• Verizon's CEO says he assumes SpaceX will flawlessly execute its US ambitions — but he's not worried.
• In order for Starlink to compete, it will still need a lot of land-based infrastructure.
• That building could require SpaceX to spend a half trillion dollars over up to eight years, he said.

In business, as in war, the safest bet is often to avoid underestimating your competitors, even when the odds appear to be in your favor.

Verizon CEO Dan Schulman says he's a student of that philosophy when it comes to Elon Musk's ambitions to develop SpaceX's Starlink into a significant US network player.

"Clearly, the tech and the wireless landscape is rapidly evolving, and we need to rapidly evolve along with that," he said during the company's third-quarter earnings call Monday. "I also operate under the assumption that everything SpaceX says they will do, they will do, and that they will execute flawlessly."

Setting aside Musk's track record of delivering on his eyebrow-raising promises, Schulman said there are significant technical and financial hurdles that Starlink would have to clear to meaningfully compete with established networks like Verizon. But it is possible.

"If they build a terrestrial network, it will basically look and feel like every other network," he said. "I think we should take it quite seriously."

News earlier this month that Starlink had acquired a batch of mobile-friendly low-band spectrum sent the share prices of the major US mobile carriers falling by approximately 10%. Verizon is the only one of the three to partially recover from the drop.

"Their service just can't compete with a terrestrial network in suburban and urban areas, where like 98% of our revenues are," he said of the satellite-based system. "We're somewhere between 100 to 1000 times more efficient than they are."

Building a competitive US network, especially for mobile, would require building as many as 80,000 large cell towers on Earth linked with some combination of satellites and fiber optics, Schulman said.

Schulman estimates that project would cost up to a half trillion dollars over six to eight years, with a minimum of four to six years to actually build out the network.

"Then they need to build retail customer service, back office systems, et cetera., and all of that gets them basically the same network and same capabilities and same cost structure as what we have today," Schulman said.

After the call, Musk responded to the forecast with a post on X: "Will take 2 or 3 years."

The Verizon chief's remarks come less than a week after his AT&T counterpart, John Stankey, brushed off concerns that Starlink's mobile network could pose a threat to his business.

"I wouldn't over-rotate on what I would call one carrier of low band spectrum," he said.

Verizon CEO Dan Schulman (pictured) punched back on any concerns related to SpaceX’s proposed direct-to-device (D2D) mobile service during a Q3 earnings call, warning the satellite player faces years of construction and hundreds of billions of dollars in spending to build a rival terrestrial network.

“I’d just start off by saying my operating philosophy in general is to be very thoughtful, be analytic and to never take anything for granted,” he said when asked about the threat a SpaceX D2D service could pose to US operators and whether Verizon will ever consider an MVNO deal to give a satellite player access to its infrastructure.

“I always have my eyes wide open,” Schulman added. “Clearly, the tech industry and the wireless landscape is rapidly evolving, and we need to rapidly evolve along with that”.

The CEO also said he operates “under the assumption that everything SpaceX says they will do, they will do, and that they will execute flawlessly”.

His comments came in the wake of reports SpaceX is seeking access to at least 80,000 US cell sites for Starlink Mobile. Bloomberg named Crown Castle among the tower companies in discussions over potential leases.

Schulman argued offering a competitive service would require 65,000 to 80,000 macro sites, backhaul, RAN equipment and substantial power supplies, alongside retail, customer service and back-office operations.

He estimated a full network build would take at least four-to-six years, with spending of $300 billion to $500 billion over seven or eight years, which he argued could leave SpaceX with broadly the same capabilities and cost structure Verizon has today.

“I think that SpaceX realises this, and they’re exploring a potential path to creating a terrestrial network,” he explained. “There’s no magic wand, there’s no secret sauce, there’s no shortcut, there’s no radically lower structural cost advantage.”

In addition to tower leases, SpaceX plans to combine satellites with ground-based radios, supported by an agreement to acquire up to 14MHz of paired 800MHz spectrum from Grain Management for a D2D service expected to launch in early 2028.

Schulman maintained satellite broadband is best suited to remote areas and cannot match terrestrial networks in urban and suburban markets, which he said account for about 98 per cent of Verizon’s revenue.

He said Verizon will keep improving its network and cost structure while SpaceX builds, pointing to its mmWave spectrum, work on 6G applications and plans for AI-enabled services.

While leaving room to work with satellite providers on complementary coverage, Schulman rejected the prospects of an MVNO agreement and stated existing agreements do not offer back-door access.

Schulman said he saw no benefit whatsoever in extending an MVNO deal to a satellite provider.

“It’s very hard to throw a punch against something that doesn’t exist, but once they come into the market, we will be ferociously competitive.”

Last week AT&T CEO John Stankey outlined the advantages he sees over the potential threat of SpaceX’s D2D service during a Q3 earnings call.

The post Verizon CEO plays down SpaceX threat appeared first on Mobile World Live.

Verizon unveiled an agreement worth more than $2 billion with Amazon Web Services (AWS) to supply dark fibre infrastructure to meet AI workload demand, alongside Q3 figures showing a spike in post-paid customers.

The operator noted the AWS agreement “establishes a commercial framework to scale distributed compute and meet the real-time demands of agentic and generative AI workloads”.

It builds on an existing strategic partnership between the two and mirrors a dark fibre deal with Google announced earlier this year.

On the operator’s earnings call today (26 October), CEO Dan Schulman said “these two contracts are a clear signal that the largest builders of AI infrastructure in the world are choosing Verizon as a strategic connectivity partner”.

He added the company also has an “active pipeline of additional hyperscalers, neocloud providers and large enterprise clients who are in negotiations to have us supply them with either dark or lit fibre connectivity”.

Results
Verizon reported net additions of 406,000 post-paid phone customers, up 820% year-on-year, and 137,000 post-paid net account additions.

It noted the latter is its best performance for this metric in more than a decade.

Net income of $5.3 billion was up 5.2%, attributed to a “sharp focus” on operational efficiency. Total operating revenue was $34.3 billion, up 1.5%.

In its Mobility and Broadband segment, it noted service revenue growth of 2.9% was offset by a 9% drop in equipment sales, due primarily to “significantly lower upgrade volumes” as customers keep devices longer.

It also noted the impact of a “strategic decision to reduce spending on device subsidies”.

Schulman hailed the period overall as “another record-breaking quarter” adding “one year into our transformation, Verizon is fundamentally stronger, operationally, financially and competitively”.

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