The race between two of the world's richest men, Elon Musk and Mukesh Ambani, is heating up as they prepare to battle in India's satellite broadband market.

According to India's government announced After last week's announcement that satellite spectrum for broadband services would be allocated administratively rather than through auctions, this battle has only intensified.

Mr Musk had previously criticized the auction model supported by Mr Ambani.

Satellite broadband allows internet access anywhere within satellite range.

This makes it a reliable option for remote or rural areas where traditional services such as DSL – a connection that uses phone lines to transmit data – or cable are not available. It also helps bridge the difficult-to-bridge digital divide.

India's telecom regulator has not yet announced spectrum pricing, and commercial satellite internet services are yet to launch.

However, the number of satellite internet subscribers in India is expected to reach two million by 2025, according to credit rating agency ICRA.

The market is competitive and includes around half a dozen key players, led by Mr Ambani's Reliance Jio.

Jio has invested billions in wireless auctions to dominate the telecom sector and has now partnered with Luxembourg-based SES Astra, a leading satellite operator.

Unlike Mr. Musk's Starlink, which uses low Earth orbit (LEO) satellites positioned between 100 and 600 miles (160 to 1,000 km) from the Earth's surface for faster service, SES operates medium Earth orbit (MEO) satellites at much higher altitudes and offers such a more cost-effective solution system. Receivers on the ground receive satellite signals and process them into Internet data.

Mr Musk's Starlink has 6,419 satellites in orbit and four million subscribers in 100 countries. It was him The aim is to launch services in India from 2021but regulatory hurdles have led to delays.

If his company ventures into India this time, it will give a boost to Prime Minister Narendra Modi's efforts to attract foreign investment, many say.

It will also help his government's efforts to burnish its image as pro-business and counter claims that its policies favor top Indian businessmen like Mr. Ambani.

While auctions have proven lucrative in the past, The Indian government defends its decision to allocate satellite spectrum administratively this time, saying it is in line with international norms.

Satellite spectrum is not typically awarded through auctions because the costs involved could impact the financial justification or investment in the company, says Gareth Owen, technology analyst at Counterpoint Research. In contrast, administrative allocation would ensure spectrum is fairly distributed among “qualified” players, giving Starlink a fighting chance to enter the race.

But Mr. Ambani's Reliance says an auction is necessary to ensure fair competition because India lacks clear legal provisions on how to offer satellite broadband services directly to people.

In letters to the telecoms regulator in early October, obtained by the BBC, Reliance repeatedly urged the creation of a “level playing field between satellite and terrestrial access services.”

The company also said that “recent advances in satellite technology…have significantly blurred the boundaries between satellite and terrestrial networks” and that “satellite-based services are no longer limited to areas not served by terrestrial networks.” A letter said spectrum allocation is done through auctions in accordance with India's telecom laws, with administrative allocation permitted only in cases where “public interest, government functions or technical or economic reasons prevent auctions.”

Regarding The International Telecommunications Union (ITU), a UN digital technology agency, sets global regulations and India is a member and signatory.

When the Reuters news agency reported that Mukesh Ambani was there Lobbying the government To reconsider his position, Mr. Musk responded to a post on

Mr Ambani's resistance to the administrative pricing method may be due to a strategic advantage, suggests Mr Owen. The tycoon could be “willing to outbid Musk” and use an auction to potentially exclude Starlink from the Indian market, he says.

But it is not just Mr Ambani who has supported the auction route.

Bharti Airtel Chairman Sunil Mittal said that companies looking to serve high-end urban customers “Take telecom licenses and buy spectrum like everyone else“.

Mr Mittal – India's second-largest mobile operator – along with Mr Ambani controls 80% of the country's telecoms market.

Such resistance is a “defensive measure aimed at increasing costs for international actors seen as a long-term threat,” says Mahesh Uppal, a telecommunications expert.

“Although there is no immediate competition, satellite technologies are advancing rapidly. Telecom companies (in India) with large terrestrial businesses fear that satellites could soon become more competitive and threaten their dominance.”

Clearly at stake is the promise of the vast Indian market. Nearly 40% of India's 1.4 billion people still lack internet access, with rural areas accounting for most cases, according to EY-Parthenon, a consulting firm.

For comparison: there are almost 1.09 billion internet users in China, which is almost 340 million more than in India 751 millionaccording to DataReportal, which tracks global online trends.

India's internet usage rate still lags behind the global average of 66.2%, but recent studies show that the country is closing the gap.

At the right price, satellite broadband can help bridge this gap and even help Internet of Things (IoT), a network that connects everyday objects to the Internet and allows them to communicate with each other.

Pricing will be crucial in India, where mobile data is among the cheapest in the world – right now 12 cents per gigabytesaid Modi.

“A price war (with Indian operators) is inevitable. Musk has deep pockets. There is no reason why it cannot offer free services in (some) places for a year to gain a foothold in the domestic market,” says Prasanto K Roy, a technology analyst. Starlink has already reduced prices in Kenya and South Africa.

However, it may not be easy. In 2023 reportEY-Parthenon noted that Starlink's higher costs – nearly 10 times those of India's major broadband providers – could make it difficult to compete without government subsidies.

Ensuring global coverage requires many more LEO satellites – like those operated by Starlink – than MEO satellites, increasing launch and maintenance costs.

And some of Indian operators' fears may be unfounded.

“Companies will never fully switch to satellite if there is no terrestrial option. Terrestrial networks will always be cheaper than satellites, except in sparsely populated regions,” says Mr Owen.

Mr. Musk may have a first-mover advantage, but “satellite markets are notoriously slow to develop.”

The battle between two of the world's richest men over the Internet of Space has truly begun.