Image: Verizon
Verizon chief executive Dan Schulman told analysts on Monday that SpaceX would need at least four to six years and between $300 billion and $500 billion to turn Starlink Mobile into a full US carrier, speaking on the company’s third quarter earnings call. His comments come days after reports that SpaceX is seeking access to 80,000 US cell sites to give its satellite phone service a network on the ground.
Update: Elon Musk pushed back on Schulman’s timeline on X on Monday, saying a full Starlink Mobile buildout “will take 2 or 3 years,” roughly half of the minimum Verizon’s CEO estimated.
Asked about Starlink’s push into the core mobile business, Schulman said a terrestrial SpaceX network would require 65,000 to 80,000 macro sites, plus backhaul, radio equipment and “a tremendous amount of spectrum.” He estimated the cost at $300 billion to “half a trillion” over the next seven or eight years, before SpaceX adds retail stores, customer service and back-office systems.
Satellites on their own, the Verizon boss argued, can’t compete in the suburban and urban areas that he said make up about 98% of Verizon’s revenue, claiming the carrier is “somewhere between 100 to 1,000 times more efficient” there. Even if SpaceX builds out a ground network, he said, Starlink would become “the sixth, not the fourth” competitor in the US market. Schulman didn’t name the others, though he noted two rivals already offer free wireless service.
Despite the tough talk, Schulman gave SpaceX credit. He said he operates “under the assumption that everything SpaceX says they will do, they will do, and that they will execute flawlessly,” while insisting there is “no magic wand” for building a network. He also ruled out offering any satellite provider an MVNO deal on Verizon’s network, though he left the door open to working with satellite companies on coverage in remote areas.
SpaceX sees the opportunity very differently. On its own third quarter call on October 20, Elon Musk said he sees a clear path to several hundred billion dollars a year in connectivity revenue, and he followed up on X the same day with a direct message for the wireless industry.
In that post, Musk wrote that cellular veterans “look at the chess board of existing pieces and don’t see a solution,” while SpaceX is “developing entirely new pieces that fundamentally alter the strategic landscape.” He has also suggested SpaceX hold a longer presentation to lay out its Starlink connectivity game plan for investors.
Those pieces are already coming together. This month, SpaceX agreed to buy up to 14 MHz of paired 800 MHz spectrum, won FCC approval for 15,000 next-generation direct-to-cell satellites and outlined plans for Starlink towers built on the real estate of existing Starlink installations. AT&T, Verizon and T-Mobile, meanwhile, have been lobbying the FCC to keep key 5G bands out of the agency’s satellite-to-phone rules.
Outside the US, Starlink Mobile is scaling through carrier partners rather than fighting them. The service went live across Brazil on Monday through Vivo, putting it in front of 50 million customers, and Starlink said last week it has connected more than 11 million people on VEON’s networks in Ukraine, Kazakhstan and Bangladesh.
Keep in mind that Schulman’s $300 billion to $500 billion figure is the incumbent’s estimate, not SpaceX’s, and SpaceX hasn’t put a public price on its own ground buildout. Do you think Verizon is underestimating how fast SpaceX can build Starlink Mobile into a real US carrier?
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