Investing.com -- SpaceX is in talks to buy EchoStar's Boost Mobile or gain access to its network, which is leased from AT&T and T-Mobile, the Washington Post reported Monday, citing people familiar with the matter.
The Elon Musk-led rocket maker has held discussions with EchoStar in recent months about launching its own branded wireless service through a deal with the company, the Post said. Musk has been involved personally, meeting EchoStar Chairman Charlie Ergen last month, the paper reported.
EchoStar shares rose 4% in premarket trading by 06:07 ET, while SpaceX gained 2.8%
The possible deal may lead to SpaceX acquiring Boost Mobile or gaining access to its network, which it leases from AT&T and T-Mobile U.S., the report said. The second route could give Musk a back door into a U.S. wireless market that MoffettNathanson values at $235 billion, though the service might need consent from AT&T and T-Mobile to launch, since a carrier's lease typically cannot be transferred to a new buyer without its permission, the Post said.
The talks fit SpaceX's push to build a hybrid satellite-terrestrial network through Starlink Mobile, combining its constellation of more than 12,000 satellites with ground-based infrastructure to compete with AT&T, Verizon and T-Mobile.
A built-out mobile network would help turn the satellites into a significant new revenue source and advance SpaceX's goal of establishing a human settlement on Mars, which would need a way to communicate, the report said.
SpaceX executives have been open about the ambition. On its recent earnings call, Chief Financial Officer Bret Johnsen said the company aims to "become a major mobile carrier ... in the United States."
SpaceX earlier this month agreed to buy $8 billion of wireless spectrum licenses.
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