Australia’s Internet Network Taps Amazon for Satellite Help
- NBN chooses Amazon's Project Kuiper over Starlink for rural internet.
- Project Kuiper will replace government satellites and target 300,000 sites.
- Analyst sees worries about control and sovereign risk underlying the decision.
SYDNEY, August 5 (Reuters) Instead of tech entrepreneur Elon Musk's Starlink, Australia's state-owned internet network has hired Amazon (AMZN.O) and opened a new tab for an untested startup satellite service to connect individuals who cannot access its terrestrial network.
The financial parameters of the agreement were not released, but it is expected to deliver high-speed internet access to approximately 300,000 homes and companies that are not served by NBN Co's terrestrial network.
Low-Earth orbit satellites owned by Amazon's Project Kuiper will begin replacing two Australian government-owned satellites slated to be decommissioned in 2032, according to a joint statement released on Tuesday by NBN and Amazon.
"Indeed, Amazon Kuiper has not yet launched services in Australia or globally, but they are reportedly investing approximately $15 billion in that programme," said Gavin Williams, NBN's chief development officer for regional and remote services.
"We have every confidence that we've got a partner in Kuiper that will do what they say they're going to do," he said during a phone interview.
NBN stated that its selection was based on a rigorous procurement procedure, but did not explain why it chose Amazon over Starlink.
The transaction is a squandered opportunity for Starlink, the world's largest provider of such network services, which already has over 250,000 users in Australia, according to industry figures.
According to telecoms researcher Paul Budde, the decision was most likely motivated by the need to limit sovereign risk associated with handing over management of critical Australian infrastructure to a business allied with "a very unpredictable America".
"I am sure total reliance on Starlink would not be viewed favorably," Budde, an industry veteran who has advised the United Nations on internet strategy, wrote in an email.
If US President Donald Trump was dissatisfied with something, he might use both Starlink and Kuiper for political objectives, which was concerning, Budde said.
Starlink was not immediately available for comment.
Starlink residential connection dishes are sold by Australia's two largest telecoms providers, and several government agencies, like the Australian Electoral Commission, have contracts with the company.
Starlink, a subsidiary of Musk's SpaceX rocket company, now has 8,000 fast-orbiting satellites after initially launching them in 2019, while Amazon's service has only 78 since its inception in April.
NBN and Amazon stated that Project Kuiper would eventually have more than 3,200. The low-Earth orbit satellites will communicate with each other via optical links, as well as antennas and other ground sites.
NBN's Williams stated that supplying vital infrastructure involves regulatory and legal requirements, as well as technical, operational, and financial concerns in the procurement process.