Updated version 1 - SpaceX will acquire spectrum to enable Starlink mobile services

SpaceX (SPCX.US) announced on Thursday that it has reached an agreement to acquire a portfolio of low-frequency spectrum licenses covering the entire United States, enabling it to directly compete with traditional wireless communication giants nationwide. While Starlink Mobile’s existing global 2 GHz mid-band spectrum will provide high bandwidth capacity, this new spectrum will allow its signals to penetrate obstacles. This move accelerates Elon Musk’s ambitious plan to bypass traditional wireless infrastructure and deliver cellular network connectivity directly to smartphones from Earth’s orbit. The deal involves acquiring 100% of a nationwide 800 MHz spectrum portfolio owned by private equity firm Grain Management, and is still subject to regulatory approval by the Federal Communications Commission (FCC). In addition, the FCC this week approved Starlink Mobile’s application for a second-generation satellite constellation, authorizing SpaceX to deploy 15,000 satellites worldwide optimized for the 2 GHz band. Following the announcement, shares of US telecom companies fell in after-hours trading, while SpaceX (SPCX.US) shares rose by over 1.7%.

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Reuters, October 8 – SpaceX (SPCX.O) reached an agreement on Thursday to acquire a nationwide portfolio of low-frequency spectrum, enabling Elon Musk’s satellite company to directly challenge traditional US wireless giants at the orbital level. While Starlink Mobile’s current global 2 GHz mid-band spectrum provides high bandwidth capacity, the new spectrum will allow its signals to penetrate obstacles. The financial terms of the agreement were not disclosed. Low-frequency bands are highly sought after for their longer transmission distance and ability to penetrate dense structures such as walls and tree cover, helping to solve a major technical obstacle previously faced by satellite-based mobile networks. By combining nationwide low-frequency radio waves with high-frequency space transmission capabilities, SpaceX is positioning Starlink Mobile as a service that can completely bypass traditional base stations and challenge the wireless oligopoly both in terms of broad coverage and reliable indoor signal. The deal intensifies competitive pressure on traditional carriers, transforming satellite direct-to-device technology from a supplementary safety feature for remote dead zones into a full-fledged commercial competitor capable of replacing terrestrial cellular networks. Shares of T-Mobile US (TMUS.O), Verizon (VZ.N), and AT&T (T.N) all fell more than 6.5% in after-hours trading. The transaction involves acquiring 100% of the nationwide 800 MHz spectrum portfolio held by private equity firm Grain Management, pending regulatory approval from the Federal Communications Commission (FCC). Grain acquired this spectrum earlier this year from T-Mobile. Crucially, most existing, unmodified mobile phones already support the 800 MHz band, so consumers do not need to purchase dedicated satellite phones. The FCC this week also approved Starlink Mobile’s application for its second-generation satellite constellation, authorizing SpaceX to launch 15,000 satellites worldwide optimized for the 2 GHz band. This new constellation will operate in very low Earth orbit, providing ordinary phones with broader bandwidth and low-latency connections. (For the convenience of non-native English speakers, Reuters automatically translates its reports into several other languages. Automated translations may contain inaccuracies or lack necessary context; Reuters does not guarantee the accuracy of automated translation and provides it solely as a convenience for readers. Reuters is not liable for any damage or loss resulting from the use of automated translation.)

The Dow Jones closed up by 0.1%, the Nasdaq fell by 1.25%, and the S&P 500 decreased by 0.47%. Among the most actively traded stocks, Micron Technology dropped by 4.79%, Nvidia declined by 2.94%, SanDisk fell by 4.9%, and Super Micro Computer dropped by 3.9%.