(Bloomberg) — Italy is in advanced talks with Elon Musk’s SpaceX for a deal to provide secure telecommunications for the nation’s government — the largest such project in Europe, people with knowledge of the matter said Sunday.
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Discussions are ongoing, and a final agreement on the five-year contract hasn’t been reached, said the people, who asked not to be identified citing confidential discussions. The project has already been approved by Italy’s Intelligence Services as well as Italy’s Defense Ministry, they said.
The negotiations, which had stalled until recently, appeared to move forward after Italian Prime Minister Giorgia Meloni visited President-elect Donald Trump in Florida on Saturday.
Italian officials have been negotiating on a €1.5 billion ($1.6 billion) deal aimed at supplying Italy with a full range of top-level encryption for telephone and Internet services used by the government, the people said.
The plan also includes communications services for the Italian military in the Mediterranean area as well as the rollout of so-called direct-to-cell satellite services in Italy for use in emergencies like terror attacks or natural disasters, they said.
The possible deal has been under review since mid-2023. It’s been opposed by some Italian officials concerned about how the services may detract from local carriers.
Representatives from the Italian government and SpaceX didn’t immediately respond to requests for comment made outside regular business hours.
This year alone, Musk’s SpaceX has added more than 20 nations from Ghana to Argentina to its Starlink satellite internet service. It now serves more than 4 million people in 100-plus countries and territories, blanketing the globe with broadband services, pushing out legacy telecom operators and outpacing fresh challenges from Amazon.com Inc. and nation-state rivals such as China.
SpaceX offers its Starlink service for commercial applications ranging from residential internet service to maritime shipping and airlines, and is also developing a product called Starshield for defense and sensitive uses.
It’s conquering the global satellite communications market thanks to a powerful mix of technology leaps and shrewd business maneuvering, as well as Musk’s growing political clout.