Will Satellites Replace Cell Towers? 2026 D2D Guide

In April 2023, AST SpaceMobile completed two-way voice calls directly to standard, unmodified smartphones using its BlueWalker 3 test satellite in low Earth orbit: no cell tower, no specialized antenna, no satellite phone. Just a regular smartphone connecting directly to a spacecraft hundreds of miles overhead.

As of September 2026, satellite-to-smartphone service is real but still early. SpaceX's Starlink Mobile service, run with about 30 carrier partners such as T-Mobile, provided messaging, data and app-based voice to about 7.4 million monthly unique devices from about 650 satellites as of March 31, 2026 (per its IPO prospectus). In Ukraine, Kyivstar's parent Veon said in March 2026 that about 5 million people were using it and that it expected about 12 million by the end of 2026. AST SpaceMobile reported 13 spacecraft in orbit in August 2026 (its BlueWalker 3 test satellite and 12 BlueBirds), is preparing beta service with partner carriers, and is targeting about 45 BlueBird satellites in orbit in early 2027.

This is direct-to-device (D2D) satellite technology.

The Coverage Gap

Despite decades of cell tower construction, large stretches of land and almost all of the oceans have no terrestrial cellular coverage. Most people who are offline actually live within coverage and do not use it, but GSMA estimates that about 3% of the world's population still lived outside mobile broadband coverage entirely at the end of 2025.

The economics explain why. Every tower carries construction, power and backhaul costs, and in rural and remote areas there simply aren't enough potential subscribers to justify the capital expenditure. The result is a coverage gap that terrestrial networks have not closed.

Satellites can reach it. A single D2D satellite in LEO can cover a very large service area, reaching smartphones within its footprint without any ground infrastructure. The economics flip: instead of building thousands of towers to reach scattered rural users, you deploy a constellation that covers the entire planet from orbit.

How Direct-to-Device Works (Technical but Accessible)

The core technical challenge of D2D is straightforward to state and extraordinarily difficult to solve: a standard smartphone transmits at roughly 200 milliwatts (0.2 watts), a signal so weak that it wasn't supposed to be detectable from orbit. Traditional satellite phones solve this with large external antennas and high-power transmitters. D2D satellites solve it differently.

The Giant Antenna Approach

AST SpaceMobile's first-generation BlueBird satellites deploy an enormous 693-square-foot phased array antenna that unfolds in orbit, and the Block 2 BlueBirds (launched since December 2025) carry arrays of up to about 2,400 square feet. This massive antenna provides enough gain (signal amplification) to detect the tiny signal from a standard smartphone on the ground. Think of it like a satellite with a giant ear, listening for whispers from roughly 500 km (about 320 miles) below.

The antenna works in both directions: it can also transmit a focused, high-power beam back to the smartphone, delivering broadband-speed data (AST reported repeated downloads of above 10 Mbps in June 2023 tests with BlueWalker 3, and said in August 2026 that it had demonstrated nearly 100 Mbps on a Block 1 BlueBird) without requiring any modification to the phone's hardware or software.

The Protocol Layer

D2D satellites operate using standard 4G LTE and 5G protocols, the same wireless standards used by terrestrial cell towers. From the smartphone's perspective, the satellite appears as just another cell tower. The phone connects using its existing cellular radio, authenticates through its existing SIM card, and routes data through its existing carrier account. No app download, no hardware modification, no special mode.

This is the critical differentiator. Unlike satellite phones (Iridium, Globalstar) that require specialized hardware and separate subscriptions, D2D works with the billions of smartphones already in people's pockets.

The Latency Question

Low Earth orbit keeps the signal path short. AST's FCC authorization places its satellites at altitudes of roughly 460 to 690 km, and SpaceX reports median latency of about 25 milliseconds for its Starlink broadband service (as of March 31, 2026), well within acceptable limits for voice calls. By comparison, Viasat says a signal from a satellite in geostationary orbit might have a latency of about 600 milliseconds.

AST SpaceMobile: Big Antennas, Fewer Satellites

AST SpaceMobile (NASDAQ: ASTS) is building the broadband-to-phone approach. The company's milestones so far:

• 2022: Launched BlueWalker 3, a test satellite
• 2023: First two-way voice call (April) and first 5G connection (September) between a satellite and unmodified smartphones
• 2024: Launched the first five commercial BlueBird satellites (September), each with a 693 sq ft antenna array
• 2025-2026: The first Block 2 BlueBird launched on India's LVM3 (December 2025); a second was lost when New Glenn's upper stage left it in too low an orbit (April 2026); six more launched on Falcon 9 in June and August 2026, giving 13 spacecraft in orbit including BlueWalker 3. The company says it is preparing beta service with partner carriers
• 2027: About 45 BlueBirds in orbit is the company's early-2027 target; global coverage needs many more satellites

Carrier Partnerships

AST SpaceMobile's business model is a wholesale partnership with existing mobile carriers. Rather than selling directly to consumers, AST provides satellite capacity to carriers who bundle it into their existing plans. Current partnerships include:

• AT&T: Lead U.S. partner. AT&T subscribers in eligible areas are meant to see satellite coverage as a seamless extension of their existing service: the phone simply connects to the satellite when no tower is available.
• Verizon: A second U.S. carrier partner since May 2024, when it committed $100 million to the partnership.
• Orange: Partnership covering Europe and Africa.
• Additional partners: Agreements with Rakuten (Japan), Vodafone, Globe Telecom (Philippines), Telkomsel (Indonesia), and others. AST said in August 2026 that it has signed more than 60 mobile operators that together cover over 3 billion subscribers.

The Business Model

The revenue model is a wholesale fee paid by carriers, which share revenue from customers who use satellite coverage. How large that becomes depends on how many satellites fly, how much carriers charge, and how many customers pay for coverage they use only occasionally. Published forecasts vary widely; none has been tested by a year of full commercial service yet.

Competition: Starlink Direct to Cell (Starlink Mobile)

SpaceX is not ceding the D2D market to AST SpaceMobile. Starlink's direct-to-cell service, now marketed as Starlink Mobile, takes a fundamentally different technical approach:

• Smaller antennas, more satellites: Instead of AST's approach of large antennas on fewer satellites, SpaceX flies dedicated direct-to-cell satellites (about 650 as of March 31, 2026, per its IPO prospectus) alongside the rest of the Starlink constellation (11,117 working Starlink satellites in total as of October 11, 2026, per Jonathan McDowell). This sacrifices per-satellite performance but provides denser coverage.
• Text first, data next: T-Mobile launched satellite texting on Starlink in 2025, with data for selected apps following. Carriers abroad, including Kyivstar in Ukraine, run the service too. SpaceX's June 2026 IPO prospectus says it plans to start deploying next-generation V2 Mobile satellites on Starship in 2027 and expects them to provide 5G-like connectivity to a meaningful portion of existing unmodified devices in the United States, using spectrum it is acquiring from EchoStar or spectrum leased from carrier partners.
• Scale through carriers: Because the service rides on carriers' existing customers and phones, it reached millions of users before AST's constellation was large enough for continuous service.

The competitive dynamic is nuanced. AST SpaceMobile is designed for higher bandwidth per user (voice and data from launch; its commercial service had not started as of August 2026) but has fewer satellites and limited coverage until its full constellation is deployed. Starlink offers broader initial coverage (from its dedicated direct-to-cell satellites) but starts with lower-bandwidth services. Both approaches have merit, and the market may ultimately support both.

Apple's Satellite Features

Apple's satellite features for iPhone 14 and later models, delivered through a partnership with Globalstar, began with Emergency SOS via satellite and location sharing, and since iOS 18 include Messages via satellite in some countries. They are limited to text messaging, while carrier D2D services such as Starlink Mobile already add data and app-based voice. In April 2026 Amazon and Apple announced an agreement for Amazon Leo to power satellite services for iPhone and Apple Watch.

What This Means for the Telecom Industry

D2D satellite technology doesn't just fill coverage gaps; it fundamentally changes the economics of the telecommunications industry:

Fewer Towers in the Hardest Places

Carriers have spent decades building out tower networks in progressively less economical locations. D2D could reduce the need to extend terrestrial infrastructure into the least economical areas, because a satellite can cover them from orbit.

Disaster Resilience

When hurricanes, earthquakes, or wildfires destroy cell towers, satellite D2D provides a backup that does not depend on local towers. SpaceX says its carrier partnerships support critical connectivity during disasters and power outages.

Emerging Markets

In Africa, Southeast Asia, and Latin America, D2D could leapfrog terrestrial infrastructure entirely, similar to how mobile banking (M-Pesa) leapfrogged traditional banking in Kenya. Hundreds of millions of people could gain smartphone connectivity for the first time without waiting for tower construction that may never come.

Technical and Regulatory Challenges

D2D is not without obstacles:

• Spectrum sharing: D2D satellites use the same frequency bands as terrestrial cell towers, creating potential interference issues. The FCC adopted a "supplemental coverage from space" framework in March 2024, but each operator still needs its own authorizations and interference limits.
• Capacity limits: Each satellite can serve a limited number of simultaneous users. In densely populated areas, the capacity per user drops significantly. D2D is complementary to towers in urban areas, not a replacement.
• Capital intensity: Deploying a full constellation costs billions of dollars. AST SpaceMobile has funded its build with repeated equity and debt raises, and launch problems push revenue further out: in April 2026 a New Glenn upper-stage failure left BlueBird 7 in too low an orbit, and the satellite was deorbited.
• Regulatory variation: Each country has its own spectrum allocation and telecom regulations. D2D requires regulatory approval in every market it enters, a time-consuming process.

Who Is Exposed to D2D

These are the companies whose results depend most on D2D. This is a description, not investment advice:

• AST SpaceMobile (ASTS): a pure-play D2D company whose planned service revenue depends on getting enough BlueBirds into orbit for continuous service (its 2025 revenue of $70.9 million came before that service launched).
• Globalstar (GSAT): Apple's satellite partner for Emergency SOS; Apple agreed in 2024 to pay $400 million for a 20% equity interest in Globalstar Licensee, LLC, the Globalstar subsidiary that will own its expanded satellite network. In April 2026 Amazon agreed to acquire Globalstar (closing expected in 2027). Provides emergency messaging, with potential expansion to broader D2D services.
• SpaceX: Starlink Mobile is one growth line within SpaceX's broader satellite business, which it described in its 2026 IPO filing.
• Carriers: AT&T (T), T-Mobile (TMUS), and Verizon (VZ) have D2D partnerships to extend coverage (T-Mobile with Starlink; AT&T and Verizon with AST SpaceMobile); how much it earns them is not yet disclosed separately.

The 2030 Outlook

SpaceNexus analysis: by 2030 the D2D landscape could look very different from today, with possibilities including:

• Multiple competing constellations from AST SpaceMobile, SpaceX, Amazon Leo (formerly Project Kuiper; Amazon says it will deploy its own D2D satellite system beginning in 2028) and potentially Chinese providers
• Standard inclusion of satellite connectivity in all flagship smartphones
• Regulatory frameworks for D2D spectrum sharing established in most major markets

The cell tower won't disappear; it will remain essential for high-density urban areas where satellite capacity is insufficient. But for the large share of the Earth's surface with no tower in reach, and for the people who live, work and travel there, the satellite is becoming the tower. That's not a vision for the distant future. It's happening now.

Track D2D satellite deployments, constellation coverage maps, and related company metrics through the SpaceNexus Satellite Tracker. Monitor AST SpaceMobile, Globalstar, and carrier stocks in Market Intelligence, and follow spectrum regulatory developments in Compliance Hub.