WASHINGTON (dpa-AFX) - Shares of major US telecommunications companies fell sharply on Friday after Elon Musk's SpaceX agreed to acquire a nationwide wireless spectrum portfolio from private-equity firm Grain Management, strengthening its plans to expand Starlink into mobile services.
Verizon shares dropped around 10 percent, putting them on track for their steepest single-day decline since 2002. T-Mobile fell 13 percent, its worst potential daily performance since 2013, while AT&T lost approximately 10 percent, marking its biggest decline since 2000. SpaceX shares rose around 1 percent.
The deal covers Grain Management's nationwide portfolio of 800 MHz spectrum licences, comprising up to 14 megahertz of paired spectrum. The Wall Street Journal reported that SpaceX would pay approximately $8 billion in cash, although the companies did not disclose the financial terms.
The acquisition could help Starlink Mobile improve connectivity inside buildings and in areas where conventional mobile networks struggle.
Low-band spectrum travels longer distances and penetrates obstacles more effectively than higher-frequency signals, potentially strengthening SpaceX's ability to deliver satellite connectivity directly to standard mobile phones.
The transaction remains subject to approval by the Federal Communications Commission (FCC). FCC Chair Brendan Carr described increased competition in the spectrum market as positive for American consumers, adding that the market would determine which providers succeed.
Analysts at Evercore ISI said the acquisition gives SpaceX the foundations of a more developed network, while JPMorgan said it makes Starlink Mobile's long-term opportunity more credible.
However, analysts cautioned that established wireless carriers face limited near-term risk because building a competitive network requires considerable time, infrastructure and capital.
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