SpaceX in talks with Crown Castle to secure 80,000 US cell sites

Investing.com -- SpaceX is working to secure at least 80,000 cell sites across the United States and is in discussions with at least one major cellular infrastructure company to achieve this target, according to people familiar with the matter.

The agreements would strengthen the rocket and satellite company's path toward building a fourth nationwide wireless carrier, said the people, who asked not to be identified because the discussions are private. One of the companies in talks with SpaceX is Crown Castle Inc. (NYSE: CCI), which along with American Tower Corp. (NYSE: AMT) and Vertical Bridge Holdings, are among the largest owners of cellular towers.

Crown Castle Chief Executive Officer Chris Hillabrant was asked on Wednesday's earnings conference call whether the company is discussing leases with SpaceX, Amazon.com Inc. (NASDAQ: AMZN) or other satellite-based telecom providers. "You can assume that we're talking to all parties," Hillabrant said. He declined to discuss specific customer details.

Shares of Crown Castle jumped as much as 10% in late trading after Bloomberg News reported on the talks. Shares of mobile providers AT&T Inc. (NYSE: T), Verizon Communications Inc. (NYSE: VZ) and T-Mobile US Inc. (NASDAQ: TMUS) all fell around 5%.

American Tower declined to comment. SpaceX and Vertical Bridge did not immediately respond to requests for comment.

Mobile networks rely on antennas placed on towers across the country to transmit wireless signals. The carriers typically lease room for their equipment at the tower sites because it is more cost effective than owning and maintaining them, in part because the facilities can be shared.

The value of the deals with SpaceX could reach into the billions.

SpaceX Chief Executive Officer Elon Musk has stated his intentions to create a standalone wireless carrier. The company recently acquired low-band spectrum and won Federal Communications Commission approval to launch 15,000 satellites designed to provide mobile service directly to phones.

"We will be building out our terrestrial networks so there's broad-based connectivity anywhere that SpaceX and Starlink are allowed to operate," Musk said during SpaceX's earnings call this week. Satellite launches plus spectrum acquisition "will pave the way for Starlink Mobile to become a major mobile carrier in the US," he said.

Crown Castle's Hillabrant said SpaceX's acquisition of the low-band spectrum is a "huge milestone" in being able to provide broad mobile coverage.

SpaceX has already said it plans to use its home Internet equipment to emit mobile signals in the areas surrounding customers' installations.

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