CIOInsider India Magazine

The gates have finally opened to allow the US telecom giant Starlink, owned by Elon Musk, to make its way into India. The company has made major inroads by inking deals with Bharti Airtel and Reliance Jio, the two largest telecom companies in the country, to enter the country. While the retaliatory tariffs navigate through hot waters under the US President Donald Trump’s government, this development occurs at a critical time in trade negotiations between the Indian and US government. Likewise, in India, the telecom regulation did not favor Airtel and Jio, despite strong lobbying against Starlink, and this led to the unexpected partnership with Starlink. Once it has adhered to the regulations, Starlink will greatly increase satellite internet coverage throughout India, giving millions of unconnected consumers access. Industry experts say that Musk's company will gain access to around 70 percent of India's mobile user base as a result of this relationship. At the same time, Starlink’s satellite broadband services could benefit from India’s burgeoning economy.

In a major step, Starlink has sealed the deal with two of the largest telecom service providers in India to introduce SpaceX's Starlink satellite internet services. One is Indian billionaire Mukesh Ambani’s Reliance Jio, and the other is Bharti Airtel, India’s largest mobile operator.

How Starlink Could Disrupt the Indian Telecom Market
Some industry experts voiced concerns that Starlink might shake up the telecom industry and provide internet access to unreached regions. Satellite internet could, in fact, pose as a good option for rural and isolated areas compared to regular broadband, as it offers connectivity anywhere within a satellite's reach. Not to mention, thanks to its capacity to launch satellites at far reduced rates using SpaceX rockets, Starlink has a near-monopoly in the market and now has 7,000 operational satellites with plans to develop a mega-constellation of 42,000.

How Jio and Reliance Came to Seal the Deal With Starlink
Previously, Jio Platforms viewed Starlink as a potential rival. It has been at odds with the company for the past two years on how the government should distribute satellite spectrum to internet service providers.

Jio uses terrestrial spectrum that is put up for auction by the Indian government, with 40 percent of the country's internet subscribers. On the other hand, Starlink provides internet services using satellite spectrum. But in 2023, Jio used Starlink as an example to support their claim that since satellite internet providers would now face competition from terrestrial internet providers, they ought to purchase spectrum through auctions. Jio believes that there would be a balanced competition spirit among telecom providers.

Jio maintained this stance until last year, even though the Indian Prime Minister’s administration eliminated auctions and established the administrative distribution of satellite spectrum under the Telecommunications Act 2023.

In the case of Airtel, the mobile operator has backed the administrative allocation from April 2023 and has sided with Starlink on the issue. Like Musk, it contended that since satellite spectrum is a "shared resource," it cannot be put up for auction.

However, this agreement does not imply that the two companies share a common viewpoint. Since Airtel's terrestrial internet services account for a substantial portion of its 33 percent market share in India, it is equally threatened by Starlink as Jio is.

Therefore, it is quite understandable that Airtel's and Jio's positions began to overlap in late last year as Starlink was about to enter India.

Last year Sunil Bharti Mittal stated that satellite companies interested in the Indian market need to buy spectrum like the telecom companies do, and pay the same license fees. This statement was widely seen to be in favor of auctions.

But the following day, Airtel cleared the air that it still desired administrative distribution of satellite spectrum. Again, towards the end of last year, it persisted in using Jio's talking points regarding the arrival of new competitors in the Indian market, arguing for "level playing field" and "healthy competition" in the nascent satellite internet industry.

How Starlink Could Benefit Indian Consumers
Starlink uses satellites in low Earth orbit to deliver fast internet to far-flung places. Internet services would also be available on domestic flights after the introduction. Several airlines outside of India currently offer this service.

By lowering costs to about Rs.3,000 a month, a collaboration with Jio and Airtel might make it more affordable. Pricing competitiveness versus Airtel's satellite broadband options and Jio's FWA services will still be difficult, though.

Starlink will have a direct distribution point in thousands of retail locations throughout India thanks to Jio, the country's biggest telecom provider, stocking Starlink equipment in its stores. The Reliance agreement comes a day after Starlink and Bharti Airtel, the country's second-largest telecom provider, announced a similar cooperation. The agreements with Jio and Airtel are both contingent on Starlink receiving government clearance to start operations in the nation.

In 1,700 Indian cities and towns, Jio and Airtel have more than three million FWA users. They want to include Starlink into their service offerings, with Airtel concentrating on business connectivity solutions for overseas enterprises and Jio offering JioFiber and JioAirFiber. Both businesses will also make advantage of their wide distribution networks to guarantee that their services are effectively delivered to customers.

But there Are Still Rules to be Followed
In India, Starlink might now immediately receive any regulatory breaks as a result of its partnership with Airtel. Before launching its satellite-based services, the company still needs to get a license from India's Department of Telecommunications and adhere to local laws.

Elon Musk's satellite communications company, Starlink, has been instructed by the Indian government to set up a control center there. To preserve peace and order, this action intends to give authorities the ability to halt or stop communication services in delicate or problematic areas as needed.

Along with outlining security measures, the government has permitted law enforcement to intercept calls through official channels when necessary. As Starlink approaches the last phase of its application for a satellite communications license, these guidelines are issued. The company has been negotiating marketing, deployment, and network improvement deals with Reliance Jio and Airtel.

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A control centre in India is considered vital to handle law-and-order crises that may need immediate suspension of satellite communication services. According to India's telecom regulations, in the event of a public emergency, disaster, or safety concern, the federal or state governments may temporarily take over any telecom service or network. When necessary, these regulations also provide for internet shutdowns.