Musk’s Broadband Satellites Have Long-Term Costs, States Say

The Trump administration is making changes to the Broadband Equity and Access Deployment Program (BEAD) Program that will benefit satellite internet providers like Elon Musk’s Starlink, but some state and federal officials worry the technology isn’t robust enough to connect Americans on a mass scale and at affordable rates. State and former federal officials, several of whom spoke to Bloomberg on the condition of anonymity, described pitfalls with Commerce Secretary Howard Lutnick’s new approach, which gives more opportunities for satellite terminals that are initially inexpensive, but can cost more over time. One state official shared internal data that showed satellite service costs consumers 53% more over the course of 30 years. Satellite service would also cost more than twice as much to maintain over that time frame, according the data.  Fiber, which involves stringing cable to a user’s home, costs at least $1,500 per location to install, according to an analysis shared by one state broadband official who asked not to be identified. However, costs can vary widely depending on where a home is located and how much existing infrastructure surrounds it, among other factors. Texas estimates it can build fiber to a home for roughly $10,000. By contrast, Starlink, which is part of Musk’s Space Exploration Technologies Inc., offers a standard residential kit for around $600, though those costs too can fluctuate. But Starlink’s satellites need replacing every five years, making their total cost to consumers much higher in the long run, according to the state analysis. Fiber’s overall cost to serve a quarter-million homes is roughly $4 billion less than satellite service over 30 years, according to the state analysis, and would save an individual household $15,600 over the same period. A shift toward satellite generally translates into profit for Starlink, which is one of two low-earth orbit satellite providers that’s operational in the US right now, with 7,000 satellites.