Italy plans $1.6 billion Space X telecom security service deal, reports Bloomberg

BLOOMBERG: Italy is in advanced talks with Elon Musk’s Space X for a deal to provide secure telecommunications for the nation’s government – the largest such project in Europe, people with knowledge of the matter, said Sunday.

Discussions are ongoing, and a final agreement on the five-year contract has not been reached, said the people, who asked not to be identified citing confidential discussions. The project has already been approved by Italy’s Intelligence Services as well as Italy’s Defence Ministry, they said.

The negotiations, which had stalled until recently, appeared to move forward after Italian Prime Minister Giorgia Meloni visited President-elect Donald Trump in Florida on Saturday.

Italian officials have been negotiating on a €1.5 billion ($1.6 billion) deal aimed at supplying Italy with a full range of top-level encryption for telephone and internet services used by the government, the people said.

The plan also includes communications services for the Italian military in the Mediterranean area as well as the rollout of so-called direct-to-cell satellite services in Italy for use in emergencies like terror attacks or natural disasters, they said.

The possible deal has been under review since mid-2023. It has been opposed by some Italian officials, concerned about how the services may detract from local carriers.

Representatives from Italian government and Space X didn’t immediately respond to requests for comment made outside regular business hours.

In 2024-alone, Musk’s Space X has added over 20 nations from Ghana to Argentina to its Starlink satellite internet service. It now serves more than 4 million people in 100-plus countries and territories, blanketing the globe with broadband services, pushing out legacy telecom operators and outpacing fresh challenges from Amazon.com Inc. and nation-state rivals such as China.

Late last year, Kyivstar PJSC, Ukraine’s largest mobile operator, signed a deal with Starlink to introduce satellite-powered cellular service in a bid to place telecom infrastructure beyond the reach of Russian attacks.

Space X offers its Starlink service for commercial applications ranging from residential internet service to maritime shipping and airlines, and is also developing a product called Starshield for defence and sensitive users.