Your phone bill is one of the few monthly costs you rarely question.
You pick a carrier, sign up and pay roughly the same amount for years. That works for the companies because only a handful of them own the towers that carry your calls.
So when a new player threatens to build its own network, it gets attention fast. More competition usually brings prices down.
Wall Street noticed it first. The threat already wiped billions of dollars off telecom stocks this month.
Now the head of Verizon has put a price on the challenge. In his telling, the bill is enormous.
Verizon (VZ) CEO Dan Schulman said SpaceX will need at least four to six years and between $300 billion and $500 billion to build out a full Starlink Mobile carrier network in the U.S. He made the comments on Verizon’s third-quarter earnings call on Oct. 26, answering a question from Citi analyst Michael Rollins.
Schulman said he was working “under the assumption that everything SpaceX says they will do, they will do, and that they will execute flawlessly.”
What Verizon’s CEO said about Starlink Mobile
Schulman’s central argument is about physics and money. “Their service just can’t compete with a terrestrial network,” he said on the call.
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In suburban and urban areas, where about 98% of Verizon’s revenue comes from, the company is “somewhere between 100 to 1,000 times more efficient” than satellite service, Schulman said.
He then walked through what a ground network would take:
- Sites: SpaceX would need to cover 65,000 to 80,000 macro cell sites.
- Equipment: It would need backhaul, radio access network gear and “a tremendous amount of spectrum.”
- Time: “It’s going to take a minimum of four to six years to fully build that out,” he said.
- Cost: He put the bill at “somewhere between $300 billion and half a trillion” over roughly the next seven or eight years.
- Everything else: SpaceX would also need retail stores, customer service and back-office systems.
“There’s no magic wand. There’s no secret sauce. There’s no shortcut,” Schulman said.
All of that, he argued, only gets SpaceX “basically the same network and same capabilities and same cost structure as what we have today.”
Why Schulman calls SpaceX a ‘sixth’ competitor
Schulman also pushed back on the idea that SpaceX would shake up a three-carrier market. If the build-out works, SpaceX could become “the sixth, not the fourth, the sixth competitor in the market,” he said.
He shut one door outright. Verizon sees no benefit in extending a wholesale network deal, known as an MVNO, to a satellite provider, and “there are no back doors to any of our MVNO agreements,” Schulman said on the call.
Related: AT&T CEO holds firm stance on Elon Musk’s SpaceX phone strategy
Verizon isn’t planning to wait around either. “Four to five years from now, we will be two to three generations better than where we are today,” he said, pointing to the company’s millimeter-wave spectrum and early 6G work.
He isn’t alone. AT&T CEO John Stankey has said direct-to-cell satellite is “solving the last 2%, not trying to come up with a new way to solve the 98%,” according to Forbes.
“It’s very hard to throw a punch against something that doesn’t exist,” Schulman added.
What SpaceX is actually building
SpaceX has been clear about its goal. At SpaceX’s recent earnings call, President Gwynne Shotwell said Starlink is on a path to becoming a “major mobile carrier in the US.”
The company is in talks with tower operators for access to about 80,000 U.S. cell sites, Bloomberg reported, according to Light Reading. That lines up closely with Schulman’s own estimate.
Spectrum is the bigger gap. Evercore counts about 79 MHz at SpaceX, compared with 280 to 380 MHz for each of the big three carriers, TIKR reported.
SpaceX also agreed this month to buy up to 14 MHz of paired 800 MHz low-band spectrum from Grain Management, for a direct-to-device service expected to launch in early 2028, Mobile World Live reported.
Musk has brushed off the skeptics. “Veterans of the cellular industry look at the chess board of existing pieces and don’t see a solution,” he wrote on X on Oct. 20.
What the threat has done to Verizon stock
Investors aren’t treating the threat as hypothetical. Verizon shares closed down 10.14% at $41.65 on Oct. 9, the day after SpaceX announced the spectrum deal. About $0.71 of that drop reflected the stock going ex-dividend the same day.
Monday’s results were strong on paper. Verizon added 406,000 postpaid phone customers, more than 820% more than a year earlier, and raised its 2026 free cash flow growth forecast to nearly 12%, according to the company’s earnings release.
Revenue of $34.31 billion still missed the $34.74 billion analysts expected, and shares fell 2.70% to $43.45 on Monday, Benzinga reported.
This is the part I’d focus on if you own Verizon for income. The quarterly dividend is 70.75 cents per share, or $2.83 a year.
By my math, that works out to a yield of about 6.5% at Monday’s price of roughly $43.45. Free cash flow of $7.8 billion in the quarter, up 12.1%, is what pays for that dividend.
If you’re a Verizon customer, the takeaway is different. Starlink Mobile isn’t likely to change your U.S. plan before 2028, but the threat is already shaping how carriers treat you.
Schulman said on the call that he is “not against taking up pricing as long as we add value to that.”
Here’s how to use that:
- Ask for loyalty offers. Carriers are working harder to keep customers, so call before you switch.
- Compare total cost. Check fees and device payments, not just the advertised monthly rate.
- Watch for satellite add-ons. Satellite texting in remote areas is already sold as an extra on some plans.
- Don’t chase a dividend alone. A high yield can signal risk, so check free cash flow and debt too.
Schulman may be right that there’s no shortcut. But a rival doesn’t need to win to change what you pay.
Related: Bank of America sends SpaceX stock investors strong signal