SpaceX's Starlink Could Build a Nationwide Cell Network. Here's What Investors Need to Know

SpaceX's Starlink satellite network has become a lucrative cash generator, providing internet to millions worldwide. The division, which accounts for more than 90% of the company's growth potential, is also testing the waters in terrestrial cellphone networks when users are in out-of-service areas. In the long run, Starlink plans to establish its own cellular network.

Investors should be aware that SpaceX has invested billions in spectrum and has a long-term agreement with Qualcomm to build a 5G network. The company may also consider acquiring an existing terrestrial network to boost its user base and secure more frequency rights. The potential value of Starlink is estimated at around $1.6 trillion, with major U.S. carriers' valuations indicating that a successful cellular division could capture hundreds of billions of that value.

However, building a terrestrial network will involve more than just consumer cellphone plans, as SpaceX aims to serve autonomous vehicles, drones, robots, and other connected devices. This could open up new opportunities beyond the competitive consumer wireless market. Ultimately, SpaceX's success in creating a complementary terrestrial cellular network will be crucial in realizing the company's growth potential and justifying its high valuation.