This week, Indian telecom giants Reliance Jio and Bharti Airtel dominated the news by announcing partnerships with Elon Musk's SpaceX to offer broadband services via Starlink in India. The first announcement came from Sunil Mittal-led Bharti Airtel, followed by a similar announcement from Reliance Jio the next day. Both companies emphasized that the agreement is contingent on SpaceX receiving the necessary regulatory approvals to operate Starlink in India. The announcement surprised many, particularly because Reliance Jio, which is considered a major competitor to Starlink in India, has long been at odds with SpaceX over satellite communication spectrum allocation.
While Elon Musk has advocated for a global allocation model, Jio and Airtel have called for an auction system, citing fairness and a level playing field. The issue became heated during a Telecom Regulatory Authority of India (TRAI) open house discussion on satellite authorisation in November, with the two Indian telcos arguing for a level playing field to protect their network investments.
It is speculated that the decision by Jio and Airtel to partner with Starlink may have been forced upon by the government amid the threat of reciprocal tariff by the US administration, which Elon Musk is a part of.
Why the partnership?
The big question is why these companies, both of which have their own satellite broadband ventures—Airtel with Eutelsat OneWeb and Jio with SES—would partner with SpaceX.
The press releases from both Bharti Airtel and Reliance Jio were almost similar, stating their collaboration with SpaceX to offer Starlink’s broadband internet services in India. The agreement will also explore how Starlink's offerings can complement the services of Jio and Airtel. The companies plan to make Starlink available through retail outlets and online storefronts, focusing on providing high-speed internet to businesses, schools, healthcare centers, and remote communities across India. Moreover, this is not the first time Starlink has teamed up with telecom players globally. Starlink has already partnered with companies like T-Mobile (US), Rogers (Canada), Optus (Australia), and KDDI (Japan) to expand satellite connectivity.
Many analysts speculate that Starlink, the global leader in satellite communications, could leverage the ground infrastructure of Jio and Airtel to extend its reach. This collaboration is seen by many as Starlink’s formal entry into India, a market Elon Musk has been trying to access since 2021. There are also possibilities that Starlink might collaborate with Indian telecom providers for direct-to-cell satellite services as it has done in other countries.
What is Satcom?
Satellite communication (Satcom) uses satellites to transmit data and voice across regions where traditional fiber-optic cables are impractical. Satcom is especially beneficial in rural, mountainous, and disaster-prone areas where terrestrial networks are either too costly or impossible to deploy. While Satcom offers wider coverage and minimal latency, terrestrial networks are generally faster and cheaper. According to a Deloitte report, India’s satellite broadband market is projected to reach $1.9 billion by 2030, with a compound annual growth rate (CAGR) of 36%.
Impact on Indian telcos
Initially, there seems to be no immediate threat to Indian telcos like Jio and Airtel. According to industry experts, this partnership is not seen as direct competition with their existing broadband services, such as Jio Fiber and Airtel Xstream Fiber. The collaboration is expected to complement these services by expanding internet access to areas where laying fiber-optic cables would be too difficult or expensive. Moreover, Sunil Mittal, chairman of Bharti Airtel, emphasised that satellite internet will primarily serve rural and remote regions, enhancing their efforts to bring high-speed internet to underserved areas. Also, satellite communication services tend to be more expensive than terrestrial networks. According to a report by Bernstein, Starlink's satellite technology offers advantages in remote areas, but its high cost and potential speed variability make it less attractive to average consumers in urban and semi-urban regions, where Airtel and Jio provide affordable and reliable broadband services. Therefore, experts believe the partnerships won’t immediately affect the market share of Jio and Airtel in the broadband space.
Market share
As of December 2024, Reliance Jio holds 50% of India's broadband market with 477 million subscribers, followed by Bharti Airtel with 30.62% (289 million), and Vodafone Idea with 13.37%, according to Telecom Regulatory Authority of India. Meanwhile, Starlink has surpassed 4.6 million users globally, with approximately 1.4 million subscribers in the US. While Starlink currently has the largest satellite constellation with 6,750 satellites, competitors like Amazon's Project Kuiper and Eutelsat OneWeb are also planning to launch large satellite networks.
Licensing and regulatory hurdles
Experts speculate that Starlink’s partnership with Jio and Airtel could ease its path to obtaining the necessary licenses to operate in India. Starlink applied for the Global Mobile Personal Communication by Satellite (GMPCS) license in 2022, which is required to offer services in the country. However, the Department of Telecommunications (DoT) has made it clear that the company must comply with several conditions, including using satellites for authorized services only and providing call data records to security agencies when requested. The company will also need to establish a buffer zone along India's international borders and ensure that all calls originating or terminating in India pass through a GMPCS Gateway within the country. The DoT's scrutiny stems from concerns about Starlink's equipment being used for illicit purposes recently in India. In December 2024, Starlink equipment was discovered in Manipur, allegedly facilitating communication among local militant groups. Additionally, drug smugglers were found using a Starlink Mini, a portable satcom device, to infiltrate Indian waters in the Andaman and Nicobar Islands. These incidents have raised concerns about the potential misuse of Starlink's technology.