The marketplace competition for these companies either doesn't exist or has been largely eliminated or circumvented.
For example, Starlink is part of SpaceX. SpaceX has $22 billion in government contracts. No other independent company can reasonably compete with this level of government subsidy.
A better way to think about the scope of this market is “internet access” rather than “satellite internet access”. Even in the latter case, nothing is preventing others from entering that market. Starlink has been visionary and audacious so they can command a premium. That’s the market in action.
So when "free market" ideals come up short, re-define the market? How convenient.
"Satellite internet access" is what they offer and "satellite internet customers" with no other reasonable alternative are the ones being milked --- but it's "better" not to think about that?
Even in the latter case, nothing is preventing others from entering that market.
Except for the fact that Starlink is heavily subsidized by government contracts.
Not sure what solution you are advocating for. Is it that the government should shut down Starlink or is that they should prop up other companies or what?
"picks a winner" can be read in two ways.
That's like saying if the government is buying a vehicle from Ford, they are subsidizing Ford. They are different things.