Mitchell Martan
Investment Researcher for The Long Investor, Economics/Finance Background
SpaceX's planned 800 MHz spectrum purchase does not make it more competitive with AST SpaceMobile for mobile-operator partnerships because it will mainly serve direct-to-consumer customers, whom AST is not targeting, according to Deutsche Bank. Deutsche Bank called Friday's 10% selloff misguided and raised its AST price target to $93; the upgrade looks warranted, and AST shares should go much higher. x.com x.com x.com
Space Investor
Space-Sector Investor
$ASTS: AST SpaceMobile just told the FCC it will start satellite-to-phone operations in the Philippines "imminently" with Smart Communications. ... Smart holds a 30-day permit to demo the tech at four sites (Pampanga, Batangas, Ilocos Norte, Bataan) on 700, 850 and 900 MHz. x.com
AlvaSupportsImminent demonstrations with Smart across four Philippine sites and three low-band frequencies support AST's progress in turning operator partnerships into working service, under a 30-day permit.
Fireside Alpha
Business, Technology and Investing Interview Digest
DEVELOPING: Starlink could reach phones on its own spectrum after the FCC voted 3–0 to propose 482 MHz more for satellite-to-phone service and eliminate carrier lease requirements x.com
AlvaChallengesThe FCC's proposal to replace mandatory carrier leases with coexistence agreements or spectrum ownership would reduce satellite operators' dependence on carrier partnerships, weakening a regulatory advantage of AST's model.Fireside Alpha
Business, Technology and Investing Interview Digest
Srini Gopalan: ... “If it’s a complementary product, I’m very happy to look at a resale arrangement, which is exactly what T-Satellite was, which gets built into it. But an MVNO is a wholly different thing. So I hope that clarifies where our head’s at on MVNOs and more broadly satellite.” x.com
AlvaSupportsWillingness to resell complementary satellite coverage, coupled with a separate hurdle for MVNO deals, supports the distinction between serving mobile operators and securing their support for a consumer-carrier business.
Elon Musk
CEO of Tesla, Founder & CEO of SpaceX
[Replying to @SawyerMerritt: "They're going to look at 65,000–80,000 macro sites. They're going to need backhaul, RAN, and a tremendous amount of spectrum. It's going to take a minimum of four to six years to fully build that out."] Will take 2 or 3 years x.com
AlvaChallengesMusk's two-to-three-year estimate for a full US carrier-network buildout challenges the longer timelines underpinning the view that SpaceX's spectrum purchase poses little near-term competitive risk to AST.Fireside Alpha
Business, Technology and Investing Interview Digest
“I also operate under the assumption that everything SpaceX says they will do, they will do, and that they will execute flawlessly. That’s my operating assumption on it. I think to assume anything else, makes no sense from my perspective." ... "We always knew that they needed a terrestrial network to have any chance at providing a competitive service. ... without a terrestrial network, their addressable market for broadband services is relatively small.” x.com
AlvaMixedVerizon's CEO takes SpaceX's terrestrial buildout seriously while arguing that satellite service alone cannot compete broadly with terrestrial networks, putting execution of that buildout at the center of the competitive threat.Space Investor
Space-Sector Investor
Anatel’s authorization covers 15+15 MHz of S-band spectrum, totaling 30 MHz, for AST SpaceMobile’s planned service in Brazil. In addition, following Anatel’s regulatory approval, agreements with four regional operators support AST SpaceMobile’s authorized secondary use of up to 10+10 MHz of spectrum in the 700 MHz band within the operators’ respective licensed areas. x.com
AlvaSupportsAST says Brazil authorized 30 MHz of S-band and up to 20 MHz of carrier-linked 700 MHz spectrum, adding concrete capacity behind its operator-partnership rollout.
Reuters
Global News Agency
AST SPACEMOBILE ADVANCES BRAZIL EXPANSION WITH ANATEL’S APPROVAL FOR S-BAND SPECTRUM AND SECONDARY USE OF THE 700 MHZ BAND, AGREEMENTS WITH FOUR REGIONAL OPERATORS AND PLANNED GROUND ... INFRASTRUCTUREAST SPACEMOBILE - PLANS GROUND INFRASTRUCTURE TO SUPPORT 200 MILLION HANDSET LINES IN tradingview.com
AlvaSupportsAST's reported fourth regional-operator agreement and Anatel spectrum approvals strengthen its carrier-partnership rollout in Brazil, alongside a ground-infrastructure plan sized for 200 million handset lines.Space Investor
Space-Sector Investor
AT&T, Verizon and T-Mobile met all three FCC commissioners' offices on Oct. 20 through their trade group CTIA, pushing back on the FCC's draft plan to open more carrier spectrum to satellite-to-phone service. ... They also want to keep the current leasing rule, which makes satellite operators lease spectrum from carriers. x.com
AlvaSupportsThe three major US carriers' push to retain mandatory spectrum leasing favors AST's carrier-partnership model over a satellite operator's independent access to carrier bands.
Dow Jones
Real-Time Financial News Wire
Citi analyst Michael Rollins sees it happening no earlier than 2029 and more likely 2030 to 2032. ... It has amassed about 80 megahertz of spectrum. T-Mobile US has about 400 megahertz. ... The hardware alone would cost $20 billion. SpaceX would need to spend another $20 billion on more wireless spectrum. tradingview.com
AlvaSupportsCiti's 2029-or-later mobile-service estimate, grounded in a spectrum shortfall and substantial buildout costs, supports the view that SpaceX's spectrum purchase alone does not warrant a near-term reassessment of AST's operator position.Space Investor
Space-Sector Investor
Unifique, Brisanet and Iez! Telecom will supply 700 MHz spectrum and fund the ground gateways. Final terms are still under negotiation. x.com
AlvaSupportsThree Brazilian carriers' commercial agreement to supply spectrum and fund gateways strengthens AST's operator-partnership case, with final terms still under negotiation.Reuters
Global News Agency
SPACEX IN TALKS TO ACCESS 80,000 CELL SITES FOR WIRELESS NETWORK ... NEWSONE OF THE COMPANIES SPACEX IS IN TALKS WITH IS CROWN CASTLE - BLOOMBERG NEWS tradingview.com
AlvaChallengesBloomberg News reports that SpaceX is discussing access to 80,000 cell sites, including with Crown Castle, which would strengthen its terrestrial network and make it a more credible competitor for mobile-operator partnerships.Dow Jones
Real-Time Financial News Wire
Building a scaled, converged network is "not something that gets done overnight," AT&T CEO John Stankey says ... Stankey says it takes several years to get a network to the performance levels that customers have come to expect. ... "I wouldn't over-rotate on what I would call one carrier of low-band spectrum," Stankey says. tradingview.com
AlvaSupportsAT&T's CEO says building a scaled network takes years and cautions against overreading one low-band spectrum carrier, supporting the view that the purchase alone does not justify AST's selloff.
Space Exploration Technologies Corp.
Rocket Launch, Spacecraft and Starlink Satellite Internet Company
As far as the mix goes, I think we expect that the S-band spectrum will provide the majority. And then obviously, you need the low-band spectrum, the 800 megahertz spectrum to basically penetrate buildings. ... and by the way, I'll correct myself if I'm wrong afterwards, but I think the S-band will carry the majority and then the low-band spectrum will carry less but provide a critical piece, by the way. ... We will basically leverage the real estate from Starlink installs and other towers.
AlvaChallengesShotwell's expected use of 800 MHz for indoor coverage, alongside S-band and sites for terrestrial radios, makes the purchase part of a broader mobile-network plan; its implications for competing for mobile-operator partnerships remain unclear.Elon Musk
CEO of Tesla, Founder & CEO of SpaceX
And we will also have direct-to-cell, high bandwidth direct-to-cell capability and we will be building out our terrestrial networks that there's broad-based connectivity anywhere that SpaceX and Starlink are allowed to operate.
AlvaChallengesA planned high-bandwidth direct-to-cell service alongside terrestrial networks weakens the assumption that SpaceX's mobile ambitions are limited to a separate consumer segment.
Ed Ludlow
Host of Bloomberg Tech, Correspondent at Bloomberg News
SpaceX moved very quickly and very aggressively to buy terrestrial assets and to buy spectrum necessary for them to basically offer themselves as a more complete carrier, offering not just constellation space-based internet, but direct-to-cell services as well ... And so we're waiting for the continuation of that story to kind of present itself as a business model, what SpaceX Mobile looks like. And we're not quite there yet. podtrac.com
AlvaSupportsSpaceX's spectrum purchases appear aimed at building its own direct-to-cell carrier service, supporting the thesis's consumer-versus-operator distinction, though its mobile business model remains undefined.Ed Ludlow
Host of Bloomberg Tech, Correspondent at Bloomberg News
And maybe one of the reasons why you saw them go in and buy more spectrum so it could fix some of the challenges with Starlink for being in buildings and such. podtrac.com
AlvaSupportsFerguson's suggested indoor-coverage use for the spectrum lends some support to Deutsche Bank's view that the purchase addresses Starlink's own service, though he frames it as a possibility.Ed Ludlow
Host of Bloomberg Tech, Correspondent at Bloomberg News
SpaceX moved very quickly and very aggressively to buy terrestrial assets and to buy spectrum necessary for them to basically offer themselves as a more complete carrier, offering not just constellation space based internet, but direct to cell services as well podtrac.com
AlvaSupportsThe spectrum purchases strengthen the thesis's view that SpaceX is building a direct-to-consumer mobile service rather than competing primarily for AST's operator partnerships.Ed Ludlow
Host of Bloomberg Tech, Correspondent at Bloomberg News
If you remember, she said explicitly, we're going to try and take customers from T-Mobile, Verizon, AT & T, and those stocks fell as a result. ... SpaceX moved very quickly and very aggressively to buy terrestrial assets and to buy spectrum necessary for them to basically offer themselves as a more complete carrier, offering not just constellation space based internet, but direct to cell services as well podtrac.com
AlvaMixedThe reported plan to take carrier customers supports a consumer-facing strategy, but SpaceX's purchases of terrestrial assets and spectrum challenge a clean separation from the mobile-operator market AST depends on.Dow Jones
Real-Time Financial News Wire
SpaceX's Starlink is doubling down on its ambitions to become a "major mobile carrier in the U.S." that can compete with AT&T, Verizon, and T-Mobile, COO Gwynne Shotwell says. The company recently bought a large portfolio of 800 MHz spectrum, and got approval from the FCC to launch 15,000 satellites optimized for global 2GHz spectrum. "We will be building out our terrestrial networks," CEO Elon Musk says during a Tuesday earnings call tradingview.com
AlvaChallengesStarlink's reported spectrum purchase and terrestrial-network plans strengthen the case that it intends to compete as a direct-to-consumer mobile carrier, the distinction on which the thesis relies.Dow Jones
Real-Time Financial News Wire
Elon Musk said SpaceX would continue big investments in more powerful Starlink satellites while building out "terrestrial networks" to help the business "become a major mobile carrier" in the U.S....the company this month bought a swath of ground-based wireless spectrum rights-a must for cellphone service inside buildings and dense urban areas. But its Starlink service would need to invest much more in cellular infrastructure to provide service close to matching the likes of AT&T and T-Mobile. tradingview.com
AlvaChallengesThe reported terrestrial-network plans strengthen SpaceX's direct-to-consumer path, consistent with the thesis's market distinction; the substantial infrastructure still needed makes that path longer-term.