Shares of the three major American wireless carriers slumped in premarket trading early on Friday after Elon Musk’s SpaceX announced a deal to acquire nationwide low-band spectrum that it said will “pave the way” for the launch of its cellular service “Starlink Mobile.”

SpaceX announced it has agreed to acquire nationwide low-band wireless spectrum from investment firm Grain Management , though the deal still requires FCC approval.

The 800 MHz spectrum will let SpaceX’s Starlink Mobile offer wider mobile coverage, especially inside buildings, addressing what the company says is “one of the key remaining technical gaps” in its cellular launch plans.

Unlike the higher-frequency spectrum Starlink uses, the lower-band 800 MHz spectrum can travel farther and penetrate walls or structures more effectively.

SpaceX’s announcement notes that most existing devices already support the 800 MHz band, potentially allowing customers to use Starlink Mobile without buying a new phone.

Recent iPhone models also support the 800 MHz band, but it’s unclear whether they will be compatible with Starlink Mobile when it launches.

The two companies didn’t disclose any financial terms for the deal, but the Wall Street Journal reported that SpaceX has agreed to pay Grain Management $8 billion in cash for the spectrum.

AT&T, Verizon And T-Mobile Stocks Slide After Announcement

Shares of the three major U.S. mobile carriers slumped sharply in premarket trading early on Friday after the announcement. AT&T shares dropped 6.6% to $23, while Verizon fell 7.23% to $43. T-Mobile’s stock dropped 6.79% to $159.70. After falling 4.19% on Thursday, SpaceX’s shares rose 3.6% to $166.40 in early trading.

In its statement, SpaceX noted that the FCC had also approved its plan to launch 15,000 new Starlink Mobile “Gen2” satellites that the company claims will offer more than “100 times the bandwidth of our current generation” to “unmodified devices” around the world. The new satellites will use the 2 GHz spectrum SpaceX had acquired from EchoStar last year as part of a $17 billion deal.

Executives at all three major U.S. wireless carriers have recently dismissed the idea of a Starlink-launched cellular service becoming a major competitor, citing limitations in its satellite-based technology and the lack of ground infrastructure like cell towers. AT&T CEO John Stankey spoke at a Goldman Sachs event earlier that month and said direct-to-cell satellite is “solving the last 2%, not trying to come up with a new way to solve the 98%,” referring to people in remote locations. He warned that this won’t be effective “in competing against decades of infrastructure that’s been put in place.” In a recent earnings call , Verizon CEO Dan Schulman also said that simple physics will prevent “satellite to effectively compete against a terrestrial network in either mobility or broadband in urban and suburban geographies.”

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