SpaceX today challenged US mobile carriers by agreeing to buy a nationwide low-band spectrum portfolio. Verizon, AT&T, and T-Mobile shares each fell about 6% in after-hours trading on Thursday.

The seller, private-equity firm Grain Management, acquired those airwaves from T-Mobile in August. SpaceX (SPCX) would pay an undisclosed price, Reuters reported.

Why SpaceX Challenges US Mobile Carriers With Low-Band Airwaves

Spectrum, the radio frequencies that carry mobile signals, comes in bands with different strengths. Starlink Mobile, SpaceX’s satellite-to-phone service, previously leaned on 2 gigahertz (GHz) mid-band airwaves suited to data capacity.

Low-band frequencies, however, travel farther and reach deeper indoors, which should help its signal clear buildings and foliage.

The portfolio spans up to 14 megahertz (MHz) of paired spectrum in the 800 MHz band, SpaceX said.

Separately, the Federal Communications Commission (FCC) approved SpaceX’s application for a 15,000-satellite Starlink Mobile Gen2 constellation, Reuters reported.

AT&T fared worst in after-hours trading, down almost 7%, while Verizon lost more than 6% and T-Mobile 6%, CNBC reported.

Mobile carriers face a threat from SpaceX’s latest move. Image Source: Trading View

In contrast, SpaceX shares gained almost 3% in the same session.

Carrier shares fell 4% in July when Semafor reported that SpaceX was hunting for spectrum. AT&T CEO John Stankey played down Starlink’s ambitions that month, according to the same report.

“The reality is that they’re coming to the game very late after this industry has been established.”

Who Held These Airwaves Before SpaceX Stepped In?

T-Mobile closed the sale of its 800 MHz portfolio to Grain on August 11. It received $2.9 billion in cash and Grain’s 600 MHz licenses.

The FCC had cleared the swap on July 1.

Less than two months after the sale closed, SpaceX agreed to buy Grain’s nationwide 800 MHz holdings.

Meanwhile, T-Mobile also sells Starlink-powered satellite-to-phone service today under the T-Satellite name.

That report also noted the three largest carriers spent about $110 billion over a decade buying most US low-band spectrum. SpaceX has now agreed to buy a nationwide portfolio of it in one transaction.

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