Economy · · 2 min read
Editor: Bohdan S.
US warns EU of retaliation over Starlink satellite spectrum, FT says
Washington's envoy to Brussels has reportedly threatened European companies with heavy payback if the EU keeps most of a key satellite-to-phone frequency band for its own operators.
The short answer
The US ambassador to the EU, Andrew Puzder, warned of devastating retaliation against European companies if Brussels limits spectrum access for non-EU firms such as SpaceX's Starlink, the Financial Times (FT) reported. The dispute is over the 2 GHz band used to connect satellites directly to phones, and it adds a new front to transatlantic trade tensions.
What happened
According to the Financial Times (FT), Andrew Puzder, the US ambassador to the EU, said Washington would hit back hard if Brussels goes ahead with plans to restrict spectrum access for companies from outside the bloc. The target is a European Commission proposal from May for the 2 GHz mobile-satellite band. Rights there are now held by US firms Viasat and EchoStar and expire in May 2027. Under the plan, non-EU operators could bid for only one-third of the band, with the rest kept for government use and European newcomers. No details of possible US retaliation have been given.
What it means
The 2 GHz band is valuable because it lets satellites talk directly to ordinary mobile phones, known as direct-to-device service. That is a fast-growing business, and Starlink is building its mobile offering around this spectrum. In Europe, Deutsche Telekom has said its planned satellite-to-phone service with Starlink will use Starlink's mobile satellite spectrum, with a launch aimed at 2028.
The Commission's plan splits the band into three equal blocks. One goes to an EU operator for secure government communications linked to IRIS², the bloc's planned satellite network. One is set aside for European new entrants. Only the last is open to both EU and non-EU companies, with a cap on how much any single operator can hold. Brussels says the goal is to boost Europe's competitiveness and security and reduce reliance on foreign technology.
Washington sees it differently. Puzder's argument, as reported, is that holding back American companies will not make European ones stronger, and that rules protecting sensitive government data should not double as industrial policy. The threat echoes earlier remarks from Federal Communications Commission chairman Brendan Carr, who has said reciprocity will guide how the US treats European satellite operators in America.
Nothing is settled. The proposal still needs agreement from the European Parliament and EU governments, and the Commission's own planning points to adoption in late 2027 or 2028 and new licenses in 2029. Existing rights can be extended by two years in the meantime. So this is an early round in a long negotiation, but it adds tech to a growing list of trade frictions between the US and Europe.
The bull case
Both sides have reasons to compromise. One-third of the band stays open to non-EU firms, and analysts at Aetha Consulting said a well-funded player like SpaceX looks well placed to win it. European satellite operators such as SES and Eutelsat could gain from reserved spectrum and government work tied to IRIS², while a negotiated deal would remove a source of uncertainty for satellite stocks.
The bear case
If the US follows through, European companies could face penalties in the American market, and Europe could respond in kind, widening trade tensions. Viasat stands to lose its current European spectrum and would need to pay up front and annually for a smaller slice, according to New Street Research. Prolonged uncertainty could also slow investment in satellite-to-phone services on both sides of the Atlantic.
Why it matters
For investors
Satellite operators with European spectrum exposure, including Viasat and EchoStar, could swing on headlines about the dispute, as could European operators like SES and Eutelsat. Broader EU exporters may feel pressure if the row escalates into wider trade measures.
The wider context
Satellite-to-phone service could eventually end dead zones for mobile users. Trade fights over who gets the airwaves may decide which companies provide it, and at what cost.
Market impact
| Asset (ticker) | Possible move | Timeframe | Why |
|---|---|---|---|
| Viasat (VSAT) | ↓ Down | Long term | The EU plan would shrink its European 2 GHz rights and add fees. |
| EchoStar (SATS) | ↔ Unclear | Long term | Its European rights expire in 2027, and transfers to SpaceX would need new licenses. |
| SES (SESG) | ↔ Unclear | Short term | European operators gain from reserved spectrum but face retaliation risk in the US. |
The FinPrism newsroom's view of how these figures could move, as of . It is general news commentary, not a recommendation to buy, sell or hold anything.
Frequently asked questions
Why is the US threatening Europe over Starlink?
The EU plans to reserve most of the 2 GHz satellite band for European operators once current licenses expire in 2027. The Financial Times reported that US ambassador Andrew Puzder warned of severe retaliation against European companies if Brussels limits access for American firms such as SpaceX.
What is the 2 GHz satellite band used for?
It is a slice of radio spectrum suited to direct-to-device service, which lets satellites connect straight to ordinary phones, and to Internet of Things links. In Europe it is used today by Viasat for in-flight connectivity and by EchoStar for IoT and mobile services.
When will the EU decide on satellite spectrum?
Not soon. The Commission's proposal from May must still be agreed by the European Parliament and EU governments. Its planning points to adoption in late 2027 or 2028, a selection process in 2028 to 2029 and new rights from 2029, with current licenses extendable by two years.
Sources: Financial Times, European Commission, Tesla North, Light Reading, Greenberg Traurig
How this was made: written with AI assistance from the sources listed above, following our editorial standards.
