The competition between satellite internet providers and traditional telecom companies is intensifying as SpaceX moves to expand Starlink into the U.S. mobile and connectivity market.
The company’s agreement to acquire Grain Management’s nationwide 800 MHz spectrum portfolio has raised concerns among investors about the future of established wireless operators, sending AT&T, Verizon, and T-Mobile shares sharply lower.
On October 9, T-Mobile closed down 13.3%, while AT&T fell 9.8% and Verizon declined 8.8%. The three companies recorded their worst single-day performances in years, with T-Mobile suffering its worst decline since 2013, AT&T since 2000, and Verizon since 2002.
The agreement, announced a day before on October 8, will give SpaceX access to low-band spectrum that could help Starlink Mobile expand its coverage and compete more directly with existing wireless providers.
Although the companies did not disclose the financial terms, Wall Street Journal reported that the deal was valued at approximately $8 billion.
SpaceX Acquires Spectrum to Expand Starlink Mobile
SpaceX will acquire Grain Management’s nationwide 800 MHz spectrum portfolio, which includes up to 14 MHz of paired spectrum. Grain Management had acquired the same 800 MHz portfolio from T-Mobile in August 2026 as part of a spectrum exchange.
However, this transaction remains subject to approval from the U.S. Federal Communications Commission (FCC) and other closing conditions.
The acquisition addresses a technical challenge for satellite-based mobile services, especially as low-band spectrum can travel longer distances and penetrate obstacles such as walls and vegetation more effectively than higher-frequency signals. As such, this makes it useful for extending coverage to areas where conventional mobile networks have limited reach, improving connectivity inside buildings.
SpaceX plans to combine the newly acquired spectrum with Starlink Mobile’s existing 2 GHz mid-band spectrum and satellite network, saying that the additional frequencies will provide a coverage layer that helps its signals reach customers in different environments.
The move is part of SpaceX’s broader effort to develop a mobile service that can compete with established telecom operators. Its plans also include ground-based equipment, such as radios and antennas installed on towers, rooftops, and other structures to support reliable connectivity.
Why Telecom Stocks Are Falling
The market reaction is a reflection of the concerns about the potential impact of SpaceX’s expansion on the wireless communication industry.
While AT&T, Verizon, and T-Mobile have invested heavily in cellular infrastructure and spectrum licenses to provide nationwide mobile services, SpaceX’s latest acquisition strengthens its position as it works to bring satellite and terrestrial connectivity together.
Kutgun Maral, a media, cable and telecommunications equity research analyst at Evercore ISI, said the deal weakened the established carriers’ defences against competition for low-band spectrum, describing the implications for AT&T, T-Mobile, and Verizon as somewhat negative.
The decline also extended to European telecom companies. Deutsche Telekom shares fell 7.9%, while France’s Orange lost 2.5% and Spain’s Telefonica declined 4.6%. The STOXX 600 Telecommunications index also dropped more than 2.9%, reaching its lowest level since January 30.
But Telecom tower companies moved in the opposite direction. American Tower, Crown Castle, and SBA Communications gained between 6.5% and 13.3% as investors considered the potential demand for terrestrial infrastructure to support SpaceX’s expanding mobile service.
Still, the agreement does not mean SpaceX can immediately match the coverage and capacity of established wireless networks. Verizon spokesman Rich Young said SpaceX would still need a network to make use of the spectrum.
“It’s just empty airwaves,” he said, highlighting the infrastructure challenge the company may face.
SpaceX Still Faces a Costly Network Buildout
SpaceX’s spectrum acquisition is a significant step towards expanding Starlink Mobile, but building a competitive mobile network will require substantial investment and time.
According to Reuters, estimates from TD Cowen put the cost of developing a network comparable to those of major U.S. carriers at more than $80 billion, with the investment covering infrastructure and other requirements involved in operating a nationwide mobile service. This may be a hurdle for SpaceX.
In addition, the pending regulatory approval is another condition SpaceX must meet before completing the transaction. Even after the acquisition closes, the company will need to develop its network and demonstrate that it can provide reliable service at scale.
For AT&T, Verizon, and T-Mobile, the deal introduces another potential competitor into an already capital-intensive industry. And the immediate stock-market reaction shows that investors are paying attention to SpaceX’s plans, but its long-term effect on established carriers will depend on how successfully Starlink Mobile turns its growing spectrum holdings into a viable alternative to conventional wireless service.
