SYDNEY, Aug 5 (Reuters) - The Australian

government-owned internet network hired Amazon's ( AMZN )

untested startup satellite service to provide connectivity to

people who cannot access its terrestrial network rather than

Elon Musk's Starlink.

From next year, low-Earth orbit satellites owned by Amazon's ( AMZN )

Project Kuiper will start replacing two Australian

government-owned satellites due for decommissioning in 2032, NBN

Co and Amazon ( AMZN ) said in a joint statement on Tuesday.

The deal, for which financial terms were not disclosed, is

designed to give high-speed internet to some 300,000 homes and

businesses that NBN's terrestrial network does not reach. The

thousands of low-Earth orbit satellites are connected to each

other through optical links and communicate with antennas and

other connection points on the ground.

The deal represents a missed opportunity for Starlink, by

far the world's biggest provider of such network services and

which already has more than 250,000 customers in Australia,

according to industry data. Australia's two biggest telecoms

providers sell Starlink residential connection dishes and some

government entities, including the Australian Electoral

Commission, also have contracts with the company.

Starlink, a unit of Musk's SpaceX rocket company, now has

8,000 fast-orbiting satellites since it began launching them in

2019, while Amazon's ( AMZN ) service has just 78 since its first launch

in April. NBN and Amazon ( AMZN ) said Project Kuiper would ultimately

have more than 3,200.

NBN said the decision followed a rigorous procurement

process, but did not say why it had chosen the Amazon ( AMZN ) service.

Starlink was not immediately available for comment.

"It is true that Amazon Kuiper has not launched services yet

in Australia or globally, but they are reportedly pumping in

about $15 billion into that programme," said Gavin Williams,

chief development officer for regional and remote services at

NBN.

"We have every confidence that we've got a partner in Kuiper

that will do what they say they're going to do," he added in an

interview.

Asked if Musk's ownership of Starlink played a part in the

decision, Williams said only that NBN supplied critical

infrastructure with regulatory and legal obligations and

"technical, operational, and commercial imperatives that fall

into that consideration were contemplated and ventilated through

the procurement process."