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SpaceX announced an agreement Thursday to buy a nationwide spectrum portfolio, advancing its push to take Starlink deeper into the U.S. telecommunications market. The announcement hammered shares of AT&T, Verizon and T-Mobile in extended trading.

The planned acquisition involves spectrum licenses owned by Grain Management, a firm specializing in digital infrastructure. The transaction remains subject to approval by the Federal Communications Commission.

SpaceX described the asset in a statement as a “license portfolio of up to 14 megahertz of paired spectrum in the 800 MHz band.” The company presented the portfolio as an important piece of its mobile strategy.

“This prime low-band spectrum addresses one of the key remaining technical gaps that will pave the way for Starlink Mobile to become a major mobile carrier in the US,” SpaceX said.

SpaceX CEO Elon Musk amplified the significance of the agreement in a post on X. He called it a “very big deal.”

The move places SpaceX in a more direct confrontation with the largest U.S. telecommunications companies. The company appears intent on delivering its own services rather than depending on the established mobile operators.

That competitive pressure follows an announcement last week from T-Mobile, AT&T and Verizon. The three companies formed a joint venture “focused on expanding coverage in underserved areas,” using satellite and D2D services.

Starlink was notably absent from the joint venture. T-Mobile has also previously removed references to Starlink from promotions for its T-Satellite offering.

Tim Farrar of TMF Associates said the spectrum purchase intensifies the contest between SpaceX and conventional mobile companies. At the same time, he pointed to limitations that could complicate SpaceX’s ambitions.

“This adds fuel to the fire in the battle between SpaceX and the mobile operators,” Farrar said. “But it’s still a very limited amount of spectrum and to get reliable building penetration in urban areas SpaceX would have to deploy towers on the ground.”

The SpaceX announcement arrived one day after the FCC said it would vote on a proposal to auction 25 megahertz of what the agency called “prime spectrum.” That spectrum would support D2D services connecting satellites with smart phones.

The FCC also said it would vote Oct. 29 on whether to seek public comment concerning another spectrum proposal. That plan would make an additional 482MHz available for supplemental coverage from space while modernizing FCC rules governing D2D services in licensed spectrum.

Both FCC proposals could benefit SpaceX. They could also benefit Amazon, which has moved to develop a service using satellite networks.

SpaceX went public in June through a record IPO and is now valued at more than $2 trillion. Starlink has served as the company’s cash cow and remains its only profitable business segment to date.

The company is also adjusting its rocket operations. SpaceX has reduced the launch cadence it planned for next year while working to make its massive Starship rockets reliable and fully reusable.

That effort is intended to enable a transition away from the company’s smaller Falcon rockets. SpaceX is also constructing a cloud computing business and aims eventually to build orbital data centers.

For now, the company’s space and artificial intelligence units are losing money. That leaves Starlink carrying particular financial importance as SpaceX expands into additional communications services.

SpaceX did not immediately respond to a request for more information, including when the proposed new services could begin if regulators approve the transaction. The timing therefore remains unresolved.

If the purchase receives clearance, the additional spectrum will help SpaceX combine satellite service with ground based coverage after it constructs a network of towers. Farrar’s comments indicate that such towers would be necessary to provide reliable penetration inside urban buildings.

SpaceX shares rose roughly 2.5% in extended trading following the announcement. That advance came after the shares had fallen 4% during regular market hours.

The reaction among incumbent telecommunications stocks moved sharply in the opposite direction. Shares of AT&T, Verizon and T-Mobile all tumbled after the market closed as SpaceX disclosed its latest push into their territory.

DISCLAIMER: GoldInvestors.news is not a registered investment, legal or tax advisor or broker/dealer. All investment/financial opinions expressed by GoldInvestors.news are from the personal research and experience of the owner of the site and are intended as educational material. Although best efforts are made to ensure that all information is accurate and up to date, occasionally unintended errors and misprints may occur.