SpaceX’s move to acquire reportedly billions-of-dollars in new spectrum assets to power its growing mobile telecom ambitions sank domestic telecom stocks and caused a sharp reaction from a technology executive.

SpaceX late this week announced plans to acquire up to 14 megahertz of spectrum in the 800 MHz band from Grain Management that it said would be a key component for the satellite-based broadband provider to enter the domestic telecom space with its Starlink Mobile service.

The Wall Street Journal reported that the spectrum deal was valued at $8 billion, with SpaceX noting that “low-band spectrum addresses one of the key remaining technical gaps that will pave the way for Starlink Mobile to become a major mobile carrier in the U.S.”

SpaceX currently offers broadband service using approximately 65-megahertz in the 1.7/2.1 GHz bands, which includes $11 billion in spectrum licenses it recently acquired in a deal with EchoStar.

The deal came just days after SpaceX secured the go-ahead to deploy 15,000 high-capacity D2D satellites as the company looks to compete with AT&T, Verizon, and T-Mobile US. It also came just a week after those three operators officially launched their long-gestating spectrum-pooling partnership targeted at encouraging new players in the D2D space.

News of the deal sent telecom carrier investors reeling on Friday. Verizon’s stock sunk nearly 9%, AT&T was down nearly 10%, and T-Mobile US plunged more than 13% following the news.

Spectrum, physics, and history

SpaceX’s move also elicited a strong reaction from T-Mobile US CTO John Saw, who via a LinkedIn post enumerated five reasons “worth keeping in perspective” when evaluating the deal.

Saw noted SpaceX’s still remains spectrum starved relative to established operators; pointed to physics-based challenges in using that minimal spectrum pool to provide a competitive service; that indoor coverage will remain difficult; and the significant capital required to build out a compelling network.

Saw’s notes echoed those of T-Mobile US CEO Srini Gopalan, AT&T CEO John Stankey, Verizon CEO Dan Schulman, and industry trade groups that have all been peppered with questions about SpaceX’s potential to enter the market. Those executives have also downplayed any interest they may have in offering SpaceX access to their terrestrial networks through a mobile virtual network operator (MVNO) arrangement.

Saw’s missive was also notable as T-Mobile US made waves when it rushed to partner with SpaceX in offering D2D connectivity using the Starlink service. However, that deal was consummated under T-Mobile US’ prior regime and the carrier has since scrubbed any mention of SpaceX or Starlink from its D2D service branding.

Grain Management acquired the 800 MHz spectrum in a deal just a few months ago from T-Mobile US as part of a spectrum swap that included $2.9 billion being paid by Grain to T-Mobile US for that 800 MHz spectrum.

T-Mobile US had itself initially gained that spectrum as part of its purchase of Sprint, a deal that also included Saw coming over to T-Mobile US. EchoStar initially had dibs on as part of T-Mobile US gaining approval on the Sprint deal, a spectrum purchase that eventually fell apart due to EchoStar’s financial juggling.

Going deeper, that 800 MHz spectrum was initially disaggregated frequencies Nextel Communication used to operate its unique iDEN network. That spectrum was contentiously consolidated into a single 14-megahertz chunk as part of Sprint purchasing Nextel in 2005 for $35 billion.