SpaceX set to sign billion-dollar deal with Italian government for telecoms, security services

Discussions with SpaceX progressed when Italy’s Prime Minister recently met President Trump
A five-year contract worth $1.6 billion is on the cards for SpaceX
However political elements of the proposal have been criticized

The Italian Government is reportedly in negotiations to commission secure telecoms from SpaceX in what could be the largest project of its kind.

A report by Bloomberg claims discussions are said to be ongoing; and if agreed upon, SpaceX could win a five-year contract to provide the Italian government with telecommunication services.

Unnamed sources familiar with the matter stated the country’s Intelligence Services and Defense Ministry have already expressed approval for the deal.

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SpaceX could supply the Italian government

The deal, believed to be worth €1.5 billion ($1.6 billion), would see SpaceX provide telephone and internet service encryption for the government.

Discussions had previously been put on hold until the country’s Prime Minister, Giorgia Meloni, recently visited upcoming US President Donald Trump in Florida.

Talks have been ongoing since mid-2023, however some have expressed concerns about how a deal with Musk’s SpaceX could be detrimental to Italian competition.

Under the deal, the Italian military operating in the Mediterranean would also benefit from the encrypted services. Direct-to-cell satellite services are also on the cards, which would provide an important backup when terrorist attacks and natural disasters render cellular connections unusable.

However, the relationship between Meloni, Trump and Musk has been criticized on a global scale. The SpaceX leader’s substantial political contributions and alliances could give him extensive access to the White House and global leaders, harming both politics and market competition.

Should such a deal go ahead, it wouldn’t be the first time that Italy and the US have worked together, as in 2024, Telecom Italia SpA sold its landline network to KKR & Co, a US private equity company.

The Italian government has explored other options, including building its own satellite constellation and using IRIS, a secure satellite constellation developed by the European Union to support European sovereignty, however SpaceX’s costs are believed to be favorable.