Crucial connections —
Russian assault on electricity grid drives Starlink prices up.
Mehul Srivastava and Roman Olearchyk, FT
The list prices of Starlink communications devices have nearly doubled in Ukraine, as mobile networks have started failing under Russia’s assault on the country’s electricity grid and increased demand for the SpaceX-manufactured satellite communication device.
Starlink terminals, which are made by Elon Musk-owned SpaceX, will increase in price to $700 for new Ukrainian consumers, according to the company’s website. This represents a rise from about $385 earlier this year, screenshots of past pricing data shared by users inside the country show.
The consumer cost of the monthly subscription to Starlink has fluctuated recently, dropping from about $100 to $60 on Ukraine’s Independence day on August 24 to “reflect local market conditions,” and will now rise to $75.
Prices have also soared in neighboring Poland, where many Ukrainians source Starlink to avoid problems with domestic mail delivery, but remained the same in Slovakia and most other European countries.
Musk did not immediately respond to a request for comment.
The small portable devices, which connect to satellites via a book-sized antenna, have provided crucial Internet connectivity to the Ukrainian military and civilians in areas with little to no mobile phone networks or broadband coverage.
It is unclear if the prices have also changed for the Ukrainian government, which uses a mix of Starlink from various donors, including Musk’s SpaceX, the Polish government, Nato allies, and crowdsourced supporters.
In separate, ongoing negotiations between SpaceX and the US Department of Defense, SpaceX had as recently as October asked Washington to pay $4,500 a month for each terminal intended for Ukraine, a person familiar with the situation said. A Pentagon spokesman said the department has been in contact with SpaceX about Starlink but declined to detail the discussions. He said the US and Ukraine have identified satellite communications as a critical capability on the battlefield.
Musk turned on connectivity for the satellite-based service within Ukraine days after Russia launched its full-blown invasion on February 24, responding on Twitter to a request by a Ukrainian minister.
Since then, Ukrainian military has used Starlink extensively along the frontline, where months of battles have rendered mobile networks unreliable, using vast amounts of high-speed data to communicate with each other and with their bases and to transmit high-resolution drone images.
The Ukrainian government is planning to purchase thousands of new Starlinks, Prime Minister Denys Shmyhal said on Tuesday, and will make their imports tax and duty-free.
Civilians in areas taken back from Russian control also often rely on Starlink while Ukrainian mobile network providers restore services.
In recent weeks, though, mobile networks in big cities such as Kyiv have also faltered, as Russia has sought to cripple Ukraine’s electricity distribution system.
Musk has previously complained that the cost to SpaceX of delivering Starlink services to Ukraine could run as high as $100 million by the end of 2022, after the Financial Times reported that the Ukrainian military faced operational problems in October after discovering the devices didn’t work in areas recently liberated from Russian control.
SpaceX had also asked the US government to pick up the costs of providing the service to the Ukrainian government and military that could run to $400 million over a 12-month period, CNN reported in October. It is unclear what additional costs Musk is referring to, since many users pay SpaceX directly for buying the terminals and a monthly subscription fee.
Dimko Zhluktenko, a software engineer who runs a charity to fundraise equipment for soldiers, said he had purchased as many as 200 Starlinks in the past to send to the front lines, averaging about $500 for the price of each terminal, a deposit, and the first month’s subscription fee.
But his most recent fundraising effort, where he was raising $50,000 to buy 100 more, has been derailed by the price increase.
“This really just affects civilians at the moment—as a Ukrainian doing it for the military, I will pay whatever amount is needed,” said Zhluktenko. He said he was using a Starlink because 4G in his Kyiv neighborhood was down on Tuesday afternoon.
Demand for Starlink has grown in recent weeks, local retailers said, as a small gray market emerged of people paying as much as $1,125 for immediate delivery of the devices, rather than waiting to source them from Poland or for SpaceX to make the delivery.