A selloff in the entire mobile industry was set off by SpaceX’s announcement that it would buy a nationwide portfolio of low-band spectrum licenses from private investment firm Grain Management. The deal has raised fears that Starlink could become a direct rival to mobile operators rather than a satellite connectivity partner.
The deal, announced in October 2026, is said by Bloomberg quoting people familiar with the matter to be worth around $8 billion. The contract includes spectrum at 800 Mhz, which will provide SpaceX with yet more tools to develop its Starlink Mobile plan. The deal is subject to regulatory approval.
Investors responded strongly to the announcement on October 9, causing several major telecommunications stocks to decline. T-Mobile US dropped 13.2%, reaching its lowest point in over 33 months. AT&T and Verizon also experienced significant decreases, with both stocks falling to their lowest levels in more than two months.
European telecoms were dragged down in the sell-off amid doubts about the likely competitive threat. Deutsche Telekom, which controls about 54% of T-Mobile US, fell 7.9%. Spain’s Telefonica was down 4.6% and France’s Orange lost 2.5%. The STOXX Europe 600 telecommunications index dropped to its lowest since January 30.
The response underscores worries over the impact of SpaceX now seeking to hold sway in a space long ruled by providers with dense webs of cellular towers, base stations and fibre connections.
“The electromagnetic spectrum is an important resource for wireless networks. Various frequency ranges have various benefits. Low band wireless frequencies, in particular, could be immensely beneficial because they can transmit signals over long distances and penetrate through walls more easily than high-band frequencies, ” says Anil.
If the deal is approved, it will enable SpaceX to expand its existing collection of 800 MHz spectrum licenses across the country, which it might be able to leverage to pack satellite connection and land-based wireless services. SpaceX plans to deploy these technologies to improve coverage and decrease dependence on traditional cellular networks in some instances.
The project takes Starlink beyond its core satellite broadband business. Rather than simply providing internet to hard-to-reach places via satellite, SpaceX wants to develop a more robust mobile offering that can vie for customers already using standard wireless networks.
Yet, owning spectrum is only one aspect of running a mobile network. SpaceX would still need to address regulatory requirements, build appropriate infrastructure, and put in place the necessary arrangements to provide reliable service in various environments.
Investors have been unsettled by the prospect of a new rival, with telecom firms’ near moat-strong competitive edges often historically tied to spectrum licenses, network assets and loyal customer bases.
That model could be tested by SpaceX’s increasing reach, mostly in more rural areas where traditional mobile networks may be expensive to extend. Satellite equipment may be a cost-effective alternative for providing coverage in more remote areas.
Though, industry experts note that the danger wouldn’t be realized overnight. Offering reliable mobile service in cities, where many of the users are, and indoors is difficult, and SpaceX would need more than spectrum licenses to be competitive at scale.
