SpaceX has agreed to acquire 50 MHz of wireless spectrum and mobile satellite service spectrum licenses from EchoStar for its Starlink satellite network. EchoStar will sell its AWS-4 and H-block spectrum licenses in exchange for $8.5 billion in cash and $8.5 billion in SpaceX stock.
SpaceX said it would let it develop and deploy its “Direct to Cell” constellation, which it claims can provide broadband-speed internet access to mobile phones across the world.
This purchase will allow SpaceX to start building and deploying upgraded, laser-connected satellites which the company believes will expand the cell network’s capacity by “more than 100 times.”
READ: SpaceX calls off Starship flight for the second day in a row (
Gwynne Shotwell, president and COO at SpaceX, said the deal will help the company “end mobile dead zones around the world… With exclusive spectrum, SpaceX will develop next-generation Starlink Direct to Cell satellites, which will have a step change in performance and enable us to enhance coverage for customers wherever they are in the world.”
Echostar stocks surged 19% in early trading, following news of this deal.
SpaceX has launched more than 8,000 Starlink satellites since 2020, building a distributed network in low-Earth orbit which has seen demand from militaries, transportation firms and consumers in rural areas. Around six of these satellites were launched since January 2024, for the company’s direct-to-cell network, orbiting closer to Earth than the rest of the constellation.
Last year, SpaceX received approval from the Federal Communications Commission (FCC), to go ahead with plans to offer a direct-to-phone version of its Starlink satellite internet service, with T-Mobile as a provider. The company now has more freedom to operate, with this spectrum purchase.
The deal was conducted under pressure from the FCC, which launched an inquiry into EchoStar’s utilization of its spectrum holdings in May, after public encouragement from SpaceX. President Donald Trump personally urged EchoStar CEO Charlie Ergen to sell the spectrum licenses, according to a Bloomberg report. On Aug. 26, EchoStar sold $23 billion worth of spectrum licenses to AT&T.
EchoStar said in a statement that it believes that, together with the AT&T deal, today’s spectrum sale to SpaceX will resolve the FCC inquiry. However, the deal also brings an end to EchoStar’s own ambitions to build a direct-to-device satellite constellation. EchoStar cancelled a $1.3 billion contract with Canadian satellite maker MDA Space that was announced just five weeks earlier, as part of the move.
SpaceX recently pulled off its most successful launch of its Starship rocket, marking its tenth flight after a number of failed attempts.
