Elon Musk is planning to make huge change to the US' biggest cell networks with SpaceX
Elon Musk is set to rival some of the United States' biggest cell networks with a major expansion to SpaceX's services, offering a direct-to-cell mobile service without any of the middle men.
While you might know SpaceX primarily for its lofty space exploration goals or the recent blockbuster IPO, the company owned by Elon Musk actually operates primarily as a satellite network, with over 10,000 satellites currently in Low Earth Orbit (LEO).
What this provides is the baseline for both Starlink – SpaceX's internet provider subsidiary – and the company's impressive satellite cell connection service through providers like T-Mobile in the United States, but that could soon change.
As reported by the Financial Times, Musk's company is planning on launching its own direct mobile service for customers in the United States, which could fundamentally revolutionize the phone network market and offer significant competition to existing industry titans.
What would SpaceX offer as a network?
SpaceX President and COO Gwynne Shotwell revealed that the company was considering building its own retail product alongside a terrestrial mobile network in America, and this would expand on the existing satellite services they already provide.
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Through existing partnerships, SpaceX effectively fills in the gaps in situations where you would otherwise be left with no cell service through traditional providers — such as in remote locations or areas that aren't quite as well covered.
With its own network, however, SpaceX would provide the entire connection and, in theory, have a service that rarely if ever loses connection while maintaining high speeds.
It would achieve this through the ever growing number of satellites SpaceX operates in space, as they cover a wide enough area to ensure almost unilateral coverage.
Documents seen by the FT show SpaceX expecting the prospect of 'Starlink Mobile' "to be most impactful for customers in remote areas uncovered by terrestrial mobile networks," with future plans competing "to be the preferred connectivity experience to our customers no matter where they are located, whether in rural, suburban or urban areas."
Would there be any downsides?
While the plan seems great in theory – and existing SpaceX services have already proven to be a success – one of the biggest concerns and downsides would be the prospective price if Starlink is anything to go by.
Starlink is a fantastic product that allows a far greater number of people to access high-speed internet in areas where that would simply be impossible, yet on average its far more expensive than traditional broadband providers, and offers little to no benefits for customers already in serviced areas.
Staring out it would probably be difficult for anyone not living in a remote location to opt for Starlink Mobile unless it was already at an incredibly competitive price point, yet that could change as the service evolves over time.
Additionally, telecommunications research firm New Street Research has highlighted the difficulty that SpaceX would face in penetrating a marketed dominated by existing and long-established networks, pointing out the disparity in spectrum between the three current US mobile network operators (1,020MHz) and SpaceX (65MHz).
According to New Street Research partner David Barden, building a "wireless network in saturated markets around the world would be incredibly hard."
Instead, he speculates that this suggestive announcement could be a way for SpaceX to secure a better deal for itself in negotiations, indicating that it would stay as a partner going forward instead of forging its own path alone.