Elon Musk’s SpaceX may pursue an acquisition of T-Mobile if it cannot secure a wholesale network agreement to fuel its expansion of Starlink into the consumer mobile industry, according to an analyst.
Forbes reports that SpaceX is positioning its Starlink Mobile service as a potential challenger to established wireless providers like Verizon and AT&T, and one analyst believes T-Mobile represents the most logical acquisition target to advance this strategy.
The space company, founded by Elon Musk, detailed its wireless expansion ambitions in its IPO filing last month. That filing cast Starlink Mobile as a direct competitor to major telecommunications carriers in the United States market.
TD Cowen analyst Gregory Williams wrote in a Thursday note that T-Mobile would be the “clear choice” for SpaceX if the company fails to reach a wholesale network deal, or if Musk decides he would prefer to own a wireless operation rather than partner with one. Williams pointed to SpaceX’s existing partnership with T-Mobile through its Starlink satellite internet business as a foundation for such a deal.
Williams also floated an alternative possibility, suggesting that “another thought would be [for SpaceX] to acquire AT&T.” The analyst indicated that SpaceX could finance such a purchase by selling additional shares of its own stock, noting that this approach could be executed without substantially diluting the ownership stakes of current shareholders.
Beyond wireless carriers, Williams suggested SpaceX might also consider acquiring a cable television company. He identified both Comcast and Charter Communications as potentially attractive targets, citing the wholesale network agreements that each company has already established with Verizon.
The financial performance of SpaceX’s various divisions reveals why the company is prioritizing its connectivity business. Starlink generated 69 percent of SpaceX’s total revenue during the first quarter of this year. The company’s connectivity division, which encompasses Starlink Mobile, was SpaceX’s only profitable segment. By contrast, the space unit recorded losses of $619 million, while the artificial intelligence arm posted a massive deficit of $2.5 billion.
SpaceX’s IPO filing projected the addressable market for Starlink Mobile at $740 billion. The filing briefly mentioned plans to “expand our Starlink Mobile offering” without providing extensive detail on specific product timelines.
Breitbart News previously reported that some analysts believe it is very likely that Musk will merge SpaceX and Tesla:
The merger speculation has been met with positive reactions from some Tesla investors. Wedbush Securities analyst Dan Ives, a longtime Tesla bull, wrote in a recent note that he expected the two companies to combine next year, suggesting the move would enable Musk to own and control more of the AI ecosystem.
Ross Gerber, a longtime Tesla investor and Musk critic, expressed support for a potential merger. “SpaceX is kind of a thing everybody’s talking about. Nobody’s talking about Tesla, and so it kind of sucks for Tesla shareholders,” Gerber told reporters. “Are they better off together or apart? I think they’re better off together,” he said.
Read more at Forbes here.
Lucas Nolan is a reporter for Breitbart News covering issues of AI, free speech, and online censorship.