Shares of AT&T, Verizon, and T-Mobile declined between 4% and 5% in premarket trading on Friday following a Bloomberg report that SpaceX is in discussions with cellular infrastructure companies to secure access to at least 80,000 sites across the United States.
AT&T stock fell approximately 4.6%, Verizon slipped around 4%, and T-Mobile dropped about 5% before the market opened. In contrast, SpaceX shares gained over 2%, while tower operators Crown Castle and American Tower saw their stocks rise nearly 9% and more than 6%, respectively.
According to Bloomberg, citing people familiar with the talks, SpaceX aims to secure a minimum of 80,000 cell sites and is negotiating with at least one major cellular infrastructure company. The potential agreements could be worth billions of dollars and would help the Elon Musk-led company establish a fourth nationwide wireless carrier, intensifying competition for established telecom providers.
Crown Castle, American Tower, and Vertical Bridge Holdings are among the largest owners of cellular towers in the US, and Crown Castle is reportedly one of the companies involved in the discussions. Wireless carriers typically lease space on these towers to install equipment that transmits signals across their networks, making shared infrastructure a cost-effective alternative to building and maintaining individual sites.
SpaceX's reported push to secure thousands of locations could therefore create a significant business opportunity for tower operators as the company assembles the infrastructure needed to compete in the US wireless market. During an earnings conference call on Wednesday, Crown Castle CEO Chris Hillabrant said, "You can assume that we're talking to all parties," when asked about discussions with SpaceX, Amazon.com, or other satellite-based telecom providers. He declined to identify specific customers but described SpaceX's recent acquisition of low-band spectrum as a "huge milestone" in its ability to provide broad mobile coverage.
Tower operators' shares had already climbed after news of SpaceX's spectrum purchase earlier this month, reflecting investor expectations that the company could require substantial ground infrastructure to deploy its wireless services. Musk has made clear his ambition to turn SpaceX into a standalone wireless carrier, using its Starlink satellite network and newly acquired spectrum to challenge established mobile operators.
SpaceX recently secured Federal Communications Commission approval to launch 15,000 satellites designed to provide mobile connectivity directly to phones. Combined with its spectrum holdings and terrestrial infrastructure, the satellites could help the company build a more comprehensive wireless service. "We will be building out our terrestrial networks so there's broad-based connectivity anywhere that SpaceX and Starlink are allowed to operate," Musk said during SpaceX's earnings call this week. He added that satellite launches and spectrum acquisition "will pave the way for Starlink Mobile to become a major mobile carrier in the US."
SpaceX has also said it plans to use home internet equipment to emit mobile signals around customers' installations. However, research firm MoffettNathanson LLC has noted that these locations are not necessarily where infrastructure is needed to ensure consistent network coverage. Securing access to existing cellular tower sites could help address that challenge, although the scale, cost, and timing of any agreements remain unclear.
This article is for informational purposes only and does not constitute financial advice.
