Elon Musk’s plan for SpaceX to “become a major mobile carrier in the U.S.” sent shares of the nation’s big three wireless carriers sliding by double digits Friday, wiping out more than $50 billion in market value before lunch. “Once we receive final FCC approval, Starlink Mobile will deploy a flexible architecture combining our satellite-to-mobile constellation in space with an advanced terrestrial deployment that can seamlessly connect devices everywhere,” the company said late Thursday.

It also announced that the Federal Communications Commission had approved the launch of 15,000 new satellites, also under Starlink Mobile, which is a subsidiary of SpaceX. Shares of AT&T and Verizon both dropped 10% on Friday morning, while T-Mobile US stock plunged 14%. Shares of Charter and of Comcast, the parent company of NBC News, also fell throughout the day Friday. Both companies sell wireless services under their own brands using Verizon’s infrastructure.

Musk’s empire expands The announcement from SpaceX marked Musk’s latest step to expand his global tech empire. The world’s richest man and its first-ever trillionaire, Musk’s net worth as of Thursday was about $990 billion. Musk’s constellation of companies already includes electric vehicle maker Tesla, the social media site X and xAI, which builds data centers and develops artificial intelligence. SpaceX includes multiple lines of business, too. Starlink sells high-speed internet to companies and consumers worldwide, while Starshield does the same, but to governments.

But the major money maker for SpaceX is Starlink, which was worth $2.2 trillion as of Friday. With more than 12 million payingrs, Starlink is also the only profitable part of SpaceX’s business, according to its latest earnings report. The acquisition of spectrum was “the last critical piece of the spectrum puzzle needed for SpaceX to provide complete phone coverage in America,” Musk wrote on n X. SpaceX is also a massive U.S. government contractor, building and launching rockets on behalf of NASA and several national security agencies. Favorable decisions by government regulators and additional agency contracts are crucial to maintaining SpaceX’s lofty valuation.

White House VIP As a close ally of President Donald Trump and a major donor to his 2024 election effort, Musk is a frequent guest at White House events. At a recent White House state dinner for China’s President Xi Jinping, Musk was seated next to first lady Melania Trump. Just this week, Trump gave Musk an award for achievements in science. As Republicans struggle to hold on to control of the House and Senate in November’s midterm elections, Musk is once again giving tens of millions of dollars to help them.

As of Friday, Musk’s America PAC had spent more than $36 million to boost Trump’s fellow Republicans in key battleground races, according to figures compiled by Wired and verified by NBC News.

Musk also appears to have support for his deal already from FCC chairman Brendan Carr. “All of this is going to be really good news for the American consumer,” Carr said Friday morning on CNBC.

Skeptics on the street Wall Street analysts and Starlink’s potential competitors were skeptical Friday of the SpaceX plan. Absent a deal with an existing wireless carrier, “SpaceX would likely need to build a terrestrial network using macro towers to deliver a user experience on par with traditional wireless carriers,” wrote analysts at JPMorgan Chase. “We continue to see limited near-term risk to U.S. wireless incumbents given the time, infrastructure and capital required to build a competitive terrestrial network,” they added.

Put another way, the analysts think SpaceX plan’s does not pose an imminent threat to the established carriers because it takes a lot more than just satellites to deliver reliable wireless service.

SpaceX would need earth-based infrastructure to bolster its network of satellites because the radio waves it purchased would likely be unable to reach the interior of some buildings, wrote analysts at UBS. “We still believe it will take time for SpaceX to scale its wireless ambitions.”Like the analysts, the major telecom companies feeling the sting from Musk’s announcement also downplayed any risk that Starlink might pose to their businesses.

“Acquisition of spectrum alone does not provide the network or infrastructure to offer true nationwide coverage or to compete with mobile providers,” Verizon said in a statement to NBC News. “A company can have billions of dollars of spectrum, but if they do not have the network to use it, it’s just empty airwaves.”John Saw, president of technology at T-Mobile wrote, “I have tremendous respect for what SpaceX has accomplished in space,” but that building a network would take “years of engineering.”

“You can acquire spectrum in a single transaction. You cannot acquire a nationwide, high-performing wireless network overnight,” he wrote on LinkedIn. AT&T did not respond to a request for comment on Friday. The three big wireless companies have a complicated relationship with Starlink. In 2022, T-Mobile announced a partnership with SpaceX, but recently dropped the name of the company from parts of its website.

And when the three wireless companies announced a joint venture recently to “eliminate coverage ‘dead zones’ and expand satellite coverage,” there was no mention of SpaceX or Starlink.