BT is in talks with Elon Musk

BT is in talks with Elon Musk

BT is in talks with Elon Musk’s Starlink over a satellite phone and broadband service that could help tackle the plague of so-called rural not spots.

The telecoms giant is testing Starlink equipment at its Adastral Park research centre near Ipswich as it explores ways to deliver connections to hard-to-reach areas.

Mr Musk’s company operates a network of roughly 5,000 satellites, which orbit 350 miles above the earth and beam down signals.

BT has been mulling using the network for broadband services, but bosses are also keen to harness the technology to improve mobile signals.

The former telecoms monopoly has previously signed adhoc deals with Mr Musk’s company outside the UK. However, no formal agreement has yet been reached in Britain.

Should BT sign a direct to mobile deal with Starlink, it may need to secure a special licence from regulator Ofcom.

The talks come amid doubts over the prospects for London-based satellite firm OneWeb, with which BT inked a partnership in 2021.

OneWeb was handed a £400m bailout by the Government during the pandemic amid concerns China could seek to take control of the struggling business

It has since merged with French space company Eutelsat, but the value of the taxpayer’s stake has more than halved because of a slump in its share price.

Starlink this week conducted its first successful test of the satellites to send and receive text messages with unmodified smartphones.

Talks are currently focused on BT’s business offering, allowing the company to deliver mobile and broadband services to remote sites such as oil rigs and mines.

But the technology is also expected to be rolled out to consumers in an effort to plug gaps that traditional cables and masts cannot reach.

The Government has teamed up with mobile operators on a £1bn plan to tackle rural “not spots”.

However, the venture has suffered a major setback after The Telegraph last year revealed that Vodafone, Three and Virgin Media O2 have warned the first stage of the plan will be delayed by up to two years.

BT, which has more mobile masts than its rivals and is contributing to phase one separately, is understood to have hit the initial target of covering 88pc of the UK’s landmass six months ahead of schedule.

Satellite technology is growing in popularity as businesses and consumers look for solutions to connectivity issues.

Meanwhile, around 42,000 UK customers had connected to Starlink’s network at the end of last year, a sharp increase from 13,000 in 2022, according to figures from Ofcom.

Starlink’s hardware, dubbed a “terminal”, can be purchased from around £450, while users pay a monthly charge of £75.

Sources said Mr Musk’s company had been pushing for BT to sell terminals to its customers. However, it is understood the mobile network operator does not want to become a reseller and would rather use satellite technology to improve its own services.

BT rival Virgin Media O2 has carried out Starlink trials at a remote rural location in Wales, but does not have an ongoing relationship with the company. Vodafone is trialling satellite services with Texas-based AST Space Mobile and Amazon.

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