‘Real consequences’: AT&T, Verizon and T-Mobile warn FCC as Elon Musk plots a SpaceX phone network for the US by 2028

AT&T, Verizon and T-Mobile have spent months insisting a satellite company can't compete with their networks. Investors aren't convinced.

On Oct. 23, shares of AT&T (NYSE:T) and T-Mobile (NASDAQ:TMUS) each fell nearly 8% after Bloomberg reported that SpaceX is in talks to access at least 80,000 U.S. cell sites, a step toward becoming the country's fourth nationwide carrier. Verizon (NYSE:VZ) slipped about 1.2%.

The selloff came a day after the carriers' trade group, CTIA, filed a letter with the Federal Communications Commission following Oct. 20 meetings with agency officials. In it, CTIA warned that "the Commission's buildout decisions have real consequences for consumers who rely on ever-increasing wireless capacity to access the modern economy and support their day-to-day living."

The letter doesn't mention SpaceX (NASDAQ:SPCX), which wants to become one of those carriers. On the company's Oct. 20 earnings call , President Gwynne Shotwell said a new spectrum purchase and the FCC's approval of its next satellites would "pave the way" for Starlink Mobile to become a major U.S. mobile carrier, with service on its own airwaves targeted for early 2028. Musk told analysts he sees "a clear path to several hundred billion dollars a year" in connectivity revenue, from a business that brought in about $5.2 billion in the third quarter.

The U.S. hasn't had four national carriers since T-Mobile bought Sprint in 2020. Regulators approved the deal expecting Dish Network to build a fourth network. The plan fell apart in 2025, when Dish's parent, EchoStar, agreed to sell spectrum to AT&T for about $23 billion and to SpaceX in deals now worth about $19.6 billion, and moved its Boost Mobile customers onto AT&T's network. The FCC approved AT&T's purchase and SpaceX's in May.

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What AT&T, Verizon and T-Mobile want from the FCC

The carriers' immediate concern is an FCC vote on Oct. 29. The agency will consider a proposal to update its rules for satellite-to-phone service, which it calls "supplemental coverage from space." That's when a satellite beams a signal straight to an ordinary phone using airwaves licensed to a regular carrier.