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Elon Musk gave Apple CEO Tim Cook just 72 hours in 2022 to accept a $5 billion deal that would have made SpaceX the exclusive satellite provider for iPhones, or face competition from his own rival service. Apple rejected the offer, setting off a bitter three-year battle that continues to threaten the iPhone’s satellite capabilities and has left Android users inadvertently grateful for Cook’s defiance.The ultimatum came after Musk learned Apple planned to announce satellite connectivity for the iPhone 14 through partner Globalstar, according to a new report from The Information. SpaceX’s proposal demanded $5 billion upfront for 18 months of exclusive iPhone satellite service, followed by $1 billion annually. When Apple declined, Musk made good on his threat, announcing a competing T-Mobile partnership just two weeks before the iPhone 14 launch, a deal that initially would have locked out Android devices entirely.Apple’s satellite ambitions actually began nearly a decade earlier with the ambitious “Project Eagle,” a scrapped $36 million initiative that would have partnered with Boeing to launch thousands of satellites providing full internet service to both iPhones and homes by 2019. The project died due to fears of alienating carrier partners like Verizon and AT&T, who remain crucial to iPhone sales.
SpaceX wages regulatory war against iPhone features
SpaceX has since escalated the conflict through regulatory warfare, filing challenges to Globalstar’s radio spectrum rights that could cripple iPhone satellite features if successful. The company accused Globalstar of hoarding unused spectrum to block competitors, specifically naming Apple in filings that reportedly alarmed Apple executives. SpaceX’s vice president of satellite policy bluntly stated the spectrum battle “serves one purpose: to block competitive entry in frequencies Globalstar has never meaningfully used.”The Information reports that Apple fears Musk’s relationship with the Trump administration could give SpaceX advantages with federal regulators. This concern prompted Apple to hire dedicated staff to handle orbital spectrum issues and counter SpaceX’s legal maneuvers. Industry analysts note that “SpaceX only thinks about Apple as a serious competitor and Apple only thinks about SpaceX as a serious competitor” in the satellite space.Adding to the pressure, Musk has demanded Apple broadly support SpaceX’s T-Mobile satellite service across older iPhone models, a move that would maximize Starlink’s market reach. Apple’s reluctance to extend support beyond iPhone 14 models has further frustrated Musk, intensifying the standoff. When T-Mobile officially launches the service in July, compatible iPhones will default to Starlink rather than Apple’s Globalstar solution, a final insult in their corporate feud.
Apple executives fight company’s own satellite strategy
The satellite program faces fierce resistance within Apple itself, with senior executives including software chief Craig Federighi and corporate development head Adrian Perica reportedly pushing to kill the initiative entirely. Internal critics slam Globalstar’s network as fundamentally inferior to rivals like Starlink, warning that even planned satellite upgrades won’t meaningfully improve performance for a decade. Some former employees openly acknowledge that “SpaceX is ahead of Globalstar.”The rebellion stems from fears that expanding satellite services could trigger federal regulation of Apple as a telecommunications carrier, potentially forcing the company to build surveillance backdoors into iMessage, a privacy nightmare for the company. Apple’s refusal to charge for satellite features, despite spending hundreds of millions annually, reflects these regulatory concerns. The internal schism has created an unusual dynamic where Apple’s own executives are betting against their company’s multi-billion-dollar strategy, with some believing the satellite features should be abandoned entirely and left to carriers. Despite the internal revolt, Apple has doubled down with a $1.7 billion investment in Globalstar for new satellites, refusing to bow to either Musk’s pressure or internal dissent.
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