Steven Weber: When Competitors Create Better Competition
Rivals AT&T, T-Mobile and Verizon are teaming up on a shared satellite network, a model of infrastructure collaboration that could boost connectivity and U.S. competitiveness.
The success of the U.S. economy is defined by fierce competition and the drive to innovate. The foundation enabling this is robust infrastructure — the basic layers of a technology stack on which firms compete to build the best products. The joint venture between telecom giants AT&T, T-Mobile and Verizon should serve as a case study for smart collaborative investment in essential infrastructure.
It will accelerate the transition to modern mobile communications where anyone can be anywhere, with any device and have reliable network access — essential connectivity to data, AI, emergency services and everything mobile networks make possible.
AT&T, T-Mobile and Verizon — usually known for fierce competition — will build a satellite powered direct-to-device (D2D) network joint venture, aiming to achieve nationwide satellite coverage and increased connectivity for all Americans. This builds upon each company’s strengths while bringing together infrastructure and teams to scale satellite technology at a new level.
Together, they’re coordinating deployment and aligning capabilities to achieve faster expansion into underserved areas and stronger, more resilient infrastructure.
Each company enjoyed initial success in the satellite domain. T-Mobile emerged as an early leader, working with SpaceX’s Starlink since 2022 to offer satellite services on everyday smartphones. AT&T and Verizon have both partnered with AST SpaceMobile: AT&T announced plans to offer pre-commercial D2D satellite service earlier this year, while Verizon finalized plans to provide direct-to-cell services late last year.
These developments demonstrated that commercial satellite powered D2D networks were achievable, but companies still faced difficulties coordinating across operators, spectrum and distribution. In a testament to the competitive U.S. telecom ecosystem, no single company had the spectrum or infrastructure needed to undertake this massive task. Americans in rural and remote areas struggled without reliable connectivity, including during emergencies, and communities faced bitter conflicts about whether and where to build cell towers. This announcement can end these problems and bring the future of mobile communications closer to the present.
It’s also a welcome application of an important lesson from cellular telephony’s early history, when companies built competing infrastructure layers, leading to slower build-out, lower quality of service and higher prices. Prior to the early 2010s, multiple network standards (CDMA, TDMA, and others) existed in the U.S., each requiring independent base stations and incompatible handsets. Continental Europe, in contrast, built unified infrastructure on a single standard which enabled seamless roaming, lower prices and better service. When the U.S. standardized on 4G LTE in the early 2010s, it took years to catch up. We can’t make that mistake and fall behind in satellite connectivity. Customers would suffer, as would U.S. competitiveness.
Moments like this, when companies are scaling advanced technologies, pooling resources or expanding strengths of one party to an entire system, demand a forward-looking philosophy. When major players combine forces, benefits can grow exponentially for technology and consumers.
Major U.S. industries should take note and consider following suit by putting aside rivalries in favor of targeted collaboration to solve large, complex challenges and make America the envy of the global economy. The market should encourage and reward such collaborations.
Cross-company collaboration in satellite infrastructure has another essential benefit: it helps U.S. companies compete with foreign rivals. This is especially true regarding China, where the state-run satellite marketplace can coordinate more easily and innovate on top of that advanced infrastructure faster. This joint venture allows U.S. commercial satellite companies to match these capabilities, enabling stronger, more efficient competition above the infrastructure layer, where customers immediately feel the benefit. This is modern market capitalism at its best.
Other essential industries have demonstrated the value of collaboration at the infrastructure layer, with competitors teaming up with each other and the government. The United States Advanced Battery Consortium (USAB) was formed as a collaboration between Ford, GM and Stellantis alongside the Department of Energy. The group aims to promote long-term R&D into EV batteries, and recently received $60 million to continue research into lower-cost battery production and recycling.
As USAB demonstrates, these partnerships often take a “whole is greater than the sum of parts” approach by combining investment, capabilities and experience to address complex issues. This is especially useful for issues with high technical or financial demands and benefits extending beyond any bottom line.
We all depend on American connectivity — which is why we should follow the telecom industry’s progress with great interest and root for its success, especially amid fierce global competition. This announcement represents “one giant leap” towards dependable, nationwide satellite connectivity for all Americans and the latest demonstration of partnership between competitors to conquer a new technological frontier. In massive infrastructure buildouts, more can be achieved through collaboration than by even the most dominant company. Other industries facing their own challenges should take note and consider what they could achieve together, and we should all keep an eye out for the results of this collaboration.
Steven Weber is a professor of the Graduate School, UC Berkeley School of Information. He has published numerous books, including “The Success of Open Source” and, most recently, “Bloc by Bloc: How to Build a Global Enterprise for the New Regional Order.” A partner at Breakwater Strategy and an academic affiliate at Analysis Group, he has worked with and received research funding from a number of companies, including in the telecom industry. This Expert Opinion is exclusive to Broadband Breakfast.
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