SpaceX spectrum buy hits US telecom shares as Starlink eyes mobile market

Shares of top US mobile network providers fell sharply on Wall Street after Elon Musk's company SpaceX bought low-band airwaves to expand its Starlink service. AT&T shares dropped 11 percent to reach $21.96, while both T-Mobile US and Verizon Communications saw their shares fall by 11 percent as well.

The Deal

SpaceX bought the low-band spectrum from investment firm Grain Management. Neither company shared the money details of the agreement. Grain had earlier bought these airwaves from T-Mobile during the year. Elon Musk stated on X that this low-band spectrum was the final missing piece needed for SpaceX to offer full phone coverage across America. The new frequencies will let Starlink signals pass through walls and tree cover to connect regular phones indoors.

Next Steps

SpaceX still needs the Federal Communications Commission to approve the deal. Once approved, the company plans to mix its satellite services with a ground network to connect phones everywhere. SpaceX President Gwynne Shotwell stated in August that the company truly plans to build out this ground network and enter the mobile carrier business.

Context

Traditional telecom networks rely heavily on ground cell towers to provide service to phones. Satellite-to-cell technology aims to remove dead zones by connecting mobile devices directly to space-based networks, which could change how people get phone service in remote and urban areas alike.