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Anpanman - North American Lockdown: The AST SpaceMobile Competitive Advantage · AST SpaceMobile Podcast

0:06
This is the AST Space Mobile podcast.
0:11
Just basically from your phone be seamless regardless of where
0:14
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.
0:24
Large. Hey, everyone.
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Thanks for joining on what is a tremendous day for AST Space
0:33
Mobile. As many of you have probably
0:36
seen and I've reposted a number of these announcements, but the
0:40
company is firing on all cylinders signing up these new
0:43
partnerships which are primarily memorandums of understanding.
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However, a new definitive commercial agreement was
0:50
announced yesterday. And so I'm going to talk a bit
0:53
about that and cover a few other topics of of note.
0:58
But yeah, I think I think we're setting up for I, I tweeted
1:03
earlier, I think we're setting up for a very bullish set up
1:05
here. You've got launch that's going
1:09
to get scheduled any day now or Blue Origin, New Glenn, Bluebird
1:12
7. My guess is that it's going to
1:15
happen sometime in the 3rd or 4th week of this month.
1:20
Hopefully that will be enough time for everyone to schedule
1:23
their travel and find accommodations to go view that
1:27
launch. I may or may not be there
1:30
because our kids actually have spring break and we're trying to
1:33
figure out some of those plans and maybe we can plan to go down
1:37
there. But we need some additional
1:39
advance to notice. And it seems like the company
1:42
might be counting something somewhat last minute.
1:45
But but yeah, exciting time. Hopefully I can make it down.
1:49
But if not, of course, I'll be watching online and and maybe
1:54
we'll run a space as well. But but yeah, let's kind of go
1:57
through the list of items here. I mean, so M&O partnerships,
2:01
this week we heard news from Satellite Connect Europe, which
2:04
is the joint venture between AST and Vodafone.
2:08
I think that joint venture is going to expand.
2:11
In terms of economics. My guess is that Televonica,
2:15
Arrange and some of these other European carriers, they probably
2:19
will make some type of investment into that JV and then
2:22
get economics in return at the ownership level in addition to
2:27
revenue splits. That's that's what I would
2:30
expect. And I think for a European
2:31
project you probably need to have additional your, you know,
2:36
carrier ownership, MNO ownership in order to look well positioned
2:42
in front of European regulators. The other thing there is that
2:47
funny enough, Orange is one of the early backers of the Iris 2
2:53
project out of Europe, which is the, the, you know, Europe is
2:58
trying to build their own sovereign consolation.
3:00
And I think it was a week or two ago Orange and Deutsche Telekom
3:04
expressed doubts about that getting off the ground.
3:08
And so like I said before, I think I think Satellite Connect
3:13
Europe is very well positioned to get 2 gigahertz MSS spectrum
3:16
in Europe. And you know, when you've got 4,
3:20
the top five, the European M&O is backing it and then you've
3:24
got an additional probably two or three out of the top 10.
3:27
So call it 7 to 8 of the top 10 outside of Deutsche Telecom,
3:33
which is, you know, they're, they're going with Starlink.
3:35
I think it's going to be really hard for European regulators to
3:38
justify not giving spectrum to set satellite connect Europe.
3:44
And we've seen Brendan Carr publicly announced that Europe
3:49
should be very careful in terms of not hindering competition
3:53
from US satellite companies. And I think, you know, some
3:57
might might say that that's trying to help Starlink get
4:00
position for A2 gigahertz, you know, spectrum allocation, which
4:05
I think you know, they they should get some allocation.
4:08
Will it, will that be 5 by 510 by 10?
4:11
Who knows. And of course they're going to
4:14
try to pursue that spectrum through the existing Echostar
4:17
allocation. But but that also helps us
4:21
because the satellite connect Europe, it is a European entity,
4:25
it's owned and operated by Europeans.
4:26
But ultimately the underlying constellation is owned by ASD
4:30
Space Mobile, which is AUS company.
4:32
And so having a level playing field and making sure that the
4:36
best technology is, is granted spectrum is key, right.
4:42
And so if that's truly the case where the best technology is
4:46
going to get a spectrum allocation, then I feel 100%
4:49
confident and fully comfortable with going going head to head
4:53
with Starlink and whoever else out there, which at this point
4:56
it's it's Starlink and Echostar. Of course it's Biasat in Marsat.
5:01
I mean, who knows what they're doing.
5:03
My guess is for those that haven't followed it closely,
5:07
Europe gave Biasat A2 gigahertz spectrum allocation.
5:11
I think it's 15 by 15 many years ago and that's coming up for
5:15
renewal and Biosat for all intensive purposes, I think
5:18
they've they've utilized that spectrum primarily for aircraft
5:23
connectivity. But obviously Biosat is losing
5:26
customers hand over fist to Starlink fixed wireless.
5:29
And so they're going to have a pretty tough time I think
5:32
justifying getting a new allocation in Europe.
5:34
And so I think it's it's really going to be a jump ball between
5:38
Starlink and ASD Space Mobile's satellite connect.
5:41
And then perhaps there might be an allocation given to this
5:45
Irish project if they can ever get it off the ground.
5:48
So yeah, I mean, I think Mobile World Congress just demonstrates
5:53
the company's, you know, support amongst them.
5:56
And OSII know Scotiabank who is the sole bear on the street
6:00
wrote several or has been writing bearish report saying
6:05
that AST space mobile is going to lose customers to to
6:09
Starlink, which has not been the case.
6:11
Is not. If anything, AC has been signing
6:14
more customers and signing more definite agreements.
6:17
I remember and this is the this is the research analyst to turn
6:21
to bearish after getting flipped by a bunch of short sellers.
6:24
Cause of course, the almighty Commission dollar sometimes is
6:27
too hard to ignore, especially for the smaller investment bank
6:30
like Scotia, who you know, is a Canadian broker and kind of, you
6:35
know, trying to scrap by, I guess.
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But, but back in, I guess it was last October, maybe it was
6:44
September when Scotia went negative on the company and, and
6:47
you know, came out with a negative rating and lower their
6:49
stock price target on the, on the assumption that Starlink's
6:53
competition was going to be too much and they're going to steal
6:56
customers. Right after he published that
6:58
note, of course we signed with Saudi Telecom for a 10 year
7:02
commercial agreement, $175,000,000 prepayment, minimum
7:06
$1 billion value. We signed to that.
7:09
And of course Verizon signed the Defender commercial agreement as
7:12
well. And so this guy like keeps
7:14
Tooting that horn that competition is going to be too
7:18
much for AST. And since then of course we've
7:20
signed all these additional customers.
7:22
So it's just kind of funny just seeing this guy desperately try
7:28
to try the price down and the opposite it's happening.
7:31
But going back to the MO partnerships, as I mentioned in
7:33
the call before, you know, we've got Vodafone Ukraine, which is
7:37
actually not part of Vodafone. It's a separate entity.
7:41
They they just continue to keep the Vodafone name.
7:45
And obviously, you know, Starlink's very active with I
7:48
think it's Cuba, Cuba star in Ukraine.
7:50
But given how war-torn that country is, that's going to be a
7:56
a model for satellite connectivity because obviously a
8:00
lot of the terrestrial infrastructure has been
8:02
destroyed. And So what better way to light
8:05
up spectrum and connect customers than utilizing
8:07
satellite directed device connectivity.
8:09
And so for Starlink and for ASD, it's going to be a great market
8:14
to demonstrate the technology. And you could kind of view it as
8:19
in a case where a terrestrial network goes down in an
8:23
emergency or war situation, you know, natural disaster, you
8:27
could point to Ukraine and say, well, this is what it looks like
8:29
when the infrastructure is destroyed and people are
8:33
connecting. And so I think it was Starlink,
8:36
they, they announced somewhat a while back that they've
8:39
connected like 10 million customers in Ukraine.
8:41
And so it just shows like the power of this technology beyond
8:45
just filling in dead spots, but actually becoming the network
8:49
when the network is down. And so I, I think that's, that's
8:51
important. But we did, you know, we, we saw
8:54
additional partnership and testing with Vodafone Romania,
8:58
Vodafone Ireland, Vodafone 3, which is the new UK carrier,
9:02
which combined two of two of the, some of the, or yeah, two
9:07
of the largest UK operators, Vodafone and then CK
9:10
Hutchinson's 3. And so that's, that's now the
9:14
largest carrier in the UK. We also saw Sunrise Telecom out
9:18
of Switzerland called Taiwan Mobile, which I covered the
9:22
other day about how it's not just about filling in dead
9:26
spots, but it's about resiliency, redundancy during
9:29
natural disasters, hopefully not, you know, armed conflicts.
9:32
But for for specifically Taiwan satellite direct to device
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connectivity is going to be absolutely critical.
9:40
And then today we did get a new partnership that was announced.
9:44
And by the way, like a lot of these partnerships have been
9:47
kind of in the background, but now because we are getting
9:50
closer to commercialization, now they're being inked and you
9:56
know, becoming, you know, what was part of the 50 global M and
10:01
OS that we had MO used with. Now now they're becoming more
10:04
public because we're getting closer to service, right?
10:06
And so we, we just signed today with Axion Telecom out of
10:11
Africa. They, they cover a number of
10:13
countries, key markets in Africa, which is I think
10:17
43,000,000 subscribers. And so a really big, I think
10:20
they're the 6th largest mobile operator in Africa.
10:23
And so another great win. But the big news which I think
10:27
is causing the stock to move quite a bit today.
10:29
And of course you know we did get this Deutsche Bank upgrade,
10:32
but big news last night was Telus, right?
10:35
And so Telus is the third largest wireless carrier out of
10:38
Canada. They're second only to Bell
10:42
Canada and of course Rogers. And so for those people that
10:45
know, Rogers decided to go to the Starlink and yeah, I guess
10:49
they enjoy the minimal viable product, whereas Bell Canada and
10:53
Telus have gone with ASD Space Mobile.
10:55
And so we do know it hasn't been publicly announced yet, but Bell
11:00
Canada does have an agreement with AST and they were an early
11:04
investor in the company and then tell us which was announced last
11:08
evening, they signed a definitive commercial agreement.
11:12
And so you know, they're investing in ground
11:15
infrastructure and then they're taking equity stake, right?
11:18
And so some people have asked, well, what what form of equity
11:21
does that mean? Are they going to buy shares
11:22
directly from the company? I think that's probably not the
11:26
case because the company doesn't need capital at this point.
11:29
My guess is that Telus either already has or will just buy
11:34
stock on the open market. And you know, they'll who knows
11:38
how much they'll buy exactly, but but you know, they want to
11:41
be aligned with company. And so you know, the company
11:43
previously did strategic convertible debt with strategic
11:47
with investors like Verizon, ATT and Vodafone and Google.
11:53
I don't think the company's going to pursue that path
11:55
anymore because they they candidly don't need capital at
11:58
this point. And so for a company like Telus,
12:02
they probably already have bought a stake or maybe they
12:05
will buy a stake, but they can just buy their shares on the
12:08
open market, right? But as I tweeted yesterday, this
12:12
is a pretty big milestone because we now have locked up
12:17
2/3 of the most profitable market in the world, right,
12:20
which is North America, primarily the USAT and T and
12:23
Verizon, and then of course Canada, which is Bell Canada and
12:27
Telus. And so I think this model is
12:29
actually going to, is going to carry throughout the rest of the
12:35
world. And I'll talk about like 2
12:37
specific markets where I can already show you the template
12:40
like that's, that is already happening or, or will happen.
12:45
But yeah, I think that's going to be.
12:47
And, and part of it is, of course, you know, we've talked
12:49
about this at length, but the, the fact that AST is actually a
12:54
strategic cooperative partner with M and OS versus Starlink,
12:59
which is a direct competitor today and will become even a
13:02
bigger competitor in the future. And on top of that, Starlink
13:07
gives pretty bad economics, which I'll talk about a more
13:11
talk in a bit more later. But but yeah, so locking up the
13:16
North American market, I know some people pointed out like,
13:19
hey, Mexico's part of North America.
13:21
Well, I, I kind of in this analysis considered Mexico as
13:25
part of Central America. I know that's like that's a bit,
13:29
a bit of a nuance, but but let's talk about Mexico.
13:32
So if we want to say North American market majority, let's
13:36
see. So Mexico America Mobile has
13:39
like 67% market share there, that's Carlos Slim's MNO, AT&T
13:45
Mexico, which is owned by Mexico or AT&T has 18%.
13:49
And then Movie Star which is a joint venture between Picasso
13:53
PCs and Telefonica that has 16 1/2%.
13:57
And then Altan which is a wholesaler that runs 700
14:02
megahertz spectrum in Mexico. They, they on behalf of M and
14:07
OS, MV and OS they to hard reach places.
14:10
They I think they serve like 18,000,000 subscribers.
14:12
So there's a few ways to kind of cut the Mexican market up in
14:16
pieces, but I guess the the main line M and OS not virtual
14:21
network operators who rent space on other, you know, other
14:26
infrastructure. Those are the big three, right,
14:29
American Mobile, AT&T, Mexico, Movistar and then Altan, which
14:32
is a wholesaler. And when we talk about MN OS
14:36
versus MVN OS, the different, the key difference is that MN OS
14:40
are facilities based, like they actually own towers, they own
14:43
Spectrum, they do billing and all that stuff.
14:45
And then MVN OS are virtual, virtual operators like they are
14:49
really a marketing brand kind of like Mint Mobile here in the US
14:55
They, they actually lease capacity on other people's
14:59
networks. And so these are the key
15:02
facility operators. And I can tell you like AST is
15:05
already working with American Mobile in in Brazil, which I'll
15:10
talk a bit in, in a bit. I'll talk more in a bit.
15:12
But you know, they're already working with Carlos Slim, right?
15:15
And so we did see a little preview in a presentation this
15:19
week where the America Mobile logo was on a CS coverage map
15:24
covering, you know, Mexico, of course, AT&T, Mexico, we're
15:27
probably working with them because it's AT&T.
15:30
And then Mobistar is kind of a, it's unclear, right?
15:33
Because I think Picasso might have control that entity,
15:36
although Telefonica is a joint venture partner.
15:39
So that one maybe goes to Starlink because I know Starlink
15:42
had hinted that they're going to sign someone up in Mexico.
15:44
And so that could be it or it could be one of these smaller MV
15:47
Nos, right. But if you assume that American
15:50
mobile, AT&T, Mexico go with AST, that's pretty much the
15:54
Mexican market. That's 67% plus.
15:59
Let me see here. Yeah, 18%, right.
16:01
So they're going to, you're going to have a majority and of
16:03
course you have all town as well.
16:05
So yeah, North American market I think would be pretty much
16:09
locked up by AST and, and I would expect to see, you know,
16:14
some commercial agreements being announced relatively soon.
16:18
As we know Altan is, is is testing with AST currently in
16:22
Mexico. And then American Mobile.
16:25
You know, famously, I think it was Elon Musk who claimed that,
16:31
you know, Carlos Slim was a drug dealer.
16:33
And then Carlos Slim responded by saying he's he was never, he
16:36
cancelled any work they were doing the Starlink and would
16:38
never work with him. You know, people can, I guess,
16:42
you know, they can bury the hatchet and and decide to work
16:45
together. But we have been working with
16:46
American Mobile for quite some time.
16:48
And so I would expect that that commercial agreement to happen
16:52
at some point in the near future.
16:54
And this is where in this part of the world, this is where a
16:58
Bell's, you know, Venezuelan heritage.
17:00
And then of course working with Cisneros who has, you know,
17:06
Adriana Cisneros, her father was a huge pioneer of Dish or sorry
17:12
DIRECTV Latin America, you know, and having for media assets
17:15
there. They they have a tremendous
17:17
amount of relationships. And so that's helped AST quite a
17:21
bit in that part of the world. And so but yeah, I think, I
17:24
think Mexico will be locked up. And then moving on to let's talk
17:28
about Brazil. I mean, so we currently are
17:31
working Vivo, which is telephonic in Brazil.
17:33
They have 38% of the market. We already have a partnership
17:36
with Clara, which is American mobile.
17:38
That's, that's their, they own that brand, 33% of the market.
17:41
And then we are working with Telecom Italia's, you know,
17:46
subsidiary in Brazil, Tim, Brazil, which is 23%.
17:49
So in Brazil we actually have effectively 100% lock on that
17:53
market. And so I, as I, as I said
17:55
before, I think we as you go around the world and as carriers
18:00
start signing up for service and they see where the value is,
18:02
where true broadband connectivity is there and
18:06
working with a partner that's working truly with you, not
18:09
against you and that's sharing fair economics.
18:12
I think KST is going to be the partner of choice, right?
18:15
And so we have the US lockdown, we have Canada, it seems like we
18:21
have Mexico, we definitely have Brazil.
18:23
And, you know, that will continue, I think in the coming
18:26
months as we see. I think there was a slide that
18:28
was hinted in one of these presentations by the GSMA, I
18:33
think organization or something like that, saying that AC has 30
18:36
partnerships coming this year. So yeah, it'll be fun to be fun
18:41
to count those off as they come in.
18:44
Let's see. So yeah, that that covers the
18:49
partnership side. Actually, I don't have too much
18:52
time to talk because I need to go move my car outside because
18:54
there's the snow is thawing here in in New York.
18:58
And so I parked out on the street and I do that before,
19:01
before before I get a ticket. But I do want to cover a few
19:05
more things real quick. So yesterday someone had
19:11
astutely gone through Echostars 10K and a great nugget was found
19:16
there, which was the economic, the the actual deal terms
19:20
between Echostars Boost Mobile subsidiary, which is a semi
19:27
MVNO, semi MNO. And but their, their economic
19:31
split and deal that they got with Starlink.
19:33
And so I, there was some like slight nuances in there.
19:37
I won't go into too much detail. I actually need to go through
19:39
that agreement and with a fine tooth comb.
19:42
But you know, some of the key terms were that I think the
19:46
first 10 million customers for boost, they would, they would
19:49
get like, you know, the service at cost right for boost and so
19:54
they, they wouldn't have to split economics essentially.
19:56
But then beyond the 1st 10 million, the economic split
20:00
would be 80% Starlink and 20% Boost Mobile, which is pretty
20:05
crazy because that's not really giving the carrier much in terms
20:09
of economics. And so you could say well, Oh
20:12
yeah, it's Boost Mobile. You know who cares?
20:14
Like it's a small 2 bit player like what?
20:17
Why does that matter? Well in the contract they boost
20:20
actually gets an MFN and So what MMMMMFN means is most favorable
20:25
nation and so. When you enter into a contract
20:28
and give someone most favorable nation terms, you might agree
20:32
to, let's just make something up.
20:33
Let's say a 5050 split, right? I'll give you 50%.
20:36
I keep 50%. And then because of that MFN, if
20:38
I go, if I go negotiate with Kook Telecom and I give them,
20:45
hey, you know what, I really want you to come on board.
20:47
I'll give you 60% of the economics and I'll just take
20:50
40%. Well, what that MFN does is
20:53
because you have most favorable nation clause, then whatever I
20:57
agreed to with them, if it's better than the deal that I gave
21:00
you, I automatically have to give you the same exact deal,
21:03
right? And so that's how MF NS work.
21:05
And so the, the key nugget in this disclosure is that Boost
21:11
Mobile has an MFN. And so based off of that you can
21:16
and it's an MFN for USMN OS, right?
21:19
And so there's only one other MNO in the US that's using
21:22
Starlink, which is T-Mobile, right?
21:24
And so from a legal perspective that basically because Boost is
21:29
getting the best possible deal and no deal can be better than
21:32
them, that means that Starlink and T-Mobile agreed to an 8020
21:36
split where Starlink is getting 80% of economics and T-mobile's
21:41
getting 20%, which is to me insane, right?
21:43
Because like T-Mobile actually brought is letting Starlink use
21:49
their 1900 megahertz G block PCSG block spectrum.
21:54
So they actually brought spectrum to the table and you
21:57
know, it's small, it's like 5 by 5 megahertz, but still it's
22:00
nationwide spectrum. And yeah, it's mid band, but
22:04
they're allowing Starling to use that exclusively.
22:07
But yet they're only getting 20% economics, which is crazy,
22:10
right? Like, and maybe there's like
22:11
some threshold where they get most of the economics for the
22:14
1st 20 or 30, you know, 20,000,010 million subscribers.
22:18
But the fact that that 8020 split there to me that that's
22:22
like of such a lopsided deal. And you would only take that
22:25
deal if you were desperate, right?
22:27
And so that's why I tweeted yesterday where I think
22:30
T-Mobile, because they saw that AT&T was working with AST Space
22:34
Mobile when when Starlink came to them and say, hey, we want to
22:39
do this. And these are the terms T-Mobile
22:41
was like, oh, you know what, we can be the first to do this.
22:44
We can pretend that we're the first to do this.
22:46
And we're working with Starlink. They've got this great brand.
22:49
We're just going to sign up. And so, yeah, we'll, we'll do
22:50
8020. You take 80% and we'll take 20,
22:53
even though we're bringing the spectrum and, you know, we're
22:55
bringing the customers because like, maybe in their mind, they
22:58
thought that this is a niche product and it wasn't going to
23:00
bring much in terms of revenue. And it'll like solidify their
23:05
customer base and, you know, reduce churn.
23:08
And so they justified it somehow.
23:09
But but yeah, this this disclosure by Boost Mobile
23:13
basically says like T-Mobile got the same deal 8020.
23:16
And so that's a really bad deal because economically, as this
23:21
thing grows over time, you're just giving away more economics
23:26
and your customers to star link. And so the other, the other
23:29
interesting thing about the deal with Boost and I, I don't know
23:32
if this exists in T-Mobile, but but not, nothing precludes
23:39
Starlink from competing to get your customer for what is
23:43
branded as Starlink Mobile, right?
23:45
And so Starlink has the ability to compete with you in the
23:47
future and there's no restrictions on that.
23:51
And so maybe it's just for Boost Mobile and maybe there's like
23:54
some additional restrictions with T-Mobile.
23:56
But as a reminder, like T-Mobile that that agreement in terms of
24:00
exclusivity ends this coming summer.
24:02
And my guess is that if there were any types of restrictions
24:05
around competition, maybe those gets removed too with
24:08
exclusivity expiring. So.
24:11
So yeah, T-Mobile, I don't understand.
24:13
Maybe This is why Mike Sievert got pushed out.
24:16
Like, he agreed to a bad deal. But for all intents and
24:20
purposes, like, you know, Starlink, they've now branded it
24:22
Starlink Mobile. It's clear, you know, Alan will
24:25
say, like, hey, we're not getting into that business.
24:27
But in reality, everyone knows they're going to get into it,
24:29
right? They're going to compete
24:30
directly with M and OS. They bought spectrum here, you
24:34
know, it's mid band spectrum. So it's good for capacity, but
24:37
it's not good for coverage. But who's to say they won't try
24:40
to work on an MVNO agreement with T-Mobile and then try to go
24:45
to the business directly themselves, right?
24:48
But I think it's an important distinction for these companies
24:51
that are working with Starlink around the world, Like they're
24:53
probably getting something like 8020.
24:56
And for those companies that are working with Starlink, you can
24:59
kind of view it as, you know, a desperate move, whereas AST
25:03
Space Mobile is truly working as a partner, AST is working in the
25:07
background. You know, it's like your brand,
25:09
your marketing, your, your customer, your billing, your
25:13
support, which is the beauty of the model, right?
25:15
Like in terms of fixed cost, AST has little to none in terms of
25:19
touching the customer. They don't have to go require
25:22
customers, they don't have to keep them, they don't have to do
25:24
all these things. The bets for the M&O, right?
25:26
But then in exchange for all that, we'll give you 50% of the
25:29
economics, we'll keep 50. But I think that's an important
25:33
distinction where, you know, some of these early adopters for
25:38
four Starlink, over time, they're going to find out that
25:41
they made a Faustian bargain. Faustian bargain, meaning like,
25:44
you know, you sold your soul to the devil to get like something
25:48
quick and easy upfront, but then over the long run bad things are
25:53
going to happen, right? Unintended consequences.
25:56
You thought it was good, but in, in fact you got thrown into the
25:59
deal. So, so that was a really big
26:02
disclosure yesterday. I, I don't think the media has
26:07
covered it yet and maybe some space mob members can share the,
26:12
the specific economics of this 'cause I think it's something
26:14
that more of the media should, she should see and, and also the
26:18
industry. But yeah, I think, I think for a
26:22
company like T-Mobile, at the end of this, they're going to
26:25
find out that they've created a competitor who's taken some of
26:28
their customers 'cause you have to think about this way, right?
26:30
Like people know the brand Starlink.
26:32
Starlink is a direct, direct to consumer organization.
26:36
They sell fixed wireless service to consumers and so they have to
26:40
spend money on marketing, they have to go acquire consumers.
26:42
And so for Starling, it makes tons of sense.
26:44
It's like, hey, we're already spending a lot of money on our
26:46
brand Indigo acquire customers. Why don't we create our own
26:49
mobile brand as well? And so we can offer like we can
26:53
offer mobile broadband service in non dense areas.
26:57
And then we'll, and you know, we'll, we'll perhaps enter into
27:01
an NBN agreement and lease T-mobile's network for the
27:06
coverage aspects that we need, right.
27:07
And they could do that globally. They could go, go to each market
27:10
and try to, you know, envy knows to an extent, some, some are
27:15
shorter sided and will enter into MVNO agreements to enable a
27:18
competitor like that. But, but you know, hats off to
27:22
Starling. That's, that's a great strategy
27:23
and it's not what the AST is pursuing.
27:26
And and I think the other thing as we see some of these
27:29
announcements out of Mobile World Congress, some of these
27:32
carriers are going to work with both companies, right?
27:34
Like in certain geographies, they might choose Starlink and
27:38
other geographies, they might use AST space mobile, right?
27:40
And so Telefonica, it could be an example like that where you
27:45
know, they don't have this constraint anymore because
27:48
Vodafone sold its Spain, Spanish business And so exclusivity is
27:51
not there. But in certain markets where AST
27:55
and these are rare, but if there's exclusive rights to it,
28:00
then perhaps other companies or subsidiaries have to actually
28:04
use Starlink by default. So Telefonica, we can work a
28:08
Telefonica all throughout South America.
28:11
In Europe, that's somewhat constrained because of
28:13
Vodafone's exclusivity. However, that's changing with
28:17
the fact that the Vodafone has opened it up.
28:20
It's like, hey, if you guys join Satellite Connect Europe, then
28:23
that exclusivity goes away. But again, you're going to see
28:27
some of these countries, these countries and both companies in
28:31
different capacities. And of course that includes
28:33
fixed wireless versus satellite to device wireless.
28:38
But that shouldn't be a surprise to anyone, right?
28:40
We're still at early stages. And you know, one example is
28:44
Globe Telecom, I think is working with Starlink right now
28:48
initially, but then they still have a partnership agreement
28:50
with AST Space Mobile. And so especially for some of
28:54
these areas that have very large coverage areas, you might
28:58
utilize the technology differently in different
29:01
segments. And so that's something to keep
29:04
in mind of where I'd again, I I don't think it's like a 0 sum
29:07
game where 1 carrier is going to it's going to be winner to take
29:11
all, but it, it probably is going to be a decent duopoly.
29:15
And I think again, just given the competitive, given the
29:18
competitive dynamics and the economics, I think it's going to
29:22
be in the technological lead. I think it's going to be, you
29:27
know, the, the, the scale is going to tip for AST space
29:29
mobile. So oh, and the other thing I
29:33
would mention, which I think some folks have covered over the
29:36
last week or two, I mean, the fact that SpaceX merged with
29:40
XAI, which is burning a ton of cash, they've got to think about
29:44
their business differently, right?
29:45
And so it's not just about space communications or you know, I
29:50
guess it's now the mission to moon, the moon or Mars, but it's
29:53
also about fighting Earth war, like an absolute knife fight
29:57
down here on Earth around artificial intelligence, right?
30:01
And so earning a billion dollars a month on building out data
30:05
centers and training and all that, you know, all that stuff,
30:08
it's going to change the competitive balance of where
30:11
your resources are focused and what you're willing to do.
30:14
And so of course, when SpaceX goes public, you know they're
30:19
going to have access to capital and you know, we'll see what the
30:21
market what, what levels of I guess acceptance the market is
30:27
willing to give them for, for spending CapEx and relative to
30:31
our profitability. But with AST, you have a very
30:35
clean story, right? Like it's very straightforward.
30:37
Here's the consolation. This is what we're doing.
30:39
It's dual, it's dual use case for commercial side directed
30:44
device connectivity for military connectivity comes too.
30:47
But then radar sensing, GPS, all these other things, you know,
30:52
electronic warfare, jamming, and then of course having the
30:56
patents and building blocks and production capacity to do other
30:58
stuff in space, right? Whereas I think for SpaceX,
31:02
it's, you know, some people will like it.
31:04
They'll like this diverse behemoth that's got all kinds of
31:07
different things going on. But I don't know, at least it's
31:10
just my personal preference. Like I, I, I want to have a more
31:13
focused company and I think in terms of pollution and
31:18
probability, you know, having to carry the water for something
31:22
that is, you know, maybe it's a third or fourth or fifth player
31:25
in AI, but is trying to, you know, enter a knife fight with
31:30
open AI. Google Anthropic that that seems
31:34
pretty daunting, but the pay off, you know, could be big,
31:37
right? But, but I'd rather, you know,
31:40
stay focused. Of course, you know, maybe
31:41
tomorrow he goes out and merge with Anthropic and then I've got
31:45
to change my tune. But that's I I highly, highly,
31:48
highly doubt that's going to happen.
31:49
So but yeah, I, I think coming out of this, what an exciting
31:55
set up. Like we've got Bluebird 7 that's
31:57
going to launch this month and then we've got our first batch
32:01
shipment that's going to happen in April.
32:03
And some people have asked like, you know, why did it take so
32:05
long? There's probably unforeseen, you
32:09
know, with composites when you're building these things and
32:13
then you just, and then you're going to have to stack them up
32:15
to 8 on top of each other. Interfering things are going to
32:18
happen, right? Like you're going to find
32:20
through that manufacturing process, you know, maybe some
32:22
things that you're doing didn't come out as expected and you go
32:25
back to the drawing board and do it again or do something
32:27
different. And so it sounds like the
32:29
company is got through that. You know, it's specifically they
32:32
were talking about stacking and stacking for those people that
32:35
don't know, typically when you launch satellites, you have to
32:40
assemble them together and interfering and make sure that
32:43
they're safe and can go through vibration of of a rocket and the
32:46
tremendous amount of force. And you know all that stuff that
32:52
happens when you when you launch into space and then you so you
32:56
have to carry them safely to space and then deploy them,
32:58
right? But you can't leave like all
32:59
this junk around in space. And so AST to optimize for the
33:03
dollar spent on launch, they came up with this revolutionary
33:08
design where they, the actual infrastructure that keeps them
33:13
stacked are the buses themselves, right?
33:15
And so you can imagine you go to the grocery store and you have
33:17
these like tuna cans that are all stacked together.
33:19
That's what AST has done, right? And so when I looked at some
33:23
analysis of how many of these things can fit in the fairing of
33:27
a rocket, if you needed the lattice work like the support
33:30
structure to carry all these things, let's just say like, you
33:34
know, 6 or 7 Bluebird satellites, then you wouldn't
33:37
need with which are call it 4200 kilograms each.
33:41
You would probably need another 1000 to 1500 kilograms of, of
33:45
weight to create a structure to support all those if they
33:49
didn't, if they weren't built to stack on each other like Legos.
33:52
But these things are actually built to stack on each other.
33:54
And so you can by saving that 1000 to call it 2000kg of space,
33:58
you can actually fit another satellite in some of these
34:02
variants. You can fit another satellite up
34:03
for launch. And that's, that's huge, right,
34:05
in terms of your per unit cost. And so I think the company
34:10
talked about challenges of stacking.
34:12
This is what they meant. And so if you stack these things
34:16
and you're using a new composite design, sometimes you're going
34:19
to maybe have a failure right where a design wasn't strong
34:22
enough. And so you're going to have to
34:24
reinforce it. AST this company is I've talked
34:28
about before, is a, you know, succeed the first time, succeed
34:31
every time. Like there's they're not here to
34:33
throw spaghetti at the wall and have things fail.
34:36
It's a measure twice and cut once type of approach to
34:39
development. And so it took a little more
34:41
time and, and now it seems like we are on track to send our
34:46
first batch of 6 down to the Cape, Cape Canaveral in and
34:51
under. I guess it's like 27 days right
34:53
now or sometime over the course of April.
34:56
Of course, sending 6 is a batch. What does that mean?
34:59
Like that could be, and I, I've talked about this before
35:03
yesterday or the day before, but we might actually be scheduled
35:07
to go on New Glenn 4 because I don't think there's any payloads
35:10
that are currently scheduled for the next New Glenn launch.
35:14
And so we might actually see a stack of 6 go up on New Glenn,
35:18
which would be pretty cool. Otherwise we are going to be
35:21
utilizing Falcon 9 and that would be 2 Falcon 9 launches for
35:25
two batches of three. So, so we'll see.
35:28
But anyway, that's the quick update.
35:32
I think as I, as I had tweeted out earlier, you know, whether
35:37
you think things are priced or not or there's excitement,
35:41
typically we see a ramp up into these launch events.
35:44
And so I, I think the stock price is already kind of
35:46
reflecting that now. And, and I think my personal
35:49
opinion, not financial advice, but I think we'll, we'll
35:51
definitely breach above 12130 perhaps and hit a new to all
35:56
time high before the Bluebird 7 launch.
35:59
And then from that point on, it's, you know, who knows,
36:01
right? Because I think as I mentioned
36:04
before, in previous instances, you, you kind of have like a
36:06
pullback, but then at that same time not.
36:09
And you know, shortly after that launch, you're going to have
36:12
that first shipment of 6 satellites down the tape.
36:15
And those will launch within what a two to three-week time
36:18
frame. And then it's going to keep
36:20
going, right. And on top of that, maybe we get
36:22
more of these partnership agreements or even better
36:26
definitive commercial agreements falling in place.
36:29
And then you've got Golden Dome Awards, specifically, I'm
36:34
looking forward to new developments around MDA Shield
36:37
and then of course, the Noble program as well.
36:41
And yeah, so there's, there's a lot to look forward to.
36:44
So anyway, that's all I had. I've got a hop now.
36:48
I got to go move my car. So we'll catch up again later
36:53
and look forward. You know, we, we still have
36:56
another day to go at Mobile World Congress.
36:58
And so there might be more news for the company.
37:00
But anyways, everyone take care and we'll talk to you soon.
37:03
Bye. Still listening to the AST Space
37:08
Mobile podcast? If you enjoyed this episode and
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37:23
Thanks again and I'll see you next time.
37:29
We're doing something very, very big and I think with this
37:31
technology we can really affect billion lives.
37:34
FT Space globally is the only company that has good technology
37:39
to deliver cellular broadband connectivity directly through
37:42
state to the everyday smartphone.
37:45
People will just basically turn their phone and be Syndex.
37:48
But regardless of where you are, we don't want the mutual even to
37:51
know that it's connected by satellite.
37:54
Our role is to bring this into reality, always in partnership.
38:05
Listen, Waffles.