SpaceX pays $8 billion for spectrum to launch mobile service

CONTESTED None found. SpaceX agreed on Oct. 8 to buy up to 14 MHz of paired nationwide 800 MHz spectrum from Grain Management for about $8 billion in cash, pending FCC approval. SpaceX said the licenses will provide "a coverage layer that penetrates walls and serves devices indoors," with Starlink Mobile combining its satellite constellation and a terrestrial network. On Oct. 9, T-Mobile, AT&T and Verizon fell and Deutsche Telekom dropped 7%, while Crown Castle, American Tower and SBA Communications rallied and held gains through Oct. 15. Citi analysts wrote, "We view the news as … an ongoing risk for the telecoms and cable stocks." T-Mobile CTO John Saw said Starlink Mobile’s prospective spectrum totals roughly 80 MHz versus nearly 400 MHz at T-Mobile: "You can acquire spectrum in a single transaction. You cannot acquire a nationwide, high-performing wireless network overnight." Stéphane Beyazian said, "Without a roaming agreement with a partner, it will take years before Starlink can build and sell a good quality product." Tim Farrar said reliable in-city indoor coverage would require equipment on towers. Strand Consult’s Oct. 15 report said satellites complement rather than replace terrestrial networks, put SpaceX spectrum at roughly 79 MHz with about 32 MHz usable for data to phones, and estimated Starlink satellite useful life at roughly five years before deorbiting. Bernstein put a standalone U.S. network at $50 billion to $130 billion including spectrum. FCC approval remains pending.