SpaceX expands Starlink satellite network with $17bn EchoStar deal

The spectrum acquisition allows SpaceX to grow the compartment network’s capableness by ‘more than 100 times’ and volition assistance ‘end mobile dormant zones’.

SpaceX volition bargain wireless spectrum licences from EchoStar for its Starlink outer web for astir $17bn, a large woody important to expanding Starlink’s nascent 5G connectivity business.

The Elon Musk-owned aerospace institution announced the acquisition connected Monday.

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The companies besides agreed to a woody that volition alteration EchoStar’s Boost Mobile subscribers to entree Starlink direct-to-cell work to widen outer work to areas without service.

The spectrum acquisition allows SpaceX to commencement gathering and deploying upgraded, laser-connected satellites that the institution said volition grow the compartment network’s capableness by “more than 100 times”.

Gwynne Shotwell, president and COO of SpaceX, said the woody volition assistance the institution “end mobile dormant zones astir the satellite … With exclusive spectrum, SpaceX volition make next-generation Starlink Direct to Cell satellites, which volition person a measurement alteration successful show and alteration america to heighten sum for customers wherever they are successful the world.”

The propulsion comes amid fast-rising wireless usage. In 2024, Americans utilized a grounds 132 trillion megabytes of mobile data, up 35 percent implicit the anterior all-time record, the Cellular Telecommunications Industry Association (CTIA) said connected Monday.

SpaceX has launched much than 8,000 Starlink satellites since 2020, gathering a distributed web successful low-Earth orbit which has seen request from militaries, proscription firms and consumers successful agrarian areas.

Roughly 600 of those satellites – which SpaceX calls “cell towers successful space” – person been launched since January 2024 for the company’s direct-to-cell network, orbiting person to Earth than the remainder of the constellation.

Crucial to those larger satellites’ deployment is Starship, SpaceX’s elephantine next-generation rocket that has been nether improvement for astir a decade. Increasingly analyzable trial launches person drawn the rocket person to its archetypal operational Starlink missions, expected aboriginal adjacent year.

The woody comes months aft the US Federal Communications Commission (FCC) questioned EchoStar’s usage of its mobile-satellite work spectrum and raised concerns astir whether it was gathering its obligations to deploy 5G successful the country.

EchoStar said it anticipates that the transaction with SpaceX and the AT&T woody volition resoluteness the FCC’s inquiries.

An FCC spokesperson said the “deals that EchoStar reached with AT&T and Starlink clasp the imaginable to supercharge competition, widen innovative caller services to millions of Americans, and boost US enactment successful next-gen connectivity”.

The institution successful August sold immoderate nationwide wireless spectrum licences to AT&T for $23bn. AT&T agreed to get 50 MHz of nationwide mid-band and low-band spectrum.

US President Donald Trump antecedently prodded EchoStar and FCC Chair Brendan Carr to scope an amicable woody for the company’s wireless spectrum licences.

Underused airwaves

SpaceX volition wage up to $8.5bn successful currency and contented up to $8.5bn successful stock. SpaceX has besides agreed to screen astir $2bn successful involvement payments connected EchoStar’s indebtedness obligations done precocious 2027.

After the sale, EchoStar volition proceed operating its outer tv work Dish TV, streaming TV level Sling, net work Hughesnet and its Boost Mobile brand.

SpaceX had aggressively pressed the FCC to reallocate underused airwaves for satellite-to-phone work aft alleging EchoStar failed to conscionable definite obligations.

In a missive to the FCC successful April, SpaceX said EchoStar’s spectrum successful the 2 gigahertz set “remains ripe for sharing among next-generation outer systems” and that the institution has near “valuable mid-band spectrum chronically underused”.

The woody with EchoStar volition let SpaceX to run Starlink direct-to-cell services connected frequencies it owns, alternatively than relying solely connected those leased from mobile carriers similar T-Mobile.

In May, the FCC approved Verizon’s $20bn woody to get fibre-optic net supplier Frontier Communications. Verizon spent $5bn to get and wide cardinal spectrum successful 2021.

The quality sent shares of EchoStar surging 14.7 percent arsenic of 1pm successful New York (17:00 GMT). Shares of US wireless carriers are trending downwards. AT&T is 1.6 percent little and T-Mobile is down by 2.2 percent. Verizon arsenic good is down 1.8 percent.