Musk Ultimatum to Taiwan Imperils Its Push to War-Proof Internet
Comment of the Day

July 07 2023

Commentary by Eoin Treacy

Musk Ultimatum to Taiwan Imperils Its Push to War-Proof Internet

This article from Bloomberg may be of interest to subscribers. Here is a section:

Starlink’s performance in Ukraine also caught the attention of China’s military analysts.

In April last year, the Beijing Institute of Tracking and Telecommunications published a report acknowledging the satellite system would create “a huge challenge for our current situational awareness and traditional defense capabilities.”

In his comments to the Financial Times published in October, Musk said Beijing had “made clear its disapproval” of the Starlink rollout in Ukraine to help the military circumvent Russia’s severing of internet access. He added Beijing had sought assurances that he wouldn’t sell the service in China.

Those sort of China vagaries worry politicians in Taiwan and beyond.

“If I’m China, I would ask Elon Musk to control all the satellite receivers in Taiwan. If I can control him, in an emergency I can turn it off,” Herming Chiueh, Taiwan’s deputy minister of digital affairs, said. “That’s my perspective, because we know China better than anyone else.”

Lincoln Hines, a China space expert and assistant professor at the US Air War College in Montgomery, Alabama, agrees Taiwan has reason to be concerned.

“Could Taiwan really count on the goodwill of Elon Musk in a crisis? That’s a position not many countries would like to be in,” he said.

Eoin Treacy's view

Why was Elon Musk allowed to wholly own the Tesla factory in Shanghai? No other industrial company has been afforded that benefit. China has a dominant position in designing and manufacturing next generation batteries, and Tesla competes with domestic companies. They don’t need Tesla, so there must be another reason for agreeing to such beneficial terms.

Perhaps it is because Musk owns the pre-eminent satellite and reusable rocket company. Now that he owns one of the most popular news dissemination sites, he is an even more valuable potential ally. From China’s perspective, it is even better that he may have dug himself into a hole with the purchase price of Twitter and will therefore be more amenable to cooperating.

This is another example of the web of connections and business reliance China uses to tie corporations and countries to its sphere of influence. It is very unlikely Musk will give up his Shanghai facility, and future business opportunities on the mainland, just to provide the Taiwan independence movement with communications technology. Taiwan would also have justifiable concerns about the security of transmissions over the Starlink network given Musk’s close ties with China.

In a globalized economy these considerations are irrelevant because everyone plays along to get along. In a bifurcating geopolitical environment the floating alliances of global companies will be questioned. That is particularly true for a group like Musk’s where the “move fast and break things model” is on overdrive. It’s also a potential issue for Apple given how intertwined the business is with the good graces of the Communist Party. 

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