Analysts Skeptical of SpaceX Mobile Plans
The satellite company said it intended to deploy terrestrial ‘femtocells’ to support its direct-to-device service
WASHINGTON, Aug. 6, 2026 – During its first earnings call as a public company, SpaceX executives said they intended to build out terrestrial components and use their credit-to-device service to compete with the wireless carriers.
Telecom industry analysts don’t think the plan is very likely.
The idea would be to place tiny “femtocells” on mounts already used for the company’s fixed broadband dishes “all over the place,” SpaceX CEO Elon Musk said. They would use spectrum SpaceX is buying from EchoStar for $17 billion, which can be used for both terrestrial mobile and direct-to-device satellite service.
That would ideally allow the company to avoid spending billions on a traditional mobile network and additional spectrum licenses, and allow the company to acquire “quite a few” of the U.S. carriers’ customers.
The carriers’ stocks each dropped after the comments, but have since recovered.
“The idea of seamless Satellite + Starlink small cell wireless network seems far-fetched to us as a workable solution,” BNP Paribas analyst Sam McHugh said in an investor note.
He noted that Musk, known for grandiose predictions, also predicted Starlink would carry a majority of the entire world's internet traffic by the end of the decade. If there were that many Starlink dishes, it might be feasible, he wrote, but that’s not likely in the U.S. any time soon.
“In our view, it is highly improbable that Starlink will carry the majority of internet traffic in the US in the next decade,” McHugh wrote. “Lower Starlink broadband penetration means any femto cell plan is likely to be even further from being a credible solution for wireless.”
Multiple analysts have said SpaceX’s only avenue for competing directly with the carriers is a deal to offer service on one of their networks. That’s due largely to the difficulty of serving dense areas or indoor users over the massive distance between the ground and orbiting satellites.
“Nothing in today's commentary — including floating the relatively well-worn idea of a mesh network of rooftop ‘femtocells’ — changes that assessment,” MoffettNathanson analysts wrote in a Wednesday investor note.
Each of the three carriers have shot down the idea of a mobile virtual network operator deal (MVNO), and they’re forming a joint venture aimed at promoting use of their spectrum in remote areas, rather than their whole network.
But McHugh saw the aggressive talk as a potential means of pressuring one of the carriers into granting an MVNO, something MoffettNathanson analysts also think the company will generally put a lot of effort into doing. Satellite industry analyst Tim Farrar has said the same about previous media reports of SpaceX pursuing an offload deal with cable giant Charter and even considering buying a carrier outright.
That pressure might continue until at least the upper C-band spectrum auction next year. If SpaceX competes heavily for those licenses, it could be interpreted as a sign the company does have real mobile ambitions.
Or it would mean SpaceX was trying to hoard valuable assets to convince a reluctant carrier to give it an MVNO deal. Although Farrar has noted the tight deployment deadlines on upper C-band licenses would make them less attractive.
“We are doubtful that Starlink would really want to build a terrestrial wireless network, let alone buy a carrier, but Musk may be left with little choice other than to make a more aggressive move if the telcos retain their united front” on an MVNO, Farrar wrote in an investor report excerpt he posted on X.
McHugh also noted that SpaceX Chief Operating Officer Gwynne Shotwell said on the call that the carriers’ combined annual wireless revenue was $600 billion, when the real figure is about $220 billion.
He saw that as “reinforcing our view that their wireless ambitions and plans are highly embryonic, and not yet fully fleshed out / credible.”
