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Elon Musk Makes Threat That May Change Russia-Ukraine War

Tesla CEO threatens a move that could have a big impact in Russia's war on Ukraine.
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Of all the products and services that Elon Musk and his various companies provide, Starlink, the secure satellite internet access service, has in recent months become globally prominent. 

Now available in all continents, Starlink has become a window on the world for people living in dictatorships, in countries that have been devastated by natural disasters, and in countries that are at war.

The product was propelled on to the world stage by Russia's war on Ukraine. Musk sent Starlink terminals to Ukrainians after Russia's unprovoked invasion on Feb. 24. 

Starlink is particularly of use by civilians in areas under attack by Russia and in areas where communication infrastructure has been destroyed. Government officials and armed forces employ the service on the ground because it's secure.

The company 's satellites are helping Ukrainian military drones destroy Russian tanks and army trucks. The drones are equipped with anti-tank grenades to be launched at targets.

"Over 100 cruise missiles attacked [Ukraine's] energy and communications infrastructure," Ukraine's vice prime minister and minister of digital transformation, Mykhailo Fedorov, said on Twitter on Oct. 12. "But with Starlink we quickly restored the connection in critical areas. Starlink continues to be an essential part of critical infrastructure."

About 20,000 Starlink satellite units have been shipped to Ukraine. They are provided and partially financed by SpaceX, USAid, Poland, the European Union and private companies, according to the Ukrainian state-run news agency Ukrinform.

All this comes at a cost, Musk recently reminded the world.

Providing Starlink in Ukraine "has cost SpaceX $80M & will exceed $100M by end of year," Musk said on Oct. 7.

Musk and his aerospace company, SpaceX, which supplies Starlink, are looking to build Starlink into a business that generates around $30 billion in annual revenue by 2025, before either selling the unit or taking it public.

SpaceX Can't Fund Ukraine Service Indefinitely

In this context the company has addressed a warning to the Pentagon, saying it cannot continue to finance the service in Ukraine as it has done until now. 

SpaceX has thus asked the American government to support the cost of Starlink for Ukraine, a cost of about $120 million for the rest of the year, according to CNN, which quoted a letter addressed to the Pentagon. The figure could total $400 million for the next 12 months.

If the Pentagon does not get involved in funding, the service risks being turned off.

"We are not in a position to further donate terminals to Ukraine, or fund the existing terminals for an indefinite period of time,” SpaceX’s director of government sales wrote to the Pentagon, CNN reported.

Musk reiterated this warning on Twitter on Oct.. 14, after the publication of the article, which also mentions that the Ukrainian authorities in July asked Musk for 8,000 more Starlink terminals.

"SpaceX is not asking to recoup past expenses, but also cannot fund the existing system indefinitely *and* send several thousand more terminals that have data usage up to 100X greater than typical households," the tech tycoon warned. 

He added: "This is unreasonable."

"In addition to terminals, we have to create, launch, maintain & replenish satellites & ground stations & pay telcos for access to Internet via gateways," he continued. "We’ve also had to defend against cyberattacks & jamming, which are getting harder."

He then disclosed the total cost: "Burn is approaching ~$20M/month."

'Starlink Is Still Losing Money'

He added that Starlink was not yet making money. But he set himself the goal when SpaceX launched the service not to go bankrupt.

"Starlink is still losing money!" the mogul said. "It is insanely difficult for a [low-Earth-orbit] communications constellation to avoid bankruptcy – that was the fate of every company that tried this before. When asked what the goal of Starlink was at a space conference, I said 'not go bankrupt'."

Finally, the CEO added that by asking the Pentagon to pay for Starlink in Ukraine, he was only following the advice of the Ukrainian ambassador to Germany, who used an expletive when Musk proposed a plan to end the Russia-Ukraine war.

The plan, unveiled on Oct. 3, mirrored Russian demands. The techno king asked Ukraine to recognize the Crimea region, which Russia annexed in 2014, as Russian territory. 

Under the terms, Kyiv would also have had to agree to remain neutral on the international scene. Ukraine would have to renounce the idea of membership in NATO and the European Union, two organizations that Russia considers a threat to its sovereignty.

This plan was widely rejected by Ukrainians, including President Volodymyr Zelensky. But the strongest reaction came from Andrij Melnyk, Ukraine's ambassador to Germany, who said "Fuck off" to Musk's diplomatic efforts.

"We’re just following his recommendation 🤷‍♂️," Musk said on Oct. 14.