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T-Mobile (TMUS), SpaceX Team Up for Direct-to-Cell Services

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T-Mobile US, Inc. (TMUS - Free Report) recently announced that it has joined forces with SpaceX to launch Starlink satellites with Direct-to-Cell services in the United States. Starlink's Direct-to-Cell technology ensures dependable text, voice and data services for LTE phones worldwide, even in regions where ground network infrastructure is limited. This satellite-to-cellular service will ensure complete coverage almost anywhere a person can see the sky, with no additional hardware or other applications required.

T-Mobile is a major player in the SpaceX global partner ecosystem, sharing a common vision of achieving universal coverage. T-Mobile offers the lowest multi-server latency, which significantly reduces network delays and accelerates application response times. It offers one of the fastest connectivity with a consistent network speed. Despite challenges such as geographical obstacles, land restrictions and various other factors hindering infrastructure development, the company is taking ample initiatives to extend coverage in remote locations where terrestrial network coverage is non-existent.

Integrating Starlink’s Direct-to-Cell capabilities with its industry-leading wireless network will mitigate the issues of mobile dead zones where legacy cell signals cannot reach. It will also eliminate the need for high-end satellite phones.

The first batch of satellites was launched by SpaceX’s Falcon 9 rocket and are now deployed in low earth orbit. Field testing by pairing SpaceX's cutting-edge satellite constellation and TMUS’ wireless network for the cell services is expected to commence soon. Following the successful launch of its services, T-Mobile customers will have text coverage everywhere in the United States. Voice, data and IoT services are likely to be available in upcoming years.

Despite rapid 5G network expansion, over half a million soiree miles across the country remain out of network coverage from any service provider. Starlink’s technology will help connect a significant number of smartphones already using T-Mobile's network. The introduction of these features will be a lucrative addition to T-Mobile’s portfolio offerings and will likely give a substantial competitive advantage in the U.S. wireless industry.

The company’s 5G network covers more than 330 million people in the country. The Ultra Capacity 5G delivers superfast speeds, powering 5G smartphones and enabling innovators to deliver transformational 5G experiences, covering 300 million Americans. The company now intends to bring more competition to home broadband, especially in underserved rural markets.

Shares of the company have gained 12.2% in the past year against the industry’s decline of 2.3%.

Zacks Investment Research
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T-Mobile currently carries a Zacks Rank #3 (Hold).

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