Ford gov't pays undisclosed penalty to Starlink over 'Elbows Up' cancellation of contract
The Ford government has admitted to paying an undisclosed penalty after tearing up a $171 million deal with Elon Musk’s Starlink in trade war retaliation against the Trump administration. The project promised high-speed internet to over 43,200 rural homes in Ontario.
Ontario's Doug Ford government has officially cancelled its $100 million Starlink internet contract with Elon Musk's SpaceX, according to Global News. This cancellation followed negotiations for a break fee.
The provincial government confirmed it cancelled the Starlink contract, stating in an email, “We are seeking an alternate solution as we continue our efforts to secure long term, stable high-speed internet access across the province.”
Signed in November, days after Donald Trump won the U.S. presidential race, the agreement would have provided satellite internet to 15,000 northern Ontario homes but collapsed due to escalating trade tensions with the United States.
Months later, tariffs hit Canadian products. Premier Ford retaliated, vowing to “rip up” the $100 million agreement with Musk, who owns SpaceX.
“It’s done,” Ford said in March. Musk responded, “Oh well.”
Premier Ford first committed to scrapping the contract on February 3 but reversed course hours later after President Trump delayed tariffs on Canada by 30 days.
“I never believe in starting a fight, but I believe in winning the fight,” he said at the time.
Ontario's premier had rejected calls to axe the deal the week prior but changed following an executive order to tariff all Canadian exports, initially slated for February 4.
Moreover, ending the lucrative deal with Musk's company was complex. Legislation was considered, but risked the U.S. company refusing future provincial work or cancelling other Ontario contracts, like satellite internet for northern health care.
Sources say the province's approach ensures other agreements with Starlink remain intact and allows for future collaboration, unlike a unilateral cancellation.
Meanwhile, the government has not specified which companies it is considering to supply internet to those affected by the cancellation, nor when it plans to sign a new deal.
Ford earlier promised to pursue domestic options to no avail.
Ontario NDP Leader Marit Stiles criticized Ford’s government, stating the lack of reliable internet in northern and rural communities benefits Musk, who profits from an unfulfilled deal.
Ontario taxpayers paid an undisclosed fee to cancel its deal with SpaceX, which a senior government official told Global was “not zero” but significantly less than the original $100 million valuation. SpaceX did not comment.
“Months have passed and we still don’t have a plan or even a process that’s calling for home-grown solutions,” Stiles said.
The government of Ontario has already invested over $2.5 billion, connecting 450,000 homes to the internet by year-end.
Alex Dhaliwal
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Alex Dhaliwal is a Political Science graduate from the University of Calgary. He has actively written on relevant Canadian issues with several prominent interviews under his belt.
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COMMENTS
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Susan Ashbrook commented 2025-07-30 22:22:53 -0400What an idiot Doug Ford is… giving up the best for the least over a sense of false pride. This is the kind of leader that gets us into more trouble than we need. We seem to have a dearth of them at the moment!
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Bernhard Jatzeck commented 2025-07-30 21:33:49 -0400There’s likely more to this than Ford’s sudden onset of faux-patriotism. I’m sure that certain members of Canada’s telecom cartel wanted a piece of the action. These firms are well-known for their chumminess with the Liberals, so there may have been some backroom dealing.
Dumping Starlink will, of course, be costly. For one thing, the reason its services can be offered at significantly lower cost is that it’s ubiquitous. It’s been in existence for several years and has a demonstrated capability.
But, this is Canada, a country that prides itself in always re-inventing the wheel. If the wheel turns out to be shoddy or higher in price, simply slapping a maple leaf emblem on it instantly turns dross into gold and Canadians line up to buy them.
There was an item in the news yesterday about B. C. and Ottawa spending millions to provide high-speed Internet to remote communities. Starlink, of course, wasn’t mentioned because, I’m sure, Eby has a loathing for anything connected with America.
Meanwhile, there’s lots of leftover used satellite equipment available for cheap on the second-hand market, and most of that isn’t made by Starlink. -
Bruce Atchison commented 2025-07-30 18:22:10 -0400I’m sure this will cost Ontario millions. Imagine the good that money could have done. Ontarians must keep telling others that their poor cell service is Doug Ford’s fault.
