Italy is in advanced negotiations with Elon Musk’s SpaceX for a €1.5 billion ($1.55 billion) deal to deliver secure telecommunications services to the government, marking one of Europe’s most significant projects in this sector. While discussions are still ongoing and a final agreement on the five-year contract has yet to be finalized, sources familiar with the matter indicate that the deal is likely to proceed. According to reports citing unnamed insiders, the project has already received approval from Italy’s Intelligence Services and Defence Ministry.
The Italian government is seeking to use Musk’s Starlink technology, which offers satellite-based connectivity for phones and the Internet, for communications with the military in the Mediterranean and to support emergency communications in the case of terror attacks or natural disasters. The people said that Italy also plans to roll out a direct-to-cell satellite service to provide coverage in places where local cell networks may fail. Some Italian officials have opposed that part of the plan, fearing it could hurt local telecom companies, which have struggled with profits.
Many SpaceX employees have security clearances since the firm is a defense contractor that puts NASA astronauts into orbit, provides its Starlink satellite Internet service to the military, and ands working with the Pentagon on a new constellation of spy satellites. Clearances require extensive background checks, including searches of personal relationships, financial records, and interviews with friends and relatives. However, some employees have complained that Musk has disregarded rules for revealing information about his activities and projects for years. Some employees who oversee the company’s disclosure procedures have complained to federal investigators, two of these people said.
A deal that would put SpaceX in charge of Italy’s communications may have moved forward after Prime Minister Giorgia Meloni visited with future President Donald Trump at his Florida resort over the weekend. Meloni’s office published photos of her and the president-elect together. Neither Meloni nor her office responded to requests for comment Sunday night.
In the US, several of the same officials are concerned that Musk could potentially share secret information with allied nations or adversaries and have raised concerns over the billionaire’s obtuse approach to business issues. Last month, the Air Force denied him high-level security access because of concerns that he might threaten national security, and allied nations have also expressed concern.
However, SpaceX is one of the most critical aerospace contractors for the Defense Department and is expected to continue winning contracts for various missions, from sending cargo on Dragon rockets to putting military payloads into orbit on Falcon 9 and Titan rockets. It is expected to receive $10 billion in federal contracts between 2019 and 2023. That will likely lead to an expansion of the company’s military operations, which now include supplying its Starlink terminals to the military and providing military satellite support through its private Starshield network.