Would Starlink's Access to the AWS-4 Spectrum Be a Carrier Killer?

The satellite industry's most ambitious player is eyeing underutilized spectrum that could reshape the competitive landscape—but the reality is more nuanced than the headlines suggest

In the high-stakes world of telecommunications, spectrum is the ultimate currency. It's finite, regulated, and increasingly valuable as our appetite for connectivity grows insatiable. So when SpaceX's Starlink begins circling EchoStar's AWS-4 spectrum like a hungry predator, industry veterans take notice.

The question on everyone's mind: Could Starlink's potential acquisition of AWS-4 spectrum transform it from a carrier partner to a carrier killer?

The short answer is no—but the long answer reveals a complex and potentially alarming shift in the competitive dynamics that every telecom executive and investor should be watching closely.

The AWS-4 Prize: A Spectrum Battle Royale

Let's start with what's at stake. The AWS-4 band (2000-2020 MHz and 2180-2200 MHz) represents 40 MHz of valuable S-band spectrum currently licensed to EchoStar (formerly Dish Network). This spectrum sits in the sweet spot for satellite communications while still being potentially usable for terrestrial services.

As of May 2025, this spectrum has become the center of a regulatory battle that could reshape the satellite Direct-to-Device (D2D) market:

"I have directed agency staff to begin a review of EchoStar's compliance with its federal obligations to provide 5G service throughout the United States per the terms of its federal spectrum licenses," FCC Chairman Brendan Carr wrote in a May 9 letter to EchoStar Chairman Charles Ergen.

The timing is no coincidence. SpaceX has been aggressively lobbying the FCC, claiming that EchoStar is warehousing this valuable spectrum. In an unprecedented move, SpaceX even deployed its own satellites to measure spectrum utilization, claiming EchoStar uses "less than 5% of what would be expected from an actual wireless network operator."

This is more than a technical dispute—it's an existential battle for both companies. For EchoStar, losing AWS-4 would undermine years of investment and strategic positioning. For Starlink, gaining access could potentially eliminate its dependence on carrier partnerships for D2D services.

But would it really?

The Carrier Partnership Paradox

To understand the implications, we need to examine Starlink's current approach to the D2D market. Rather than pursuing independent spectrum ownership, Starlink has chosen a carrier partnership model, most notably with T-Mobile in the US.

This partnership, announced in 2023 and now in beta testing, uses T-Mobile's existing PCS spectrum (1850-1990 MHz) to provide text messaging services directly to standard smartphones. The service is expected to expand to voice and data capabilities in the future.

Starlink has also formed similar partnerships with carriers worldwide, including KDDI (Japan), Optus (Australia), One NZ (New Zealand), Salt (Switzerland), Entel (Chile & Peru), and Rogers (Canada).

This strategy raises a critical question: If Starlink values independence from carriers, why is it pursuing these partnerships so aggressively? The answer reveals why AWS-4 access alone wouldn't transform Starlink into a carrier killer.

The Technical Reality Check

The technical limitations of satellite D2D services create fundamental constraints that even AWS-4 spectrum wouldn't overcome:

1. Capacity Constraints

The AWS-4 band provides only 40 MHz of total bandwidth. While this sounds substantial, it pales in comparison to the spectrum holdings of major carriers. T-Mobile, for instance, holds hundreds of MHz across various bands.

As the Wireless Infrastructure Association notes:

"In the US, satellite D2D services use a 5MHz block of spectrum, which means that the capacity of the system is very low. Because the beams produced by the distant satellite spread out further, they are covering an area much larger than a typical terrestrial tower."

This fundamental physics problem means that even with AWS-4 spectrum, Starlink would face severe capacity limitations compared to terrestrial networks. A single satellite beam may cover 30 times more area than a terrestrial cell tower, meaning 30 times more people sharing the same limited bandwidth.

2. Device Compatibility

Most consumer devices are not designed to work with the AWS-4 band. While Starlink could theoretically deploy services using this spectrum, it would face the chicken-and-egg problem of device support.

Manufacturers would need to incorporate support for these frequencies into their chipsets and devices—a process that requires significant investment and coordination. Without an established user base, manufacturers have little incentive to prioritize such support.

3. Indoor Coverage Limitations

Satellite signals struggle to penetrate buildings, dense urban environments, and even tree cover. This fundamental limitation means that even with dedicated spectrum, Starlink's D2D service would remain complementary to terrestrial networks rather than competitive.

As one industry expert put it: "D2D is not a true substitute for terrestrial cellular service and terrestrial wireless infrastructure remains vital."

The Business Case Reality

Beyond technical limitations, the business case for Starlink as a carrier competitor faces several challenges:

1. Customer Acquisition Costs

Carriers have spent decades and billions of dollars building customer relationships, retail presence, and brand recognition. Starlink would need to replicate this infrastructure or—more efficiently—leverage it through partnerships.

2. Regulatory Complexity

Operating as a full-fledged carrier would subject Starlink to a host of additional regulatory requirements across multiple jurisdictions. These include emergency services obligations, law enforcement cooperation requirements, and consumer protection regulations.

3. Service Integration

Modern telecommunications services are deeply integrated into the digital ecosystem. From billing systems to roaming agreements, the infrastructure required to operate as a competitive carrier is extensive and complex.

The Strategic Calculation

Given these realities, Starlink's interest in AWS-4 spectrum likely reflects a more nuanced strategy than simply becoming a carrier competitor. Instead, it points to three potential strategic objectives:

1. Negotiating Leverage

By positioning itself as a potential competitor, Starlink gains leverage in partnership negotiations with carriers. The threat of independence—however theoretical—strengthens Starlink's hand when negotiating revenue sharing, technical integration, and go-to-market strategies.

2. Regulatory Arbitrage

Satellite spectrum and terrestrial spectrum are regulated differently. By controlling both types of spectrum, Starlink could potentially exploit regulatory differences to gain competitive advantages in specific markets or use cases.

3. Strategic Optionality

Technology and markets evolve rapidly. By securing access to AWS-4 spectrum, Starlink would preserve strategic options for future business models that may not be viable today but could become so with technological advancement.

The Competitive Landscape: A Race for the Sky

To fully understand Starlink's positioning, we must consider the competitive landscape. Several players are pursuing different approaches to the satellite D2D market:

AST SpaceMobile

With agreements with more than 40 MNOs including AT&T, Rakuten, and Vodafone, AST SpaceMobile is pursuing a similar carrier partnership model but with a more ambitious technical approach. The company aims to provide broadband-level speeds (2-4 Mbps initially) using large, high-power satellites with large antennas.

However, AST SpaceMobile faces significant capital requirements and technical challenges. The company needs to raise substantial funding to deploy its full constellation and has yet to demonstrate commercial service.

Lynk Global

Lynk has contracts with 34 mobile network operators and is already providing intermittent texting services in several countries including the Solomon Islands, Cook Islands, and Palau. The company recently received investment from SES to enhance its capabilities.

Lynk uses smaller "pizza-box-sized" satellites and focuses on text messaging with plans for voice and data. Like AST SpaceMobile, Lynk faces capital constraints and needs to deploy thousands more satellites to provide continuous global coverage.

Iridium

As an established player with an operational satellite network, Iridium has partnered with Qualcomm to enable satellite connectivity in Snapdragon chips. However, activations won't start until late 2024, and the company projects a 10-year timeline for widespread adoption.

Iridium's measured approach reflects the technical and market realities of satellite D2D services. As Iridium COO Suzi McBride cautioned: "We as an industry have to be clear and manage expectations for the customers... We have to be very cautious that we manage expectations properly so that it is successful long term."

The Carrier Response: Threat or Opportunity?

For carriers, Starlink's interest in AWS-4 spectrum presents both threats and opportunities:

The Threat Scenario

If Starlink gained AWS-4 spectrum and overcame the technical and business challenges outlined above, it could potentially offer limited D2D services independently. This would primarily impact rural and remote areas where terrestrial coverage is limited or non-existent.

In this scenario, carriers could lose some high-margin roaming and emergency service revenue from these areas. However, the impact would be limited by capacity constraints and indoor coverage limitations.

The Opportunity Scenario

More realistically, carriers can view Starlink as a potential partner for network extension rather than a competitor. By integrating satellite capabilities into their service offerings, carriers can:

1. Extend coverage to previously uneconomical areas

2. Provide emergency backup services during disasters

3. Offer premium "coverage anywhere" packages to high-value customers

4. Reduce the capital expenditure required for rural coverage

Investment Implications: Reading Between the Lines

For investors in the telecommunications sector, Starlink's spectrum ambitions require careful analysis:

Carrier Stocks

Major carriers like T-Mobile, AT&T, and Verizon face limited near-term threat from Starlink's potential AWS-4 acquisition. The partnership model is likely to persist regardless of spectrum ownership, and the technical limitations of satellite D2D services make them complementary rather than competitive with terrestrial networks.

However, carriers with significant rural exposure could see some margin pressure in these markets if Starlink gains independent spectrum access. This risk should be monitored but not overweighted in investment decisions.

Satellite Operators

Traditional satellite operators like Intelsat, SES, and Eutelsat face more significant disruption from the emerging D2D market. These companies must either partner with new entrants (as SES has done with Lynk) or develop their own D2D strategies to remain competitive.

The capital requirements for new satellite constellations create significant financing risk for pure-play D2D ventures like AST SpaceMobile and Lynk. Investors should carefully assess funding pathways and partnership announcements from these companies.

Equipment Manufacturers

Network equipment manufacturers and smartphone makers face a complex calculus. Supporting satellite connectivity requires chipset modifications and antenna design changes, creating both costs and opportunities.

Companies like Qualcomm that have already invested in satellite connectivity solutions may gain competitive advantages as the market develops. However, the slow adoption timeline suggests these advantages will materialize gradually rather than immediately.

Regulatory Wildcards: The FCC's Crucial Role

The FCC's decisions regarding AWS-4 spectrum will shape the competitive landscape. Several potential outcomes could emerge from the current proceedings:

Spectrum Sharing

The FCC could establish a spectrum sharing framework that would allow new entrants like SpaceX to use the AWS-4 band alongside EchoStar. This would increase spectrum efficiency but create technical challenges for coordination.

License Revocation

In the most extreme scenario, the FCC could revoke EchoStar's licenses for the AWS-4 band, potentially making them available for reallocation through auction or direct assignment.

New MSS Entrants

The FCC is specifically seeking comment on "steps the Commission might take to make more intensive use of the 2 GHz band, including but not limited to allowing new MSS entrants in the band." This language suggests openness to new satellite operators using the spectrum.

The Bottom Line: Evolution, Not Revolution

Despite the provocative headline, Starlink's potential access to AWS-4 spectrum would not transform it into a carrier killer. The technical and business realities of satellite D2D services make them inherently complementary to terrestrial networks rather than competitive.

However, the strategic implications remain significant:

1. For Carriers: The partnership model will likely persist, but terms may shift as Starlink gains leverage. Strategic partnerships now could secure favorable terms before competition intensifies.

2. For Investors: The satellite D2D market represents a meaningful evolution in connectivity, but with a longer adoption timeline than some projections suggest. Investment opportunities exist but require careful assessment of technical feasibility, capital requirements, and regulatory pathways.

3. For Regulators: Balancing innovation with efficient spectrum use presents complex tradeoffs. Spectrum sharing frameworks may offer the optimal path forward, allowing multiple providers to serve different market segments.

The telecommunications industry has always been defined by technical innovation, regulatory evolution, and strategic competition. Starlink's spectrum ambitions represent the latest chapter in this ongoing story—significant but not revolutionary, concerning but not catastrophic.

For industry executives and investors alike, the key is to separate the signal from the noise, understanding both the theoretical possibilities and practical realities of satellite D2D services. In this context, Starlink's interest in AWS-4 spectrum deserves close attention—but not panic.

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This analysis is based on current regulatory filings, technical assessments, and market developments as of May 2025. Regulatory decisions, technical breakthroughs, or strategic pivots could alter these conclusions.