Elon Musk Criticizes FCC for Adding 'Crazy Requirements' to Revoked $885M Starlink Deal

Elon Musk recently stated that the U.S. Starlink deal could have been significantly cheaper if the FCC had not imposed unnecessary requirements. The $885 million grant, meant to provide high-speed internet to underserved areas, was revoked in 2022, with Musk criticizing the added costs due to regulatory demands.

Musk Criticizes Government's ‘Absurd Requirements’ for Driving Up Costs in Revoked Starlink Deal Amid Disaster Response

The potential of utilizing Starlink in regions devastated by natural disasters has been reaffirmed in the wake of Hurricane Helene. Elon Musk recently commented on social media platform X that the United States Starlink deal, which the FCC subsequently revoked, could have been significantly less expensive if the government had not stipulated "so many crazy requirements that add no value."

The Federal Communications Commission (FCC) initiated an initiative four years ago that awarded grants to companies that could provide high-speed internet access to the underserved areas of the United States, as noted in a FOX News report. The initiative was designed to connect over 640,000 households and businesses in 35 states nationwide at approximately $1,300 per kit. SpaceX was awarded a $885.5 million grant under the program. Nevertheless, the grant was revoked in 2022. In December 2023, the FCC reiterated its decision.

The recent deployment of Starlink packages to areas severely affected by Hurricane Helene by FEMA and private individuals and organizations underscored the company's ability to provide internet connectivity in disaster-prone areas. Amid the ongoing recovery efforts, some users in X observed that the five most severely affected states by Hurricane Helene would have had access to over 92,800 Starlink packages if the FCC had not revoked its award for the satellite internet system. Additionally, the cost of each Starlink kit in the five most afflicted states would have exceeded $1,000 per unit.

SpaceX CEO Elon Musk stated in a response on X that the cost of each Starlink kit for the underserved areas of the United States could have been reduced. According to Musk, the government's insistence on requirements that did not significantly contribute to the value of the Starlink kits under the rescinded FCC award increased the price of each kit. Musk wrote in his response to X, "By the way, the price could be significantly lower if the government did not impose so many absurd requirements that provide no value."

FCC Faces Criticism for $42B Fiber Plan After Revoking Starlink Deal, Citing Need for Competition

The United States government would now be spending over $42 billion to provide fiber high-speed internet to underserved areas due to Starlink's $885 million award revocation. As noted by FCC Commissioner Brendan Carr, “Now you’ve got cases where the government is spending in the ballpark of, and in some cases in excess of, $100,000 per location to build out fiber high-speed internet to these locations.”

It is intriguing that FCC Chairwoman Jessica Rosenworcel also suggested at a conference earlier this year that Starlink's development is excessively rapid and that the satellite internet system requires competition. As per the FCC Chairwoman, Starlink has “almost two-thirds of the satellites that are in space right now and has a very high portion of internet traffic.” She also noted that “Our economy doesn’t benefit from monopolies. So we’ve got to invite many more space actors in many more companies that can develop constellations and innovations in space.”