Part Two in a Series on Geopolitics and Satellite Networks
The re-election of Donald Trump in the U.S. has introduced some new geopolitical factors that have already begun to shape the coverage of LEO networks – particularly Starlink. The previous instalment of the series outlined the geopolitical barriers blocking Starlink and OneWeb from Russia and China, and discussed hesitancy from other countries politically different to the U.S./West. This article focusses on the intensifying trade war between China and the U.S. and how increasingly tense relations are driving the growth of China’s LEO network.
U.S. vs The World
The U.S. and China have been in a continuous ‘tit-for-tat’ state of play since 2017. This year, Trump, in a bid to increase both supply and demand of American made goods imposed a 145% tariff on Chinese imports. In retaliation, China levied a 125% tax on U.S. imports and added new export controls on metal products and related technologies including tungsten, a critical metallic element for industrial and defence application. This could disrupt satellite manufacturing supply chains for U.S.-based companies. In response, Trump is considering a semi-conductor tariff impacting the cost of devices such as cell phones, while China’s Ministry of Commerce said it would “fight to the end” if the U.S. “insists on provoking a tariff or trade war”.
However, after negotiations in May 2025, Trump has eased tariffs on Chinese products crossing the border to 30% and Beijing has kept a 10% tariff on U.S. goods entering the country which represents a vast economic improvement on the situation. In saying that, in his bid to keep production of goods on home soil, Trump has still worsened relations with China, as well as other countries he’s imposed tariffs on.
Somewhat surprisingly, one such country is Canada. Trump has imposed 25% tariffs on select goods crossing the Canadian border, which Musk is associated with through his involvement with the administration. As a result of this, and concerns that Musk will influence public opinion towards right-leaning ideology, some Canadian politicians have demanded that X, Tesla and Starlink are banned from the country. For example, Ontario announced the cancellation of a $68 million Starlink contract declaring that “Ontario won’t do business with people hellbent on destroying our economy.” Worth pointing out that, despite some lengthy delays, this could provide a good opportunity for Telesat to build a domestic subscriber base.
Borders In The Sky
Part One of this series pointed out that Russian airspace remains completely closed to both Starlink and OneWeb. Starlink, is now even being targeted by Russia (more below). We may see a global coverage split with one side dominated by Western LEO networks and the other dominated by an alternative currently being built in China.
China’s LEO Presence
While OneWeb appears to be leaning into government, enterprise and mobility, with its second-generation network seemingly hinging on its involvement in the European Union’s satellite strategy, Starlink is going for global proliferation across all verticals. This is outlined in Valour’s dedicated report, “Starlink Aviation: Deep Dive”. One of the biggest threats to its success is China’s growing LEO presence, which is already proving to be a popular alternative among countries like Brazil, despite not yet operating, where Musk and Trump have aggravated already tense foreign relations. Chinese LEO networks have signed Memorandums of Understanding with Malaysia, Nigeria and Thailand to date.
One such network is China Satellite Network Group Co’s (China SatNet) mega-constellation, GuoWang. Development began in December 2024 for use in defence and government applications. The constellation will host 13,000 satellites when complete and is positioned to serve China, Russia and other nations hesitant to engage with Western network operators. Alongside GuoWang is SpaceSail’s Qianfan/Thousand Sails which is a Shanghai-based mega-constellation, Its first 54 satellites were sent into orbit across three launches in 2024. Spacesail’s goal is to have over 600 operational satellites by the end of 2025 and will comprise 14,000 satellites when complete. We’ll likely see Qianfan utilised in commercial applications. Both LEO constellations represent the country’s goal to establish a series of national satellite networks with global reach that compete with Starlink, OneWeb and Kuiper
Development of LEO infrastructure is growing at pace; China launched more than 230 spacecraft in 2024, surpassing 2023’s national record. The country’s ambitious launch schedule is possible thanks to a huge increase in satellite manufacturing capacity over the last couple of years. Manufacturers are receiving significant state funding to close the technology gap with the U.S. and so a satellite space race is underway.
Alliances between China and countries like Russia and Brazil have also emerged. Shortly after tensions arose between Musk and Brazil’s Supreme Court, a representative from the Brazilian government visited Spacesail’s satellite-manufacturing facilities. The Minister of Communications (ironically) took to X to state that “we were impressed by what we saw, not only in their ability to produce up to one satellite per day, but also their ambitious plans for expansion and development in space.” A spin-off of Spacesail will be set up in Brazil within the next two years.
One of the largest telcos in the wider Central and South America region, América Móvil, has also cut ties with Starlink and is considering partnering with a Chinese network, strengthening the country’s LEO presence on a global scale. SpaceSail has confirmed that it’s in talks with over 30 other countries regarding provision of satellite connectivity
Escalation and Fragmentation
Trump’s comparatively protectionist policies and ongoing conflicts between the West and countries like China, Russia and Brazil will have rippling effects on the satellite operator landscape. As is the case now, major players like Starlink will continue to dominate in the West. However, its position as global LEO leader is precarious as reliance on satellite connectivity grows and regional control over network operations becomes increasingly important for defence strategy. Weak points are already starting to show:
- In 2024, the Ukrainian military noted some outages in the Starlink network which were chalked up to Russian interference. Russia reportedly has a new system, Kalinka or so-called ‘Starlink Killer’, which supposedly can detect and disrupt Starlink signals with the goal of interfering with Ukrainian military, though other accounts suggest that Starlink is robust.
- Despite Brazil recently approving Starlink’s expansion, the country is concerned that its reliance on a US-based network could be leveraged by the Trump administration, especially in the midst of the current trade war.
- Telesat is now in talks with the Brazilian government to enter the market as another alternative to Starlink, further demonstrating that Starlink’s first-mover advantage may not guarantee long-term dominance as it becomes more associated with U.S. politics.
Conclusion
The satellite industry is no longer just about technological advancement, it’s now inextricably tied to national politics, strategy and culture, and will continue to impact and be heavily impacted by geopolitics. While in aviation and beyond, many have seen the LEO race as consisting of only two horses, China’s LEO network is likely to be built at pace while its leadership forges relationships with those that are experiencing the U.S./Trump/Musk burn bridges. It’s likely that coverage over the West will be dominated by Starlink or Kuiper while China covers those countries with different political alignment This represents an opportunity for neutral satellite operator parties to work with regional networks and others to achieve global coverage and potentially focus on commercial and business aviation customers flying long haul/global routes. This subject will be covered further in our upcoming report, “In-Flight Connectivity: China and India Deep Dive”.
The third part to this series will explore the future of existing LEO networks given current geopolitical tensions, other factors such as space sustainability, and how all of this will impact the race to have the biggest constellation in space.
