Latest / AST SpaceMobile Podcast / Anpanman - UBS Fireside Chat, Ligado FCC Modification & Launch

Transcript

Anpanman - UBS Fireside Chat, Ligado FCC Modification & Launch · AST SpaceMobile Podcast

• 0:06
  This is the AST Space Mobile podcast.
• 0:10
  Where we just basically turn the phone be seamless, regardless of
• 0:14
  where you are. We don't want the user even to
• 0:16
  know that it's connected by satellite.
• 0:21
  Listen, the opportunity that we have is very, very, very large.
• 0:28
  Ah, there we go, you guys hear me?
• 0:30
  Now add the mute button on a microphone.
• 0:36
  OK, I think people can hear me. Just wait here for confirmation.
• 0:45
  I'm just going to go ahead and start, but thanks everyone for
• 0:49
  joining. I wanted to talk about some
• 0:54
  recent developments. It's funny, I think Cook and I,
• 1:01
  we're talking about how his weekly is going to be
• 1:04
  insufficient because it seems like there's a week's worth of
• 1:09
  information that is getting disseminated daily.
• 1:13
  So it's, yeah, it's it. I, I guess I'll be doing more of
• 1:19
  these spaces possibly. But what an exciting time, man.
• 1:23
  So yesterday we had quite a bit of news, in particular, you
• 1:29
  know, Scott spoke at the UBS conference and there was a lot
• 1:33
  to say there. And I haven't, even though the,
• 1:37
  you know, the guy was sick, the guy's sick and he has a it
• 1:39
  sounds like a pretty bad cold and sound pretty beat up.
• 1:43
  I haven't heard a more bullish time from him speaking.
• 1:49
  And I'll go through the various points that he went through.
• 1:52
  But yeah, there was quite a bit of a hutzpah and and, you know,
• 1:59
  I think confidence coming out of that, that that UBS discussion.
• 2:04
  And so we can kind of go through some of those points.
• 2:06
  But but yeah, I came away from that very positive about the
• 2:10
  next few weeks, few months and upcoming year, quite frankly.
• 2:15
  And so, yeah, I even last night I was really tired so I didn't,
• 2:20
  I decided not to do a space, but I figured I'd do it this
• 2:23
  morning. But yeah, there's just a lot to
• 2:26
  cover there. And then you know, yesterday we
• 2:28
  also got Legato's FTC modification application and
• 2:33
  then we'll we'll talk a bit about launch, but maybe maybe
• 2:36
  since Scott's discussion was so long, maybe we'll talk about
• 2:39
  Legato first. So yesterday, as we had
• 2:44
  discussed before, the company filed with the FTC and
• 2:49
  modification application for Legato's spectrum licenses.
• 2:53
  And so there, what's interesting is that they are not going
• 2:58
  through a new round of processing.
• 3:01
  They're basically just saying, hey, look, we want to use Legato
• 3:04
  spectrum as is and you know the the Geo satellite that currently
• 3:09
  is using that that spectrum, we're going to keep it.
• 3:12
  I think that's sky Terra one. And then however, we are, we
• 3:17
  want to modify, modify that license because, and this is
• 3:20
  kind of technical, but we're going to put Legato payloads
• 3:26
  called Skyterra next, which I mean, I think that's just kind
• 3:29
  of a, a legal label. It's actually going to be fully,
• 3:34
  fully, you know, owned and and operated.
• 3:37
  And of course, the underlying technology is going to be fully
• 3:40
  AST space mobile. But to keep the license as is,
• 3:44
  you need to designate these new satellites.
• 3:47
  They there needs to be some Legato association.
• 3:50
  So they're going to, so they basically say, you know, we're
• 3:52
  putting on Skyterra next payloads on top of what is going
• 3:55
  to be the Block 3 Bluebirds, which are mid band spectrum
• 4:00
  focused Bluebirds. And so you know the in that
• 4:05
  application they are basically going to the FCC and saying you
• 4:10
  want to modify the license. We're going to actually put a
• 4:14
  payload on top of AST Space Mobile Block 3 satellites and
• 4:20
  we're going to operate our service as is.
• 4:22
  The reason why you would do this is that, you know, there's no,
• 4:26
  there's no need to go for a new license or go through another
• 4:32
  processing round. The more elegant solution is to
• 4:35
  just do this modification. And what that means is that if
• 4:39
  you go through a new processing round that could take, you know,
• 4:41
  one to two years, whereas a modification of a license, you
• 4:45
  know, an existing operating license, that's usually like a
• 4:48
  three to six month process, which is how the parties, Legato
• 4:52
  and AST Space Mobile have guided towards a first half 2026 FCC
• 4:59
  approval. And so it's just a more elegant
• 5:02
  way to to basically get, you know, AST get approval for AST
• 5:09
  to monster satellites and then, you know, host this, this sky
• 5:13
  Terra next payload, but all intensive purposes.
• 5:16
  They're just referring to block 3 satellites.
• 5:19
  The way that that license works is you know we are we are
• 5:24
  leasing the spectrum but in all intensive purposes like Legato
• 5:27
  is the legal operator of the spectrum and they'll continue to
• 5:32
  be the owner. Of course.
• 5:33
  However, because it through our leasing agreement, you know
• 5:36
  we're obviously putting up the satellites and providing service
• 5:39
  and managing the consolation. So that was a big piece of news.
• 5:43
  As we had discussed before, we expected that license to drop
• 5:47
  after the comment period ended for ASD Space Mobile's, you
• 5:54
  know, US commercial application, SES application when, when that
• 5:57
  comment here closed, which was December 5th, we expected to see
• 6:01
  Legato file that modification which happened yesterday.
• 6:06
  And so there's, there's five documents in there.
• 6:10
  You know, there's been a few folks pointing out some of the
• 6:13
  content there and and maybe five times I'll go through the
• 6:16
  narrative that was filed, which is quite interesting, but that's
• 6:21
  a pretty big milestone. You know, this is this is, you
• 6:27
  know, a key step in the process for the company to activate and
• 6:31
  deploy mid band spectrum L band spectrum, you know, 40 megahertz
• 6:36
  here in the US and 45 in total, I believe in Canada.
• 6:41
  And just to give you a comparison, Starlink slash
• 6:45
  SpaceX, you know, they're buying Echostars AWS 4 in a AWS 3
• 6:50
  spectrum, the AWS 4 spectrum that actually is going through
• 6:54
  an entirely I believe an entirely new processing round,
• 6:57
  which is why they don't expect that deal to close until late or
• 7:04
  yeah, I think they pointed to the fall of 2027.
• 7:07
  So it's going to take time. And so that's a pretty long that
• 7:11
  that will be a very long process for them.
• 7:15
  Let's see, going back to, oh, I guess the other topic before we
• 7:19
  dive into UBS is launch. And so as people have seen, it
• 7:25
  looks like the launch has been pushed back from December 15th
• 7:28
  or no earlier. The way that people will talk
• 7:30
  about these launch diaphragms, they'll say no earlier than a
• 7:33
  certain date and of course it can happen on that date or or
• 7:36
  sometime thereafter. The launch window got pushed
• 7:39
  back from December 15th to now December 20th and there's a bit
• 7:43
  of speculation as to why that is.
• 7:45
  I, I believe there's some weather related potential issues
• 7:48
  around that date And so just to be cautious, they're moving the
• 7:53
  date back and you know, you, you don't ever, when you're about to
• 7:58
  put up a, a, a satellite and you're paying 10s of millions of
• 8:03
  dollars for lunch, you don't want anything to go wrong.
• 8:05
  So by delaying things a few days, not a big deal.
• 8:10
  However, what was confirmed in Scott Wisniewski's presentation
• 8:14
  yesterday is that they do expect BB7 to launch shortly after.
• 8:19
  And so I would expect that we will probably see, you know, the
• 8:26
  shipment dues sometime this week or next week.
• 8:30
  I mean, it's unclear, but I do think that that satellite is
• 8:34
  ready. And as Kook and others have
• 8:37
  discussed, it sounds like that satellite due to customer
• 8:42
  requirements might be going up at a different, you know,
• 8:45
  different altitude. And then of course inclination.
• 8:49
  And we've already I guess you know, between a few folks, I've
• 8:53
  already speculated that I think that new inclination in
• 8:57
  particular has uses that are going to be very relevant for
• 9:02
  the government. And so I think that's why we've
• 9:04
  seen some of the delay there. The other thing we're trying to
• 9:07
  figure out is I think it is possible that it will be a
• 9:11
  SpaceX flight. However, as you know Scott
• 9:15
  alluded to yesterday at UBS, they've they now that we have
• 9:21
  this, this abundance of launch. Just a reminder and I'll talk
• 9:26
  about this more, the company is overbooked launch.
• 9:28
  So even though we are looking to put up 45 to 60 satellites next
• 9:34
  year, I think they're overbooked for something north of 75 or
• 9:38
  perhaps higher. And so the company is put down,
• 9:43
  you know, launch payments in order to give them flexibility
• 9:47
  and wants to make they want to make sure that if if a
• 9:50
  particular launch vehicles not ready that they can just go with
• 9:54
  another one. And so there is some building
• 9:57
  speculation that this FM 2 or what we call PD7, it could be
• 10:03
  going on a Falcon 9 or alternatively it might actually
• 10:07
  go on the next Blue Origin launch which you know New Glenn,
• 10:13
  which to me that would be that would be a pretty tremendous and
• 10:18
  crazy event to go up on the third launch for a Blue Origin.
• 10:23
  New Glen would be would be amazing.
• 10:25
  I think the reason why there is some speculation around that is
• 10:28
  that Blue Origin is looking to send up New Glen in January.
• 10:35
  However, the associated payload with that may not be ready.
• 10:39
  And so as Scott mentioned in the UBS call yesterday, it's often
• 10:44
  times where launch may be ready, but the payload's not ready.
• 10:47
  And so at that point, you know, you'll have these launch
• 10:51
  providers have it being to scramble for, to basically find
• 10:54
  customers. And, you know, we talked about
• 10:57
  ula last year where they pretty much had to send up an empty
• 11:00
  rocket because the customer that they were supposed to take up
• 11:04
  was not ready. And they, because of, you know,
• 11:08
  a government milestone that they had to meet, they, they had to
• 11:10
  send up the rocket regardless. And so if that's a case that the
• 11:16
  Blue Origin I believe they were taking up, someone will have to
• 11:21
  correct me if I'm wrong, but I think it was like a moon Lander
• 11:24
  or something to that effect. They that payload may not be
• 11:29
  ready. And so we might find ourselves
• 11:33
  and this would be really cool. You might find ourselves down in
• 11:37
  the Cape floor in, you know, Cape Canaveral in Florida in
• 11:41
  January, seeing 2 new things, FM 2 and then of course that going
• 11:46
  on top of Blue Origin, New Glenn, which would be a
• 11:49
  tremendous event. And so me personally, I'm, I'm
• 11:51
  kind of hoping for that to happen.
• 11:54
  But you know, or again, it could just be a Falcon 9.
• 11:59
  So anyhow, we, we should find out in the next week or two or
• 12:03
  coming weeks. I mean, it's unclear, but but
• 12:06
  yeah, that that will be exciting.
• 12:08
  And then of course, after that, the expectation is that you'll
• 12:11
  have two Falcon nines take up two batches of batches of three
• 12:17
  of Lock lock 2 Bluebirds. But anyway, that's the quick
• 12:22
  update for launch. I think they're, you know, we're
• 12:26
  looking at December 20th and perhaps maybe you know, a day or
• 12:30
  two after that, but but we'll see anyway.
• 12:34
  So going back to the UBS presentation from Scott, yeah,
• 12:41
  he, you know, even though he was sick, he actually went through
• 12:45
  quite a number of things. And Kevin was actually so kind
• 12:49
  as to summarize them. But I was actually going to go
• 12:53
  through the transcript and this might take a bit more time, but
• 12:58
  I just wanted to highlight some of the things that he said and
• 13:01
  and kind of go through why. At least for me, that was
• 13:06
  probably one of the most bullish, you know, public
• 13:10
  speaking, speaking times that I've ever seen the company give.
• 13:13
  And so, yeah, why don't we just jump right into it?
• 13:17
  So let's see here, let me go through the transcript.
• 13:22
  So the first thing that stood out to me was that in the
• 13:24
  opening, Scott talked about the fact that they've gotten
• 13:27
  manufacturing, their manufacturing plan almost up to
• 13:30
  rate. And So what that means is, you
• 13:33
  know, the company is targeting or had targeted getting up to
• 13:37
  building 6 Bluebird satellites by the end of the year in terms
• 13:40
  of, you know, production capacity.
• 13:42
  And we know the gating item there is, is a control set
• 13:47
  because they're already at six microns worth of production.
• 13:54
  And I think they hit that sometime, I think it was the end
• 13:56
  of October or sometime in November.
• 13:59
  So, so it sounds like they're pretty close to reaching that
• 14:02
  goal. And I believe, although I'm not
• 14:06
  sure, I think, I think if the when and if that the company
• 14:09
  does hit that goal, I think that will be disclosed.
• 14:11
  I don't know if it's going to be like in the Q1 call or maybe
• 14:17
  perhaps it will be an event where they actually PR, but but
• 14:21
  that was good to hear. And so obviously that that's
• 14:25
  important because obviously we, we've got a lot of satellites to
• 14:28
  build for 2026 and for them to hit 5 orbital launches by the
• 14:34
  end of Q1, they need to get to the six Bluebirds per month
• 14:39
  production rate by the end of this year.
• 14:42
  The other reason why that's important is that if they decide
• 14:46
  to go up on Blue Origin, New Glen and put multiple Bluebirds,
• 14:50
  which would be at a minimum 6 on satellite, then you need to ramp
• 14:55
  up production to, to, to fill those, those launch vehicles.
• 14:59
  So, so that's important. And I think obviously, you know,
• 15:02
  this, this point about production cadence has been a
• 15:07
  big area of focus for investors. And so if they can hit that,
• 15:10
  that, that'll be tremendous. Let's see here.
• 15:14
  So I'm just going through some of these comments.
• 15:24
  Yeah, so he, he also highlighted the, the next area of, of
• 15:27
  discussion was about launch providers and in launch timing.
• 15:31
  I already talked about launch timing.
• 15:33
  You know, he he did discuss the first BB 6 satellite going up on
• 15:38
  Israel in the the coming the coming weeks.
• 15:43
  And so as we know, you know that the date of December 15th has
• 15:47
  been pushed back to December 20th.
• 15:49
  However, he also added some color around the fact that, you
• 15:52
  know, in particular, you know, he discussed Falcon 9.
• 15:58
  You know how many, I guess the, the Chris Scholl who covers the
• 16:02
  the company at UBS asked about the capacity of launch of each
• 16:05
  of the vehicles and he interestingly for Falcon 9, he
• 16:09
  said 3:00 to 4:00. So I think as we've discovered,
• 16:13
  you know it, it's 3 for now, but it by putting back or giving
• 16:18
  that range of three to four, it sounds like there is an
• 16:21
  expectation that they'll continue to get the weight down
• 16:24
  of the block 2 Bluebirds. And so, you know, you'll be able
• 16:26
  to fit up to 4, which would be great.
• 16:29
  And then he did mention for Blue Origin, you know, 6 to 8.
• 16:33
  And of course, at the high end for eight, you need to get the
• 16:36
  weight down. He did reiterate that the plan
• 16:39
  is to get 13 launches in total through the end of 2026, which
• 16:43
  is good. And then let's see here, you
• 16:48
  know, he did talk about bringing in or evaluating other launch
• 16:52
  providers because they do expect additional launch to come online
• 16:57
  in 2027. And so what's important there is
• 17:00
  that the satellite has been designed to fit any standard
• 17:03
  fairing. And so once some of those other
• 17:06
  options come to the fore, you know, the company will be able
• 17:10
  to potentially leverage those vehicles.
• 17:13
  He did mention, you know that they've booked in excess of what
• 17:16
  they need and that's contracted launch for 2026.
• 17:21
  And so to get to 45 to 60, if there are some hiccups around
• 17:26
  the launch providers. And my, my assumption here is
• 17:30
  that they've probably overbooked relative to what they thought
• 17:33
  they would need on SpaceX. Cause they've, you know, they,
• 17:37
  they've actually contracted quite a bit of capacity or
• 17:40
  majority of the capacity on Blue Origin.
• 17:42
  And so if you're going to book in excess of what you need, but
• 17:46
  a majority is with Blue Origin, my guess is the excessive
• 17:50
  capacity that they've booked is with, with Falcon 9.
• 17:53
  And so, so we did point that out that you know, the plan in 2026
• 17:59
  they will have flexibility because they've basically
• 18:01
  stacked all this launch on top of each other.
• 18:03
  And so one way or another, they're going to get all those
• 18:07
  satellites up. So I'm going to move on here.
• 18:13
  Let's see moving to the next section.
• 18:19
  You know, he talked about how vertical integration is
• 18:22
  important, how the previous because that the the research
• 18:25
  channels had asked about potential delays and previously
• 18:30
  for the Block 1 launches, there were two components that delayed
• 18:33
  that launch at which they have since internally brought that in
• 18:37
  house to get vertically integrated.
• 18:39
  And I think it's important to point out, and you know, Scott
• 18:42
  Hammers this point quite often is that, you know, it's
• 18:46
  difficult to build through purchase order or, you know,
• 18:48
  drawing on primes. You know, when you have a prime
• 18:51
  contractor building something for you, that adds another layer
• 18:55
  of bureaucracy. And it's not just bureaucracy,
• 18:58
  but it cost. So, you know, imagine if if you
• 19:02
  go through Boeing and you, you spec out, you know, you, you put
• 19:07
  out an RFP for a satellite, you know, these are the requirements
• 19:10
  that they want. And then those primes come back
• 19:12
  and say, well, here's here's what I've designed and here's
• 19:14
  what it's going to cost. You know, the you're not
• 19:17
  actually in control. The design like they, they bring
• 19:19
  something to you and then you can make modifications to it,
• 19:23
  but it's unclear like if that thing is actually going to work.
• 19:25
  And so as they build it, you know, maybe you want to modify
• 19:30
  it, that actually costs money. Like you have to go back and
• 19:32
  say, well, actually, I want to change these things.
• 19:34
  And then the prime is like, OK, well, let us think about that.
• 19:37
  And then they come back and say, well, OK, this is our solution.
• 19:40
  It's going to cost you this to to change it.
• 19:44
  And so that's why it's so expensive and costs a lot to go
• 19:48
  through primes versus being vertically integrated like a,
• 19:52
  you know, a Starlink slash SpaceX or AST space mobile, you
• 19:56
  can develop and iterate quickly. And Scott mentioned this in in
• 20:02
  the call that for example, by being vertically integrated, you
• 20:06
  know, for example, you have to like manage yields for some of
• 20:09
  these components. And if the yields are low and
• 20:12
  you through tests and you find out that some component has
• 20:14
  failed, then you just basically swap it out, right?
• 20:18
  And you put in you you keep testing until the components.
• 20:22
  You know, your yield goes up, but the but the components that
• 20:24
  that you're testing work. And then, you know, obviously
• 20:27
  that goes on to the finish satellite.
• 20:28
  But but through that process, you're able to do that very
• 20:31
  quickly. And you see it in real time
• 20:32
  versus having to wait around a few weeks to hear back from the
• 20:35
  prime like, oh, this, this is not working.
• 20:37
  What do you want us to do? And then you've got to tell them
• 20:39
  and then they go back to the drawing board.
• 20:41
  And as you can imagine, like that bureaucratic process, it
• 20:44
  costs money, but but more importantly, it costs time
• 20:47
  because time is money. So, but that that point
• 20:51
  yesterday was being made that being vertically integrated,
• 20:54
  it's important. And you know, there was a number
• 20:56
  of times where Scott talked about how the factory is, you
• 21:00
  know, they're almost at their rate or nearly at pace.
• 21:02
  And so those are all, you know, positive little Nuggets that he
• 21:05
  dropped. The other thing is that he did
• 21:08
  disclose that they're seeking so on top of the 500,000 square
• 21:11
  feet that they already have. Currently they're already
• 21:16
  looking for a fourth site in Midland.
• 21:18
  And that site will be focused exclusively on building microns,
• 21:22
  which is, you know, as most of you are familiar, that's, that's
• 21:26
  microns are the building blocks that go into the unfoldable
• 21:30
  array, which has solar panels on one side, it has antenna rays on
• 21:34
  the other. Within that Micron there's the
• 21:38
  the processors that the ASICS and and also batteries as well.
• 21:43
  And of course the radiating, you know, structures that allow you
• 21:48
  to dissipate heat. And So what was interesting is
• 21:51
  that, you know, he talked about the desire to build a an entire
• 21:56
  factory just focused on microns. And then he mentioned that, you
• 22:01
  know, the those building blocks are going to be applicable to
• 22:05
  any of the satellites they build.
• 22:06
  And then many other applications, which I think goes
• 22:09
  to, you know, our hints towards this whole idea of eventually
• 22:14
  making satellites or, or, you know, components for other
• 22:20
  people, right? And in particular, particular if
• 22:23
  that's for defense applications or data center applications, you
• 22:27
  know, we'll see. But I thought that was pretty
• 22:30
  interesting. Let's see here.
• 22:42
  The other thing related to the factories as well that I think
• 22:47
  the, the, the host had asked about the new spaces, the new
• 22:51
  factory spaces in Florida and Midland that they just acquired
• 22:56
  and asked if those had been ramped up.
• 22:58
  And it sounds like they have not, they're not there yet, but
• 23:01
  they are bringing them online. And so in particular, Scott was
• 23:06
  saying, you know, that's at this point in time of say, you know,
• 23:09
  at this point in time for the company in order to produce
• 23:13
  faster, it's a matter of throwing bodies at the problem.
• 23:16
  But they are focused on automating as much as they can.
• 23:19
  And so as you know, Katzie has said before, FM 1 and FM two
• 23:25
  were really the satellites needed to learn how to build
• 23:30
  those satellites. And so through the process of
• 23:33
  building those two then yeah, the know how the systems, the
• 23:37
  setup were put in place to then build the rest of the Block 2
• 23:41
  satellites. And and now you know, they
• 23:44
  they've been hiring like crazy as we all all seen, I think they
• 23:47
  have 1800 employees now. But the goal is to automate as
• 23:52
  much of that process as possible.
• 23:53
  And it sounds like those two factory floors which are being
• 23:58
  set up right now there, it seems like based off of what, what
• 24:03
  Scott was saying, there's going to be a heavy focus on
• 24:05
  automation and then, you know, taking out costs through
• 24:09
  efficiency as well. All right, I'm going through,
• 24:16
  let's see here. There was a, a small discussion
• 24:19
  about ASICS and the improvements in, in performance.
• 24:22
  And as as we all know, you know, we reiterated that once ASICS
• 24:27
  are put into the Block 2 satellites that should give them
• 24:29
  up to 10 gigahertz of processing power, which is triple what the
• 24:35
  previous block ones have likes could do.
• 24:39
  Let's see here. Moving on to the next section.
• 24:53
  You know, there was a discussion about partnering using Emmanos
• 24:56
  as partners. And I mean it's this is
• 24:58
  something that we all know quite well.
• 25:00
  That company has 5050 agreements with nearly 3 billion
• 25:04
  subscribers. We also Scott you know, drove on
• 25:07
  the point that M&O partners own 20% of the equity and have a
• 25:11
  number of representatives on the board, whether that's directs
• 25:15
  like Mickey Mikutani, 18 of of Rakuten AT&T as a board member,
• 25:21
  Vodafone, but then all you know, American tower as well, which is
• 25:25
  a which is a partner. And then Verizon also has an
• 25:29
  observation see. So there are borders over.
• 25:37
  So there wasn't there was a question about how long the
• 25:41
  defended commercial agreements are and we did get a little more
• 25:43
  color in terms of range. And so obviously like Saudi
• 25:47
  Telecom is the longest at 10 years, AT&T it's 5, I believe
• 25:51
  Vodafone is five. And then the company did discuss
• 25:55
  two years, you know, a, a potential or one of the defended
• 25:59
  commercial agreements being as long as two years.
• 26:01
  And so I think that might be the one for Verizon, which makes
• 26:05
  sense since Verizon is, is kind of a not, not as I you know, not
• 26:11
  as a senior partner as AT and TI think AT&T is kind of
• 26:14
  quarterbacking on the M&O side the the US deployment of of
• 26:20
  supplemental coverage from space.
• 26:22
  And so for Verizon, you know, having shorter 2 year agreement
• 26:26
  would make sense. And then that, you know, after
• 26:28
  seeing how the service performs over 2 years, you know, they'll
• 26:31
  decide whether or not to re up as as most of you guys know,
• 26:36
  Verizon is, is a strategic investor.
• 26:38
  They've also contributed their 850 megahertz spectrum.
• 26:41
  And yeah, but who knows, maybe Verizon is, is five years and
• 26:46
  perhaps the two years is, is another party.
• 26:48
  But that's my guess. Let me see here, Scott did get
• 26:57
  asked about the economics of dependent agreements with these
• 27:01
  with these M and OS and you know, he talked about 5050
• 27:04
  revenue split being sacrosanct, you know, they're North Star.
• 27:07
  And so it sounds like a majority of the contracts are falling at
• 27:12
  5050 at a minimum. And I know in the past that when
• 27:15
  he's talked about potentially getting a higher cut depending
• 27:19
  on the nature of the relationship.
• 27:21
  But I think you know for the the most important relationships
• 27:24
  where M and OS have contributed equity revenue prepayments
• 27:29
  especially spectrum, you know they will get that more
• 27:33
  favorable 3050 split. The other thing that he
• 27:39
  disclosed is that these definitive commercial agreements
• 27:43
  are are very exhaustive, you know, 100 plus page documents
• 27:49
  that bring you mentioned specifically, you know, in this
• 27:54
  example 20 cross functional groups at the M&O organization
• 27:58
  led by senior management. And so you know, these are in
• 28:02
  his estimation contracts that are going to be worth hundreds
• 28:05
  of millions of dollars by customers.
• 28:07
  And so I think that just shows like the level of integration
• 28:10
  and importance and where, you know, Scott's physically was
• 28:13
  saying these agreements are, are put together because we are
• 28:16
  building, you know, new businesses, which with each of
• 28:19
  these M and OS, this is not a, you know, separate tack on
• 28:25
  business of SMS messaging. It's full broadband, full
• 28:28
  integration. I mean, you know, and I guess I
• 28:32
  forgot to cover this. I mean, a prime example is ATT
• 28:36
  and Firstnet, where yesterday Firstnet disclosed the video,
• 28:41
  which was great. They it targeted space space mob
• 28:46
  to get some level engagement to kind of, I guess, you know, draw
• 28:49
  some hype around that video. But it was cool is that we saw
• 28:52
  three, three public agencies, one federal, one state and one
• 28:57
  local test the service. And so when we talk about the
• 29:02
  integration, you know, obviously AT&T is going to provide
• 29:06
  commercial service to its customers, but then through
• 29:08
  Firstnet, we're going to be providing first responder
• 29:12
  services. And so having that tight
• 29:14
  integration, I can only imagine how complex these commercial
• 29:18
  agreements are because it's, it's not just how you're going
• 29:22
  to sell and support the service, but it's how you know you're
• 29:25
  going to utilize the carrier's terrestrial spectrum, which is a
• 29:29
  big deal, right? Because spectrum is a lifeblood
• 29:32
  of all these M and OS. It's, it's how they, it's a
• 29:34
  bedrock of how they build it. You know what they build their
• 29:37
  business on top of. And so to engage a company like
• 29:41
  ASD Space Mobile with this new, new technology, you're going to
• 29:46
  have to put in some protections and make sure that, you know,
• 29:50
  whatever service AST is providing, it's not going to
• 29:52
  impact your core business, right?
• 29:54
  And so that's for example, in the case of Starlink, where
• 29:59
  they, they actually don't reuse terrestrial spectrum.
• 30:06
  In the case for T-Mobile, they're actually, they were
• 30:09
  given a dedicated 5 megahertz channel of Midman spectrum.
• 30:14
  I mean, it's terrestrial for all intense purposes, but they, they
• 30:17
  were given completely separate spectrum that does not overlap
• 30:21
  with T-mobile's terrestrial spectrum.
• 30:24
  And through that, because of the, you know, well documented
• 30:27
  interference and power issues with Starlink there they could
• 30:31
  run a service and and not at least from the T-Mobile
• 30:34
  perspective, not feel that, you know, their existing terrestrial
• 30:37
  service is going to be impacted. Whereas what AST Space Mobile's
• 30:40
  doing in the first row out of the block 1 Bluebirds is they're
• 30:44
  actually because you you're able to put down fixed, very accurate
• 30:48
  fixed cell beams. You can just fill with precision
• 30:52
  and accuracy all the dead spots that the covers, the carriers
• 30:56
  can't cover with their own spectrum.
• 30:58
  And you're using that spectrum, which is why, you know, the
• 31:00
  service is so valuable because that special spectrum, which is
• 31:03
  low band has better propagation and, and coverage
• 31:07
  characteristics. And so that's what's really and
• 31:10
  and you know, that's the killer app, right, for direct to sell.
• 31:13
  It's using low band spectrum that can go through, you know,
• 31:17
  one or two walls that can work in your car, work, you know, in
• 31:20
  a plane, work wherever you really want it to work.
• 31:23
  And this is what, you know, Apple, the information article I
• 31:27
  had talked about, for example, Apple wanting to get satellite
• 31:31
  service to the point where it's basically transparent to the
• 31:34
  user. So not forcing someone to like
• 31:36
  go outside their house and point their phone directly to
• 31:38
  satellite, but to be able to take it out of your pocket and
• 31:42
  use it wherever you are. That's that's the Holy Grail,
• 31:44
  right? And that's what utilizing
• 31:48
  terrestrial spectrum with a large phase array that does very
• 31:52
  precise beam forming. That's, that's what you know,
• 31:55
  first principles design can do for you.
• 31:58
  And so that's, you know, that when, when looking at these
• 32:04
  definitive crucial agreements, there's a lot of things that
• 32:07
  have to be hashed out and there's a lot of complexity,
• 32:09
  which is why, you know, it took, it took a year and let's see
• 32:15
  what was it a year and four or five months to get Verizon from
• 32:22
  an MOU to a definitive commercial agreement.
• 32:25
  And obviously the additional complexity there is that Verizon
• 32:28
  is, is Ryan O'Connor would say Verizon's sharing the toothbrush
• 32:32
  with AT&T or they're sharing underwear together.
• 32:35
  They're they're both using the same pair of underwear.
• 32:38
  And so when you have two large parties that are competitive,
• 32:43
  working cooperatively and contributing highly valuable
• 32:47
  spectrum, 850 megahertz spectrum to provide nationwide coverage,
• 32:52
  that's a complex, that's a complex marriage to figure out,
• 32:56
  right? And so, yeah, that's why it took
• 33:00
  so long. But but I think going back to
• 33:02
  the virtual point, I'm kind of rambling here.
• 33:04
  These defender commercial arena's are complex and I can
• 33:07
  only imagine Saudi Telecom, you know, a 10 year agreement, $1.8
• 33:12
  billion minimum value with revenue commitments $175,000,000
• 33:15
  pre ban it, which is going to come before the end of this
• 33:18
  year, you know, covering the Kingdom of Saudi Arabia.
• 33:23
  And it was interesting, Scott actually made a point that I'd
• 33:27
  I'd talked about before, which is, you know, Saudi Telecom also
• 33:31
  has access to or they, they have the rights to 60 megahertz of S
• 33:35
  band spectrum in the country. And so that's something that's
• 33:40
  a, a huge asset that the ASTC mobile is going to be able to
• 33:42
  leverage. And then of course, Saudi
• 33:46
  Telecom also has operations in, you know, 13 other countries in
• 33:51
  and around the Gulf. And so, so, yeah, these these
• 33:54
  agreements and you know, Scott alluded to the fact that we
• 33:58
  should be expecting many more this coming this coming year in
• 34:02
  2026. So yeah, I, I guess he's going
• 34:05
  to be quite busy negotiating these things.
• 34:09
  Let's see, I'm going to move on. So there was a question about
• 34:17
  whether the most recent Verizon and S and Saudi telecom
• 34:21
  agreements have spurred on additional conversations and
• 34:25
  what I had said before. And this is where Scott made the
• 34:30
  the famous quote, he responded, you know, there's not an
• 34:33
  operator around the world who doesn't want to meet with us and
• 34:36
  think about how we can work together, which is pretty crazy,
• 34:38
  right? And the constraint is that it's
• 34:42
  it's largely on the company. And I think also it's on the
• 34:45
  technology, right, Because on the one hand, you've got 50 M
• 34:50
  and OS that you have MO us with. But to then move to Finna
• 34:55
  commercial grant, you have to be very strategic and smart about
• 34:57
  that because you're not going to be able to just roll out service
• 35:01
  to 20 countries at the same time.
• 35:03
  You're going to want to roll out service to your key player key,
• 35:07
  you know, key partners and iron out the quirks and make sure
• 35:10
  everything's working. And then you take on another
• 35:13
  country or two. And then and then you know,
• 35:16
  everything's fine. You work it out and then you,
• 35:18
  you add another country and, and while you're doing that, you're
• 35:21
  also launching additional satellites.
• 35:24
  So you're cut, your capacity goes up so you can actually,
• 35:26
  you'll provide proper service to each of those, those, you know,
• 35:30
  new customers. And so it's going to take time.
• 35:32
  It's not going to be something where you, you immediately turn
• 35:36
  on all 50 because that would be crazy.
• 35:39
  You're going to do this in pieces.
• 35:41
  And, but at the same time, like the great thing is that as these
• 35:46
  customers see the service and they see the impact on their
• 35:50
  subscribers and the economic impact of that, you're going to
• 35:54
  have this, this dynamic where people are going to, and we, I
• 35:58
  mean, we've already seen it with prepayments, but you're going to
• 36:00
  have this dynamic where people are going to be paying you
• 36:02
  upfront, higher premiums to turn on service in their country
• 36:06
  first, right? And so that's, that's a great
• 36:10
  position to be in. And that's perhaps where you
• 36:14
  might have been giving some of these earlier customers, which
• 36:18
  are the most important candidly, but you know, you're giving them
• 36:20
  5050 deals or the folks who join later who were more on the fence
• 36:26
  and were is willing to commit as much economics then then Vine,
• 36:29
  you know, maybe you'll get 40% or 30% split versus, you know,
• 36:36
  50%. And so that's, that's how like
• 36:38
  the the economics, the dynamics can change quite a bit.
• 36:44
  Let's see here going to go through next few questions.
• 36:55
  So moving on to government here, Scott gave quite a bit more
• 37:02
  color around the government opportunity.
• 37:05
  As we as most of us know government and there how you
• 37:09
  define that is there's kind of two areas.
• 37:10
  One is first responder networks, which I think is going to
• 37:15
  become, you know, we saw the the Firstnet video yesterday and,
• 37:19
  and I'll just add the Firstnet video that the tweet that
• 37:24
  Firstnet put out was like, hey, we're giving you just a, a brief
• 37:29
  little teaser video of some of the testing we did.
• 37:31
  And then stay tuned because there's going to be more updates
• 37:35
  on the program soon, which, you know, I don't want to get like
• 37:39
  too optimistic or whatever, but there's a board meeting for a
• 37:43
  first night coming up in a few days.
• 37:44
  And so whether that it happens at that board meeting, it
• 37:48
  certainly does seem like in an, at a minimum over the course of
• 37:50
  2026, we should be getting a commercial contract with
• 37:54
  Firstnet, especially as the service rolls out.
• 37:57
  And of course it's going to be intermittent initially, but even
• 38:02
  intermittent service in, you know, it in the, in, in a
• 38:08
  situation where there's a disaster where you need some
• 38:12
  resiliency or some type of communication regardless, even
• 38:15
  again, if it's, I think I think Firstnet will want to have that
• 38:19
  online. And so I think we'll probably
• 38:21
  see some type of contract per person in 2026.
• 38:26
  And interestingly, based off of some of the FCC filings that
• 38:29
  we've seen from Verizon, it does seem like Verizon's first
• 38:33
  responder network, Frontline, that's going to be another
• 38:37
  contract that we sign as well. And I believe Frontline, you
• 38:41
  know, it's not as big as Firstnet, but it it has a few
• 38:43
  million subscribers. So, so that is going to be
• 38:45
  pretty, pretty material. But going back to what I was
• 38:49
  saying before, yeah, so the government, there's two kind of
• 38:52
  angles, 1 is first responder networks and then of course, the
• 38:55
  the second one is military. And so in this discussion, Scott
• 39:01
  gave quite a bit more details around, you know, military use.
• 39:05
  One was giving, of course, the war fighter, you know, your
• 39:10
  troops more connectivity and connectivity means, you know,
• 39:16
  whether that's older devices, but newer devices, you know,
• 39:19
  that's going to be a key, key use.
• 39:22
  And he talked about even, you know, goggles and and different
• 39:27
  connected devices on the battlefield.
• 39:29
  But then he moved on to discuss some of the non communication
• 39:33
  cases, which I think is where most folks are interested, for
• 39:38
  example, utilizing the large phase arrays and being able to
• 39:41
  manipulate frequencies to do, you know, interesting types of
• 39:45
  applications around radar. And so then he connected that
• 39:49
  with the fact that, and this is for the US and allies.
• 39:52
  And when, when he talks about allies, we know that the company
• 39:56
  has been doing testing with, with Fairwinds and Nokia or
• 40:02
  through those two parties with NATO.
• 40:04
  And so I'm assuming that's probably the first batch of
• 40:06
  allies that he's talking about. And then of course, you know,
• 40:10
  that probably expands out to the Pacific theater as well.
• 40:13
  But we're actually, I take that back, it's already happened in
• 40:16
  the Pacific theater because Fairwinds is tested with with
• 40:22
  the Navy Air, I think it was Air Force and a few other.
• 40:25
  Armed forces out in out in the Pacific.
• 40:28
  And so so anyway, I take them back, NATO and Pacific already.
• 40:33
  But going back to the reference to radar, he tied that to Golden
• 40:38
  Dome. And so sensing applications, he
• 40:40
  said, you know, including radar, which is one of the applications
• 40:44
  that brought them into the Golden Dome conversation over
• 40:46
  the past year. And so in particular, you know
• 40:51
  that that's one of the few times where he's actually talk about a
• 40:53
  very specific application then tied it to Golden Dome.
• 40:57
  You know, he mentioned how the environment is, is very positive
• 41:00
  or these companies special with dual, dual use technologies
• 41:05
  where you have a commercial capability that that makes the
• 41:09
  technology viable and can stand on its own economically and then
• 41:12
  that can be leveraged in defense application.
• 41:16
  And so, you know, he discussed the $150 billion RFP that's open
• 41:19
  for these programs that relate to the Golden Dome and that, you
• 41:24
  know, there's a lot a number of big use cases for them and that
• 41:27
  they feel pretty positive about that and so on.
• 41:30
  In terms of timing, he didn't say this, but based off of our
• 41:33
  research, I think, you know, Golden Dome timing is probably
• 41:37
  sometime in January, we'll probably hear in January,
• 41:39
  February. So, so yeah, something to look
• 41:42
  forward to. And I think the race Deep Space
• 41:47
  Mobile like most people associate the company with
• 41:50
  direct to sell and that's kind of where the story ends.
• 41:53
  I think most institutional investors who are looking on the
• 41:57
  sidelines or not familiar with the company pretty much like
• 42:00
  have no clue that the company is working with Firstnet.
• 42:04
  And that also, there's a tremendous amount of military
• 42:09
  applications here and it's not just connecting devices on the
• 42:12
  ground, which is going to be critical, right?
• 42:16
  If you think about all the battlefield assets having what
• 42:20
  we learned in Ukraine, you want to have multiple resilient and
• 42:23
  redundant communications networks, right?
• 42:25
  So if something gets taken down, you have backups.
• 42:28
  And so on the battlefield, I guarantee you like those assets
• 42:32
  will be utilizing governments, you know, government
• 42:35
  communication networks, but it also Starlink, also HD space
• 42:38
  mobile and, and any others. Could you do want to have
• 42:41
  redundancy and resiliency if, if your adversary is, is able to
• 42:45
  either hack your network and take down one or two of those,
• 42:48
  those, those pathways to communicate or they use
• 42:54
  electronic warfare, which, you know, these large, powerful
• 42:59
  phased arrays can do some interesting things around
• 43:02
  electronic warfare as well, which we've discussed at length.
• 43:05
  And so not just defensive and communication capabilities, but
• 43:09
  offensive capabilities. But as I was saying before, you
• 43:14
  know, a lot of institutions actually don't associate the
• 43:17
  company with defense. And so it will be, you know,
• 43:21
  when when the company does get, you know, that 10th, 11th and
• 43:28
  12th like defense award. And they go beyond they they go,
• 43:32
  they size up from into programs of record and become worth
• 43:35
  hundreds of millions, which the company has discussed for 2026.
• 43:40
  The biggest revenue drivers are going to be government and
• 43:42
  defense related. I think that's going to be eye
• 43:45
  opening for some of these institutional investors.
• 43:47
  And so you know the story, I think we'll end up creating a
• 43:52
  bigger tent and draw in aerospace, defense, you know,
• 43:56
  investors and and on top of, you know, your traditional TMT
• 43:59
  investors. All right, So I'm going to keep
• 44:04
  going here, go through additional parts of this
• 44:08
  transcript. Let's see here, I'm going to try
• 44:22
  not to cover some of these things that have been covered
• 44:24
  before, so I'm going to move through this.
• 44:33
  He did like, OK, so he did talk about the S band and L band
• 44:37
  spectrum strategy. You know, like Starlink, AC
• 44:42
  Space Mobile has secured North American, well, in particular
• 44:46
  for Starlink, that's US and then for ACUS and Canada, but each
• 44:51
  have secured, you know, MSS spectrum for for North America.
• 44:57
  And and then beyond that, both companies are going to have to
• 45:00
  go out there and speak with regulators or perhaps you know,
• 45:04
  engage with parties that already own the spectrum.
• 45:06
  But you know, it's going to be an interesting two to three
• 45:10
  years as both companies go out and make their case to procure
• 45:15
  additional S&L band spectrum. And in particular we talked
• 45:18
  about I guess it was Sunday night how or Starlink they are
• 45:25
  going to be? Are they just given how I guess
• 45:28
  vocal, you know, Elon Musk has been around his displeasure with
• 45:32
  the EU that's going to make that conversation increasingly
• 45:36
  difficult or adversarial. And so it's unclear, you know,
• 45:41
  it's, it's actually Echostar that's going to go back and try
• 45:43
  to get that spectrum renewal for May of 2027.
• 45:48
  However, I think the EU probably sees Echostar being a large, you
• 45:53
  know, being a proxy for SpaceX shares of course, but leasing
• 45:57
  out its spectrum in North America to to SpaceX, it'll
• 46:01
  probably view Echostar and SpaceX as one in the same.
• 46:05
  And so I think at the minimum it increases the Vodafone Satco JV
• 46:11
  with AST, it increases the odds that we do get an allocation of
• 46:16
  MSS spectrum. And so that if that's 5 by 5 or
• 46:20
  10 by 10 that those odds go up. And I think the odds of Echostar
• 46:25
  just given their historic use of that spectrum, which has been
• 46:30
  pretty much, you know, they, they didn't utilize it, but
• 46:34
  historic use. And then based off of the
• 46:36
  potential use, my guess is that they don't get an allocation.
• 46:41
  Or if they get something, it's going to be pretty marginal,
• 46:45
  like maybe maybe a 2 1/2 megahertz by 2 1/2 or 5 by 5 at
• 46:49
  most. But yeah, I think I think it's
• 46:53
  important to highlight the sovereignty issue where, you
• 46:59
  know, countries do you want to have control of their data, they
• 47:03
  do want to have control of constellations that are going
• 47:05
  over their countries that are providing that that service.
• 47:08
  And so Sacco JV has the company has been at the fore, they've
• 47:13
  been at the forefront in terms of technology leadership
• 47:16
  according spectrum when in most people would say that that
• 47:19
  wasn't a good idea. And then of course, you know,
• 47:21
  Echostar did the same. But in in regards to the
• 47:25
  sovereignty, this is an important technological and
• 47:29
  structural point for the EU by creating this JV you give them
• 47:34
  and you know you've got the partners that are related to
• 47:37
  that in terms of voting control, that's going to be totally
• 47:41
  European LED and the constellation when it's over
• 47:44
  Europe, that's going to be European essentially owned and
• 47:47
  operated. And that's going to be you know
• 47:50
  that the data is going to it's going to land in that country.
• 47:54
  And so that's, that's important, right, Because I think from a,
• 47:57
  an architecture standpoint, Starlink actually operates as a
• 48:01
  completely separate network. It doesn't integrate with the
• 48:05
  core of the M&O partner. It actually, you know, it, it's
• 48:09
  almost like a roaming network where everything happens on
• 48:11
  Starlink and then they eventually bring the data and
• 48:14
  customer back to you. And so in that type of
• 48:17
  architecture, I don't think it's going to work for your if
• 48:21
  sovereignty is their key focus. And so I guess for V3, for the
• 48:29
  engineers, they're they perhaps they're thinking about it,
• 48:32
  they'll come up with some type of solution that gives their,
• 48:36
  you know, some of these countries more comfort.
• 48:38
  But but yeah, you know, whether it's technological or political,
• 48:44
  I think I think the key thing is that the tailwinds are behind
• 48:47
  ASD space mobile that you've got countries in politicians and,
• 48:54
  you know, the existing political frameworks that at once on
• 48:56
  routine. And, and I think AST has the
• 48:58
  best solution for that. And, and this is not just
• 49:02
  happening in Europe, it's it's also happening, for example, in
• 49:05
  Mexico, where I think, I think the, you know, LON called Carlos
• 49:10
  Slim, a drug dealer and, and Carlos Slim basically cut all
• 49:14
  his ties of potentially working for Starlink.
• 49:16
  And, and you know, we're working with Claro and America Mobile
• 49:19
  already. I think at that point, you know,
• 49:24
  Slim was evaluating both companies and, and then after
• 49:29
  what was said, you know, he, he threw his weight behind HD space
• 49:33
  mobile. So anyway, just something,
• 49:36
  something to think about. Let's see here.
• 49:42
  So I'm getting towards the end of this, which is good, this
• 49:45
  transcript. One thing that I, I will point
• 49:50
  out is that during these conversations, Chris Scholl
• 49:56
  asked, asked Scott several times.
• 49:59
  It was actually twice to compare AST space mobile to Starlink and
• 50:06
  and Scott pretty much kind of deflected that he he did talk
• 50:09
  the the one point that he made was that ASTS solution has been
• 50:16
  from the ground up and from the beginning has been about
• 50:18
  broadband, right? And so that's where he made
• 50:20
  another famous quote where, you know, we're not comparing apples
• 50:24
  to oranges. We're comparing apples to
• 50:25
  aircraft carriers. And so, you know, we're not
• 50:29
  starting out with text messaging and then kind of trying to
• 50:33
  upgrade the solution to get to some level of data capacity.
• 50:37
  He's like, we're going to be doing full on broadband from the
• 50:40
  get go, which is why it's taking this long while we've been
• 50:43
  careful and deliberate in developing technology and and so
• 50:47
  we want that customer experience to be broadband right out of the
• 50:50
  gate. But the point I was making is
• 50:52
  that one thing you'll never hear the executives, you know, Scott
• 50:58
  A Bell, anyone at AC Space mobile there.
• 51:01
  And this is, this is actually a good business practice.
• 51:03
  I think most people should try to, to incorporate this into how
• 51:07
  they, you know, how they talk about competitors, but you'll
• 51:11
  never see Scott or Abel denigrate Starlink or, or, you
• 51:16
  know, other folks out there. And, and I think that's
• 51:18
  important in that it's, it's not really a point of comparison.
• 51:24
  And, you know, Scott made the point that the market is going
• 51:27
  to be, the market is huge and there's a lot of interest and
• 51:30
  there's going to be room. The one thing that you will hear
• 51:33
  them say is that they'll probably room for, you know, two
• 51:36
  or three players. And my assumption is that, you
• 51:38
  know, obviously Starlink is one of those, but they'll never be
• 51:41
  out there, you know, denigrating Starlink.
• 51:42
  And, and obviously, you know, there's, there's some practical
• 51:45
  reasons for that. One is, you know, SpaceX is a is
• 51:48
  important launch partner. And so we probably don't want to
• 51:51
  denigrate Starlink because they're connected.
• 51:53
  But then also just in terms of, you know, decorum, what the
• 51:59
  company does is they, they try to get people to focus on what
• 52:01
  they're doing. It's not really about the other
• 52:03
  guys, right? And so I thought that was pretty
• 52:05
  interesting. I think that's actually a good
• 52:07
  policy to have. You know, when people ask you
• 52:11
  about competitive landscape, you you focus people on what you do.
• 52:13
  You don't spend time talking about how others are inadequate
• 52:18
  or maybe you don't maybe. Yeah, yeah, I guess making
• 52:23
  direct comparisons, you let other people do that.
• 52:27
  So I thought that was was kind of interesting.
• 52:30
  Let me just look through here. So of course, 1 area that got
• 52:40
  people very excited is, you know, Scott was asked about the
• 52:43
  financial model and, and what margins would look like.
• 52:45
  And you know, you talked about how historically for satellite
• 52:49
  companies, you know, wholesale businesses, you've seen
• 52:53
  incremental margins of 85%. And so given the company's
• 52:57
  growth and the type of services they're providing and the, you
• 53:02
  know, the economic structure that they have with M and OS,
• 53:05
  you could see 90% plus marginal economics and EBITDA margin flow
• 53:11
  through that. That would be somewhat
• 53:12
  comparable. And so, so that I think that's,
• 53:15
  you know, obviously that's a big eye opener.
• 53:17
  It's, it's what people, you know, once the business is up to
• 53:21
  scale and you've, you've for that type of business, you've,
• 53:25
  you've got to spend a lot of CapEx upfront to get the
• 53:27
  consolation up. But then once it's up and
• 53:30
  running and you have, you know, some ongoing maintenance CapEx
• 53:33
  replacing some of these satellites on an ongoing basis,
• 53:36
  yeah, I mean the company is going to be generated.
• 53:39
  So the amount of of of cash flow and the margins are going to be
• 53:42
  pretty tremendous. Let me see here in terms of the
• 53:48
  operating model and leverage, you know, you talked about how
• 53:51
  OpEx right now 60 million per quarter and that might trend up
• 53:56
  a little bit, but just given how the organization organization is
• 54:02
  set up, he doesn't really see ongoing operating expenses
• 54:06
  increasing. And so as a constellation goes
• 54:08
  up and you expand customers and sell more service, you know the
• 54:11
  margins, operating leverage that you get is going to be pretty
• 54:14
  tremendous. What's here and I'm just going
• 54:28
  through the rest of this. So I think, you know, there was
• 54:33
  a question about liquidity and you know they're they're funding
• 54:38
  in place for 100 satellites and it sounded, you know, the
• 54:42
  question was about opportunistic funding in the coming year.
• 54:46
  And so I think Scott said, you know they're going to be
• 54:48
  reactive. They feel very comfortable with
• 54:50
  3.2 billion of pro forma cash and liquidity that also includes
• 54:53
  the remainder of the ATM that they have.
• 54:57
  And so they can get up to with the money that they have right
• 55:00
  now, they can get up to 100 million satellites to
• 55:02
  deployment. As we know they've also are
• 55:06
  tapping other sources. We still have XM funding that's
• 55:10
  ongoing that process which could be a few $100 million.
• 55:13
  And then of course, yeah, as we saw with S Saudi telecom bring
• 55:17
  in 175,000,000 of prepayments, there's going to be more of
• 55:20
  these in the coming year. And so I think you know, could
• 55:23
  the company do another convert a refinancing that or doing more
• 55:28
  equity? Sure, they they might
• 55:30
  opportunistically, but I think now it feels like the company is
• 55:35
  going to focus more on some of these, you know, commercial
• 55:39
  prepayments as they sign more commercial definitive
• 55:42
  agreements. And then also, you know, because
• 55:45
  government, the defense side is kicking in where you've got,
• 55:49
  you're going to have, you know, hundreds of millions of revenue
• 55:51
  this coming year. And then of course, Golden Dome,
• 55:54
  some of these contracts contract awards coming in.
• 55:58
  I don't me personally, I don't think that company's going to
• 56:00
  need to really draw heavily on on for example, equity funding.
• 56:05
  And so it sounded like at least from that conversation that they
• 56:11
  are, they feel comfortable with it where they are.
• 56:13
  They're not going to need to tap any additional funding.
• 56:17
  So finally, in closing, what was interesting is that, you know,
• 56:22
  Scott referred to having the the 2 shells, which is low band and
• 56:27
  mid band spectrum shells, block 2 and block three.
• 56:30
  He also did talk about the possibility of a government
• 56:34
  shell, which makes sense, which is why I mean, the company is
• 56:38
  now considering expanding production eventually from six
• 56:43
  satellites to 12 satellites a month.
• 56:44
  And they're, they're, they're contracting additional space
• 56:47
  because it sounds like government, you know, they must
• 56:51
  begin and this goes to Golden Dome.
• 56:54
  They must be getting some heavy hints that the government wants
• 56:59
  dedicated, A dedicated consolation and dedicated, you
• 57:04
  know, solution. And so on top of the existing 2
• 57:08
  constellations that will be up, perhaps the government will have
• 57:10
  more specialized dedicated consolation.
• 57:13
  You might do that for a number of reasons.
• 57:15
  One would be you don't want to share piggyback with commercial.
• 57:19
  You maybe you want to use it as I mentioned before, like an
• 57:21
  electronic war for war for platform or you might use it for
• 57:25
  very specific reasons like jamming, spoofing, all that
• 57:28
  stuff. And as we know, there's 9 total
• 57:34
  contracts on the defense side. And so any number of those could
• 57:37
  require a more dedicated, you know, consolation.
• 57:40
  And as we've, you know, this is speculation on our part, you
• 57:44
  know, we, we assume that FM 1 and FM 2 are part of Halo.
• 57:49
  And so my assumption is that I think we're, there's probably
• 57:52
  going to be moved to eventually and maybe it happens in
• 57:56
  parallel, put up a more specialized constellation,
• 57:59
  similar what you know, SpaceX has done around Starlink Star
• 58:04
  Shield. Perhaps there would be you know,
• 58:07
  we've talked about this in the past like a a dedicated shell
• 58:10
  that would, you know, it might be blackbirds, right?
• 58:13
  And so so that was interesting. That was the first time that
• 58:16
  I've heard where the company's talked about the potential of a
• 58:18
  government shell or he said very specifically potential
• 58:22
  government constellations, constellations with AI guess
• 58:26
  that's plural. And then he you know, he closed.
• 58:29
  What was interesting is he talked about how the there are
• 58:34
  these add on opportunities. And so once once you've built,
• 58:40
  you know, they you know, he he talked to the very specifically
• 58:43
  earlier about building satellites and having this
• 58:47
  ability to leverage an architecture that's going to put
• 58:49
  the most power at the cheapest cost, but the largest arrays
• 58:54
  into space. And so that that platform gives
• 58:59
  you the potential to support other, you know, applications,
• 59:03
  other strategic interest from governments.
• 59:06
  And so, you know, he closed by saying that the add on
• 59:08
  opportunities are really impressive.
• 59:09
  And so I think, you know, the company is probably kept its
• 59:14
  road map very close to its chest and, you know, is focused on
• 59:18
  communications and, and you know, for many years we we
• 59:21
  speculated that government, there were a lot of government
• 59:24
  applications and the company never really discussed them
• 59:26
  until of course, towards the end of 2024 and then and then 2025.
• 59:33
  And so my guess is as the, as they execute on the Block 1
• 59:39
  consolation, perhaps sometime over the course of 2026, you'll
• 59:43
  start hearing more about some of these other areas of expansion.
• 59:47
  Because I, you know, as we speculated, I think the company
• 59:50
  has been, has had talks with Microsoft and a few other big
• 59:54
  players. And of course we know that they
• 59:56
  have an existing strategic investment and, and commercial
• 59:59
  agreement with Google. And so perhaps we'll we'll hear.
• 1:00:03
  You know more about these other areas that that leverage, you
• 1:00:07
  know, the existing technology and and future production
• 1:00:10
  capacity. And so, so yeah, that's pretty
• 1:00:13
  much it. Let me just take a look and see
• 1:00:18
  if anyone has questions or comments.
• 1:00:22
  There's a few here. You look actually there are no
• 1:00:29
  questions. OK.
• 1:00:31
  But anyway, I hope that was helpful again, you know, it's,
• 1:00:35
  it's kind of a crazy time. There's so much news coming out.
• 1:00:38
  Like for example, when I started this chat, the space, I totally
• 1:00:42
  forgot about the first news. Yeah, first news Firstnet demo
• 1:00:46
  released yesterday, the video of that.
• 1:00:48
  And so yeah, it's, it's a pretty exciting time after the UBS, you
• 1:00:55
  know, discussion. I, I, and thinking about it more
• 1:00:59
  overnight, I, I couldn't be more bullish about our prospects in
• 1:01:03
  the coming weeks and months. And so, yeah, I mean, we've got
• 1:01:07
  a very, what seems to be a, a new Fed chair coming on board
• 1:01:12
  and it's going to be a very accommodative environment.
• 1:01:15
  You've got this focus from the US government of, you know,
• 1:01:19
  pushing the US forward as being a leader in space and amongst a
• 1:01:23
  number of other initiatives, whether that's AI or others.
• 1:01:26
  But we, we, we appear to be at the Nexus of what's important
• 1:01:29
  right now and whether that's for the business that we're
• 1:01:34
  attacking today or by having the the flight heritage, the
• 1:01:39
  development background, the experience, the building blocks
• 1:01:42
  and the patents for the future. Yeah, I think, I think the
• 1:01:46
  company is well positioned and it can be a more exciting time.
• 1:01:49
  So I want to deal with that. And you know, we'll see of the
• 1:01:53
  coming days additional news that that's coming out.
• 1:01:56
  But but yeah, I'm looking forward to December 20th.
• 1:02:00
  I think we are Cook and I agreed to and and Cassie as well, I
• 1:02:03
  think agreed to do a space that will be hosted by another space
• 1:02:08
  mob member and we'll do a live space of of the launch.
• 1:02:12
  Hopefully it won't it'll be at a reasonable hour for New York
• 1:02:14
  time. But but yeah, in the meantime,
• 1:02:17
  I'm sure somethings will come out and I'll do another space in
• 1:02:21
  the in a day or two. Seems like that that's the new
• 1:02:23
  cadence. I feel like maybe my cadence for
• 1:02:26
  spaces are like production for Bluebirds, like I'm getting up
• 1:02:29
  to six, six per week, 6 spaces per week.
• 1:02:33
  But I guess for some of you that that's, that's good because
• 1:02:37
  apparently people want more spaces.
• 1:02:40
  But the other thing I was going to do is I, I do think as we
• 1:02:44
  head into the holiday season, we could do, I'm going to perhaps
• 1:02:48
  host like a holiday space where we can, we kind of reflect on
• 1:02:52
  2025. And I'm going to try to bring up
• 1:02:55
  as many people in the space mob as I can for that space where we
• 1:02:58
  can just talk about, you know, things that we learned over
• 1:03:01
  2025, things that, you know, to celebrate and of course things
• 1:03:05
  to look forward to, but also to share some more stories because
• 1:03:08
  obviously there's a ton of those.
• 1:03:11
  And I, I did, I guess I'll just drop a little hint.
• 1:03:14
  I did hint perhaps over the last few days about, you know, I, I
• 1:03:20
  rarely, I mean, I don't ever, only on rare instances will I
• 1:03:23
  talk about like position size, you know, some of the things
• 1:03:27
  that I'm in, in terms of actual numbers, I've never really
• 1:03:31
  disclosed like portfolio size. But I did the other day I
• 1:03:35
  actually put in one of my, I disclosed my retirement account
• 1:03:39
  performance. Just, you know, in the point of
• 1:03:41
  doing that was just to reiterate that, you know, often times the
• 1:03:45
  best strategy is do nothing. And in that, in that account in
• 1:03:48
  particular, like it pretty much just buy and hold stuff and, and
• 1:03:52
  my AST position in there, you know, I, I, I don't really touch
• 1:03:57
  it. And so, and you'll see like that
• 1:04:00
  retirement account has gone up, it's gone down, But, but sure
• 1:04:03
  enough, like it's just growing over time.
• 1:04:06
  And the reason why I did that, and this is what I was about to
• 1:04:09
  refer to, is that, you know, I think in the coming week or two
• 1:04:13
  there, there may be an article coming out interviewing a few
• 1:04:17
  different space model folks, just talking about space mob and
• 1:04:21
  and the journey. And so, yeah, be on the lookout
• 1:04:24
  for that. And it's part of the article.
• 1:04:26
  The person I spoke to you had asked about, you know, what your
• 1:04:29
  position size. And so I disclosed it there.
• 1:04:31
  So I guess people will know. So I figured, hey, I guess it's
• 1:04:35
  it's it's not the end of the world if I, you know, disclose
• 1:04:39
  one of my retirement counts the size of it.
• 1:04:40
  So anyway, but yeah, that's something to look forward to.
• 1:04:43
  I think the reason why and you know, some people have asked
• 1:04:48
  like, why would you, why would you do that, You know, talk to a
• 1:04:51
  journalist. I think it's really just we, we,
• 1:04:55
  we've been on this like tremendous journey and this this
• 1:04:57
  community has been exceptional. I think in terms of the people
• 1:05:01
  who from all walks of life, you know, primarily retail
• 1:05:05
  investors, but people who have expertise in production,
• 1:05:10
  engineering, law, accounting, or just day-to-day like bartending,
• 1:05:15
  you know, owning a restaurant, any number of things.
• 1:05:17
  But it's, it's cool that folks from all walks of life, kind of
• 1:05:21
  an organic way have come together and built this
• 1:05:23
  community and, and have, you know, connected and, and formed
• 1:05:29
  these friendships. But you leverage that to
• 1:05:33
  basically Crowdsource research, right?
• 1:05:35
  Whether that's understanding the underlying technologies,
• 1:05:40
  understanding the risks. I know there's there's a few
• 1:05:43
  rabble rousers out there. I don't know who they are, but
• 1:05:45
  talking about like how we don't talk about risks, which which is
• 1:05:47
  funny. It's like, well, wherever you've
• 1:05:49
  been over the last five years, But I think I think it's
• 1:05:53
  important for me at least, and I've said this before, you know,
• 1:05:57
  I wouldn't have made it through these five years without this
• 1:05:59
  community. And that's for sure, right?
• 1:06:02
  Like my friendship with Katzie Kook and Steve Larrison early on
• 1:06:06
  and and a whole host of folks. And so I think I think it's
• 1:06:10
  something to be celebrated, right?
• 1:06:11
  Like it's a unique thing that I don't think will ever be
• 1:06:14
  replicated. I don't know if any community
• 1:06:17
  has had this amount of deep due diligence, but also just
• 1:06:22
  friendship and people who are kind, right, who I mean, I'll,
• 1:06:26
  I'll be the first to say like Catsy, if it wasn't for his deep
• 1:06:30
  technical due diligence and understanding of RF, RF
• 1:06:33
  engineering and, and yeah, military use cases, I certainly
• 1:06:38
  wouldn't have had the conviction to hold.
• 1:06:41
  And this guy, you know, he's a farmer.
• 1:06:43
  He, he serves in the military. He also does, I think he has
• 1:06:46
  another day job. He spends A tremendous amount of
• 1:06:50
  time and effort in, in putting together, you know, due
• 1:06:56
  diligence and doing that in such a way that's easily digestible.
• 1:07:00
  Well, sometimes easily digestible.
• 1:07:02
  Sometimes it it takes quite a bit like for me to read through
• 1:07:05
  something 10 times to actually understand it.
• 1:07:07
  But for somebody to give their time so freely and who are
• 1:07:13
  willing to do that. Because I think, you know, I was
• 1:07:14
  talking about this with my sister back in the day before
• 1:07:18
  social media when you had, and this is, well, this is
• 1:07:22
  particularly true for professional investors.
• 1:07:24
  People tend to keep great ideas to themselves, right?
• 1:07:27
  And or they might share it with close friends, but they're not
• 1:07:30
  going to go out there and freely share it with with complete
• 1:07:33
  strangers, right? And so with this community,
• 1:07:37
  you've seen the exact opposite where people do a ton of work
• 1:07:41
  and they will share it freely. And often times they yeah, it's
• 1:07:46
  like without any, without any ulterior motives or objectives.
• 1:07:52
  It's like, oh, these, these people are kind of view as my
• 1:07:55
  friends and family. And, and so if there's something
• 1:07:57
  bad that I find I'm going to share it or there's something
• 1:07:59
  good, I'm going to share it. And so, so that's very unique.
• 1:08:03
  I, I don't, you know, I don't think that there's anyone any
• 1:08:07
  other. And this is not like to or get
• 1:08:10
  denigrate others, but I don't think, I think this community
• 1:08:13
  stands out and it's unique in, in its membership and, and the
• 1:08:18
  ethos, which I don't, I don't even, I mean, it's not like we
• 1:08:21
  have a set guideline of this is how you should behave and this
• 1:08:24
  is what you should do. But but it's kind of something
• 1:08:26
  organic that's just happened where it's like, yeah, be, be
• 1:08:29
  nice to one another and, and people share things freely and
• 1:08:35
  just be a good person. So anyway, I'll do with that.
• 1:08:39
  But yeah, be on the lookout. I think something cool might be
• 1:08:41
  coming out soon, or I hope it does and we'll see.
• 1:08:46
  Anyway, I owned it there. Thanks for joining.
• 1:08:48
  And yeah, looking forward to the next year end and an even bigger
• 1:08:54
  2026. Take care everyone.
• 1:08:57
  Thanks for listening to the AST Space Mobile podcast.
• 1:09:00
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• 1:09:03
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• 1:09:07
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• 1:09:09
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• 1:09:13
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• 1:09:16
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• 1:09:21
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• 1:09:24
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• 1:09:27
  company that has full technology to deliver cellular broadband
• 1:09:32
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• 1:09:34
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• 1:09:38
  their phone and be seamless, regardless of where you are.
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