Ontario Terminates $100 Million Starlink Contract Amid U.S. Tariff Dispute
Toronto, Monday, 3 February 2025.
Ontario cancels a $100M Starlink deal over new U.S. tariffs, reflecting escalating trade tensions impacting cross-border tech collaborations.
Immediate Contract Termination
In a decisive move on February 2, 2025, Ontario Premier Doug Ford announced the termination of a nearly $100 million contract with SpaceX’s Starlink service [1]. The contract, which was originally signed in November 2024, was intended to provide high-speed internet access to 15,000 homes and businesses across rural, remote, and northern communities by June 2025 [1].
Trade Tensions and Political Response
The contract cancellation comes as a direct response to new U.S. tariffs imposed on Canadian goods on January 31, 2025 [1]. Premier Ford has taken a strong stance against American business interests, announcing a broader ban on U.S. companies from provincial contracts until the tariffs are removed [1]. In a strongly worded statement, Ford criticized both Elon Musk and the current U.S. administration, accusing them of actions that ‘want to destroy families, incomes, destroy businesses’ [1].
Contract Background and Infrastructure Impact
The selection of Starlink was based on a limited pool of qualified providers. According to Infrastructure Ontario, only two satellite internet service providers - SpaceX and Xplore Inc. - met the province’s requirements during the January 2024 bidding process [1]. Starlink has established itself as Canada’s leading satellite-based provider of rural internet access, serving approximately 400,000 subscribers as of 2024 [1].
Legal and Political Implications
The contract termination has attracted political attention, with Ontario Liberal Leader Bonnie Crombie having urged its cancellation as recently as January 28, 2025 [1]. Addressing potential legal concerns, Premier Ford expressed confidence about the province’s position, stating they haven’t ‘paid a penny’ for the contract yet and believes they have ‘a very, very good case if it goes to court’ [1]. The cancellation is part of a broader retaliation against U.S. trade measures, including plans to remove American liquor from LCBO stores starting February 4, 2025 [1].