AT&T, Verizon and T-Mobile are urging the Federal Communications Commission to revise a proposed expansion of satellite-to-phone services, warning that the changes could interfere with existing 5G networks. The dispute comes as SpaceX moves to launch Starlink Mobile, a potential fourth competitor in the US wireless market.

The FCC is scheduled to vote October 29 on a proposal that would make an additional 482 MHz of radio spectrum available for satellite communications. The proposal would expand the agency’s Supplemental Coverage from Space (SCS) framework, which allows satellites to communicate directly with smartphones.

If approved, the proposal would begin a public comment process rather than immediately authorize satellite operations in the additional spectrum.

SpaceX stands to benefit greatly from the regulatory changes as it assembles the spectrum and infrastructure needed to compete with established wireless providers. The company has acquired approximately 80 MHz of spectrum, while each of the three major US carriers controls roughly 300 MHz. Additional spectrum would give SpaceX more capacity to support its planned cellular network.

The FCC’s upcoming decision is widely seen as an early regulatory test, not necessarily an immediate shift in the competitive landscape. The open question is whether SpaceX can combine satellite coverage, licensed spectrum and earth-based infrastructure to become a true alternative to the three established carriers.

Wireless Carriers Warn of 5G Interference

In an October 20 meeting with FCC officials, representatives of the three carriers and industry association CTIA pressed regulators to exclude the 2.5 GHz and 3.45 GHz bands from the satellite proposal. Removing these frequencies would reduce the proposed expansion by 290 MHz.

CTIA CEO Ajit Pai, a former FCC chairman, met with current Chairman Brendan Carr to argue against including the disputed frequencies.

The carriers claim that satellite transmissions could disrupt the Time Division Duplexing (TDD) technology used by terrestrial 5G networks. TDD allows phones and cell towers to transmit and receive data over shared frequencies during alternating time intervals.

T-Mobile relies heavily on the 2.5 GHz band, while AT&T uses 3.45 GHz spectrum. CTIA estimates that more than 300 million consumers depend on wireless services operating in these bands.

Beyond interference concerns, CTIA wants satellite operators to meet performance and consumer protection requirements comparable to those imposed on traditional wireless carriers. The association also opposes changes that would reduce carriers’ authority over satellite companies using their licensed spectrum.

SpaceX Builds Toward a Nationwide Network

SpaceX is pursuing a more aggressive strategy than simply providing satellite connectivity in areas without conventional cellular coverage. The company is negotiating access to at least 80,000 US cell towers, which would allow it to combine earth-based infrastructure with its satellite network.

Goldman Sachs analysts estimate annual tower rental costs at approximately $50,000 per site. Leasing 80,000 locations at that rate would cost about $4 billion annually, excluding equipment and other expenses.

SpaceX President Gwynne Shotwell said during an October 20 earnings call that the company expects to introduce cellular service using its own spectrum in early 2028. Starlink Mobile already serves more than 22 million monthly users worldwide through partnerships with existing carriers.

SpaceX has also expanded its spectrum holdings through agreements with EchoStar, valued at approximately $19.6 billion. The FCC recently approved its acquisition of three additional Tristar spectrum licenses covering portions of eight states.

SpaceX’s expansion could reshape a U.S. wireless market dominated by three nationwide carriers since T-Mobile acquired Sprint in 2020.

Investors are watching closely. Following reports of SpaceX’s tower negotiations, AT&T and T-Mobile shares each declined nearly 8% on October 23, while Verizon fell approximately 1.2%.

However, building a nationwide network presents significant technical and financial challenges. AT&T CEO John Stankey has emphasized that developing a competitive wireless infrastructure requires years of investment.

SpaceX has not announced pricing or a coverage map for its planned US cellular service.