- A reported handset-like AI device prototype adds fresh fuel to the Starlink phone rumor mill
- The report follows speculation that SpaceX may build its own terrestrial mobile network
- It’s a mystery why SpaceX hasn’t moved on Dish’s network assets
Is Elon Musk’s SpaceX building a phone and/or a terrestrial wireless network? Reports about both surfaced in the days leading up to the July 4th holiday. Ka-boom!
The idea of Musk building either a cell phone or a cellular network isn’t new, but these kinds of rumors and innuendo keep popping up. Why? Because in some ways, it makes perfect sense and mirrors Musk’s outsized character. In other ways, they’re kinda “out there.” Either way, they appear to be here to stay until somebody, somewhere decides to clear the air once and for all.
The latest: On July 1, the Wall Street Journal (WSJ) reported that SpaceX has developed a prototype for a handset-like device that integrates SpaceX’s xAI technology. The device would use a Qualcomm Snapdragon chipset, unidentified sources told the WSJ.
In a post on X, Musk called report: "Utterly false," without elaborating. In another weird twist, the original post was apparently deleted shortly after Musk’s reply.
The Starlink phone piece
Similar to a June 29 Financial Times story about a Starlink mobile service that goes beyond the direct-to-device (D2D) service it supplies for T-Satellite, the sources saw/heard about the prototype during talks leading up to SpaceX’s historic IPO. Companies tend to say all kinds of things to hype up their business before an IPO, even one as gigantic as SpaceX, which, as it so happens, is currently getting most of its revenue from Starlink as opposed to AI.
Obviously, a device prototype isn’t the same as a product announcement. This Gadgeteer report does a fine job explaining all that.
That said, rumors of a Starlink Mobile phone are nothing to sneeze at – nor does it seem they will ever go away. It’s reminiscent of the new phone Amazon is reportedly developing. That’s also said to be AI-centric.
It doesn’t help that Musk himself gives contradictory answers.
In February, Reuters reported that SpaceX had plans to develop a mobile device connected to its Starlink satellite internet constellation. Musk said on X that they weren’t developing a phone, but he also said it’s “not out of the question at some point.” So, which is it?
The SpaceX network piece
Fierce and others have been wondering for months why, if it wants a terrestrial wireless network, SpaceX doesn’t just buy the network that Dish Wireless built. You know, the 5G open RAN network that we’ve been talking about for years but that EchoStar decided to decommission last year after getting heat from Federal Communications Commission (FCC) Chairman Brendan Carr.
EchoStar still blames much of its current predicament on that FCC investigation because it created a “dark cloud” over its business. Er, check that. EchoStar is arguing that Dish Wireless’ bankruptcy filing is largely due to that investigation because EchoStar’s lawyers are making a legal case for Dish (not EchoStar, which is getting more than $40 billion for selling spectrum to AT&T and SpaceX) to walk away from a lot of debt. That’s a story for another day later today. Stay tuned.
Turns out, not that much of the Dish wireless network has actually been decommissioned. Radios still sit on towers and property owners are stuck with equipment they don’t want.
Last week provided a few more answers (actually, a lot more questions – who are we kidding???) about the fate of the old Dish Wireless network. In Chapter 11 bankruptcy court filings, lawyers proposed that Dish’s old network be put up for sale and EchoStar to act as a stalking horse bidder, which means it sets the floor price and prevents other buyers from undercutting the purchase price.
The bankruptcy filings didn’t say anything about why no buyer has stepped up to buy the network before the Chapter 11 filing. Was every potential bidder assuming Dish was headed to bankruptcy and wanted to wait for the lowest possible price?
Analysts at LightShed Partners surmised that SpaceX could very well buy Dish’s old network.
The Dish radios that sit on towers across many markets support the exact spectrum bands a prospective buyer like SpaceX might want: 600 MHz, AWS and H-block, much of which SpaceX is already buying from EchoStar anyway; as well as 800 MHz, which T-Mobile is selling to Grain Management. That, too, could end up with a satellite operator.
“EchoStar is running a stalking horse bid for the Dish Wireless assets and liabilities and it reads as largely all-or-nothing,” wrote LightShed’s Walter Piecyk and Joe Galone (registration required). “But whether SpaceX bids, tops that bid, or sits it out, the setup is the same. A new entrant could use these assets to move fast and a bankruptcy sale lets the buyer take the pieces it wants and leave others behind. SpaceX is the obvious candidate but why not Charter, Amazon or RocketLab?”
SpaceX and Starlink analysis
As Recon Analytics founder Roger Entner wrote in May, Starlink’s path to mobile is a checklist, and most of the boxes have already been checked, including ascertaining in February 2024 the ITU’s mobile network code 901-08, a critical component to being a stand-alone global mobile operator.
These reports about an AI-centric Starlink phone and SpaceX’s intentions to compete more aggressively in mobile phone services come at an interesting time. AT&T, T-Mobile and Verizon have all said they’re not interested in doing an MVNO with SpaceX/Starlink. Maybe one of them will blink if enough levers are cranked?
Regardless of what SpaceX does, the SpaceX overhang doesn’t have an end date, as TD Cowen analysts said in a recent report for investors. SpaceX will continue to make an impact on the Big 3 wireless stocks even though the wireless industry is otherwise in a relatively healthy state. Maybe that’s why Musk wants a piece of it?
Related Fierce Network articles about Starlink, SpaceX and more
Now SpaceX is talking to Charter about a mobile offer: report
What the SpaceX IPO filing says about Starlink Mobile’s wireless ambitions
SpaceX plans bigger Starlink mobile push in US: report