SpaceX inks Qualcomm deal, putting Starlink closer to becoming the fourth major US wireless carrier

SpaceX's ( SPCX ) goal of turning its Starlink service into a major US mobile carrier is one step closer to becoming a reality.

On Wednesday, Qualcomm ( QCOM ) announced that SpaceX has selected its Dragonwing Cellular Infrastructure platforms to power Starlink Mobile's nationwide terrestrial 5G cellular network.

Starlink already has the largest satellite-based network, and the ground-based stations will allow it to better compete with AT&T ( T ), T-Mobile ( TMUS ), and Verizon ( VZ ).

Last month, the company announced an agreement to purchase licenses for 800 MHz spectrum.

"While Starlink Mobile's global 2 GHz mid-band spectrum will provide high-bandwidth capacity in the United States, this new low-band spectrum will provide a coverage layer that ensures Starlink Mobile's signal penetrates through obstacles, such as walls, and can provide service to customers' devices even when they are in buildings," the company said at the time.

According to Qualcomm, the new deal will allow both companies to begin deploying advanced 5G service and provide "an opportunity to lay the foundation for AI-native 6G in the years ahead."

The company says the effort will require SpaceX to deploy its chip technology across tens of thousands of cellular towers nationwide.

"Our agreement with SpaceX is structured in such a way that as the deployment begins, starting from next year, it's going to ramp up pretty rapidly from there onwards," said Durga Malladi, EVP and GM for technology planning, edge solutions, and data center at Qualcomm.

"So it's a multi-year agreement that we have with them in terms of the deployment capability as we ramp up all the way to nationwide coverage," he added.

Earlier this month, The Washington Post reported that SpaceX was in talks with EchoStar ( ECHO ) to operate its own carrier through EchoStar's Boost Mobile brand.

The company made the move after AT&T, T-Mobile, and Verizon reportedly rejected its requests to use their network capacity through a mobile virtual network operator (MVNO) deal.

An MVNO rents capacity from existing carriers and sells it under its own branding. But an operator like Starlink Mobile could prove a particularly potent challenger to the Big Three network carriers, leaving them little incentive to work with Elon Musk's firm.

Email Daniel Howley at dhowley@yahoofinance.com . Follow him on X at @DanielHowley , or reach out on Signal or Telegram.