AST SpaceMobile (NASDAQ:ASTS) has struck a commercial agreement with U.S. telecom Verizon (NYSE:VZ) to provide space-based cellular and broadband services to Verizon customers starting in 2026.
ASTS shares are up 13% in premarket trading on Wednesday.
The agreement comes after a recent successful demonstration, in which the companies completed direct voice and video calls, as well as two-way RCS messaging, between standard, unmodified smartphones and a BlueBird satellite in space. The move will help boost Verizon’s network coverage in rural and dead zones across the country.
“The agreement will extend the scope of Verizon’s 850 MHz premium low-band spectrum into areas of the U.S. that would benefit from the ubiquitous reach of space-based broadband technology,” CEO of AST SpaceMobile Abel Avellan said.
The move by the two companies also builds on the previously announced strategic partnership in May 2024. The financial terms of the new partnership were not disclosed.
Earlier this month, T-Mobile US (TMUS), through a partnership with Elon Musk’s Starlink (STRLK) (SPACE), started offering space-based cellular and internet services to its customers. T-Mobile leverages 657+ Starlink direct-to-cell satellites that are in orbit.
In August, AT&T (T) purchased certain wireless spectrum licenses from EchoStar (SATS) for about $23B to add approximately 50 MHz of low-band and mid-band spectrum to bolster its network capacity.