Elon Musk tries to make Apple and mobile carriers regret choosing Starlink rivals

SpaceX's $17 billion deal to buy spectrum licenses from EchoStar should help Starlink satellites deliver better service to smartphones, and it might give a few large corporations second thoughts about their current partnerships with Starlink competitors.

The spectrum, combined with a SpaceX plan to launch up to 15,000 new and improved satellites for cellular service, could cause AT&T and Verizon to question their reliance on satellite company AST SpaceMobile. Apple, which was reportedly already facing internal dissent over its deal with Globalstar, now has another reason to wonder if it made the right choice in rejecting an offer from Elon Musk.

Pending regulatory approval, SpaceX will acquire EchoStar's AWS-4 and H-block spectrum licenses, giving Musk's space company the rights to 50 MHz of spectrum in the 1.9 and lower 2 GHz spectrum bands. SpaceX plans to acquire EchoStar's rights to the spectrum in the US and globally.

This "spectrum will allow SpaceX to provide phone, text, and broadband services from space to mobile users throughout the United States and around the world, especially in areas where terrestrial systems do not reach and at times when terrestrial coverage may be unavailable," SpaceX told the Federal Communications Commission in a filing that seeks approval of the transaction and describes its plan for the satellites.

EchoStar had ambitions to become a fourth major national carrier before Federal Communications Commission Chairman Brendan Carr pressured the company into selling its spectrum licenses. Carr acted after SpaceX alleged that EchoStar hadn't put its spectrum to good use and urged the FCC to make the frequencies available to satellite companies. Under Carr, who repeatedly alleged that the Biden administration targeted Musk's companies for "regulatory harassment," the FCC is likely to give SpaceX the approvals it needs for its new satellite network.

AT&T also benefited from Carr's pressure campaign when it struck a $23 billion deal to purchase 50 MHz of spectrum licenses in different bands from EchoStar. Verizon is reportedly in talks to buy some of the EchoStar spectrum that SpaceX and AT&T haven't already agreed to purchase.

Laying groundwork for 2027

The SpaceX/EchoStar deal won't have an immediate impact on Starlink's mobile capabilities because several things must happen first. The spectrum license transfer needs government approval, new satellites have to be launched, and support for the frequencies must be added to chips in phones.

SpaceX is laying the groundwork on those fronts so that everything will be ready once the transaction is approved. SpaceX President Gwynne Shotwell reportedly said at a conference that the firm is "working with chip manufacturers to get the proper chips in phones." SpaceX also filed with the FCC for approval of a "new system of up to 15,000 satellites [that] will provide ubiquitous connectivity to ordinary mobile handsets and a range of other devices and user terminals."

Starlink has deployed about 650 Direct to Cell (D2C) satellites under its existing authorizations, but the new satellites will be more capable and more numerous. Starlink service offered through T-Mobile initially supported texting only and now has limited data service. It's a free add-on for T-Mobile's most expensive plans, and it's available for a $10 monthly fee on other T-Mobile plans.

Starlink satellites with direct-to-cell capability.

Credit: SpaceX

SpaceX said the next-generation system will support voice, texting, and high-speed data. Consumers will presumably have to pay more to access it.

"The SpaceX MSS [mobile-satellite service] system will communicate with fixed and mobile earth stations and will be capable of providing connectivity virtually anywhere on Earth," SpaceX said.

If all goes as planned, Starlink should be able to provide a much-improved service for smartphones in late 2027.

"There's a lot of contingencies here about whether 2027 is believable, but it does up the pressure on everyone else in this industry," telecom consultant Tim Farrar told Ars. "They've all seen what's happened in the [satellite] broadband world where Starlink has established a sort of overwhelming dominance, and even people like Amazon with enormous resources are scrambling to try and catch up. It's very plausible that Starlink will now achieve a similar position in this direct-to-device market."

Getting the right chips into phones in time for the planned launch is one of the contingencies. "Musk can go and get the Starlink team to build thousands of new big satellites. Hopefully he can get his Starship working to launch them all," Farrar said. But "there isn't a single device out there today that can support this spectrum for the high-bandwidth communications that Musk is looking to provide," he added. "If no one makes the handsets, then the service isn't any use to anyone."

Musk: “Pretty much everything is wrong in this article”

Farrar published a blog post titled "SpaceX disrupts everyone's plans again" right after the deal was announced early last month. Farrar wrote that SpaceX has never been concerned much about return on investment when there is an opportunity "to dominate an industry and force competitors out."

Musk didn't like it. "Pretty much everything is wrong in this article," Musk claimed, without any explanation.

Musk may not have liked the post's framing, but Farrar's overall message on Starlink was a bullish one. "SpaceX has not only persuaded EchoStar to give up its D2D [direct to device] plans but has now made it much harder for any competitor to move forward when they can't possibly compete with SpaceX's speed in bringing new satellites to market," Farrar wrote.

While Starlink isn't likely to make its own phone or become your primary mobile carrier, it could still play a big role in the cellular market. The major US carriers are partnering with satellite operators for service that complements their networks. In areas not reached by cell towers, consumers can get service from low-Earth orbit satellites. Starlink has a chance to be the primary provider.

It's just not clear how big the potential market is, Farrar said.

"This is not going to be something that is a substitute for your everyday carrier," Farrar told Ars. "It's a complement, as Musk has said, in remote areas where you don't have any other alternatives. And the real question is going to be how many people want to buy that?... It's not clear whether this is something where you're going to get 20 or a hundred million people wanting to use it."

From a technical perspective, adding spectrum support to phone chips isn't a major hurdle, wireless technology analyst Peter Rysavy told Ars. "Chip makers are pretty good at supporting a lot of different bands... it's very doable, and if the chipset vendors want to do it, it's very straightforward," Rysavy said.

The question for Rysavy is whether phone makers see enough demand. "There has to be a demand for the service for it to actually get into phones," he said.

If, for some reason, SpaceX is unable to get spectrum support in phones, a possible solution would be making its own phone. Musk has said he'd rather not, though. "The idea of making a phone makes me want to die... if we have to make a phone, we will, but we will aspire not to make a phone," he said last year.

T-Mobile won’t be the only Starlink cellular partner

Starlink already provides limited service to phones in a deal with T-Mobile. Texting was rolled out first, and T-Mobile just announced support for data, but only for a collection of "essential off-the-grid apps" like WhatsApp, AllTrials, AccuWeather, Google Maps, T-Mobile's T-Life app, and Musk's X social network.

T-Mobile's US-exclusivity deal with Starlink will have run out by the time the purchased spectrum licenses are put into use, New Street Research telecom analyst Philip Burnett told Ars. Starlink "will certainly partner with more carriers and get additional subscribers to the service that way."

AT&T and Verizon plan to offer similar service through deals with satellite operator AST SpaceMobile, but it has been slow-going. "We're waiting to see what AST can do and whether it can launch 45 satellites or more over the next year and a half," Farrar said. So far, AST SpaceMobile's "track record has been one delay after another," he said.

AST deployed its first five commercial satellites in September 2024, relying on a SpaceX rocket for the launch. AST said in August that it plans to do at least five launches by the end of Q1 2026, with 45 to 60 satellites launched by the end of 2026. AST says its system is designed to use "gateway stations on the ground that connect satellite signals to the terrestrial infrastructure of our mobile network operator partners."

AST has "been very late in delivering its satellites and getting things into orbit," Farrar said. He pointed to a 2022 comment by AT&T CEO John Stankey, who claimed that AT&T, thanks to its partnership with AST SpaceMobile, was 18 months ahead of T-Mobile and Starlink.

"You look at where we are three years later, and you're like, well, if you're lucky, AST is 18 months behind Starlink, and it's probably more than that. So they've not kept up," Farrar said. "It's all very well for them to claim technological superiority, but they don't have [many] satellites in space, and Starlink has 650 of them in space for this service."

Verizon “less committed” to AST SpaceMobile than AT&T

In August 2024, the advertising industry's self-regulatory body told AT&T to stop running ads that misleadingly claimed the carrier was already offering cellular coverage from space.

In July 2025, AT&T and AST SpaceMobile completed a test involving a Voice over LTE call and text routed through space to a phone using AT&T spectrum. Verizon completed a test video call with AST in February. But neither carrier has announced a launch date for commercial service with AST.

Although AT&T and Verizon both partnered with AST, Burnett said Verizon is generally seen as "less committed to that partnership than AT&T is" and thus seems more likely to get on board with Starlink.

Farrar agrees that Verizon is a likely candidate to make a deal with Starlink. Verizon has pursued deals with multiple satellite companies already, as it is planning to offer service with satellite provider Skylo while it waits for AST to build a network, he noted.

AT&T and Verizon did not provide any comment when contacted by Ars.

In an interview with Yahoo Finance last month, Stankey stressed the difficulty of providing service indoors, calling it the hardest part of running a terrestrial mobile network. "Those are the harder things to do, and satellite is not particularly well-suited to meet those needs," he said.

For T-Mobile, losing its US exclusivity with Starlink would be a blow. "Once SpaceX owns its own spectrum, it can cut T-Mobile loose if it wants to, or it can go and serve everyone equally," Farrar said. "And that's sort of what SpaceX has effectively implied it may do. It's already signed a deal with [EchoStar's] Boost Mobile, so it won't be exclusive on T-Mobile going forward."

Boost Mobile is set to gain access to the Starlink cellular service as part of the EchoStar spectrum sale, a company announcement said. But Boost Mobile is a minor player compared to T-Mobile, Verizon, and AT&T. Starlink getting on the three major carriers would be a bigger win for Musk.

"They need the carriers. They want the carriers to offer it to their subscribers. from SpaceX's point of view, if it can sell through all three major carriers rather than just one, then that's three times more customers for it," Farrar said.

Amazon's Kuiper satellite system is another potential competitor, but it isn't yet offering home Internet service and hasn't announced specific plans for cellular. Amazon told UK regulators last year that it was "exploring options for D2D services." Amazon's first 27 production satellites for fixed Internet service were launched in April.

Kuiper is now up to five launches this year, totaling 129 satellites. This includes three batches of satellites sent into space for Amazon by United Launch Alliance's Atlas V rocket and two batches launched by SpaceX. Amazon said it will take over 80 missions to launch its constellation, with the next scheduled for October 8.

SpaceX gets more leverage over Apple

Apple is partnering with satellite company Globalstar for the iPhone's emergency SOS feature. The service is free to iPhone users, at least for now. Apple declined a pitch from Musk, who reportedly sought a $5 billion payment from the iPhone maker in exchange for an 18-month exclusivity deal.

There's some internal frustration at Apple about Globalstar's limited capabilities compared to Starlink, according to a May report by The Information. The concerns are that the Globalstar network is "outdated, slow, and limited in what features it can support compared with offerings from SpaceX and others."

The report said that after "Apple spurned Musk's offer of a Starlink deal in 2022, SpaceX began a campaign to make life harder for Apple in the satellite business. SpaceX filed multiple challenges to the valuable wireless spectrum rights licensed to Globalstar in filings to the Federal Communications Commission."

Thanks to the spectrum purchase, Starlink may use its increased capacity to "highly encourage Apple to sign a deal," Burnett told Ars. Globalstar's potential capacity is constrained because it "has a lot fewer satellites than SpaceX does, and they also have less spectrum," he said. Buying the EchoStar spectrum will "give SpaceX more leverage in their negotiation with Apple."

Rysavy said that "based on the amount of spectrum that Starlink has, and based on the number of satellites Starlink has, their direct-to-device network is going to be significantly greater in capacity and performance than what is possible with Globalstar."

Globalstar, which was founded in 1991, received FCC approval in August 2024 to deploy 26 new satellites "to replenish and enhance its constellation" for the provision of service to modern mobile phones. SpaceX had urged the FCC to reject Globalstar's request for authorization.

Farrar said the SpaceX/EchoStar deal increases the pressure on Apple to reconsider its Globalstar partnership. "The issues that were pointed out in that article from The Information were that Apple's senior leadership were worried that Starlink would move much more quickly than Apple could move in building new, better satellites. And now SpaceX has actually announced an intention to do that, and they have the spectrum to use on those new satellites," he said.

But there's still a question about whether "all of this will come to fruition as quickly as Musk hopes," Farrar said. "I mean, that's certainly not a foregone conclusion. There's a lot that needs to happen with Starship to actually launch these satellites." Apple will also have to decide whether not having Starlink's more capable service would make it "difficult to sell more iPhones," he said.

While Globalstar is Apple's default satellite provider, iPhone users can still access Starlink. The level of integration is affected by relations between Apple and Musk, though.

"Apple was reluctant to support the service in models older than the iPhone 14, which frustrated Musk, said people with direct knowledge of the relationship," The Information report said. Musk seemingly won that battle, as carrier-provided satellite service is now available with the last five generations of iPhones, going back to the iPhone 13.

Apple, AST, and Globalstar didn't respond to requests for comment. But executives from AST and Globalstar spoke about competing against Starlink at a recent World Space Business Week panel discussion, according to Space News:

AST president Scott Wisniewski and Barbee Ponder, general counsel and vice president regulatory affairs at Globalstar, both said SpaceX's moves validate their own strategy.

"It shows the true ability of Mobile Satellite Services spectrum and what it can do globally, quickly to provide enormous public benefits," Ponder said. "So we welcome that transaction. It will not change anything that we do in the future."

Spectrum: Buying vs. renting

SpaceX has a spectrum lease agreement with T-Mobile that covers the continental US, Alaska, Hawaii, and Puerto Rico. This lets SpaceX use 10 MHz of spectrum in the 1.9 GHz band.

Besides being a relatively small amount of spectrum, it has restrictions. The FCC lets SpaceX use the T-Mobile spectrum under what is called a "Supplemental Coverage from Space" authorization, allowing it to provide service in areas not covered by terrestrial cellular networks.

"The idea there is allowing the carriers to lease some of their spectrum to the satellite providers," but it's "not really satellite spectrum. The primary usage still has to be terrestrial," Burnett said.

The 50 MHz of EchoStar's satellite spectrum doesn't have the same restriction. The greater amount of spectrum will boost speeds, and so will planned improvements in next-generation satellites. "They're launching new satellites that they claim will increase the capacity by 20 to 100 times," Burnett said.

SpaceX's FCC filing described the improved satellites as follows:

Driven by custom SpaceX-designed silicon and phased array antennas, the satellites will support thousands of spatial beams and higher bandwidth capability, enabling around 20x the throughput capability as compared to a first-generation satellite. With the world's most advanced phased arrays, the wider bandwidth operations enabled by this spectrum purchase, and optimized 5G protocols, the system will support an overall capacity increase of more than 100x the first-generation SpaceX D2C system. In most environments, this will enable full 5G cellular connectivity with a comparable consumer experience to current terrestrial LTE service, which will be used in partnership with MNOs [mobile network operators] to augment high-capacity terrestrial 5G networks.

SpaceX telling the FCC that its 5G service will be comparable to current LTE service indicates that the firm doesn't expect to match the big three carriers' network speeds. "LTE, you know 4G, is not as good as the sorts of data rates we expect today on 5G. On the other hand, it may be as good or better than what you get in remote mountain areas in the US," Farrar said.

Mach33, an analyst firm for space industry investors, said that rural and suburban users should be able to get speeds in the tens of megabits per second from Starlink's next-generation system. The upgrade "shifts DTC from 'coverage demo' to high-speed mobile," the firm's analysis said.

But when indoors, you'll still want to rely on a fixed broadband service or a stronger cellular connection. Burnett said that if you're getting 4G speeds outdoors, as SpaceX indicated, "inside you'll get 2G to 3G speeds. We're talking about less than one megabit per second, which isn't really enough to be a replacement for your indoor Internet services, either wireless or wireline."

SpaceX could lease spectrum to carriers

SpaceX having its own spectrum licenses for mobile service will make it easier to partner with carriers. Instead of leasing spectrum from wireless network operators, SpaceX can offer service on its own spectrum and lease spectrum to carriers. A Wall Street Journal report said that "T-Mobile is in talks to lease some of the spectrum rights that SpaceX plans to acquire."

SpaceX could lease its spectrum rights in heavily populated areas to carriers as part of larger deals in which carriers offer Starlink in areas without strong cell service. The AWS-4 spectrum band "has two licenses. There's a satellite license and a wireless license," Burnett said. "SpaceX seems mostly interested in the satellite license. It's possible that they'll end up leasing the wireless license in certain areas to the mobile carriers."

Mobile satellite services generally don't work well in cities because it's harder to get a line-of-sight link to the sky than in less-populated areas with fewer larger buildings, Burnett said. Leasing wireless licenses to carriers in cities "really would make sense," he said.

SpaceX might refuse to lease spectrum to a carrier that doesn't agree to use its direct-to-device service. "I think it's all part of a broader negotiation around the agreement, the wholesale agreement for the direct-to-device services," Burnett said. "Does Verizon become their partner for those services? If they don't want to do that, I doubt SpaceX will lease the spectrum to them."

SpaceX told the FCC that its purchase of EchoStar spectrum will happen in multiple phases. Upon obtaining initial approval, EchoStar spectrum will be put in a trust "for the benefit of SpaceX... The authorizations are expected to remain held in trust for up to two years, with the final closing and assignments to SpaceX expected to occur on or about November 30, 2027, with the possibility of both an accelerated closing and limited extensions," SpaceX said.