SpaceX announced a significant $17 billion acquisition of wireless spectrum licenses from EchoStar, a move pivotal to expanding its Starlink satellite network’s 5G capabilities. This purchase enables SpaceX to deploy advanced, laser-connected satellites, resulting in a capacity increase of over 100 times for its direct-to-cell service. The deal also includes a partnership that allows Boost Mobile subscribers to access Starlink’s satellite connectivity, thereby extending service to underserved areas.
SpaceX President and COO Gwynne Shotwell emphasized the deal’s potential to eliminate mobile dead zones globally. She stated that the exclusive spectrum will facilitate the development of next-generation Starlink satellites, dramatically enhancing performance and worldwide coverage. The announcement caused EchoStar’s shares to surge by 19%, while shares of major US wireless carriers experienced declines, suggesting a potential shift in the industry landscape.
This strategic move comes amid a surge in wireless data consumption. CTIA reported a record 132 trillion megabytes of mobile data were used in 2024, representing a 35% year-over-year increase. SpaceX, which has already launched over 8,000 Starlink satellites since 2020, sees this expansion as crucial to meeting the growing demand from diverse sectors, including militaries, transportation companies, and rural consumers.
The acquisition follows months of scrutiny from the Federal Communications Commission (FCC) regarding EchoStar’s use of spectrum. EchoStar anticipates the deal, along with a separate agreement with AT&T, will address the FCC’s concerns. An FCC spokesperson expressed optimism, suggesting the deals could boost competition, expand service access, and strengthen US leadership in next-generation connectivity. The transaction involves a combination of cash and stock, along with the assumption of debt obligations. SpaceX’s aggressive pursuit of underutilized airwaves underscores its commitment to revolutionizing global connectivity.
The deal, along with Verizon’s recent acquisition of Frontier Communications, marks significant developments in the telecommunications sector. Industry analysts believe these strategic moves will lead to improved infrastructure and heightened competition. Following the sale, EchoStar will continue to operate its existing satellite television, streaming, and internet services.
