Satellite direct-to-device: coverage is solved faster than the business model

Direct-to-device (D2D) satellite connectivity, in which satellites connect straight to standard smartphones, has moved faster than most operators planned for. A few years ago it was an emergency-messaging feature in a handful of markets. By late 2026 it is a live service on dozens of networks, a spectrum-policy priority on three continents and a competitive question for every mobile operator with coverage gaps.

From pilots to a crowded market

GSMA Intelligence’s satellite and non-terrestrial network (NTN) tracker counted 132 operators that had either established satellite relationships or were operating a constellation by June 2026, up seven since March; 43 were live and 89 still planning or testing¹². Operators average 1.5 satellite partnerships each¹, and those with arrangements cover 68% of the world’s 6.12 billion mobile connections². The GSMA separately counts 151 operators with services live, in testing or planned, but its NTN lead cautions that ‘maybe about 50’ are live globally and that the deal count runs ahead of the economics³.

The spectrum path is clearing

Regulators have moved quickly, if not in step. The position as of late September 2026:

• United Kingdom. Ofcom decided in December 2025 to allow mobile operators and satellite companies to use mobile spectrum for D2D, subject to technical conditions; Ofcom noted that the technology had so far been rolled out widely in only one other European country, Ukraine⁷.
• United States. In May 2026 the FCC approved the transfer of about 65 MHz of mid-band spectrum to the largest low-earth-orbit (LEO) constellation owner in a $17 billion transaction, replacing terrestrial build-out requirements with space-based conditions; the spectrum is expected to support more than 100 times the capacity of first-generation D2D, and a device waiver means initial messaging and emergency services could begin in late 2026⁵.
• European Union. In May 2026 the European Commission proposed an EU-level selection procedure for the 2 GHz mobile satellite band, reserving one third for governmental use linked to the IRIS² secure-connectivity programme and two thirds for commercial services including D2D⁶.
• Global. The head of the ITU Radiocommunication Bureau expects WRC-27, which runs in Shanghai from October to November 2027, to produce a regulatory framework for D2D in at least some IMT bands under agenda item 1.13, which covers 694/698 MHz to 2.7 GHz³.

The economics: coverage value, thin ARPU

Omdia forecasts that smartphone D2D services will reach 411 million monthly active users and $11.99 billion of revenue by 2030, growing at mean annual rates of 80.1% and 49.4% respectively from 2026⁴. That implies revenue of roughly $2.40 per user per month, consistent with D2D as a coverage add-on or tariff feature rather than a standalone product. Standards-based cellular devices are expected to account for more than 95% of D2D users by 2030⁴, which removes device barriers but also commoditises access.

Satellite broadband to fixed terminals is a separate but adjacent market, and it is growing from a small base: Ericsson projects subscriptions rising from 10 million in 2025 to 15 million by the end of 2026 and 33 million by 2031⁸.

Partner, pool or compete

The strategic issue is control. GSMA Intelligence describes the largest LEO constellation as ‘simultaneously a satellite partner and a potential competitor’ for operators², and it now holds dedicated D2D spectrum⁵. Operators are responding in three ways. Some partner bilaterally. Others pool: in May 2026 the three largest US mobile operators agreed in principle to a joint venture to invest in D2D, pool spectrum and co-develop technology, which GSMA Intelligence calls the ‘strongest signal yet that telcos want greater control of the satellite layer’¹. A third group backs wholesale specialists; one US D2D provider has 39 planned operator partnerships despite an initial constellation of seven satellites¹. Sovereignty, security and data residency are becoming decision factors too, particularly in Europe, pushing operators towards multi-partner models¹.

The pooled model is not exclusive: the US joint venture sits alongside existing carrier–satellite agreements, and its members remain free to pursue their own satellite initiatives¹. GSMA Intelligence expects this neutral-host approach to become a blueprint for other countries, with satellite providers shifting their focus towards infrastructure and capacity sharing rather than exclusive bilateral partnerships¹.

The next wave of capacity

Competition on the supply side is intensifying. The ITU reports that filings for large non-geostationary constellations have grown by around 50% in the past four to five years, with the number of satellites in those filings roughly doubling, and that satellite-related items make up about 85% of the WRC-27 agenda³. A large e-commerce and cloud group has launched more than 375 satellites and is acquiring a mobile-satellite spectrum holder for $11.6 billion, although GSMA Intelligence expects its D2D capacity to remain largely latent until that deal closes, with service expansion in 2027–2028¹. On the standards side, Omdia notes that 6G is set to be the first mobile system to integrate non-terrestrial networks natively, with the first 6G standards release expected by 2029⁴.

For operators, more supply is good news for wholesale pricing and bargaining power, and a warning about lock-in. Exclusive long-term bilateral contracts signed in a period of scarcity may look expensive once several constellations compete for the same traffic. The GSMA’s own framing is that cooperation works only where the business models of mobile and satellite operators intersect³.