Indian government tells Starlink to refund pre-orders placed before licences approved

Elon Musk's satellite internet company 'remains excited to serve' the country

The Indian government has reportedly told Elon Musk's internet satellite company, Starlink, to refund pre-orders it could not yet fulfil because it didn't have the licences.

Starlink had been gearing up to provide the internet services in India, registering its business on 1 November, advertising and even pre-selling subscriptions.

Sanjay Bhargava, the company's brand-new head of India, boasted on 1 October that the company had already signed up over 5,000 customers and was actively encouraging more residents to pre-order the service.

He later said the sales stretch target was 200,000 terminals active on the subcontinent by December 2022, a small percentage in a market with 800 million broadband connections already.

The exec was even looking to hire "two rockstars" to join him in beefing up operations.

"Actual numbers maybe much lower than that or even zero if we do not get government approval but it is very unlikely that we will exceed 200,000," said Bhagarva, a statement that accurately foreshadowed the months ahead.

The big problem Starlink had was that it failed to secure the proper licences with the government, which was clearly not happy about it selling services before being approved to provide them.

In late November, the Department of Telecommunications advised locals not to subscribe to the service.

"We hope to have applied for a commercial license on or before 31st January 2022 (unless we hit some major roadblock)," said the exec in December on his LinkedIn profile, adding: "There are currently unknowns on when you may get your Starlink – but please pay careful consideration to whether Starlink could just be the broadband solution you need."

Judging by Bhargava's sales and marketing communication technique, the wheels on the satellite internet venture appeared to be falling off.

According to Reuters, the Indian government asked Starlink yesterday to refund all pre-orders until those licences come through. The company responded by sending its customers emails, which began appearing on Reddit, telling customers they could "receive a refund at any time" and explaining that there was no timeline for receiving the proper licences, although Starlink "remains excited to serve India."

The same day, a LinkedIn post published from Sanjay Bhargava's account announced he was stepping down from his role after a mere three months and four days.

It reads: "I have stepped down as Country Director and Chairman of the Board of Starlink India for personal reasons. My last working day was December 31, 2021. I will have no comments for individuals and media so please respect my privacy."

The Register has approached Starlink to confirm Bhargava's departure.

The exec has long had a relationship with Elon Musk-owned companies as he was a founding employee of PayPal. He even claims the title of inventor of PayPal's random deposit process on his LinkedIn profile profile bio and name drops his connection to dear Elon on his Twitter bio.

With no country head and no licensing, it leaves some very big questions about the future of Starlink in India. The company did not immediately respond to questions from The Register to clarify what the holdup is or exactly how excited they remain to serve the region.

Even if Starlink were to get the licences, the price tag on the internet service could present some problems. Just the deposit for Starlink services runs $99 (approximately ₹7,400) whereas India's largest mobile carrier, Jio, offers 2GB of downloads each day with unlimited voice serves for four weeks for $2.05. A standard Jio phone costs around $86 and is financeable.

Another challenge is competition from the likes of OneWeb. Also providing satellite internet, the company is now largely owned by Bharti Global, an Indian multinational which, along with the UK government and others, helped bail the company out when it faced the aftershocks of Brexit in the form of bankruptcy last year.

OneWeb is often compared to Starlink as they both offer similar products and are building satellite constellations in low Earth orbit. However, the CEO told CNBC last March that the two companies had very different approaches to the market, with OneWeb targeting enterprises over individuals, and therefore not really in competition.

OneWeb has been steadily building alliances with the Indian government by becoming a founding member of the Indian Space Association (ISpA), a trade organisation launched by Prime Minister Narendra Modi himself last October.

At the launch of ISpA, OneWeb announced the signing of a letter of intent between the company and a commercial arm of the Indian Space Research Organisation (ISRO) to use Indian-built satellite launch vehicles as potential launch platforms for OneWeb's equipment from 2022. ®