Musk Says SpaceX Could Buy a Legacy Telco to Grab Its Spectrum

Elon Musk said on Friday that SpaceX could simply buy a legacy U.S. telecom operator if it can use that company's spectrum more efficiently than the incumbent can. That's the CEO of SpaceX, the rocket and satellite-internet company, openly floating a takeover of a carrier the size of an AT&T or Verizon — and the market moved on it.

Musk made the comments in a fireside chat with billionaire investor Ron Baron at Baron Capital's annual investment conference. He told Baron that SpaceX will be able to "get very far" in its race against the telecom giants using the spectrum licenses it has already purchased. Those licenses give a company the right to use specific radio frequency bands.

"At a certain point if we're able to make much better use of the spectrum than, say, a legacy telco is, we can just acquire that legacy telco and use their spectrum, you know, 10 times more effectively," Musk said.

What does this change for the Big Three?

Musk's remarks will intensify the debate over the futures of AT&T, Verizon and T-Mobile. SpaceX has been building a rival national wireless service that combines terrestrial and satellite connectivity for mobile phones and internet. Initial service is expected to switch on in early 2028, per SpaceX.

Today, Starlink sells satellite-based internet plus limited mobile connectivity as an add-on through established carriers such as T-Mobile. But the pieces of a standalone network are stacking up fast:

• SpaceX has reportedly held talks to buy access to cell towers run by companies like Crown Castle, and has moved to acquire more spectrum.
• On Wednesday, SpaceX said it would work with Qualcomm to power the ground-based infrastructure for its wireless network.

BNP Paribas analyst Sam McHugh wrote in a client note this week that the visible push "suggests to us there is a clear strategy to try to ramp pressure on one of the Big Three to fold" on a deal to access their network. He also speculated SpaceX may be pressuring telecom stocks to make a potential acquisition "more accretive."

Citi analysts have argued that buying a major U.S. wireless company would hand SpaceX decades' worth of infrastructure and customer relationships — and let it launch a full-fledged Starlink Mobile service years ahead of current expectations. TD Cowen's Gregory Williams has called T-Mobile the "clear choice" among the Big Three, given its existing SpaceX relationship.

The market's verdict on Friday: SpaceX shares closed up 9% after steep Thursday losses. Verizon and AT&T each slipped 1%. T-Mobile, the rumored favorite, gained 1%.

AST SpaceMobile's $1.3 billion answer

SpaceX launches its own satellites on Falcon and Starship rockets. Rival satellite operators don't have that luxury — and one of them just decided to fix it.

AST SpaceMobile announced Friday that it will build a 20-ton rocket to deploy its BlueBird satellites, using engines supplied by Firefly Aerospace, a company working on reusable rockets. The price: $800 million in cash and stock up front, plus another $500 million for delivery and engineering support services — roughly $1.3 billion all-in.

By late 2028, AST SpaceMobile said the rockets will let it launch five satellites per flight, which could help it catch up to competitors like SpaceX and Amazon. The company has historically relied on partners to reach orbit, but it was set back after Blue Origin suffered a major incident on the launchpad earlier this year.

"This will accelerate our mission to build a new layer of global connectivity, extending connectivity beyond terrestrial networks and helping to bring AI-enabled services wherever people live, work and travel," AST SpaceMobile CEO Abel Avellan said in a statement.

Investors liked the plan. AST SpaceMobile's stock gained 7% on Friday, and Firefly shares skyrocketed almost 37%.

For practitioners, the takeaway is a timeline: SpaceX says its wireless service arrives in early 2028, AST SpaceMobile's own launch capability lands by late 2028, and Musk has now put the Big Three on notice that spectrum — not friendship — will decide who owns the network.