The recent launch of “next-generation” spy satellites by SpaceX for the U.S. government has stirred unease within the Pentagon, particularly given CEO Elon Musk’s reported conversations with Vladimir Putin.
According to the New York Times, some Defense Department officials have voiced private concerns, particularly following revelations in the Wall Street Journal that Musk has held regular phone calls with Putin since 2022. In one instance, Putin allegedly requested Musk refrain from expanding Starlink satellite coverage to Taiwan as a favor to China’s President Xi Jinping. Indeed, Taiwan remains without Starlink, suggesting Musk may have heeded this request.
NASA Administrator Bill Nelson and other officials have expressed unease over these alleged exchanges, and there are concerns that the U.S. may be overly reliant on Musk’s SpaceX for its defense and space infrastructure needs.
Three Pentagon officials, speaking anonymously to the NYT, shared that the growing monopoly SpaceX holds in space contracts for both NASA and the DoD could lead to market dependence on a single vendor. This concern was echoed by the Pentagon’s Defense Science Board, which warned that vendor lock-in could “stifle innovation and inflate prices,” effectively leading to a stagnant and anti-competitive environment.
Mandy Vaughn, a Defense Science Board member and CEO of GXO, further emphasized the implications: “There isn’t a launch or a spacecraft competition that SpaceX can’t walk into and completely warp and run the table,” Vaughn told the NYT. She added that this dominance poses a significant problem for competition and market diversity within the space industry.