SpaceX is spending $1,500 to make each Starlink terminal but customers will only be charged $499, its president says

• Each Starlink terminal used to cost SpaceX $3,000 to make. Now, they've been reduced to $1,500.
• SpaceX president Gwynne Shotwell said the firm won't charge users the overall cost of the terminal.
• She said the price of the terminal should fall to a few hundred dollars in the next year or two.
• See more stories on Insider's business page.

SpaceX president Gwynne Shotwell on Tuesday said the aerospace company has reduced the cost of each Starlink terminal from $3,000 to $1,500 each.

Starlink customers have to pay $499 for the kit, which includes the user terminal -also known as "dishy" – indicating that SpaceX is covering the remaining cost of $1,000 for each one it produces.

SpaceX didn't immediately respond to Insider's request for comment but industry experts told Insider in December it's not possible for the company to make each terminal for under $500. They said it could actually cost SpaceX nearly $2,000 on each one.

Shotwell confirmed on Tuesday during a virtual panel discussion for the Satellite 2021 LEO Digital Forum that the company had to pay $3,000 for each terminal, before reducing the price to $1,500.

"We're not charging our customers what it costs us to build those terminals," she said, adding that SpaceX has "made great progress on reducing the cost" of each Starlink terminal by half the original amount.

At, present Starlink costs users $600 upfront for the "Better Than Nothing Beta" test - that includes a $99 monthly subscription and $499 for the kit, which customers set up at home. It comes with a tripod, WiFi router, and terminal which connects to the Starlink satellites.

While it's not confirmed how many terminals have been sent out to the beta test subscribers, SpaceX noted in February that Starlink had more than 10,000 users in the US and abroad.

The company also "just rolled out a new version two that saved about $200 off the cost" and is expecting the price of each terminal to reduce to "the few hundred dollar range within the next year or two," according to Shotwell.

Read more: Starlink's $499 starter kit fee comes nowhere close to covering SpaceX's costs for the satellite-internet electronics, telecom experts say

This is good news for Starlink users looking for lower service costs.

For US customers, $600 upfront isn't bad, since it can be cheaper than the major internet providers. But in the UK, paying £439 for the kit and £89 subscription fee for 150 megabits per second (Mbps) is expensive in comparison with some national providers, which are offering speeds of up to 516 Mbps for £79 per month.

SpaceX CEO Elon Musk has spoken out in the past about the difficulties with financing Starlink.

The billionaire tweeted in February that the company "needs to pass through a deep chasm of negative cashflow over the next year or so to make Starlink financially viable."

He added that Starlink is "a staggeringly difficult technical & economic endeavor" but if it succeeds, the cost for users would improve each year.

Starlink's 10th mission this year blasted off on Wednesday, sending a batch of 60 satellites into orbit to expand SpaceX's ever-growing constellation. The aerospace company has more than 1,350 satellites in orbit and plans to launch 42,000 by mid-2027.