JAKARTA - Elon Musk is excited to bring his Starlink satellite broadband service to India. But the richest man in the world is facing strong resistance from Mukesh Ambani, Asia's richest man to run India's largest telecommunications company, Reliance Jio.

Following a meeting with Indian Prime Minister Narendra Modi in the United States on Tuesday, June 20, Musk said he wanted to launch Starlink in India which "could be very helpful" in remote villages that do not have internet or lack of high-speed services.

However, what he didn't talk about was how Starlink contradicted Reliance Ambani over the government's distribution of satellite broadband spectra, which set the stage for fighting between the world's two richest people for satellite services in the country with the largest population in the world.

Starlink is lobbying India not to auction off the spectrum, but to only license it according to global trends, saying it is a natural resource that companies must share. Auctions can impose geographical restrictions that will increase costs, the company's papers said this month.

Reliance disagrees and has requested an auction in public filings to the government, saying that foreign satellite service providers can offer voice and data services and compete with traditional telecommunications players, so there must be an auction to achieve balanced competition.

In signs of increasingly heated competition, industry sources with direct knowledge say that Reliance will continue to encourage the Indian government to auction off satellite spectra, and disapproving demands from foreign companies.

The stakes are very high for Musk. This effort comes after an experiment in 2021 to launch Starlink in India experienced obstacles from local regulators for accepting unlicensed orders, and at the same time he was in talks with India to set up a Tesla factory.

For Ambani, holding back foreign competitions in satellite broadband will be another boost - her Jio Reliance already has 439 million telecommunications users, making her market leader, and 8 million broadband cable connections, with a 25% market share.

Starlink's views on the auction were also supported by Amazon's satellite internet initiative, Project Kuiper, and the British government in support of OneWeb.

Amazon declined to comment. India's Telecommunications Regulatory Authority, OneWeb, and Starlink's parent company, SpaceX, did not provide a response.

When asked for comment, Reliance directed Reuters to their own government filings and Starlink submissions.

Of the 64 responses from companies, industry groups, and others to India's public consultations on satellite spectra, 48 support licensing, 12 choosing auctions, and the rest neutral, according to Indian Koan Advisory.

A second industry source said that Reliance believes opening the door to established foreign players like Starlink without auction will allow them to achieve "extraordinary success" like Amazon, which would harm Indian companies and create inequality in competition.

Ambani's Retail Reliance has faced Amazon, but lost the market share in the e-commerce space.

Deloitte stated that India's satellite broadband service market will grow 36% per year and reach 1.9 billion US dollars (Rp28 trillion) by 2030.

Starlink says it has been authorized by 84 administrations worldwide and has 1.5 million active users for low-laten broadband services. Amazon plans to launch its first set of satellites by 2024.

Foreign satellite internet companies fear that India's auction will increase the chances of other countries following similar steps, increasing costs and investment, said one source, an Indian adviser to foreign companies.

If India decides to hold an auction, OneWeb will have difficulty doing business in the country, an industry source said. Starlink is waiting for clarity on the allocation of India's spectrum before strengthening its commercial strategy, another source said.

Farrar's team, an analyst with US-based TMF Associates consultant, said it would be a "bad precedent" for Starlink to pay a substantial auction amount in India when they get a low-cost license in many other countries.

"I expect Starlink will offer famous free services elsewhere to try and show what India may miss," he said.


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