Topline
Shares of the three major American wireless carriers slumped in after-hours trading on Thursday after Elon Musk’s SpaceX announced a deal to acquire nationwide low-band spectrum that it said will “pave the way” for the launch of its cellular service “Starlink Mobile.”
If the deal is approved by regulators, it could serve as the first major step for SpaceX’s plan to launch its Starlink Mobile wireless service.
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Key Facts
SpaceX announced it has agreed to acquire nationwide low-band wireless spectrum from investment firm Grain Management, though the deal still requires FCC approval.
The 800 MHz spectrum will let SpaceX’s Starlink Mobile offer wider mobile coverage, especially inside buildings, addressing what the company says is “one of the key remaining technical gaps” in its cellular launch plans.
Unlike the higher-frequency spectrum Starlink uses, the lower-band 800 MHz spectrum can travel farther and penetrate walls or structures more effectively.
SpaceX’s announcement notes that most existing devices already support the 800 MHz band, potentially allowing customers to use Starlink Mobile without buying a new phone.
Recent iPhone models also support the 800 MHz band, but it’s unclear whether they will be compatible with Starlink Mobile when it launches.
The two companies didn’t disclose any financial terms for the deal, but the Wall Street Journal reported that SpaceX has agreed to pay Grain Management $8 billion in cash for the spectrum.
AT&T, Verizon And T-Mobile Stocks Slide After Announcement
Shares of the three major U.S. mobile carriers slumped sharply in after-hours trading after the announcement. AT&T shares dropped 6.51% to $23.25, while Verizon fell 5.85% to $43.64. T-Mobile’s stock dropped 6.63% to $159.95. After falling 4.19% on Thursday, SpaceX’s shares rose 2.32% to $164.30 in late trading.
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