SpaceX may soon have a major presence in Italy. According to a Bloomberg report, Italy is currently in discussions with Elon Musk’s space company, which could result in SpaceX providing secure communications for the Italian government. The ongoing negotiations are centered around a €1.5 billion ($1.6 billion) contract (which would make it the largest such deal in Europe) to supply encrypted communications for government operations, military needs, and emergency services.
At the heart of the deal is the provision of encryption for telephone and internet services, which can help safeguard government communications against cyber threats. The deal will also include military applications, particularly for Italy’s forces in the Mediterranean region, as well as the rollout of direct-to-cell satellite communication services. This technology is intended to ensure that the Italian government and military maintain connectivity during times of crisis, such as natural disasters or terrorist attacks.
For now, the agreement is yet to be finalized, even though it has received the green light from Italy’s Intelligence Services and the Ministry of Defense. The negotiations surrounding this deal have gained momentum recently, with a key moment coming during Italian Prime Minister Giorgia Meloni’s visit to U.S. President-elect Donald Trump in Florida. The meeting between Meloni and Trump, who has cultivated a close relationship with Elon Musk, was seen as a pivotal moment in the discussions.
Not that the proposed deal is without complications – some Italian officials have raised concerns about the potential impact of such a partnership on local telecom providers. Italy’s telecommunications sector has faced ongoing challenges in recent years, including decreasing profits and a wave of mergers within the industry. Critics argue that relying on a foreign company like SpaceX could weaken local carriers and stifle the growth of Italy’s domestic telecom market. This development comes at a time when Italy’s telecommunications sector is highly competitive, with major players like Telecom Italia grappling with declining profits in recent years. The industry has undergone significant changes, including the sale of Telecom Italia’s landline network to US private equity firm KKR for €22 billion – according to a report by IMARC, the telecom market size in the country reached $34.39 billion in 2023.
SpaceX has been expanding its global presence in recent times – through its Starlink service, the company has provided satellite-based internet and communications services to countries around the world. The previous year saw Starlink add more than 20 new countries to its network, extending its coverage to over 100 countries and territories.
With more than 4 million users, Starlink’s network has brought internet access to multiple areas across the globe, particularly in regions where traditional telecom infrastructure is lacking or unreliable. In addition to its commercial services, SpaceX has also developed Starshield, a specialized product for government and defense applications that can provide secure communications and military space capabilities to governments.
