Shares of major U.S. wireless carriers fell sharply Friday after SpaceX announced a deal to acquire nationwide low-band spectrum licenses. The agreement raised concerns about stronger competition from Starlink's expanding mobile network. Verizon stock lost 8%, AT&T dropped nearly 9%, and T-Mobile declined 13%. SpaceX shares gained 1% as investors assessed its plans to challenge established telecom operators.
SpaceX agreed to purchase up to 14 megahertz of paired spectrum in the 800 MHz band from digital infrastructure investor Grain Management LLC. The companies did not disclose the purchase price, and the transaction requires Federal Communications Commission approval.
Once regulators approve the deal, SpaceX plans to combine its satellite network with ground-based wireless infrastructure. The additional frequencies would help its Starlink mobile network reach customers inside buildings and across areas with weak signals.
The acquisition also provides frequencies suited to conventional cellphone towers. As a result, SpaceX could extend service beyond the outdoor coverage its satellite network currently supports, including locations where buildings obstruct satellite connections.
Elon Musk described the purchase on X as the final major spectrum requirement for achieving complete mobile coverage across America. His comments followed earlier investments in satellite and terrestrial wireless frequencies.
The announcement triggered a broad selloff in telecommunications shares, with T-Mobile recording the largest decline among the three major carriers. Meanwhile, Verizon and AT&T also faced selling pressure as SpaceX outlined its nationwide wireless ambitions.
SpaceX President and Chief Operating Officer Gwynne Shotwell had already discussed the company's competitive plans during an August earnings call. She said Starlink intended to develop a terrestrial wireless network and attract customers from established operators.
Shotwell also indicated that the company expects to launch second-generation Starlink Mobile satellites in 2027. These satellites would support the expansion of the company's direct-to-device communication services.
Could Starlink's combined satellite and ground network reshape competition across America's wireless market? The company's latest purchase brings additional spectrum to its existing infrastructure, although regulatory approval remains necessary before deployment.
Russ Mould, investment director at AJ Bell, told Investing.com that SpaceX's expansion into wireless telecommunications was consistent with its broader business strategy. He said combining low-band and mid-band frequencies could challenge traditional network operators and mobile infrastructure companies.
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SpaceX's latest agreement follows an earlier deal involving approximately USD 17 billion in cash and stock for satellite spectrum rights from EchoStar. The company subsequently added USD 2.6 billion in EchoStar ground-based spectrum licenses.
Meanwhile, the FCC approved SpaceX's request earlier in the week to launch up to 15,000 satellites dedicated to mobile services. The authorization supports its planned network expansion as it develops additional satellite capacity.
The competitive landscape has also changed among existing carriers. Last week, Verizon, AT&T and T-Mobile formed a joint venture to improve satellite connectivity in underserved areas without Starlink's participation.
T-Mobile has since removed Starlink references from its T-Satellite promotions. The two companies have worked together for more than a year to provide basic wireless connectivity in remote locations.
SpaceX continues to upgrade its satellite network with equipment capable of handling greater data volumes. Its proposed terrestrial deployment would extend that network's reach, subject to regulatory clearance and further infrastructure development.
SpaceX's latest spectrum acquisition advances its plan to compete directly with America's largest wireless carriers. The announcement sent Verizon, AT&T and T-Mobile shares lower as Starlink expanded its network strategy. FCC approval and the planned 2027 satellite launches remain important steps in the company's nationwide mobile coverage plans.