US wireless stocks sold off sharply on Friday after SpaceX announced a deal to buy a nationwide spectrum portfolio, a step toward taking Starlink into mobile service. Verizon had its worst day since July 2002, T-Mobile its worst since 2013 and AT&T its worst since 2000.
Shares in America’s biggest mobile carriers fell sharply on Friday, October 9, after Elon Musk’s SpaceX announced it would buy a nationwide spectrum portfolio, CNBC reported.
How the Stocks Moved
| Company | Fall on Friday | Worst day since |
|---|---|---|
| Verizon | 8.75% | July 2002 |
| T-Mobile | 13.27% | 2013 |
| AT&T | 9.81% | 2000 |
SpaceX shares rose about 1 percent on the day.
The Deal
SpaceX said in a Thursday statement it was acquiring spectrum from Grain Management, described as a “license portfolio of up to 14 megahertz of paired spectrum in the 800 MHz band”. The aim is to expand its Starlink internet service into mobile.
The Regulator’s View
FCC Chair Brendan Carr, whose agency will oversee approval of the deal, told CNBC that competition in the spectrum market was “really good news for the American consumers”.
“We’re probably going to bring over $100 billion of spectrum into the market over the next two years, so we’re seeing a lot of competition,” he said. “It’s not for us ultimately to pick winners and losers.”
What Analysts Said
- Evercore ISI wrote that SpaceX “now has the outline of a real network” alongside its satellite capabilities
- JPMorgan said the purchase made Starlink Mobile’s long-term opportunity “more credible”
- Analysts added in a Friday note that they still saw “limited near-term risk to U.S. wireless incumbents given the time, infrastructure and capital required to build a competitive terrestrial network”
Why It Matters
The sell-off shows how seriously investors are taking a possible new rival, even though analysts say any real threat to the established carriers is some way off. The approval process, and what SpaceX builds on the spectrum, will decide whether the market’s reaction was justified.
Image: A Verizon retail store in Burlington, Vermont (file photo). Photo: Harrison Keely / Wikimedia Commons (CC BY 4.0)
