SpaceX Targets $200 Billion Cost to Challenge US Wireless Giants

SpaceX has declared its intention to become a major US mobile carrier, a move that industry executives warn could cost Elon Musk more than $200 billion. The company plans to combine its existing direct-to-cell satellite constellation with a terrestrial 5G network to rival T-Mobile, AT&T, and Verizon.

The plan relies on a multi-year partnership with Qualcomm. Under the agreement, SpaceX will deploy Qualcomm’s Dragonwing technology across tens of thousands of 5G cell sites in the United States. The first of these deployments are scheduled to begin in 2027.

To establish its physical footprint, SpaceX is reportedly in talks with Crown Castle Inc., one of the nation’s largest cell tower owners. Sources indicate the company seeks access to at least 80,000 cell sites. This number represents roughly half of the 158,500 operational cell towers currently in the US. Crown Castle CEO Chris Hillabrant acknowledged the discussions during an earnings call, stating that the company is talking to all parties regarding potential partnerships with satellite services.

Spectrum rights form the technical backbone of the new service. SpaceX recently acquired a portfolio of low-band spectrum licenses, including up to 14 megahertz of paired spectrum in the 800 MHz band. The company says this specific band will allow Starlink Mobile signals to penetrate walls and buildings effectively. This acquisition follows a previous purchase of 2GHz spectrum from EchoStar.

Regulatory approval is the next hurdle. The Federal Communications Commission must sign off on the spectrum deal before SpaceX can fully launch its new architecture. Once approved, the company intends to use the licenses to support its terrestrial mobile network and satellite constellation simultaneously.

SpaceX leadership confirmed the terrestrial focus during the company’s first earnings call. President Gwynne Shotwell stated that the spectrum purchased from EchoStar includes terrestrial components. She noted that the company intends to build out the necessary hardware and systems to create a true mobile service. CEO Elon Musk added that the goal is to acquire a significant portion of customers currently subscribed to the three dominant US carriers.

The expansion strategy may also involve an acquisition of Boost Mobile. Reports from The Washington Post suggest SpaceX discussed a deal with Charlie Ergen, chairman of Boost Mobile’s parent company EchoStar. Such an acquisition would allow SpaceX to launch Starlink Mobile through an existing budget-friendly carrier. Boost Mobile’s network is currently powered by T-Mobile and AT&T, which could require permissions from those carriers if SpaceX proceeds with the plan.

Tim Höttges, CEO of Deutsche Telekom, the parent company of T-Mobile, responded to the announcement by saying he takes SpaceX’s plans very seriously. He estimated the cost of pulling off the expansion at over $200 billion. Analyst Walter Piecyk of LightShed Partners noted that the acquisition of low-band spectrum, which has been traded in the telecom business for decades, is a key step in SpaceX’s plan to build what it calls the world’s most advanced mobile network.