SpaceX has reached an agreement to acquire radio-spectrum licenses that could expand Starlink Mobile’s ability to deliver cellular connectivity inside buildings. The company says the deal moves it closer to becoming “a major mobile carrier in the U.S.”
Elon Musk described the acquisition as the final major step in completing SpaceX’s spectrum strategy for nationwide phone coverage. “This is the last critical piece of the spectrum puzzle needed for SpaceX to provide complete phone coverage in America,” he wrote in a social media post Thursday.
The licenses are being purchased from investment firm Grain Management, according to documents filed with the Federal Communications Commission. SpaceX, best known for its rocket launches and space exploration operations, is seeking to use the spectrum to broaden Starlink’s mobile ambitions.
The low-band frequencies are particularly valuable because they can travel through walls and other obstacles more effectively than higher-frequency signals. That capability could help address a key limitation of satellite-to-phone service, as roofs, walls and buildings can interfere with wireless connections.
The transaction remains subject to FCC approval. If cleared, the agreement would let Starlink combine satellite-to-mobile signals with what SpaceX calls an “advanced terrestrial deployment,” creating a network designed to connect compatible devices in more locations.
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SpaceX also said the FCC has approved Starlink Mobile’s request to deploy 15,000 satellites. Those spacecraft would operate in the 2-gigahertz band and connect directly with mobile phones, without requiring specialized user equipment.
UBS analyst John Hodulik said the spectrum should work with existing handsets and that he expects no major regulatory barriers. However, he cautioned that building out SpaceX’s wireless business will take time, meaning the near-term effect on the broader telecom industry is likely to remain limited.
Investors reacted sharply to the prospect of SpaceX becoming a powerful new competitor in the U.S. wireless market. T-Mobile shares fell $18.58, or 11%, to $152.72 in Friday morning trading, while AT&T dropped $1.83, or 7.4%, to $22.76.
SpaceX shares moved in the opposite direction, rising $2.61, or 1.6%, to $163.18.