T-Mobile's CTO says SpaceX's $8 billion spectrum buy leaves Starlink Mobile short of indoor coverage

A commuter on a subway platform opens a transit app and waits for it to load. Saw, T-Mobile's CTO, puts most phone use in places like that. He wrote that most mobile traffic occurs indoors, "at home, in the office, inside a store, or at a crowded venue," and questioned how SpaceX would serve those places with satellites orbiting about 200 miles away ^[9].

SpaceX's pitch is measured in geography. Elon Musk called the purchase "the last critical piece" for SpaceX to provide "complete phone coverage in America" ^[4]. Saw measures what the commuter gets. "Covering a geographic area is one thing. Delivering the speed, responsiveness, and capacity customers expect from a modern 5G-Advanced network is another," he wrote ^[10].

Spectrum is the part SpaceX can buy in a single deal. At the reported price, the 14 MHz works out to about $571 million per megahertz ^[19]. Some of what SpaceX will hold is uplink-only, Saw wrote ^[8]. His argument is that the rest of the network gets paid for one location at a time. "Great wireless networks aren't built with headlines or spectrum licenses alone. They're built site by site, neighborhood by neighborhood, in subway tunnels, office buildings, stadiums, and communities across America," he wrote on LinkedIn ^[7].

SpaceX's plan for those sites leans on femtocells. T-Mobile's outgoing CFO is among those who have dismissed the idea, according to PCMag, on the grounds that femtocells will not match the towers and larger base stations carriers use now ^[16]. Sam McHugh, a senior analyst at BNP Paribas Equity Research, wrote that "they will need to build a lot of coverage over many years to create something with mass market appeal, in our view" ^[17]. "Doing this with small cells alone seems an impossible ask," he wrote ^[17].

Saw is a competitor making the case against a company that announced this week it wants to become a major US cellular provider ^[1]. His post stayed polite. He wrote of "tremendous respect for what SpaceX has accomplished in space" and called satellite connectivity a "complement" to cell networks ^[11]. UBS, in a note the same day, wrote: "We still believe it will take time for SpaceX to scale its wireless ambitions, and the impact on near-term wireless industry fundamentals is limited" ^[15].

Who this is for depends on where a given group of users spends its phone time. A fleet or IT manager can sort it on two axes. One is whether people use their phones mostly indoors or mostly outside. The other is whether incumbent towers cover those places well today. The satellite case is outside, where towers are weak. Outside with strong towers, the choice comes down to price. Saw's post defends the indoor quadrant with strong towers. Femtocells have to prove themselves indoors where towers are weak. The forcing function is a short list: the buildings a team works in every day, and whether SpaceX has a radio inside each one.