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A new report from Reuters claims SpaceX forced the Pentagon to pay five times more for the satellite internet that controls US kamikaze drones in the Iran war (a claim both the Pentagon and Elon Musk are denying).

Some shit you should know before you dig in: If you’re unaware, the US recently started using LUCAS (which is a cheap US-made kamikaze drone built by a company called SpektreWorks and modeled after Iran’s Shahed-136). The whole point is that it’s disposable and dirt-cheap compared to a million-dollar cruise missile. It flies to a target, dive-bombs it, and blows itself up. Each drone costs $30,000. The first time these things saw real action was when the US kicked off its bombing campaign against Iran on February 28, and the head of US Central Command later called them “indispensable” to Operation Epic Fury.

What’s going on now: According to Reuters, shortly after the US started bombing Iran, SpaceX executives sat down with Pentagon officials and told them they were being undercharged for the satellite internet connections that guide the LUCAS kamikaze drones to their targets. The Pentagon had been paying around $5,000 per drone for the connection, but SpaceX argued the real number should be $25,000 (because the drones were using a higher-tier service plan than what the military was signed up for). With strikes ramping up and no real alternative provider out there, the Pentagon reportedly just agreed.

SpaceX said the drones’ flight patterns matched the plan meant for full-size aircraft (which costs way more), while Pentagon officials pushed back, arguing it makes no sense to charge a plane-tier rate for a throwaway weapon that taps into the network for a few minutes before destroying itself.

Another view: Both the Pentagon and Musk came out swinging against Reuters’ story. Pentagon spokesperson Sean Parnell called it “Fake News” on X and said the claims “are simply not based in reality,” while insisting SpaceX “remains a strong and valued partner.” Musk also denied the story but pointed the finger somewhere else: the drone manufacturer. He explained that SpaceX actually runs two separate networks: Starlink (the regular civilian version anyone can buy) and Starshield (the locked-down, secure military version sold to the government). According to Musk, the drone company screwed up and used the civilian Starlink instead of the proper military Starshield, which violates SpaceX’s terms of service.

Reuters also reported a second, separate pricing fight happening at the same time. The Pentagon wants to use Starlink’s new direct-to-cell technology (basically satellite cell service, like getting 5G straight from space without needing a tower) to help regular Iranians get around their government’s internet blackouts.

The US smuggled more than 6,000 Starlink terminals into Iran earlier this year, but Tehran has been seizing them and jamming the signals. According to Reuters, when the Pentagon asked SpaceX to set up the cell service workaround, SpaceX wanted up to $500 million just to launch it, plus another $100 million every single month after that to keep it running. Those prices reportedly shocked defense officials.

Despite the denials, Reuters is still standing by its reporting.