SpaceX agrees to buy Grain Management's US 800MHz spectrum; US carrier shares fall
In short
SpaceX said on October 8 (US time) it had agreed to buy nationwide US 800MHz mobile spectrum licences from investment firm Grain Management, a deal that needs FCC approval. The price was not disclosed, but the Wall Street Journal reported SpaceX would pay about $8 billion. Shares of AT&T, Verizon and T-Mobile fell between 6% and 7.5% in after-hours trading, according to Korean outlets.
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SpaceX said on October 8 (local time) that it had signed an agreement to acquire nationwide 800MHz mobile spectrum licences in the United States from investment firm Grain Management. Maeil Business and ZDNet Korea reported that the licences cover up to 14MHz of the band. Neither side disclosed the price. Chosun Ilbo, citing the Wall Street Journal, reported that SpaceX would pay about $8 billion in cash, and Yonhap also cited the Journal's $8 billion figure. The deal needs approval from the US Federal Communications Commission (FCC). [ 1 , 2 , 3 , 4 , 5 , 6 ]
In a statement, SpaceX said the low-band spectrum fills one of the technical gaps Starlink Mobile must close to grow into a major US mobile carrier. Chief executive Elon Musk called the agreement "a very big deal" on X. According to Korea Economic Daily and ZDNet Korea, he also described the spectrum as the last key piece needed to provide full mobile phone service across the United States. [ 1 , 2 , 3 , 4 ]
Shares of US carriers fell in after-hours trading. Korea Economic Daily reported that as of 5 p.m. on October 8, AT&T was down 7.3% and T-Mobile US and Verizon were each down 6.6%. AI Times put the falls at 7.5% for AT&T, 7% for Verizon and 6.7% for T-Mobile, and Chosun Ilbo said all three fell more than 6%. SpaceX shares rose 1.5% after hours, according to Korea Economic Daily. Maeil Business put the rise at about 2% after a 4% fall in regular trading. AI Times reported that Deutsche Telekom fell 8%, Vodafone 4.5%, Orange 3.4% and Telefonica 3.3%, while the tower operators American Tower and Crown Castle rose 5% to 6%. [ 1 , 2 , 3 , 5 ]
Outlets said the 800MHz band carries signals over long distances and through walls. SpaceX plans to use its existing 2GHz mid-band spectrum for data capacity and the 800MHz band to extend service indoors. Most existing phones support the band, so users would not need new handsets, according to Chosun Ilbo, Korea Economic Daily and Yonhap. SpaceX also said the FCC had approved the launch of 15,000 second-generation Starlink Mobile satellites, which Yonhap said will use 2GHz spectrum. According to ZDNet Korea, SpaceX says the new satellites will have about 20 times the capacity of the first generation. [ 2 , 3 , 4 , 5 , 6 ]
Last year SpaceX agreed to buy spectrum from EchoStar, but outlets give different figures. Several put it at $17 billion. Korea Economic Daily said SpaceX agreed to pay $17 billion for 50MHz and then $2.6 billion in November for up to 15MHz. Chosun Ilbo put the two EchoStar deals at $19.6 billion in total, or about $27.6 billion including the Grain deal. Yonhap reported that SpaceX had discussed a consumer mobile partnership with Charter Communications and had said on an earnings call that it plans to build a ground network. Last week AT&T, T-Mobile and Verizon announced a joint venture for satellite direct-to-device service. Maeil Business said the venture did not include Starlink. [ 1 , 2 , 3 , 4 , 5 , 6 ]
Yonhap reported that AT&T chief executive John Stankey said at a Goldman Sachs event this month that direct satellite-to-phone links serve the 2% of the population in remote areas and are not effective against infrastructure built over decades. Verizon chief executive Dan Schulman said on a conference call that satellites cannot compete effectively with land networks in urban and suburban areas. ZDNet Korea noted that SpaceX still needs FCC approval and must build ground networks, which would require large infrastructure investment. [ 4 , 6 ]
Why it matters
Korean outlets described the deal as SpaceX moving from working with US carriers toward competing with them directly, using low-band spectrum to reach indoors, where satellite signals struggle. ZDNet Korea noted that the deal still needs FCC approval and that SpaceX would have to build a costly ground network, while the chief executives of AT&T and Verizon have said satellites cannot compete effectively with land networks.
Key facts
- SpaceX agreed to acquire nationwide US 800MHz spectrum licences from investment firm Grain Management. [ 1 , 2 , 3 , 4 , 5 , 6 ]
- The licences cover up to 14MHz of the 800MHz band. [ 1 , 4 ]
- The price was not disclosed; the Wall Street Journal reported about $8 billion. [ 2 , 6 ]
- The deal requires approval from the US Federal Communications Commission (FCC). [ 1 , 3 , 4 ]
- Shares of AT&T, Verizon and T-Mobile fell in after-hours trading after the announcement. [ 1 , 2 , 3 , 4 , 5 ]
- SpaceX plans to use its 2GHz mid-band spectrum for data capacity and the 800MHz band to extend coverage inside buildings. [ 2 , 3 , 4 ]
- The FCC has approved SpaceX's plan for 15,000 second-generation Starlink Mobile satellites. [ 4 , 5 , 6 ]
- Last week AT&T, T-Mobile and Verizon announced a joint venture for satellite direct-to-device service. [ 1 , 2 ]
Confirmed by several sources
- SpaceX agreed to acquire 800MHz spectrum licences covering the United States from Grain Management. [ 1 , 2 , 3 , 4 , 5 , 6 ]
- The acquisition price was not officially disclosed. [ 1 , 2 , 3 , 4 , 5 , 6 ]
- The Wall Street Journal reported the price at about $8 billion. [ 2 , 6 ]
- The deal requires FCC approval. [ 1 , 3 , 4 ]
- Musk called the agreement "a very big deal" on X. [ 1 , 2 ]
- AT&T, Verizon and T-Mobile shares fell in after-hours trading after the announcement. [ 1 , 2 , 3 , 4 , 5 ]
- Most existing mobile phones support the 800MHz band. [ 2 , 3 , 6 ]
- The FCC approved SpaceX's plan for 15,000 Starlink Mobile satellites. [ 4 , 5 , 6 ]
Still unclear
- The exact price of the deal. The companies did not disclose it; the $8 billion figure comes from Wall Street Journal reporting and industry sources.
- The size of the after-hours share falls. Outlets give different figures: AT&T down 7.3% or 7.5%, Verizon down 6.6% or 7%, T-Mobile down 6.6% or 6.7%.
- How much SpaceX shares rose after hours. One outlet reported 1.5% and another about 2%.
- The total value of last year's EchoStar spectrum deals. Most outlets give $17 billion; Chosun Ilbo and Korea Economic Daily add a second deal worth $2.6 billion, for $19.6 billion in total.
- Falls in European telecom shares and gains in tower operators. Reported by only one outlet, AI Times.
- When the deal will close and when service will start. FCC approval is pending, and outlets said building a ground network will require large investment.
What local media are saying
Timeline, local time
- October 8, US time: in after-hours trading AT&T is down 7.3% and T-Mobile US and Verizon are each down 6.6%, while SpaceX is up 1.5%. [ 3 ]
- October 9, Korea time: Maeil Business reports the spectrum deal and the falls in US carrier shares. [ 1 ]
- October 10, Korea time: Yonhap reports the Wall Street Journal's $8 billion figure and comments from the AT&T and Verizon chief executives. [ 6 ]