Musk’s Starlink Socks Customers With $1500 ‘High Demand’ Surcharge

from the thank-you-sir-may-I-have-another dept

For years I’ve noted that while Elon Musk’s Starlink satellite broadband system can be very useful for people with no other options (warzones, RVs, boats, rural Americans), the network has struggled to maintain performance as it grows into more mainstream markets, resulting in not only widespread slowdowns, but also the company socking users with massive “congestion surcharges.”

These surcharges are actively designed to deter use because the network is struggling to handle the load. They started at around $100 a few years ago, then jumped to $750. And last week, Reddit users began complaining that they were automatically hit with a $1500 demand surcharge. And because Musk’s companies historically don’t invest in customer service, calling up to complain doesn’t really help:

“I have been charged 1500 dollars demand surcharge for simply verifying my address that I have subscribe to 3 years ago. I have contacted starlink customer support but it’s pretty worthless. I have been getting tossed from one agent to another agent for the past 5 days.”

Last year, a study from researchers at X-Lab quietly showed that Starlink struggles to manage the load as the network grows, making it ill-suited as serious game changer for U.S. access. So as the network scales up, Starlink will be forced to impose more and more limits and restrictions on usage to ensure that most people have an acceptable experience. The laws of physics are kind of annoying like that.

That a niche broadband option gets congestion normally wouldn’t be that big of a deal; the problem is Trump Republicans have hijacked and retooled the $42.5 billion infrastructure bill broadband grant program to throw billions of dollars — and millions of new customers — at Musk’s Starlink as a personal favor to one of the U.S. president’s biggest donors.

Ideally, sensible U.S. broadband policy involves pushing fiber optic cable as deeply into American communities as possible, then covering a lot of the remainder with either fixed wireless or cellular tech. Only then can low-Earth orbit satellite broadband options like Starlink (or Amazon’s Leo) act as niche options that fill in the gaps.

These technologies were never really designed to be the primary avenue for broadband delivery across the bandwidth-hungry country. They’re simply not useful in many more densely populated areas. But the Trump extended infotainment universe is convinced that Starlink is akin to some kind of magic simply because Musk’s name is involved.

So they’re redirecting billions of taxpayer dollars away from better, higher-capacity fiber options and toward Musk’s Starlink, which is only going to result in greater congestion as the network begins to strain under the heavily subsidized load. People will only start to figure this out long after Musk has pocketed billions of dollars in subsidies in exchange for Starlink service SpaceX already planned to deploy.

I’ll repeat that because it gets missed: Musk is getting billions in subsidies, which he professes to hate, in exchange for doing nothing differently. Extremely innovative.

There’s been an additional layer of stupidity created by the SpaceX IPO and its utterly bogus proclaimed valuations. The prospectus pretends that Starlink will somehow magically scale from 10 million current subscribers to more than 300 million in very short order with no headaches, but reality and the laws of physics are going to have something very different in mind.

And again (just like Tesla Solar), because Starlink customer service is largely nonexistent, folks shoveled toward Starlink by the Trump administration aren’t going to have a good time. This is all before you get to the fact that Starlink has also been criticized for harming astronomical research and the ozone layer, and is generally too expensive for the folks most in need of reliable broadband access.

That’s not to say that services like Starlink don’t have very real uses, but the company and its tech (like everything Musk touches) is being wildly misrepresented in a way that’s going to become increasingly and problematically apparent in the next few years.

Filed Under: broadband, competition, congestion, demand surcharge, elon musk, internet access, low earth orbit, satellite, telecom

Companies: spacex, starlink