SpaceX
Musk till dawn: A string of satellites operated by SpaceX, owned by the billionaire Elon Musk, pass over a house in Kansas.

When Silicon Valley tycoons look up into space today, they see dollar signs: a booming space industry flush with venture capital funding, Wall Street investment, and a hot satellite technology market worth billions of dollars.

But Moriba Jah, a NASA scientist turned ardent space environmentalist, sees doom on the horizon.

On February 12, 2020, Jah testified before the Senate Committee on Commerce, Science, and Transportation on the political economy of space and national defense. Called to Washington as a witness from Texas, where he’s a professor of aerospace engineering at UT Austin, Jah stood out from the other witnesses. He wore a charcoal-gray suit, a nose ring, and a black kukui nut necklace partially obscured by his dreadlocks.

Jah, who grew up partly in Venezuela before joining the U.S. Air Force, warned the committee about the looming disaster of space debris, which threatens to derail the entire satellite industry as well as future space exploration. The two main culprits are Elon Musk’s SpaceX and Jeff Bezos’s Amazon. The tech giants are launching thousands of satellites into low Earth orbit (LEO) with reckless abandon to provide high-speed broadband to underserved areas where terrestrial cable doesn’t reach or the connection runs too slowly.

“Every domain of human activity suffers from malicious behavior, and space is no different,” Jah told the committee. “Near Earth space is in…dire need of environmental protection.”

Approximately 30,000 space junk parts have accumulated in Earth’s orbit since Sputnik’s launch in 1957 and currently careen haphazardly through the atmosphere. Because these particles travel at thousands of miles per hour, even a minor impact between an active satellite and a tiny scrap of shrapnel as small as a paint chip is dangerous; eventually, the debris will fall back through the atmosphere and crash to the ground. As Jah’s research shows, we don’t even know how much junk is out there, because governments haven’t conducted proper inventory and only share limited information with other countries’ space programs.

“It’s a flawed system of governance all the way down the line,” Jah told me recently over Zoom.

While space junk has existed for decades, it’s evolving into a full-blown crisis because of the sudden overcrowding of commercial space by SpaceX’s Starlink program and Project Kuiper, a subsidiary of Amazon. By next year, the companies combined could operate more satellites in low Earth orbit than have ever launched into space, dating back to the 1950s.

The two companies are on track to hold a duopoly over the satellite communications market by rapidly deploying a new generation of satellite technology into low Earth orbit. These nanosatellites deliver fast internet connection by hovering far closer to Earth’s surface than the conventional geostationary satellites used by governments and satellite TV providers like Dish. Starlink already has close to 100,000 users who’ve signed up for its service, and it owns 1,500 active satellites, which is almost half of all satellites in low Earth orbit. The company is launching more every month at a breakneck pace. Amazon lags far behind, but it acquired licenses from the FCC in 2020 to begin launching a constellation of 3,000 satellites.

While space junk has existed for decades, it’s evolving into a full-blown crisis because of the sudden overcrowding of commercial space by Elon Musk’s Starlink program and Jeff Bezos’s Project Kuiper.

The upsides of satellite technology shouldn’t be discounted. LEO satellites can provide high-speed and low-latency broadband to all corners of the world by flying in huge constellation forms to cover any targeted service areas. In a world where satellite service is widely available, millions of households neglected by telecom giants like AT&T and Verizon could be able to access high-speed internet service for the first time. If the industry is regulated and well managed, LEO satellite communications could finally bridge the digital divide and even provide a competitive alternative to fiber optic cable internet service providers.

Jah recognizes the satellite industry’s potential, as he made clear in his testimony to the committee. He joined NASA because of his faith in the utopian potential of satellites to bring about new scientific discoveries and innovations. But Jah believes that government intervention is necessary to manage space debris and ensure that the financial gains of satellites don’t set us down a path of dystopian catastrophe.

So far, government agencies have failed to devise a proper regulatory strategy for organizing space as a public good rather than a playground for the egotistical ambitions of billionaires. By rapidly approving both companies’ satellite fleets and showering SpaceX with subsidies, regulators have all but given Musk and Bezos the keys to a kingdom in the sky. SpaceX’s near-total control over the rocket launch business, which is a barrier to entry, and band spectrum licenses have made the company a de facto arbiter of Earth’s orbit.

Monopolizing our satellite communications infrastructure would enrich Musk and Bezos while offloading major environmental, financial, and national security risks onto everyone else. As the companies expand their grip over the telecommunications sector, they’ll have unprecedented control over vast amounts of its users’ data, from web browser history to location tracking. These companies could also combine their access to customer data with satellite Earth-imaging capabilities, which would create a Truman Show-style system of surveillance beyond the imagination of dystopian sci-fi writers. It’s an immense amount of power and private information to put in the hands of two large tech companies.

Following the fall of the Berlin Wall, the United States lost much of its military rationale for continuing the space race, and with the decline of public investment in general after the 1980s, NASA became a shadow of its old self. Yet other trends were also at work that favored private investment in space. The rise of Silicon Valley venture capital allowed for the funding of risky entrepreneurial projects that required high up-front costs. As with the internet itself, space also remained a largely unregulated frontier of commerce. As a result, a number of Silicon Valley bigwigs, most famously Bill Gates, began funding LEO satellite broadband companies to compete for communications dominance.

They all went belly-up in disastrous bankruptcies. Sufficient demand for satellites still wasn’t there, and the rocket launch costs were still too high. Yet plenty of venture capital firms and other financiers remained eager to fund space projects. In the early 2000s, both Musk and Bezos seized the opportunity and founded SpaceX and Blue Origin to begin building rockets for private space exploration.

The Falcon 9 reusable rocket was Musk’s killer app. For decades, commercial space development lagged because of unaffordable launch costs. The reusable rocket dramatically brought down the costs of operation, which allowed SpaceX to quickly ascend in the space market and win contracts with NASA to deliver cargo to the International Space Station. Supported by government contracts, Blue Origin has mostly supplied rocket parts for the public and private sectors before recently developing its own orbital launch vehicle.

But now both companies are chasing a much broader customer base. In the developing world and even in much of rural America, lack of access to broadband is still the norm and increasingly threatens people’s ability to fully participate in modern life. Meanwhile, public frustration with telecom monopolies like AT&T, Verizon, and Comcast has reached an all-time high because of slower service and higher prices. This means there’s gold in satellites. Morgan Stanley estimates that the satellite communications sector alone will become a $400 billion business over the next two decades, and Musk and Bezos want as big a piece of that action as they can get.

Data gathering and surveillance by Space X’s and Amazon’s satellites are becoming major concerns, especially since Trump repealed privacy protections that protected users’ web browser search history, location tracking, and other data.

Musk founded SpaceX’s satellite program Starlink in 2015 as a revenue driver for funding his long-term fantasies of establishing a colony on Mars. For Bezos, Project Kuiper fills a similar purpose for the Amazon empire. As the space investor Chad Anderson put it in an interview with CNBC, Bezos looks at satellites in cold financial terms: It’s “4 billion new customers,” Anderson noted, who don’t yet have access to broadband.

Both companies are using a new generation of LEO nanosatellite technology that can provide faster internet service by flying close to Earth’s surface. Their small size makes them more cost-effective to mass produce. By traveling in tightly knit mega constellations, the nanosatellites bounce radio transmissions between one another, creating a virtual grid across the band spectrum. This technology has allowed Starlink and Project Kuiper to hit the threshold for high-speed broadband, notching 50Mbps to 150Mbps with low latency (a measure of the lag time for wireless connection). The companies are betting that if they keep improving the speed and lowering their prices they’ll eventually be able to compete against fiber optic cable.

Yet while the upside potential of this technology should be obvious, monopolization and lack of sensible regulation threaten to bring us a dystopia of crashing space junk and rule by plutocrats.

There’s only a limited amount of LEO room for satellite companies to operate in. SpaceX and Amazon have built their business strategies around this constraint by moving rapidly to launch thousands of satellites and occupy the atmosphere before it fills up.

SpaceX is the furthest along. The company already owns almost half of all satellites currently in low Earth orbit. It’s launching almost 120 per month to build out its constellation of 12,000—more than the total number of satellites that have ever been in the sky. Musk is currently seeking the go-ahead for an additional 30,000 from U.S. and international regulators to reach his stated goal of operating a constellation of 42,000.

Amazon has played second fiddle to SpaceX but is gaining momentum. While the company doesn’t yet operate any satellites, it has received approval for 3,000, which is almost as many as the total number of satellites currently in low Earth orbit. Based on its beta tests, the company claims it can match, if not improve on, the internet speed of Starlink.

SpaceX has outpaced competitors in part because of the reusable rocket and the launch pads it controls, which help save costs on production. Yet much to Musk’s advantage, the company also prospers from favorable treatment by the government. Critically, the two most important American regulatory agencies for overseeing satellite commerce, the Federal Communications Commission and the Federal Aviation Administration, have played an active role in enabling SpaceX’s power play for satellite dominance. The FCC routinely approves Starlink’s fleets with little oversight, awards them millions of dollars in subsidies, and issues the company exclusive licensing permits to low-altitude levels in Earth’s orbit out of reach for competitors.

Since 2018, when SpaceX first got approval for their mega constellation, the FCC has signed off on Starlink’s 12,000 satellites; in 2020, it voted unanimously to approve Amazon’s request to build out a constellation of 3,236 satellites over the next four years.

Critics have attacked the FCC’s lax approach, describing it as operating simply on a first come, first served basis. Most of the satellites currently in low Earth orbit were approved under the chairmanship of the Trump appointee Ajit Pai.

The agency also does not properly account for environmental hazards or collisions, or even make sure that the companies seeking approval offer the best service. That’s especially relevant when it comes to SpaceX. The company reported malfunctions in around 5 percent of its satellites in 2019 due to technical flaws. Although there’s no standardized metric for satellite failures, experts worry that the massive scale of Starlink’s constellation will magnify the damaging effects of its satellite failures. Rivals have also pointed to customer dissatisfaction with Starlink’s service, claiming that it isn’t as fast as advertised. None of these complaints have apparently given the FCC pause in approving Starlink’s fleets.

The FCC’s auctioning process for band spectrum licenses has come under increasing scrutiny as well. The broadband spectrum where radio transmissions travel is the equivalent of atmospheric real estate: There’s only so much valuable land. To receive regulatory approval, companies first need to purchase licensing for both the atmospheric real estate and the allotted band spectrum “blocks” for radio transmissions, which has become a hot market. SpaceX has quickly bought up these licensing rights and crowded out other competitors by blocking them from trespassing in its spectrum.

In the early 2000s, the FCC made a rule change that allowed companies to trade and lease out these band spectrum licenses, creating a kind of shadow market for trading space property. As low Earth orbit has become overcrowded, the licensing permits have become a highly coveted commodity. SpaceX and Amazon have taken advantage of the auctioning process for the highest bidder, which tilts the playing field toward bigger companies with deep pockets.

In April, the FCC handed down a controversial ruling on SpaceX’s licenses that effectively gives the company near-total control over the lowest levels of Earth’s orbit. The agency expanded the licenses that SpaceX had already acquired to allow the company to move its existing satellite fleet closer to Earth’s surface, below 353 miles. Flying closer-to-ground stations will improve the company’s broadband speed and latency for customers.

The decision caused an uproar among space competitors, who argue that the decision gives SpaceX an unfair advantage and increases the likelihood of collisions. Opponents of the decision, led by Dish and Amazon, also claim that the shift in the elevation angle between Starlink’s ground stations and lower satellites will disrupt the radio transmission from other companies’ satellites in higher orbit. In effect, the FCC has given SpaceX a monopoly over the most premium real estate for satellite service and locked out competitors.

If that weren’t enough, the FCC also showers SpaceX with subsidies to provide broadband to rural areas. Without these government funds, Starlink’s business model—as with most of Musk’s enterprises—would rest on a house of cards. In December 2020, the FCC awarded the company almost a billion dollars as part of its “Rural Digital Opportunities Fund” program. An investigation from the watchdog organization Free Press, however, revealed that SpaceX applied for and won subsidies for non-rural areas that didn’t fall under the grant’s criteria, such as airports and empty parking lots in urban enclaves. Under the Biden administration, the FCC reviewed the subsidies and sent out letters requesting companies to self-report any misappropriated funding they received. This incident of overt fraud hasn’t stopped the agency from continuing to approve more Starlink satellite fleets to fly in the designated areas covered by the grant.

There’s no end in sight to regulators funneling taxpayer dollars to SpaceX. The broadband speed requirements in the bipartisan infrastructure bill will allow Starlink to qualify for a wider array of lucrative government grants. In aggregate, government subsidies and military contracts have kept Musk’s Starlink operation afloat and allowed the company to under-price its competitors.

To achieve an economy of scale and greater market share, Musk has also effectively engaged in predatory pricing to expand Starlink’s customer base. Customers who sign up for the Starlink program receive a kit that includes a user terminal to connect to the satellites, a mounting tripod, and a wireless router. According to its own disclosures, Starlink loses more than 50 percent on every kit it produces for customers to keep the price at $499 per package (and $99 per month for service).

This puts a huge strain on competitors but has worked in Starlink’s favor. The company has added new customers at a rapid rate, with 20,000 in the month of July alone. While Project Kuiper hasn’t set its rates yet, the company is expected to match Starlink’s prices once it gets its fleet up and running. Such tactics kill competition and in the long term could lead to monopoly pricing, which is why, when previous new communications networks came along, such as telegraphs and telephones, Americans quickly realized the need to regulate how much they charged users.

SpaceX’s march to dominance now also involves buying out the competition. The company recently made its first acquisition, which is expected to be the first of many to come. In August, it bought out Swarm Technologies, a promising satellite firm that specializes in Internet of Things (IoT) services for energy, shipping, and transportation. For SpaceX, which deals mainly with broadband for households, the deal expands its reach into IoT services. It also gives the company control of the spectrum licensing that Swarm received from the FCC.

For industry insiders, the deal signals that the satellite market is headed toward a wave of mergers and acquisitions. According to a Bloomberg analysis, $3.6 billion has been spent so far this year on takeovers and joint ventures in the space industry, already surpassing the numbers from 2020.

“There are too many small players right now, so we’re looking at a wave of consolidation,” says Aravind Ravichandran, an independent industry analyst and consultant who runs the influential TerraWatch Space podcast and blog, which covers the space industry.

Much to Musk’s advantage, the FCC routinely approves Starlink’s fleets with little oversight, awards them millions of dollars in subsidies, and issues the company exclusive licensing permits to low-altitude levels in Earth’s orbit out of reach for competitors.

SpaceX and Amazon are expected to win the spoils of the coming period. Billions of dollars in investment have propped up a wealth of satellite start-ups but saturated the market. Because of the high capital costs for entry and equipment maintenance, most companies won’t be able to stave off bankruptcy unless they draw a large customer base. That means many of the currently listed companies will either go out of business, which could be destabilizing to the market, or start looking for acquisition partners.

Two of SpaceX and Amazon’s biggest competitors, OneWeb and Intelsat SA, filed for Chapter 11 bankruptcy during the pandemic. OneWeb, which had long been seen as SpaceX’s main rival, survived after being bought out by the UK government. Only SpaceX and Amazon have the financial firepower to weather the storm of consolidation.

As the industry centralizes around SpaceX and Amazon, data gathering and surveillance are becoming major concerns. In 2017, President Trump signed a bill revoking a set of Obama-era privacy protections that restricted telecommunications companies from collecting web browser search history, location tracking, and other data from its customers. By rescinding those protections, the bill opened the floodgates for selling personal information to third parties. It also led to the centralization of data, which makes it easier for massive breaches by hackers such as the recent T-Mobile cyberattack. The same rules apply for satellite communications.

As the satellite communications sector attracts a broader customer base, Starlink and Project Kuiper will control even more users’ personal information. The companies could weaponize data collection to build more advanced business models that would help crush smaller satellite competitors. They can also sell that data for further profit at the cost of its users’ privacy, as Google and Facebook have done. Amazon already has a robust data collection business in its retail sector, which the company could pair with telecom data to become a truly terrifying micro-targeting data empire.

Data collection isn’t a side story in the satellite business. Both companies could combine the traditional forms of data harvesting with satellite surveillance imaging, which is one of the highest-valued sectors in the industry.

The Commerce Department has offered a helping hand to the satellite surveillance industry by eroding many of the limitations on Earth imaging. In 2020, the department lifted key restrictions on high-resolution images from satellites. Companies applauded the decision, but it set off alarm bells for privacy advocates, who warned that companies could now even track the movement of individuals.

Mapping Earth’s activity has certain productive uses if it is tightly regulated. Satellite imaging could help farmers check on the health of their crops and provide data analytics for renewable-energy companies to monitor offshore wind farms. But the technology also has far more nefarious applications. Many Earth-imaging companies say openly on their websites that they can offer data analytics about the operations of a client’s competitors—in other words, spying for hire. Privacy advocates also predict that without legal constraints, Earth-imaging satellites could track individuals at the behest of large corporations, like an all-seeing eye in the sky.

While Starlink doesn’t offer Earth imaging, there’s no technological barrier prohibiting it from doing so in the future. The company already exerts indirect control over the industry. In 2021, SpaceX signed a rideshare agreement with Planet Labs, the largest satellite imaging company, to give them access to the Falcon 9 for rocket launches. Once Starlink’s satellite fleets occupy most of Earth’s orbit, as it’s currently on track to accomplish, Earth-imaging companies will have to directly or indirectly deal with SpaceX. It also is an advantageous position for Musk to request images from these partners to spy on his competitors in the automobile or aerospace industries. It gives one company a huge amount of power over a troubling industry for privacy rights. These companies’ massive stores of data would also be especially vulnerable as high-priority targets for hackers.

SpaceX’s dominance threatens to exacerbate other hazards as well. By flying at such low levels in the Earth’s orbit, Starlink is creating light pollution that interferes with astronomers’ ability to study space. SpaceX has tried applying a black coating to minimize the rays of light refracted off its satellites, but astronomers don’t think it will have much effect. Light pollution from satellites also interferes with the simple pleasure of enjoying a clear night sky.

And, of course, SpaceX and Amazon’s massive satellite fleets will escalate the space junk crisis.

Donald Kessler, a former NASA astrophysicist, warns that continually putting more and more satellites into low Earth orbit means that even a minor piece of debris from a collision or malfunction would create an effect like a giant sheet of glass shattering in the sky and trap Earth under an impenetrable dome of space debris. We would have to wait years, maybe even decades, before enough debris burned up in the atmosphere that we could access space again.

These dystopian scenarios aren’t merely speculative fears. Just two satellite incidents—one collision involving an inactive Russian satellite in 2009 and another precipitated by a Chinese anti-satellite missile test in 2007—have produced a substantial amount of the debris currently in orbit and likely to remain there for decades. While the Department of Defense’s global surveillance network has tracked 30,000 pieces of junk in the atmosphere, debris specialists estimate that the number is far greater. This uncertainty makes it more difficult to accurately predict the risk of debris and avoid collisions.

Even outside of these worst-case scenarios, space debris could cause serious problems. It could knock out key parts of the communications infrastructure, as well as other intelligence satellites owned by the U.S. government.

“We need to secure the space orbit channels so that we avoid major disasters to our communications systems,” Mariel Borowitz, a professor at Georgia Tech who specializes in space policy and national security, told me.

Collisions between different countries’ satellites could spark international conflicts. Musk has warned about China shooting down his satellites for flying over parts of the country where they don’t have licensing.

Collisions between different countries’ satellites could also spark international conflicts. Because LEO satellites fly at such high speeds, their movement can be imprecise and may cross into other band spectrums or across national borders. Since international agreements have only set vague guidelines for collisions, commercial satellite accidents could become a pretext for disputes between superpowers. In one scenario, Musk has warned about China shooting down his satellites for flying over parts of the country where they don’t have licensing. The Chinese Communist Party has put a premium on maintaining a closed internet, known as the “Great Firewall,” and might blame the U.S. if Starlink crossed over into their network. For similar reasons, Russia has also threatened to fine any citizen who signs up with Starlink.

Musk has already strained our relationship with allies by clashing with European regulators over Starlink’s constellation. In 2019, the European Space Agency contacted Starlink about an urgent potential collision they detected with one of the company’s satellites. SpaceX never responded to the request, which forced the ESA to go into damage control and maneuver its satellites out of harm’s way. Since the incident, Europe has tried to counter Starlink’s influence in the region and invest heavily in their own satellite constellations.

Fortunately, it’s not too late to take advantage of the promise of new satellite communications technology while also avoiding or minimizing the myriad environmental and societal threats it poses. That, of course, means more diligent technical oversight from regulatory bodies to ensure that satellites are built and operated with the highest safety standards. But it also means using public policy to structure commercial competition in space so it is both fair and efficient.

In many ways, we have been here before. When new communications technologies emerged in the past, the U.S. government responded with legislation and regulatory frameworks for allocating key assets and managing competition. The evolution of law and regulation governing radio technology in particular has echoes of the current dilemma with satellite technology. In the 1920s, applications for new radio licenses came in at such a pace that the Commerce Department started approving licenses to almost anyone who applied. Since there was only a limited amount of radio spectrum, this created massive problems with radio interference. Congress responded with the Radio Act in 1927, which set more stringent criteria for reviewing licensing applications. Rather than give them out on a first come, first served basis, much less sell them to the highest bidder, station licenses went to applicants who could best demonstrate their ability to serve the public as stewards of a radio spectrum commonweal. Later legislation further managed competition by putting breaks on any tendency toward monopoly. Until many of these strictures were repealed in the 1980s and ’90s, this meant limiting the number of stations any one person or corporation could control, prohibiting station owners from vertically integrating into ownership of other forms of media, and even requiring that radio stations devote a share of their airwaves to balanced, public interest programming.

Today, we need a new satellite communications bill that is of similar scale and scope and that takes on new issues as well. One example would be to ban satellite telecom companies from selling their customers’ data. Congress should also block satellite companies that offer telecom services from engaging in Earth imaging, and vice versa. As with the original Ma Bell telephone system, we should ensure that satellite owners don’t abuse their control of essential information technology by going into other lines of business that use such infrastructure, such as media or advertising companies or online retail.

Because space is a global commons, solutions to our current satellite crisis will also require international collaboration and agreements. Moriba Jah, for example, is calling for governments to quantify how much space debris exists in orbit so they can track it and avoid collisions. His team at UT Austin’s Oden Institute has built an open-access database to pool information from national space programs across the world to provide an accurate estimate of space debris and its location. Jah also advocates setting up an international space traffic system with patrol officers to manage overcrowding.

New space technologies could immensely benefit humanity, but to realize the benefits we can’t hand over this valuable resource to the domineering control of Elon Musk and Jeff Bezos. Instead, the government needs to establish rigorous oversight and enforce fair and efficient terms of competition so space junk and monopolization don’t ruin the final frontier forever.

Luke Goldstein

Luke Goldstein is an editorial intern at the Washington Monthly and a recent graduate from Wesleyan University.