Google Closing in on SpaceX Investment

Google may be in the final stages of investing in Elon Musk’s private space exploration company SpaceX, a move that would bolster SpaceX’s emerging satellite business and would help Google expand internet access around the world.

According to The Information, which cited anonymous sources familiar with the talks, the deal would value SpaceX at more than $10 billion, though the exact terms of the investment are still unclear. But at an event in Seattle last week where SpaceX founder and CEO Elon Musk first announced the new satellite venture, Musk gave some indication as to the epic scope of the project that lies ahead. He seeks to create a network of hundreds of satellites that could not only connect people on Earth to the web, but also people on Mars—if and when people get there. The total cost of such an audacious project? $10 billion.

“Our focus is on creating a global communications system that would be larger than anything that has been talked about to date,” Musk told Businessweek at the time.

That, of course, is something Google—and indeed many tech giants—would very much like to have a hand in. Over the last few years, companies like Google and Facebook have turned their attention toward connecting the unconnected to the internet. Both companies have looked to technologies like drones, satellites, and balloons that could bring internet connectivity to people living in the most remote places. While benefitting rural peoples, this would greatly expand the companies’ already enormous reach.

But recently, Google hit a major roadblock in its efforts to connect the world when Greg Wyler, who was leading its satellite efforts, left Google to launch his own venture, OneWeb. Wyler took with him not only his expertise in the field, but also the rights to some spectrum Google would need for the project. According to The Information’s sources, Wyler even tried partnering with SpaceX himself, but the deal went sour when he refused to give up a significant portion of OneWeb to Musk.

It stands to reason that Google would be on the lookout for another, well-funded partner to help realize its vision for an expanded internet. Though SpaceX is not known to have the spectrum to replace what Google lost when Wyler left, Musk has discussed plans to use a laser-based workaround for its satellite network. As Musk described it, his project would lead to internet speeds that are significantly faster than fiber optic cable. “The speed of light is 40 percent faster in the vacuum of space than it is for fiber,” Musk told Businessweek. “The long-term potential is to be the primary means of long-distance internet traffic and to serve people in sparsely populated areas.”

Of course, just because Google and SpaceX are have delivered on moonshot projects in the past doesn’t guarantee that this endeavor will be successful. Richard Branson—an investor in Wyler’s OneWeb—has publicly doubted whether Musk can pull this off. “Greg [Wyler] has the rights, and there isn’t space for another network—like there physically is not enough space,” he told Businessweek. “If Elon wants to get into this area, the logical thing for him would be to tie up with us, and if I were a betting man, I would say the chances of us working together rather than separately would be much higher.”