SpaceX and Charter held talks on U.S. mobile phone tie-up
Bloomberg reported that the companies discussed a partnership that could support SpaceX’s push to sell mobile service directly to consumers.
By Sofia Marchetti · World Affairs Correspondent
3 min read
SpaceX and Charter Communications have discussed a possible partnership for a U.S. consumer mobile phone service, Bloomberg reported, citing people familiar with the matter. The talks point to SpaceX’s effort to expand Starlink beyond home internet and into a broader mobile business.
The discussions took place at the executive level, according to Bloomberg. The people described the talks as private and were not identified.
Under one possibility described to Bloomberg, Charter could carry some SpaceX phone traffic through its land-based internet network. Bloomberg reported that the arrangement would resemble parts of Charter’s current Spectrum Mobile model, which uses a mix of rented wireless infrastructure and Wi-Fi networks.
Charter declined to comment to Bloomberg. SpaceX did not respond to Bloomberg’s request for comment.
SpaceX’s mobile ambitions
Bloomberg reported that a deal, if completed, would support SpaceX’s stated move toward becoming more of a direct-to-consumer mobile phone provider. SpaceX currently earns the largest portion of its profits from Starlink, its satellite-based home internet service, according to Bloomberg.
SpaceX also offers Starlink Mobile through T-Mobile US as a $10 monthly add-on, Bloomberg reported. That service allows users to send text messages and make internet-based calls from remote locations, according to Bloomberg.
The Financial Times reported Friday that SpaceX told investors it plans to sell mobile service directly to consumers. Bloomberg said such a service would require substantial mobile spectrum and ground-based infrastructure, in addition to the satellite spectrum SpaceX already holds.
SpaceX has been adding to its spectrum position, Bloomberg reported. The company won mobile spectrum rights in the AWS-3 band in a recent Federal Communications Commission auction, after buying mobile spectrum rights from EchoStar last year, according to Bloomberg.
SpaceX President Gwynne Shotwell recently told CNBC that the company sees a larger addressable market in mobile than in home broadband. “Starlink Mobile will far exceed Starlink broadband in the home,” Shotwell said, according to CNBC. “Not everybody is going to need broadband, a Starlink broadband, in their homes. There’s lots of other options as well. But I think the numbers of users of Starlink Mobile will far exceed our Starlink broadband.”
Why Charter could matter
Charter is the largest home internet provider in the United States, Bloomberg reported. Its wired broadband network and Wi-Fi footprint could make it a useful partner for handling mobile data traffic that does not need to travel by satellite.
Through Spectrum Mobile, Charter already sells wireless phone service to its cable and home internet customers, according to Bloomberg. The service relies on infrastructure-rental agreements with T-Mobile and Verizon Communications, while Charter routes much of the traffic over its own Wi-Fi networks, Bloomberg reported.
Charter also agreed last year to combine with Cox Communications, a deal Bloomberg said would increase Charter’s subscriber base by more than 20%. That larger customer base could give Charter a broader platform if it were to work with SpaceX on a consumer mobile offering.
Bloomberg did not report that SpaceX and Charter had reached an agreement. The talks remain a sign of how satellite operators, cable companies and wireless providers are exploring new ways to combine networks as mobile coverage expands beyond conventional cell towers.
This story draws on original reporting from Fortune.