SpaceX Targets Mobile Market as Telecom Shares Drop

SpaceX's plan to expand Starlink Mobile into a major U.S. wireless service competitor sent AT&T, Verizon and T-Mobile shares sharply lower Friday, as investors reacted to the company's push to combine satellite connectivity with terrestrial infrastructure and enter the mobile carrier market.

SpaceX's mobile ambitions center on Starlink Mobile, a subsidiary that received Federal Communications Commission approval to launch 15,000 new satellites. The company said the service will use a combined satellite and ground-based network approach.

"become a major mobile carrier in the U.S." SpaceX described the goal through its mobile expansion announcement.

"Once we receive final FCC approval, Starlink Mobile will deploy a flexible architecture combining our satellite-to-mobile constellation in space with an advanced terrestrial deployment that can seamlessly connect devices everywhere," said SpaceX.

Shares of AT&T fell 9.8%, Verizon dropped 8.7%, and T-Mobile US declined 13.3%, according to market data cited by NBC News. The moves erased more than $50 billion in market value before midday.

SpaceX's Starlink business has become the company's largest source of revenue, according to the report. Starlink had more than 12 million paying subscribers and was valued at $2.2 trillion as of Friday.

"the last critical piece of the spectrum puzzle needed for SpaceX to provide complete phone coverage in America," wrote Elon Musk.

SpaceX is also a major government contractor that builds and launches rockets for NASA and national security agencies, adding another major business line alongside Starlink, Tesla, X and xAI.

"All of this is going to be really good news for the American consumer," said FCC Chairman Brendan Carr.

Carr's statement came as analysts and existing wireless providers questioned how quickly SpaceX could build a network capable of competing with established carriers.

"SpaceX would likely need to build a terrestrial network using macro towers to deliver a user experience on par with traditional wireless carriers," wrote JPMorgan Chase analysts.

The analysts also assessed the near-term competitive impact of the move in a separate statement.

"We continue to see limited near-term risk to U.S. wireless incumbents given the time, infrastructure and capital required to build a competitive terrestrial network," added JPMorgan Chase analysts.

Verizon said spectrum ownership alone would not create a nationwide wireless network. The company argued that large-scale infrastructure remains necessary for mobile service.

"Acquisition of spectrum alone does not provide the network or infrastructure to offer true nationwide coverage or to compete with mobile providers," said Verizon.

T-Mobile President of Technology John Saw also pointed to the challenge of building a full wireless system. He said SpaceX's achievements in space were significant but terrestrial network development would require substantial time.

"I have tremendous respect for what SpaceX has accomplished in space," wrote John Saw.

"years of engineering." wrote John Saw.

Saw added that obtaining spectrum and creating a nationwide network are different processes.

"You can acquire spectrum in a single transaction. You cannot acquire a nationwide, high-performing wireless network overnight," wrote John Saw.

AT&T did not respond to a request for comment, according to NBC News. The three major carriers have previously had relationships with Starlink, including a 2022 partnership between T-Mobile and SpaceX.