Elon Musk’s SpaceX (NASDAQ:SPCX) has agreed to nearly $28 billion in wireless spectrum deals. But telecommunications expert William Webb estimates it could need another $120 billion to $130 billion to compete with T-Mobile US Inc.
(NASDAQ:TMUS) and America’s other major carriers. “The real cost is the spectrum,” Webb told Benzinga in an exclusive interview.
His estimate comes as SpaceX is reportedly seeking access to at least 80,000 US cell sites, including through discussions with Crown Castle Inc. (NYSE:CCI).
Where the $130 Billion Goes SpaceX has agreed to acquire approximately $20 billion in spectrum from EchoStar Corp. (NASDAQ:SATS), alongside a reported $8 billion deal with Grain Management.
But Webb estimates those purchases would give SpaceX only about a quarter of the spectrum held by a typical major mobile operator. Matching the incumbents’ holdings could therefore require another $90 billion, based on his rough calculation.
Spectrum is the range of radio frequencies carriers use to transmit calls and data. Without enough of it, SpaceX could offer widespread coverage but struggle to serve millions of customers in busy cities.
And buying more may not be straightforward. Webb said suitable frequencies are already scarce, making it difficult for regulators to free up additional spectrum even with political support.
“It’s just bloody difficult to find it and free it up,” he said. 14 GHz band, tentatively starting April 27, 2027.
Webb said Musk could outbid rival carriers. Webb estimates another $30 billion to $40 billion to build the network itself, including roughly $20 billion to equip 60,000 to 80,000 cell sites and about $10 billion for the core network and supporting infrastructure.
His total is a back-of-the-envelope estimate for approaching incumbent scale, not the minimum cost of launching a mobile service. Spectrum prices also vary considerably between frequency bands.
BNP Paribas offered a similarly daunting assessment Monday, estimating at least $100 billion in capital and operating spending before revenue, excluding spectrum and financing costs. Could Musk Do It for Less?
Roger Entner, founder of Recon Analytics, previously told Benzinga that SpaceX could build a substantial network for $10 billion to $15 billion, excluding additional spectrum purchases. Entner expects Musk to start in rural America, where Starlink already has customers, before expanding toward major cities.
“Think rural in,” he said. That approach would cost considerably less than Webb’s scenario but would not initially match the nationwide capacity of T-Mobile, AT&T Inc.
(NYSE:T) or Verizon Communications Inc. (NYSE:VZ).
On Polymarket, the probability of SpaceX offering its own US mobile plan by December 2027 recently fell to around 27%, from 37% last week. The contract has attracted more than $16,000 in trading volume and could resolve Yes even if SpaceX launches its own mobile plan using another carrier’s network.
Webb argued in an earlier Benzinga interview that a wholesale agreement with an established carrier could be Musk’s most economically sensible option. T-Mobile CEO Srini Gopalan ruled out a mobile virtual network operator agreement with SpaceX during Wednesday’s earnings conference call.
“I see no room for an MVNO with SpaceX,” Gopalan said.
