SpaceX buys spectrum to boost Starlink direct-to-cell services
SpaceX has agreed to a $17 billion deal to purchase 50 MHz of spectrum licenses from EchoStar, aiming to enhance Starlink's satellite connectivity for smartphones. The acquisition, pending regulatory approval, will support a new constellation of up to 15,000 satellites to provide voice, texting, and high-speed data globally, especially in underserved areas. This move pressures competitors like AT&T, Verizon, and Apple's satellite partners.
In early September 2025, SpaceX announced a $17 billion agreement to acquire EchoStar's AWS-4 and H-block spectrum licenses, totaling 50 MHz in the 1.9 and lower 2 GHz bands, for use in the US and globally. The deal requires Federal Communications Commission (FCC) approval, with initial transfer to a trust and final closing expected around November 30, 2027. SpaceX's FCC filing states the spectrum will enable 'phone, text, and broadband services from space to mobile users throughout the United States and around the world, especially in areas where terrestrial systems do not reach.'
To support this, SpaceX plans to launch up to 15,000 advanced satellites, far exceeding the current 650 Direct to Cell (D2C) satellites deployed under existing authorizations with T-Mobile. These next-generation satellites, driven by custom silicon and phased array antennas, promise 20 to 100 times the throughput of first-generation models, enabling 'full 5G cellular connectivity with a comparable consumer experience to current terrestrial LTE service.' SpaceX President Gwynne Shotwell noted the company is 'working with chip manufacturers to get the proper chips in phones.' Service rollout is targeted for late 2027, starting with expanded voice, texting, and data beyond T-Mobile's current limited offerings.
The acquisition stems from FCC Chairman Brendan Carr's pressure on EchoStar to sell unused spectrum after SpaceX's complaints. AT&T secured a separate $23 billion deal for 50 MHz in different bands, while Verizon is negotiating for remaining portions. Telecom consultant Tim Farrar highlighted contingencies: 'There's a lot of contingencies here about whether 2027 is believable, but it does up the pressure on everyone else in this industry.' He noted Starlink's dominance in satellite broadband could extend to direct-to-device markets.
This development challenges AT&T and Verizon's partnerships with AST SpaceMobile, which has faced delays despite deploying five satellites in September 2024 and planning 45 to 60 by end-2026. AST's track record includes 'one delay after another,' per Farrar, contrasting Starlink's 650 D2C satellites already in orbit.
For Apple, which rejected Elon Musk's $5 billion exclusivity offer in 2022 and partnered with Globalstar for iPhone emergency SOS, the deal adds leverage. Reports indicate internal Apple frustration with Globalstar's 'outdated, slow' network compared to Starlink. Analyst Philip Burnett said the spectrum purchase will 'give SpaceX more leverage in their negotiation with Apple.' Musk responded to a critical analysis by Farrar, claiming 'Pretty much everything is wrong in this article,' though Farrar views Starlink's moves as bullish for industry disruption.
T-Mobile's US exclusivity with Starlink ends by 2027, opening doors for broader carrier partnerships. SpaceX could lease spectrum to carriers in urban areas while prioritizing satellite service in remote ones, potentially tripling its customer base through all major US networks.