Ground-based stations are no longer the only interface! SpaceX's Starlink is rewriting the wireless competition boundaries. Low-orbit clusters directly target AT&T's telecommunications empire.

As the satellite internet power, centered on SpaceX's Starlink, rises strongly, Wells Fargo & Company, a financial giant on Wall Street, sees leaders in satellite internet such as Starlink continue to erode the market share of traditional telecommunications operators in the field of communication. It has given a "low rating" to AT&T, one of the three major traditional telecommunications giants in the United States, for the first time, citing that the growth pace of its fiber optic business under this traditional telecom operator may not be enough to offset the intensifying competition from satellite connection systems in wireless communication. At the moment when SpaceX, the American super-tech giant founded by Musk, focusing on "AI + space exploration", achieved a record-breaking IPO size that caused a sensation worldwide, the global stock market buzzed around investments in commercial space and AI computing infrastructure. The low-orbit satellite internet led by SpaceX will impact traditional telecommunications operators like AT&T's core, not by immediately "replacing all base stations", but by reopening the monopoly of coverage, marginal user access, and pricing power of rural/remote areas previously monopolized by ground networks. Therefore, the wave of satellite internet represented by Starlink is likely to continue eroding the territory of traditional telecommunications operators like AT&T in low-density broadband, edge wired networks, some FWA replacements, enterprise backup links, and direct mobile incremental markets, but at least will not completely replace traditional broadband/fiber optics as well as wireless communication and cellular networks in the short term. From the market growth trend perspective, satellite internet is entering a high-growth window. Fortune Business Insights predicts that the global satellite internet market will grow from $9.53 billion in 2026 to $33.4 billion in 2034. ResearchAndMarkets' report estimates that the global satellite internet market could increase from $5.1 billion in 2024 to $24.6 billion in 2030, with a compound annual growth rate of approximately 29.9%. These two studies highlight the redistribution of market share in the communication infrastructure market from the "grand narrative of Aerospace Hi-Tech Holding Group" to the "actual redistribution of communication infrastructure market share". From the expansion of fiber optics to the impact of Starlink: AT&T faces a new paradigm of wireless competition, with a downside space of 15% given by Wells Fargo It is understood that Wells Fargo & Company senior analyst Steven Cahall set a target price of only $18 per share for AT&T when he first covered it, representing a downside space of up to 15% from the stock's previous closing price of $21.09. Analyst Cahall pointed out that among the major traditional telcos in the US, AT&T is the least likely to reach a mobile virtual network operator (MVNO) agreement with Starlink Mobile, a subsidiary of SpaceX. He also added, "We believe AT&T is the least likely to reach an agreement with Starlink Mobile virtual network operator (MVNO), which means that the fiber/fusion business needs to significantly outperform expectations to bring strong upward space in net account additions and service business revenue." Cahall also indicated that AT&T's fiber business remains a key growth opportunity. He expects the revenue from the fiber business to account for 8% of total revenue in 2026, increasing to 14% in 2032. The analyst predicts that the number of fiber coverage sites will increase from approximately 21 million in 2023 to approximately 54 million in 2032. However, Cahall also warned that customers outside the coverage area of AT&T's fiber business are still very susceptible to competition from Starlink, adding, "As satellite internet systems pose significant competitive pressure on the entire fixed wireless access (FWA) industry, we believe that even with the support of the fiber business, AT&T faces the greatest risk in the number of net account additions and the loss of prepaid account share." Wells Fargo & Company's forecast report shows that the probability of AT&T reaching an MVNO agreement with Starlink is 20% (in contrast, the probabilities of the other two major traditional telcos are much higher, with T-Mobile US, Inc., or TMUS, reaching a cooperation agreement at 30%, and Verizon, or VZ, at 40%). Wells Fargo & Company states that reaching a cooperation agreement with Starlink could increase AT&T's valuation to approximately $27 per share. Without any cooperation, the organization gave AT&T a more pessimistic valuation of approximately $16 per share. Starlink interprets the "rise of a new king"! Ground stations are no longer the only internet connection entry point; SpaceX completely redefines the boundaries of wireless competition Starlink is no longer just a tool for filling gaps in home broadband but is advancing mobile services, direct-to-mobile connections, and potential mobile virtual network operator (MVNO) models; if SpaceX can enter the US consumer mobile market through a combination of satellite and cooperation networks, it will first impact wireless, pre-paid, fixed wireless access (FWA), and low-density areas beyond AT&T's fiber coverage, which are often key marginal battlefields for traditional US telecommunications operators that rely on bundled plans for net additions and service revenue. In addition, high-value-edge scenarios such as maritime aviation, IoT, drones, and redundant links for autonomous driving, Starlink is in an absolute dominant position and the market size is continuously expanding. SpaceX is upgrading from a "space manufacturer" to an integrated infrastructure platform for launch capabilities, low-orbit communication, mobile connectivity, and AI computing. Morgan Stanley estimates that SpaceX's revenue could reach $3.4 trillion by 2040 and sees AI-related businesses as an important source of future revenue expansion; this means that the capital market is no longer pricing SpaceX based solely on rocket launch orders but is attempting to value the vertical integration flywheel of "low-cost orbital access + global low-orbit constellation + AI computing network". Starlink's connectivity business is already the core of profitability, while the ambitions of enterprise AI applications/space orbit AI data centers have become the most resilient pillars of long-term valuation: the lower the launch cost, the faster the deployment of the constellation and computational nodes; the larger the network, the lower the marginal cost of terminal coverage, data feedback, mobile connectivity, and AI inference computing infrastructure services, which is the key differentiator for SpaceX compared to traditional cloud providers and telecommunications operators. For operators like AT&T, the threat posed by Starlink is not the short-term complete replacement of ground 5G base stations but the weakening of the traditional telcos' long-held coverage scarcity premium. SpaceX has already provided supplemental coverage to mobile phones through T-Mobile in the US and is reportedly planning to launch Starlink mobile services for US consumers, and may even establish its own ground mobile network; this means that its competitive range is expanding from "remote broadband areas" to mobile connectivity entry points. From a technical perspective, satellite-to-mobile phones currently have constraints such as capacity, indoor coverage, spectrum, power, latency, regulation, and terminal experience, so in the short term, it is more like a coverage reinforcement layer, rather than a complete replacement for urban high-density 5G networks. Research shows that direct-to-mobile (D2C) can utilize existing ground frequencies and regular mobile phones to quickly enter the market, but long-term high throughput, deep network integration, and standardization rely more on non-ground network (NTN) architectures; early Starlink direct-to-mobile services are more suitable for text messaging, emergency connections, outdoor and low-density areas, and are still a distance away from fully supporting urban mobile broadband. In other words, what AT&T truly faces is not "being completely replaced by Starlink tomorrow," but "the gradual compression of the most profitable network connection scarcity premium". It was reported earlier that SpaceX and US communication infrastructure giant Charter Communications (CHTR.US) had held high-level discussions, intending to form a cooperation relationship focused on launching mobile communication services for consumers in the US. The strategic implications of this potential collaboration are not just to add a mobile phone product to Starlink under SpaceX but to transition SpaceX from a "satellite broadband service provider" to an "integrated mobile communications operator". The term "integrated mobile communications operator" refers to Starlink integrating the low-orbit satellite network in the sky, ground broadband/fiber/core network, mobile terminals, spectrum resources, billing systems, and consumer channels into an operable mobile communication network. If SpaceX can gain Charter-like ground broadband infrastructure and customer channels, it will not only sell "satellite broadband" but may integrate satellite coverage, ground relay, mobile numbers/plans, consumer network connectivity business operations, and future data services to position itself as a "US integrated mobile communication service provider".