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The US Department of Defense has opened the door for the US military to spend over $12 billion more on commercial satellite services, including SpaceX’s Starlink, up from $900 million.
A year ago, the Pentagon set the contract at only $900 million for the US military to buy access to “proliferated low Earth orbit (pLEO)” satellite services. But on Monday, the Defense Department confirmed it had raised the contract ceiling by over 14 times after SpaceNews initially reported the massive jump in funding.
“The DOD has increased the contract ceiling for pLEO services to $13B. Should they choose, all military branches now have the option to prioritize more of their current budget to pLEO services as they balance their budgets and optimize their mission plans for maximum effectiveness in defense of the nation,” said Anthony Smith, the Pentagon’s Acting Deputy CIO for Command, Control, and Communications.
The increased budget will likely send billions to SpaceX’s Starshield, which uses the company’s Starlink technology to provide internet access to governments, including the US military. A year ago, SpaceX was among 19 other companies—including HughesNet, OneWeb, and AT&T—that were initially awarded contracts to supply satellite communications services to the US military over a five-year period until 2028.
The Pentagon is increasing the contract ceiling months after the US Navy said it was “on the cusp” of using SpaceX’s Starlink, along with OneWeb, to bring satellite internet connectivity to ships across its fleet and at bases. The US Navy has been installing dish terminals from both companies on ships to help them receive 1Gbps internet speeds.
The war in Ukraine has also highlighted how crucial Starlink has become for military operations. Still, SpaceX CEO Elon Musk has faced criticism for having too much power over Starlink, like when he restricted Starlink’s use in Ukrainian military operations against Russia. He’s also reportedly been in contact with Russian President Vladimir Putin since at least 2022.
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