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Despite what Musk says the issue was never free/not-free but what the markup over the civilian price would be for hardware and services that are exactly the sam

Despite what Musk says the issue was never free/not-free but what the markup over the civilian price would be for hardware and services that are exactly the same (or trivially different). The price to government is 10x+ the retail price civilians were paying to donate the same equipment and services. Musk was unhappy that people were paying retail price when he could be charging a government-special super-premium. My impression is that the government was resisting paying it but have now caved and are keeping the details secret to prevent a potential backlash. People were furious at Halliburton and other government contractors for price gouging during the Iraq war and you certainly got the impression that it was a "never again" situation but here we are.

freedomben 3y ago
> Musk was unhappy that people were paying retail price when he could be charging a government-special super-premium. How do you know this?
- dmix 3y ago
  Considering this is the first reporting we're getting that the DOD even paid for it I'm guessing he doesn't and it's just the usual speculation.
- foobarqux 3y ago
  Use common sense? Is the statement that a business person would prefer to be paid 10x rather than 1x contentious? Is Musk especially different in some way that would make this not true? If you want to argue about whether I should have qualified the statement with "it's very likely", or "it stands to reason", okay.
  - freedomben 3y ago
    If money is the only factor, then it certainly makes sense to prefer 10x to 1X. However, there are other factors. I know many people who would refuse a very high salary if they had ethical concerns about the work they were doing. Elon appears to have ethical concerns about supporting the war. It doesn't seem far-fetched to me to think that he might care more about not supporting war than about some money. But no I wasn't trying to make a point with the question, I was legitimately wondering if you had a source. I'd like to read more
    - foobarqux 3y ago
      We aren't talking about an imaginary person, we are talking about a specific individual. And I suggest to you that you shouldn't take the words of a prolific liar at face value, as demonstrated by the very case we are talking about. He claims to have ethical concerns but those disappeared as soon as he was paid? Maybe it was about self-interest all along?
      - snovv_crash 3y ago
        If all you can provide are ad hominems and have no actual facts to present your arguments on...
lockhouse 3y ago
Isn’t the practice of charging different rates for the same product to different customers fairly well established. Examples being hotel government rates, software that is free for personal use but carries a hefty licensing fee if used in a commercial or government setting, or business class cable internet? Using government and commercial customers to subsidize the less profitable consumer market is a fairly well established precedent in several industries at this point.
- foobarqux 3y ago
  Of course businesses want to do that. As I said the issue was how much the premium was going to be. 50% versus 10,000% makes all the difference.
  - chii 3y ago
    > 50% verus 10,000% makes all the difference. so like airline tickets then?
  - inemesitaffia 3y ago
    [dead]
nordsieck 3y ago
> Musk was unhappy that people were paying retail price when he could be charging a government-special super-premium. My impression is that the government was resisting paying it but have now caved and are keeping the details secret to prevent a potential backlash. IMO, it's probably reasonable for Ukraine to pay civilian prices for the terminals[1]. But service should absolutely be at a premium. The reason Starlink is being used by Ukraine in the first place is because Russia completely compromised Viasat and bricked every user terminal in Ukraine (and a bunch near by). It's expensive AF to defend against constant cyber attack from a capable state-level opponent. --- 1. When the terminals first came out, SpaceX substantially subsidized the cost of the terminals - to the tune of a year's worth of payments. I could see how this could make sense for them if the terminals are supposed to last for a very long time (10+ years). But their use in a war zone is probably much harder on the terminals. They're getting moved around way more often than a residential install. They're probably being targeted by the Russians. And accidents just happen in wars. I have no idea how much SpaceX currently subsidizes the consumer price of terminals, or how long the average terminal lasts in Ukraine. But I think it's pretty reasonable to adjust or even eliminate SpaceX subsidies on hardware depending on the exact value of those numbers.
- foobarqux 3y ago
  The premium we're talking about is on the order of 100 million dollars. Is that what it costs to defend against cyberattacks? They certainly haven't increased their payroll anywhere near that much. I doubt the hardware has changed much if at all.
  - mensetmanusman 3y ago
    It would cost a competitor more than $200,000,000 to take their business in this situation, so yes.
dev_tty01 3y ago
You might be right, but I have seen no reliable information to support this. I have seen references to double the price, but nothing about 10x. Could you provide references please? However, SpaceX has apparently been doing a lot of firmware support to help Ukraine to deal with EW signals, so some level of premium is likely justified. https://breakingdefense.com/2022/04/spacex-beating-russian-jamming-attack-was-eyewatering-dod-official/ https://breakingdefense.com/2022/04/spacex-beating-russian-j...
- foobarqux 3y ago
  We don't know the exact price paid because they are keeping it a secret (because it's outrageous and would trigger a backlash if revealed). https://www.cnn.com/2022/10/13/politics/elon-musk-spacex-starlink-ukraine/index.html https://www.cnn.com/2022/10/13/politics/elon-musk-spacex-sta... "Those entities also paid for about 30% of the internet connectivity, which SpaceX says costs $4,500 each month" ---- (Regular price is about $100 so the claimed price is more than 40x. 13x if look at the price actually being paid by others.) " On September 8, the senior director of government sales for SpaceX wrote the Pentagon saying the costs have gotten too high, approaching $100 million. The official asked the Department of Defense to pick up Ukraine’s new request as well as ongoing service costs, totaling $124 million for the remainder of 2022. Those costs, according to the senior defense official, would reach almost $380 million for a full year."
  - elcritch 3y ago
    Though even the marine oriented starlink cost $5k/mo. It doesn't seem crazy to charge a similar level for military usage. Companies don't charge the minimum of their service unless they have too; they charge what the market segment will bear.
    - foobarqux 3y ago
      That's arguably fine in a free-market, this is not one. And it's a weird argument to say that the price the government should pay is whatever the most any group is willing to pay for Starlink; The price segmentation, especially at the high-end, is mostly not based on cost to provide service but customer propensity to pay (boat and private jet owners). It doesn't make any sense to say "this is the special price we charge to Jeff Bezos and he doesn't care it's so high because he's rich therefore the government should also pay that price". As I said elsewhere price rationing for priority doesn't make sense in this case (because the government already knows who should get priority) and neither does higher prices as a signal to increase investment in capacity (because that investment doesn't look like it's being made despite the high prices and because creating capacity is just difficult because of the fact that the limitation is number of satellites in overhead and that can't be increased only in a specific area using LEO sats.)
bryanlarsen 3y ago
Starlink is sold with the standard razer and blades model. The terminal is estimated to cost $1500-$2500 to make, but it is sold for $500. OTOH the monthly fees are highly profitable and over time the initial costs are recouped. In a war zone where Starlinks are destroyed this model would lead to massive losses.

freedomben 3y ago

> Musk was unhappy that people were paying retail price when he could be charging a government-special super-premium. How do you know this?

dmix 3y ago
Considering this is the first reporting we're getting that the DOD even paid for it I'm guessing he doesn't and it's just the usual speculation.
foobarqux 3y ago
Use common sense? Is the statement that a business person would prefer to be paid 10x rather than 1x contentious? Is Musk especially different in some way that would make this not true? If you want to argue about whether I should have qualified the statement with "it's very likely", or "it stands to reason", okay.
- freedomben 3y ago
  If money is the only factor, then it certainly makes sense to prefer 10x to 1X. However, there are other factors. I know many people who would refuse a very high salary if they had ethical concerns about the work they were doing. Elon appears to have ethical concerns about supporting the war. It doesn't seem far-fetched to me to think that he might care more about not supporting war than about some money. But no I wasn't trying to make a point with the question, I was legitimately wondering if you had a source. I'd like to read more
  - foobarqux 3y ago
    We aren't talking about an imaginary person, we are talking about a specific individual. And I suggest to you that you shouldn't take the words of a prolific liar at face value, as demonstrated by the very case we are talking about. He claims to have ethical concerns but those disappeared as soon as he was paid? Maybe it was about self-interest all along?
    - snovv_crash 3y ago
      If all you can provide are ad hominems and have no actual facts to present your arguments on...

lockhouse 3y ago

Isn’t the practice of charging different rates for the same product to different customers fairly well established. Examples being hotel government rates, software that is free for personal use but carries a hefty licensing fee if used in a commercial or government setting, or business class cable internet? Using government and commercial customers to subsidize the less profitable consumer market is a fairly well established precedent in several industries at this point.

foobarqux 3y ago
Of course businesses want to do that. As I said the issue was how much the premium was going to be. 50% versus 10,000% makes all the difference.
- chii 3y ago
  > 50% verus 10,000% makes all the difference. so like airline tickets then?
- inemesitaffia 3y ago
  [dead]

nordsieck 3y ago

> Musk was unhappy that people were paying retail price when he could be charging a government-special super-premium. My impression is that the government was resisting paying it but have now caved and are keeping the details secret to prevent a potential backlash. IMO, it's probably reasonable for Ukraine to pay civilian prices for the terminals[1]. But service should absolutely be at a premium. The reason Starlink is being used by Ukraine in the first place is because Russia completely compromised Viasat and bricked every user terminal in Ukraine (and a bunch near by). It's expensive AF to defend against constant cyber attack from a capable state-level opponent. --- 1. When the terminals first came out, SpaceX substantially subsidized the cost of the terminals - to the tune of a year's worth of payments. I could see how this could make sense for them if the terminals are supposed to last for a very long time (10+ years). But their use in a war zone is probably much harder on the terminals. They're getting moved around way more often than a residential install. They're probably being targeted by the Russians. And accidents just happen in wars. I have no idea how much SpaceX currently subsidizes the consumer price of terminals, or how long the average terminal lasts in Ukraine. But I think it's pretty reasonable to adjust or even eliminate SpaceX subsidies on hardware depending on the exact value of those numbers.

foobarqux 3y ago
The premium we're talking about is on the order of 100 million dollars. Is that what it costs to defend against cyberattacks? They certainly haven't increased their payroll anywhere near that much. I doubt the hardware has changed much if at all.
- mensetmanusman 3y ago
  It would cost a competitor more than $200,000,000 to take their business in this situation, so yes.

dev_tty01 3y ago

You might be right, but I have seen no reliable information to support this. I have seen references to double the price, but nothing about 10x. Could you provide references please? However, SpaceX has apparently been doing a lot of firmware support to help Ukraine to deal with EW signals, so some level of premium is likely justified. https://breakingdefense.com/2022/04/spacex-beating-russian-jamming-attack-was-eyewatering-dod-official/ https://breakingdefense.com/2022/04/spacex-beating-russian-j...

foobarqux 3y ago
We don't know the exact price paid because they are keeping it a secret (because it's outrageous and would trigger a backlash if revealed). https://www.cnn.com/2022/10/13/politics/elon-musk-spacex-starlink-ukraine/index.html https://www.cnn.com/2022/10/13/politics/elon-musk-spacex-sta... "Those entities also paid for about 30% of the internet connectivity, which SpaceX says costs $4,500 each month" ---- (Regular price is about $100 so the claimed price is more than 40x. 13x if look at the price actually being paid by others.) " On September 8, the senior director of government sales for SpaceX wrote the Pentagon saying the costs have gotten too high, approaching $100 million. The official asked the Department of Defense to pick up Ukraine’s new request as well as ongoing service costs, totaling $124 million for the remainder of 2022. Those costs, according to the senior defense official, would reach almost $380 million for a full year."
- elcritch 3y ago
  Though even the marine oriented starlink cost $5k/mo. It doesn't seem crazy to charge a similar level for military usage. Companies don't charge the minimum of their service unless they have too; they charge what the market segment will bear.
  - foobarqux 3y ago
    That's arguably fine in a free-market, this is not one. And it's a weird argument to say that the price the government should pay is whatever the most any group is willing to pay for Starlink; The price segmentation, especially at the high-end, is mostly not based on cost to provide service but customer propensity to pay (boat and private jet owners). It doesn't make any sense to say "this is the special price we charge to Jeff Bezos and he doesn't care it's so high because he's rich therefore the government should also pay that price". As I said elsewhere price rationing for priority doesn't make sense in this case (because the government already knows who should get priority) and neither does higher prices as a signal to increase investment in capacity (because that investment doesn't look like it's being made despite the high prices and because creating capacity is just difficult because of the fact that the limitation is number of satellites in overhead and that can't be increased only in a specific area using LEO sats.)

bryanlarsen 3y ago

Starlink is sold with the standard razer and blades model. The terminal is estimated to cost $1500-$2500 to make, but it is sold for $500. OTOH the monthly fees are highly profitable and over time the initial costs are recouped. In a war zone where Starlinks are destroyed this model would lead to massive losses.