Telstra falls as SpaceX expands cellular network
- SpaceX acquired an 800 MHz wireless spectrum portfolio from private equity firm Grain Management.
- Shares across major Australian telecommunications providers slumped up to 3.7% in afternoon trading.
- The acquisition gives Starlink low-band spectrum needed to penetrate walls and deliver direct-to-cell coverage indoors.
Shares in regional telecommunications providers fell following reports that SpaceX (NASDAQ:RKT) acquired a wireless spectrum portfolio from Grain Management.
The drop follows selling pressure across global markets after American carriers AT&T (NYSE:T) and Verizon (NYSE:VZ) tumbled about 11% on Oct. 9.
“This prime low-band spectrum addresses one of the key remaining technical gaps that will pave the way for Starlink Mobile to become a major mobile carrier in the US,” said SpaceX President Gwynne Shotwell.
The company reported that the transaction covers up to 14 megahertz of paired spectrum in the 800 MHz band, pending approval from the Federal Communications Commission.
The deal positions the satellite operator to combine orbit-based connectivity with ground networks to target direct-to-cell users.
Following the announcement, the Telstra (ASX:TLS) share price was down 2.3% at $4.65.
The broader sector sell-off also pulled down TPG Telecom (ASX:TPG) by 3.7%, Spark New Zealand (ASX:SPK) by 1.5%, and Superloop (ASX:SLC) by 2.7%.
