corporate clients, said a second

industry source familiar with the matter.

Reliance and Starlink did not respond to Reuters queries.

With 42 million wired broadband internet users and 904

million telecom users on networks like 4G and 5G, India is the

world's second-biggest telecom market after China.

Internet penetration in India stood at 52.4% as of early

2024, according to DataReportal and there are still 25,000

villages without internet. And even in urban cities, many areas

don't have fibre-based fast internet offerings.

Musk said last year Starlink "can be incredibly helpful" in

remote Indian villages or places that lack high-speed services,

and his former India head in 2022 said Starlink at the time

targeted 200,000 customers within eight months of launch.

Starlink has also announced plans to launch globally a

constellation of hundreds of satellites to enable "direct to

cell" voice and data services in coming years.

Gareth Owen, associate director at research firm

Counterpoint, however, said some of the fears about Musk might

be overstated, as "terrestrial networks will always be less

expensive (and) businesses will never switch completely to

satellite."

For now, even before the real battle starts on the ground,

the Musk-Ambani rivalry is increasingly on display.

A Reuters report this week that Ambani was again lobbying

New Delhi to auction satellite spectrum for a "level playing

field" caught Musk's attention, after a social media user asked

if Ambani was scared of Musk disrupting the Indian billionaire's

telecom empire.

"I will call (Ambani) and ask if it would not be too much

trouble to allow Starlink to compete to provide internet

services to the people of India," Musk joked in a post on X in

response.