SpaceX has established itself as an influential contractor for the US military, allowing the Pentagon access a proprietary intelligence-based satellite network dubbed Starshield.
The related network of Starlink broadband satellite services has also played a major role in ongoing military conflict, with Ukrainian soldiers making use of thousands of Starlink terminals to bypass internet blackouts amid the country’s war with Russia.
But who gets to use which network, and what SpaceX is getting out of the agreement, remains a hotly contested subject. As Reuters reports, SpaceX officials hiked up the price for Starshield connectivity of the US military’s LUCAS (Low-cost Uncrewed Combat Attack System) suicide drones, which are uncrewed kamikaze aircraft that can identify targets and detonate on impact.
According to the news agency’s sources, SpaceX successfully convinced the military to pay closer to $25,000 per connection, instead of just $5,000, a fivefold increase in the cost per drone.
Since then, SpaceX CEO Elon Musk both angrily accused Reuters of making “false” claims — while simultaneously confirming the agency’s reporting in the very same tweet.
“Reuters article is false,” he wrote. “They made improper use of the Starlink civilian system for military purposes. Direct violation of terms of service.”
In other words, it’s Musk versus Musk: he’s broadly denying Reuters‘ claims while confirming its central thesis that the military and his space company have been butting heads over how its suicide drones were connected.
In a follow-up tweet, Musk clarified that “there is a US government arm of SpaceX called Starshield, which has a different set of satellites than Starlink, which is for civilian use.”
“The company that makes the suicide drones incorrectly used the civilian system, instead of the Starshield,” Musk added.
The billionaire also called attention to what he called a “correction” by Pentagon spokesperson Sean Parnell, who had tweeted that the “Fake News media has the story wrong, again.”
“SpaceX remains a strong and valued partner to the Department of War,” Parnell had tweeted earlier. “The claims in this article are simply not based in reality and do not reflect the close, effective collaboration between our teams.”
The controversy highlights just how much leverage SpaceX has gained over the military. The reporting also couldn’t have come at a worse time, with the company gearing up to go public later this year at an absurd valuation of $2 trillion. SpaceX’s lucrative government contracts, as well as its consumer Starlink service, continue to represent a major chunk of its revenue. Strong-arming the Pentagon into jacked-up prices for Starshield connectivity could send a mixed signal to investors.
The US military started deploying the first LUCAS drones earlier this year during the kidnapping of Venezuelan president Nicolás Maduro, with leadership praising them as “indispensable” in the US-Israel war on Iran.
More on Starshield: SpaceX Has Wildly Screwed Up Its Military Satellites, Researcher Finds
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