- EchoStar shares rose more than 3% after the Washington Post reported that SpaceX is in talks to buy Boost Mobile or use its network
- Analysts doubt that SpaceX can simply buy Boost Mobile and inherit its MVNO deals since the carriers would have to consent
- The Big 3 carriers have all said they aren't interested in an MVNO with SpaceX, and Verizon CEO Dan Schulman last week repeated that there are "no back doors" to its MVNO agreements
EchoStar’s shares were up more than 3% this morning after the Washington Post reported that Elon Musk’s SpaceX is in talks to buy Boost Mobile or use its network.
Musk held talks with EchoStar Chairman and CEO Charlie Ergen last month about SpaceX launching its own signature wireless service through a deal with Ergen’s company, according to the article. The report suggested such a transaction could result in SpaceX acquiring Boost Mobile or SpaceX gaining access to its network – which it leases from AT&T and T-Mobile.
Timing of the report is curious because the CEOs of all of the Big 3 carriers have repeatedly said they aren’t interested in doing an MVNO with SpaceX, a stance they reiterated in their last round of earnings calls that ended last week.
On Verizon’s Q3 call, CEO Dan Schulman also echoed his previous statement that “there are no back doors to any of our MVNO agreements,” preventing someone like SpaceX to get access to Verizon’s network through a third-party MVNO deal like Verizon has with Comcast and Charter Communications.
Schulman pointed out that SpaceX is going to need a lot more spectrum than the airwaves it’s currently buying from EchoStar in order to become a viable fourth mobile phone competitor in the U.S. Regardless, its cost will be somewhere between $300 billion and half a trillion dollars over the next seven or eight years to fully accomplish that feat, he predicted.
On X.com, Musk said it’s actually going to take “2 or 3 years,” without elaborating. He has previously suggested that SpaceX should hold an event relatively soon to more fully explain its mobile strategy.
New Street flags “gross understatement”
In a note for investors today, New Street Research analyst David Barden said the Washington Post article acknowledged that SpaceX “may need consent” from AT&T and T-Mobile, the two carriers supporting Boost with MVNO agreements. “We think this is a gross understatement,” he said.
The fastest, cheapest, most profitable and globally scalable business approach for SpaceX’s terrestrial ambition is a wholesale deal, he said.
He also said that based on discussions with SpaceX investor relations, it’s reasonable to assume that some kind of video interview addressing some of the “unknowns” about SpaceX’s mobile plans is possible in the next month or two.
Dish gear is adjacent topic
Barden pointed out that the discussion of SpaceX outright buying Boost and somehow getting around the MVNO deals (since Boost’s own network, built by Dish, is no longer available/in service) dovetails with an adjacent conversation about whether SpaceX might be interested in jumpstarting a terrestrial build by acquiring the legacy Dish Wireless assets.
The Dish network is made up of about 24,000 cell sites, of which the majority likely had low-band compatible radios (600 MHz), although Dish never deployed 800 MHz spectrum and thus that network would need updating for the 800 MHz Grain spectrum that SpaceX bought, he said.
The concern here is whether SpaceX wants the “residue of a failed business with novelty radios and broken vendor contracts,” he added.
These two conversations then lead to the larger conversation, which is: “Why are we talking about SpaceX buying EchoStar in pieces? Why not just buy the whole thing outright?,” he said.
“The biggest argument FOR SpaceX simply buying ECHO is that it is a very cheap way to buy its own stock back. Maybe the biggest argument AGAINST this is the fact that SpaceX could have chosen to bid to win the AWS-3 spectrum ECHO sold to Verizon but it did not. ECHO retains a large amount of said spectrum but as shown in the most recent sale, this spectrum is most valuable to the carriers that have already deployed it and least valuable to those that have not (SpaceX),” he said.
LightShed: Boost isn’t a shortcut
But SpaceX can’t “simply acquire Boost Mobile and inherit its MVNO agreements with AT&T and T-Mobile,” said LightShed Partners analysts Walter Piecyk and Joe Galone in a blog post today (registration required).
They confirmed that back on EchoStar’s Q1 2025 earnings call, when management said a similar wholesale arrangement with cable operators would “require cooperation from all parties.”
“We see no reason those restrictions would disappear in a change of control or why AT&T and T-Mobile would suddenly want to enable SpaceX as a competitor,” they wrote. “SpaceX has other options for addressing its coverage gaps.”
They also don’t see SpaceX building its wireless strategy around Boost Mobile, whether owned or otherwise.
“It has time to address its coverage challenges, and we expect the solution to be driven by technological innovation and vertical integration,” they said. “Plus, Boost already has an agreement to bring Starlink’s next-generation direct-to-cell service to its customers. That relationship could expand to include bundled Starlink home broadband, but Boost would be just one of many distribution partners for Starlink.”
EchoStar’s piece of SpaceX
They added that another distribution deal does nothing to address “EchoStar’s ‘problem,’ if you can call it that.”
“EchoStar is set to receive roughly $11 billion in SpaceX stock that is now worth more than $35 billion, raising a significant tax issue when the transaction closes. That’s EchoStar’s problem to solve, not SpaceX’s. Acquiring all of EchoStar would offer synergies, but there are also reasons not to. For one, SpaceX could potentially acquire Dish’s abandoned radios and antennas directly from the tower companies without buying EchoStar. The allure left at EchoStar is its spectrum and Verizon should buy it,” they concluded.
Big 3 stocks rise anyway
The shares of the Big 3 wireless carriers have taken a pummeling since SpaceX started talking in earnest about becoming a fourth mobile carrier. For whatever reason, shares of the Big 3 were trading up or flat today on a broader market upswing.
T-Mobile shares were up more than 1%, to $158.42, while Verizon was up about 0.66%, to $45.04, and AT&T was up by 0.12%, to $21.42.
Read more about SpaceX and its mobile ambitions on Fierce Network:
Do SpaceX’s ‘missing pieces’ carry a Dish logo on them?
SpaceX helps give towers new lease on life
SpaceX might sign deals for 80,000 towers to build mobile network, or is it bluffing?
Elon Musk: Starlink Mobile’s game plan too big for an earnings call