Musk's Starlink races with Chinese rivals to dominate satellite internet

The billionaire's Starlink communications network is facing increasingly stiff challenges to its dominance of high-speed satellite internet, including from a Chinese state-backed rival and another service financed by Amazon.com (AMZN.O) founder Jeff Bezos.

Shanghai-based SpaceSail in November signed an agreement to enter Brazil and announced it was in talks with over 30 countries. Two months later, it began work in Kazakhstan, according to the Kazakh embassy in Beijing.

Separately, Brasília is in talks with Bezos's Project Kuiper internet service and Canada's Telesat (TSAT.TO), according to a Brazilian official involved in the negotiations, who spoke on condition of anonymity to freely discuss ongoing talks. News of those discussions is being reported for the first time.

Starlink has since 2020 launched more satellites into low-Earth orbit (LEO) - an altitude of less than 2,000 km - than all its competitors combined. Satellites operating at such low altitudes transmit data extremely efficiently, providing high-speed internet for remote communities, seafaring vessels and militaries at war.

Musk's primacy in space is seen as a threat by Beijing, which is both investing heavily in rivals and funding military research into tools that track satellite constellations, according to Chinese corporate filings and academic papers whose details have not been previously reported.

China launched a record 263 LEO satellites last year, according to data from astrophysicist Jonathan McDowell analyzed by tech consultancy Analysys Mason.

The emergence of competition to Starlink has been welcomed by Brazil's government, which wants high-speed internet for communities in far-flung areas but has previously faced off with Musk over commerce and politics.

SpaceSail declined to comment when presented with Reuters' questions about its expansion plans. A newspaper controlled by China's telecoms regulator last year praised it as "capable of transcending national boundaries, penetrating sovereignty and unconditionally covering the whole world ... a strategic capability that our country must master."

Kuiper, Telesat, Starlink and Brazil's communications ministry did not respond to requests for comment.

Few of Musk's international rivals have the same ambition as SpaceSail, which is controlled by the Shanghai municipal government. It has announced plans to deploy 648 LEO satellites this year and as many as 15,000 by 2030; Starlink currently has about 7,000 satellites, according to McDowell, and has set itself a target of operating 42,000 by the end of the decade.