The European Commission is set to adopt a decision tomorrow that would privilege European satellite operators in a strategic move designed to curb the expansion of Starlink, SpaceX's flagship service operated by Elon Musk. The decision arrives as the Commission prepares to present its Tech Sovereignty Package next week, an initiative aimed at reducing EU dependence on foreign technology providers and asserting greater control over critical infrastructure.
Thomas Regnier, the Commission's spokesperson for tech sovereignty, framed the decision in terms of strategic resilience. "Satellite connectivity is a key piece of our technological sovereignty, our security, and our defence, as also highlighted by IRIS²," Regnier stated. "In the changing geopolitical situation, EU-wide satellite connectivity becomes synonymous with resilience, security, and capability."
The Spectrum Allocation Framework
Tomorrow's decision concerns the selection of operators for pan-European systems providing mobile satellite services for the 2 GHz radio spectrum frequency, the only band harmonized at the EU level. Since 2009—17 years ago—this bandwidth has been allocated to two European operators, Viasat and EchoStar. Currently, these frequencies support limited applications, notably emergency calling when smartphone networks are unavailable.
However, technological advances have created new possibilities. The Commission is now considering expanding use of these frequencies for direct-to-device communications, allowing smartphones and other devices to connect directly to satellites in space. This capability represents a significant market shift: direct-to-device communications would enable companies like SpaceX and Amazon to compete directly with European mobile operators by providing space-based connectivity that could render terrestrial infrastructure less essential.
The Commission's forthcoming decision is designed to favor the European satellite operators—entities that European telecom operators prefer to work with because they are not viewed as direct threats to their existing business models. This protective approach stands in contrast to the open competition that would result if American providers like SpaceX were permitted to compete on equal terms.
Transatlantic Trade Tensions
The EU's strategy carries significant diplomatic risk. Last year, Donald Trump returned to the White House, and his administration has proven particularly assertive in protecting American corporate interests abroad, including in Europe. Two months ago, at the Mobile World Congress in March, Brendan Carr, chairman of the US Federal Communications Commission, issued a direct warning to EU regulators.
"Europe has national champion satellite providers that do substantial business in the US. And I think we have all benefited from a fair and even-handed approach," Carr said. "And whether we get to continue to do that, frankly, is in the hands of European regulators right now." He added pointedly: "If Europe insists on going down a path of satellite sovereignty that excludes providers that are not based on the continent, then the US will have to be taking that into account with respect to the reciprocal treatment that we provide."
Car's warning signals potential retaliation through trade mechanisms or regulatory restrictions affecting European firms operating in the United States. The stakes are substantial, given that European satellite providers conduct significant business in American markets.
Mitigating Factors and Internal Tensions
The Commission believes it has already avoided the worst-case scenario. Last week, EU policymakers reached a political agreement on the controversial EU-US trade deal, suggesting some diplomatic groundwork has been laid. However, tensions remain within the Commission itself over spectrum allocation priorities.
The 2 GHz radio band creates competing pressures between commercial telecommunications interests and military applications. The EU's defence establishment continuously seeks to reserve bandwidth for its own use, creating internal friction. This tension manifests as a clash between EU digital chief Henna Virkkunen, who aligns more closely with telecom operator interests, and Defence Commissioner Andrius Kubilius.
Last week, in an interview with the Financial Times, Kubilius advocated for IRIS²—the EU's sovereign satellite initiative—to receive a portion of satellite frequencies. This position is not necessarily shared across the entire Commission, highlighting the difficulty of balancing competing institutional priorities.
The Scarcity Problem
Spectrum represents an inherently scarce resource, and its allocation has historically required careful balancing among competing interests. As the EU pursues development of domestic technology solutions, the Commission must navigate a particularly delicate equilibrium: protecting European commercial interests from American competition, maintaining sufficient bandwidth for defence applications, and avoiding escalation of transatlantic trade tensions.
Why This Matters:
This decision reflects a fundamental shift in how the EU approaches technology governance—moving from market-neutral spectrum allocation toward strategic industrial policy designed to protect European champions. The approach prioritizes government-directed outcomes over competitive market mechanisms, raising questions about long-term efficiency and innovation. The explicit protectionism risks triggering reciprocal American trade responses, potentially harming European companies with US operations. Additionally, the internal Commission disputes over spectrum allocation between commercial and defence interests signal ongoing institutional challenges in coordinating policy across competing priorities. The outcome will establish precedent for how the EU balances technological sovereignty against free-market principles and international trade relationships—decisions with implications extending far beyond satellite communications.