by Micah Maidenberg
February 20, 2024
from WSJ Website

and from MSN and WayBackMachine Website

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SpaceX is deepening its ties with U.S. intelligence and military agencies, winning at least one major classified contract and expanding a secretive company satellite program called Starshield for national-security customers.

The Elon Musk-led company entered into a $1.8 billion classified contract with the U.S. government in 2021, according to company documents viewed by The Wall Street Journal.


SpaceX said in the documents that funds from the contract were expected to become an important part of its revenue mix in the coming years. It didn't disclose the name of the government customer.

The size and secrecy of the agreement illustrate a growing interdependence between SpaceX - a dominant force in the space industry - and the national-security establishment.

SpaceX's work for U.S. defense clients has long included blasting off classified and military satellites.





The Pentagon has more recently done business with SpaceX's Starlink broadband service, including agreements to pay for Ukrainian internet links during Ukraine's war with Russia.

Less is known about SpaceX's Starshield unit, which is tailored for government clients and counts a former Air Force general among its leaders.


Starshield won a $70 million award from the military last August to provide communications services to dozens of Pentagon partners.


However, the group has largely operated out of the public eye.

"When I'm never sure what I can say in a public forum, I tend to zip it.


But I can say that there is very good collaboration between the intelligence community and SpaceX," Gwynne Shotwell, the company's president, said at an event last May.


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On a webpage made public in late 2022, SpaceX described Starshield as providing satellites capable of handling secure communications, capturing data about Earth or carrying sensors or other observation instruments for the government while in orbit.

Starshield's online job postings have sought people with top-secret clearances, as well as experience working with the Defense Department and intelligence community.


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One advertised position would require the person handling it to represent Starshield to Pentagon combatant commands - divisions that oversee military operations around the world or specific functions, such as transportation and cybersecurity.

A SpaceX spokesman didn't respond to requests for comment.

SpaceX has worked with national-security organizations since it was a startup. Shortly after Musk founded the company in 2002, it won a launch contract with an undisclosed U.S. intelligence customer, the Journal reported almost two decades ago.


Later, SpaceX began handling regular launches for military and spy agencies.

The company has also won significant national-security clients for its satellite technologies - a different set of offerings from SpaceX's traditional work blasting off satellites for those customers.


One such client has been the National Reconnaissance Office, according to people familiar with the matter.

Based in a sprawling office park south of Dulles International Airport, the NRO draws staff from different Pentagon branches and the Central Intelligence Agency, who use satellite data to support national-security and civilian agencies in the federal government.


Its existence was a classified government secret until 1992.

It couldn't be determined what satellite technology from SpaceX the NRO has tapped.

An NRO spokesman said the agency develops intelligence products with a range of partners.

"We are deepening our relationships with other government agencies, the private sector, academia and other nations," the spokesman said.

Musk, who also leads Tesla, the social-media company X and other ventures, comes from a Silicon Valley background that sets him apart from the leaders of most prime military contractors.

The Journal has reported that Musk, who has a security clearance, has used illegal drugs.


Government contractors can lose security clearances because of drug abuse, defined as the use of illegal drugs or prescription medications,

"in a manner that deviates from approved medical direction."

Musk has said he hasn't failed drug tests, and his attorney has said the executive has never failed a test.

SpaceX's Shotwell has played a significant role in building the company's relationship with national-security agencies, people familiar with those efforts say.

SpaceX executives have touted the company's capabilities to government buyers, pointing to its ability to rapidly manufacture satellites and, deploying its partially reusable rockets, launch them to low-Earth orbit at a cadence rivals can't match.


Leaders at agencies that work closely with SpaceX have praised the company's technology as sophisticated and its style as nimble.


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Terrence O'Shaughnessy, who joined SpaceX after retiring in 2020 from the Air Force as a general, has had a high-level role at Starshield, people familiar with the matter said.


A biography posted on a trade group's website described him as a,

"Senior Advisor to Elon Musk on matters regarding SpaceX" as well as vice president of the company's Special Programs Group.

He and others have urged the defense establishment to learn from the example set by more agile space startups.


Last year, O'Shaughnessy compared how SpaceX developed Starlink with a government effort to create a similar but far smaller fleet.


The latter,

"sounds a lot like Starlink," he said at a conference. "Yet they're looking for a couple hundred satellites on orbit."

Roughly a decade after Musk said SpaceX would develop a satellite-internet business to sell high-speed internet links to consumers and businesses, the company operates the world's biggest fleet, with about 5,400 satellites in operation as of mid-February.


Those devices power Starlink, which is marketed for civilian use.

SpaceX's growing importance to the U.S. government comes as space increasingly becomes a contested arena that mirrors geopolitical rivalries on Earth.

China has been ramping up its space capabilities.


Russia has ambitions to develop a space-based nuclear weapon that could be used to target satellites, U.S. officials said this month.

Satellites play a major role in U.S. national security, tracking missile launches and providing secure communications.


Others monitor activity on the ground using cameras or sensors.

Some Pentagon space leaders want to move away from ordering powerful but large satellites that might take a decade to build and launch.


In their place, they say, they want contractors to quickly launch satellite swarms that can stay online when other systems fail.


Officials are planning for an aggressive pace of military and spy satellite launches in the years ahead.

"I think speed in space acquisition is a very simple formula: You build small, you use existing technology and reduce nonrecurring engineering," Frank Calvelli, assistant secretary at the Air Force for space acquisition and integration, said in a speech at the end of 2022.


"You take advantage of commercial capabilities."

SpaceX's ability to quickly build and launch satellites has been on display during Ukraine's fight against Russia.


Since the war's earliest days, the company's Starlink satellite network has supported communications for Ukrainian civil society and troops.

The service has also generated tensions. SpaceX's Shotwell last year said the company took steps to limit Ukrainian troops from using it for direct military engagements.


This month, Ukraine's top military-intelligence officer said Russian invasion forces are using thousands of Starlink terminals in occupied Ukrainian territory to access internet services.

Musk has said no Starlink terminals, to the best of SpaceX's knowledge, have been sold directly or indirectly to Russia.


Starlink has said SpaceX takes steps to deactivate terminals if the company determines sanctioned or unauthorized parties are using them.