SpaceX said on its first earnings call after its IPO that it plans to create a cellular service, with president Gwynne Shotwell saying the company will “build out terrestrial” using spectrum it acquired from EchoStar and that it intends to make Starlink a “true mobile service” that will win “quite a few” customers from Verizon, AT&T and T‑Mobile.
Shotwell declined to discuss the costs involved and said SpaceX had “great and new ideas” for building a mobile service, citing concepts such as deploying a large number of lower-cost base stations paired with Starlink dishes instead of traditional cell towers.
Starlink spectrum purchase and technical approach
SpaceX agreed to pay $19.6 billion to acquire 65 MHz of wireless spectrum licenses from EchoStar in 2025. That spectrum will allow SpaceX to expand its direct-to-cell Starlink satellite service to include ground-based infrastructure. The company plans to launch its next-generation Starlink Mobile satellites in 2027 and is targeting an upgraded service that will be “100 times better” than current direct-to-cell service by the end of that year. SpaceX already has a partnership with T‑Mobile to power T‑Mobile’s T‑Satellite feature, which offers direct-to-cell satellite connectivity to customers.
Market challenges and timeline
Analysts said it would be extremely difficult for Starlink to compete with AT&T, Verizon and T‑Mobile without an MVNO agreement with a major carrier, noting that 65 MHz is small compared with the spectrum holdings of the large U.S. mobile operators and that those operators are unlikely to lease capacity to a competitor. Following SpaceX’s earnings call, shares of AT&T, T‑Mobile and Verizon fell 2 to 4 percent.
