Latest / AST SpaceMobile Podcast / Anpanman talks on Space Stock Weekly V2

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Anpanman talks on Space Stock Weekly V2 · AST SpaceMobile Podcast

0:06
This is the AST Space mobile. Podcast.
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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 large.
0:27
I'll talk about Global Star Amazon 1st and then and then
0:31
I'll hand it over. That's might be a short, a
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little bit a bit of a shorter discussion and my club has got
0:37
like 4 announcements last week, so perfect, let's start there.
0:40
Yeah. So Amazon, they announced their
0:42
deal to buy Goldstar for 11 billion.
0:44
It's a $90.00 deal mix of stocking cash, but it is fixed
0:48
at $90.00. You can elect some Amazon stock.
0:52
And so yeah, they they announced the deal today.
0:57
This has been a long running process that I think Global Star
1:02
put themselves up for sale middle of last year maybe with
1:05
spring last year. And then I believe based off of
1:09
the confidential aid agreements that were signed between Amazon
1:12
and Global Star, I think they they started in earnest
1:16
discussions sometime in the fall of last year.
1:19
And so this this has been a transaction that was expected to
1:23
come. I think obviously there were
1:26
some legacy pundits that thought that perhaps Starlink was going
1:29
to buy global Star, but I think for Amazon, you know, the deal
1:33
makes quite a bit of sense. Amazon is competing with
1:36
Starlink or fix broadband with their Leo consolation and since
1:40
they already are going to be making satellites, this deal
1:44
made sense to kind of fill that out to have an offering D to D.
1:49
It is a bit complicated given that Apple, you know, previously
1:53
owned 20% of global star and 85% of the capacity.
1:57
I went through the deal docs. There's no specificity because I
2:01
think there's side letters that go into detail exactly how the
2:03
relationship's going to work. But you know, at least from this
2:07
point they're going to try to work together.
2:09
Where I think for Apple, they get a well capitalized partner
2:12
that, you know, knows what they're doing, or at least is
2:15
willing to commit capital to get something accomplished versus an
2:19
under capitalized global star management team that, you know,
2:24
is stuck in transitioning from the legacy business to hopefully
2:27
creating something new. And there is some, there's some
2:31
nuances to this. So MDA space was hired to build
2:36
17 satellites to replenish the old global star system.
2:40
And so that's like the, the, the old school technology.
2:43
And then they were hired to build out a new constellation of
2:47
I believe it's 50 satellites leveraging the Aurora platform.
2:51
And so based off of what I've read, it's a little unclear
2:54
what's going to happen to that. It does seem like, and This is
2:58
why it's kind of weird because it's global star and Apple and
3:03
Amazon are kind of in a tweener process because the deal is not
3:06
going to close until probably at earliest the first quarter, the
3:11
end of the first quarter next year.
3:12
But then it could, you know, there, there's, there's the
3:15
ability to extend the deal well into summer and then even into
3:19
the fall. And so there will be a long
3:21
regulatory review process, especially since it's Amazon
3:24
acquiring them and of course Apple's involved.
3:26
And so for Apple and Global Star, you can't risk waiting for
3:32
this deal of close and not getting your consolation, the
3:35
old one getting replenished and and then working on the new one,
3:38
right? So from what I can tell, I think
3:41
they are going to continue to build the C3 consolation.
3:45
And then Amazon today said that they are going to build their
3:50
own directed device satellites as well.
3:52
And so from AI think it's important to kind of of course,
3:57
what is realistic versus like what they're hoping to do, you
4:01
know, that their aims, which obviously we all know space
4:03
companies for regulators and and internal folks and of course,
4:09
public semesters, you have your aspirations.
4:11
And then what actually comes to fruition on what time lane can
4:14
be very different. And so I think for Amazon, you
4:19
know, why do they do this deal? They're getting global, global
4:22
harmonized spectrum in the 2.4 range.
4:25
It's MSS spectrum the there. You know, it's they're they're
4:31
it's about a third of the spectrum that Starlink now has
4:34
and, and ASD Space mobile has here in the US.
4:37
But then they also global Star does have a few other markets
4:40
outside of the US and so that's a benefit.
4:43
But yeah, there's, there's probably a bit of option on
4:45
here. I mean, you, you own spectrum
4:47
now and you know, it's likely that they'll find a good use for
4:50
it. There is the, the Apple
4:54
business, which Apple is going to pay them some, some amount of
4:57
money to support the support, you know, Apple devices.
5:02
But at the same time, it's unclear what that relationship
5:08
means. You know, if Apple is like, hey,
5:09
we just want what, you know, the level of service that we
5:12
previously had with Global star will pay you some minimum amount
5:14
for that. Or do we want to offer something
5:18
that's on the level of what AST is doing eventually or or
5:23
Starlink and potentially be in competition with with the M and
5:27
OS, right. And so it's still early days.
5:30
It's unclear exactly how this stuff is going to play out.
5:32
But going back to what Amazon is doing, they are going to build
5:39
their own direct to device satellite.
5:41
I think there's a little bit of messaging here for regulators in
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that in order to get this deal approved, they're going to tell
5:46
regulators like, hey, you know, they have ambitious goals.
5:49
They're going to start rolling out direct to device satellites
5:52
in 2028, which I think it's important to note that I think
5:56
they started listing jobs related to direct a device,
6:00
maybe it was like a few months ago at most.
6:02
And so they're still really early in this process.
6:05
And, and I think 2028 is a very ambitious goal, like probably
6:09
something like 20292030 is more realistic.
6:14
And so I think you know, that and going back to Starlink, you
6:16
know, they, they announced plans to do this in the summer of
6:20
2022. And it wasn't until basically
6:23
this, I think, you know, the end of 2025 that the service
6:27
actually came to fruition. And, and we know given Amazon's
6:33
timeline for, for their Leo service, it's taking much longer
6:36
than expected. So, but I think from a regular
6:39
regulars point of view by saying that you're going to try to roll
6:44
out service, you know, consolation 2028, that's a
6:47
positive for consumers. And and from a regulatory point
6:49
of view, we saw Brendan Carr today when he's interviewed on
6:53
TNBC, he talked about how this is good for the American
6:56
consumer, that this is a three player market where he mentioned
6:59
Starlink, Amazon and then AST and then he was, he was quick to
7:03
say and there's some other players as well potentially.
7:07
But but yeah, so I think from a regulatory standpoint, it's good
7:10
for from the political perspective to say, hey, we're
7:13
trying to enable A3 player market and and so Amazon by
7:18
committing to that or saying that they're going to do that,
7:20
it helps from an approval perspective.
7:22
But that said, I think it's important to note that in
7:26
regards to T-Mobile and Starlink, I think you know, they
7:29
have exclusivity that expires this summer.
7:32
And then for AST, they actually have multi year exclusivity with
7:36
AT&T, Verizon, Vodafone, they have a five year exclusivity,
7:40
mutual exclusivity. And then you know, there's a few
7:42
others as well, but for AT&T and Verizon, I believe those are
7:45
multi year mutual exclusivity periods.
7:48
And so and that that will start from the time that commercial
7:51
service is actually online. And so if commercial service
7:55
starts at the end of this year or the first quarter of 2027,
7:58
then you would have you know some running period of mutual
8:01
exclusivity. I think it's important to note
8:03
that the AT&T and N Verizon also contributed their 850 megahertz
8:08
spectrum and so they're kind of locked in at this point.
8:12
That said, you know, when that exclusivity expires, then there
8:15
is this possibility that Amazon could potentially pursue them as
8:19
customers or they could pursue T-Mobile for that matter.
8:22
But I think, you know, the dynamics here are a bit weird
8:25
because MN OS clearly understand the competitive, you know, a
8:30
threat that Amazon would bring to the table given that they
8:33
own, you know, they own the consumer and they if they tried
8:38
to roll out this type of service, you know, what else are
8:39
they going to try to do to disintermediate the M and OS?
8:43
However, that said, you know, Amazon has the same problem that
8:47
Starlink has and that they don't have access to low band
8:51
terrestrial spectrum, which is what you know, T-Mobile, AT&T
8:54
and Verizon app. And so so yeah, it's an
8:57
interesting competitive dynamic. I think Amazon has enough
8:59
internal use cases for this service to make it, you know,
9:03
valuable enough. For example, they own the N 53,
9:07
it's like 2.4, it's right next to Wi-Fi, but a private band
9:11
that they could run, you know, enterprise private network of 11
9:16
megahertz of spectrum and that can be valuable.
9:18
And for enterprise customers it could also, it could also maybe
9:23
offer consumer router, Wi-Fi routers that would use this
9:26
particular band. And so there'll be less traffic
9:28
on it. That said, it's a low, it's
9:30
authorized for low power terrestrial use.
9:32
And so it's not like you can build out towers and, and hang
9:36
up or build towers and, and try to provide some type of
9:41
terrestrial service with that, you know that, that spectrum.
9:45
And so yeah, for Amazon, they're obviously the, the satellite
9:49
service is interesting to them. And since they're already going
9:51
to be building satellites, why not to develop a directed device
9:55
satellite to enter this market? And I, I think an important, one
9:59
of the important things about today's deal was that now you've
10:01
got Musk and Bezos who have spent 23 billion and $11 billion
10:06
on this market that naysayers have said, you know, it's not
10:10
the market's not big enough, not sure anyone will buy it.
10:13
Well, these guys are spending multi billion dollars to enter
10:16
the market. And obviously Apple has already
10:18
spent billions of dollars as well.
10:19
And so, so, yeah, it's an interesting development.
10:22
I think it validates what the company's doing.
10:25
And, you know, I think it also heightens and increases the
10:29
company's strategic value to an AT&T of Verizon.
10:33
And then of course, you know, Google and Mehta, who they're
10:36
working with and any number of other tech companies and of
10:40
course M and OS globally. But yeah, it's, it's, it's
10:44
obviously, you know, from a near term perspective, there's
10:48
there's the market has to digest this and figure out, you know,
10:51
does this actually, you know, does this eat into the potential
10:54
Tam of AST and what they're doing with with broadband
10:57
directed device? You know, it is Amazon to be
10:59
able to offer a broadband or is it going to be some type of
11:02
middle type of service? Because I think as I've
11:04
mentioned before, you know, this deal gets them a third of the
11:07
spectrum that ASD has with Legato here in the US.
11:10
And then of course, we're not counting the terrestrial
11:12
spectrum from the carriers. And then for Starlink, yeah,
11:16
this is 1/3 of what they have. But yeah, it's it's 2028 is an
11:22
ambitious timeline. I think they're they're saying
11:24
that to regulators to to achieve regulatory approval.
11:28
You know, they, they talk about pursuing M and OS to work with,
11:30
which not necessarily it's going to be here in the US could be,
11:33
you know, globally as well. And you know, I, I would, I
11:36
guess I would say that Amazon also competes with other tech
11:39
companies and e-commerce players globally.
11:41
So, you know, there will be some competitive dynamics to deal
11:45
with there. But but yeah, this, this, this
11:48
deal, you know, it's been rumored for a long time.
11:51
And I think, I think the reaction from AC stock today,
11:55
you know, obviously it's gone from rumor to reality and
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there's this mentioning of direct advice.
11:59
And so people are, you know, they're going to need to digest
12:02
this and figure out what this means, but I think it's still
12:05
early days. Like we'll need to figure, we'll
12:07
need to hear from Amazon and and Apple like what their plans are
12:10
around this. But but yeah, it's going to take
12:13
time. It's going to take multiple
12:15
years to develop a satellite. You know what, what kind of
12:18
architecture are they pursuing? If they, what's interesting is
12:21
that if they want to stay compatible with what Global Star
12:23
has today, then this is kind of the issue that Starlink has
12:28
where they put out, you know, what I view is like inferior
12:32
architecture. Their future satellites are
12:34
going to be backward compatible as if you said.
12:35
So you know, are they going to kind of build on top of that
12:39
which you know, that's a key question for Global Star.
12:41
But yeah, I think today's deal and highlights obviously the,
12:46
the key value of Global Star is their spectrum.
12:49
And so this highlights the value of Legato that AST now has a 80
12:53
year lease for you know, is that worth $20 billion relative to
12:58
AST market cap of 30? I mean, you pick the number, but
13:01
then also you know, this, this highlights the value of Iridium
13:05
spectrum. I know there's like some
13:06
Meridium bulls out there. And and you know, eventually if
13:10
you're able to acquire that spectrum and clear out the
13:12
legacy users, you know, there is some value there in the 7.8
13:17
megahertz of L band spectrum that they own.
13:20
And so perhaps you compare that with something else.
13:23
And then of course, there's Biosat as well, which Biosat
13:26
owns some MSS Spectrum X US. And you know, is that company
13:31
similar to Echostar? Is it worth more dead than
13:33
alive, right? Like eventually is that company
13:35
going to get acquired or lease out its spectrum?
13:38
But but yeah, it's all interesting stuff.
13:40
I think maybe I'll just pause there in case people have
13:43
questions. But never a dull day in space.
13:46
And so I think, I think for AST, we've got today they they did a
13:51
wet dress rehearsal with the New Glenn three.
13:54
Tomorrow's going to be the static fire.
13:56
It looks like Saturday is going to be the day of launch, which I
13:59
know some people are going to move around their schedules to
14:01
go attend. I don't believe I'll be able to
14:04
attend because I've got like several kids soccer games this
14:08
weekend which I can't miss, so I'm going to have to watch it
14:11
remotely. But yeah, maybe I'll just pause
14:14
there if anyone has questions. I'd say I have my kids first
14:17
soccer game this weekend, so that's one to manage.
14:21
So I'm not jealous, but it's also one of the best things in
14:25
the world. Yeah, no, I I look forward to.
14:28
I like watching my kids soccer games more than professional
14:30
soccer. So yeah, look forward to.
14:34
It I can't I was either a really great compliment from a dad or a
14:38
diss on all professional soccer players.
14:42
It's, it's a little bit of both like, Oh my gosh, you're
14:45
watching a bunch of like first and 2nd graders chasing after
14:48
the ball and like the, the joy on their face when they get a
14:52
score and like it, it, it's just that it's, it's a different
14:56
level of emotional connection you get when it's your kid out
14:59
there versus watching some pro like play a play.
15:03
Yeah, I'm sure. I'm sure you guys are both great
15:06
dads, Dads of the year, just space.
15:09
But so so I guess more more of a comment than a question, but
15:13
just just as far as I you kind of touched at the beginning, but
15:16
I keep trying to tell people that like the end of this market
15:19
is not everyone's cell phone. It is every device that's ever
15:22
gonna need to be connected everywhere.
15:24
And so the, the Tam is, I just, I can't like describe the level
15:28
of growth it's going to go through over the next decade or,
15:31
or 15 years. And just to think that
15:33
everything's going to be connected this way or have the
15:35
ability to connect this way. And yeah, I, I, I said, I think
15:38
I said it last week or the week before, like even if ASC got all
15:41
90 of its satellites up next month, they would have a
15:43
capacity issue because I mean, I think the growth, the growth of
15:47
this thing is going to be faster than anyone company could take
15:49
advantage of. And so it's it's great news that
15:51
there's another massive I I that's a competitor, another,
15:56
another player in this entrance. I mean, you the only thing I
15:59
would mention is that rent a car today was the interviews posted
16:02
today. He basically said SpaceX, Amazon
16:05
Leo and and space mobile are the three director device like
16:09
players. So like, I mean, you're already
16:11
getting it from the FCC chairs. Like, like it's a good thing.
16:14
So there might be more entrance, but this is a good market as it
16:16
is. Like, I don't know, it's just to
16:17
me. To me, it was an easy, an easy
16:20
case to close my cover calls. Yes, I shouldn't have opened
16:23
them if it's going to yell at me, but I, I did anyway.
16:25
Yeah. And then I bought, I, I added
16:28
more of my calls when it was when it dropped.
16:30
So yeah. Yeah, I, I would say so in the
16:34
future for Internet of Things, which was mentioned in the
16:36
Amazon press release. And I think Amazon has a very
16:38
keen interest around that, whether it's like drones for
16:41
delivery, any number of connected Amazon devices.
16:45
I mean, someone just reposted the Reuters article from March
16:49
20th that they're developing a new smartphone, which obviously
16:52
the first Fire Phone failed, but they're coming back to work with
16:54
a smartphone. And you know, how does what does
16:56
Apple think about that? But it's not about phones, It's
16:59
about it's about all devices, right?
17:01
And especially for IoT, a lot of these devices are off the
17:05
threshold network or perhaps like the you're going to have
17:10
some capacity constraints, right, for all these devices.
17:12
And so I think you're right in that when there's this
17:16
proliferation of of cars that are connected robots, drones,
17:21
you know, you name it, right. And this is just a commercial
17:23
side of the business. Like we haven't talked about
17:25
defense, but that's going to I think, you know, be a pretty big
17:31
driver demand. And so having having three
17:35
players out there, you know, I think for AST the on the
17:38
commercial side, it will be focused on the consumer mobile
17:42
phone market and then any connected devices, watches,
17:44
things like that. For Amazon, I think they are
17:47
going to probably have this, you know, more internal where if you
17:51
have customers who are using AWS and any connectivity in their
17:55
campus, they're going to utilize this N 53 spectrum.
17:59
You know, they are obviously going to offer direct to device
18:02
in some some way, shape or form, which you know, they'll need to
18:06
service Apples phones, which I think it's it's kind of
18:10
interesting because I think if they are going to let MDA space
18:13
build out the C3 consolation, then maybe that's what's going
18:17
to serve Apple's stuff. And it's going to be very low
18:19
level. And then Amazon directed device
18:22
like they're going to eventually transition to that consolation.
18:25
And it's I mean it's still early days like we don't know what
18:28
they're hoping to achieve with that, but obviously it's going
18:31
to be higher data throughput. It's not going to be the old
18:34
school, you know, global star satellite.
18:37
So yeah, it's a pretty exciting time.
18:40
And I I think, I think obviously the market apparently is big
18:44
enough for all these players. And and I think you you point
18:47
out, you know, we're in a car today talking about a three
18:49
player market, which I kind of made a joke about it where it's
18:52
like, oh, I guess it wasn't a three player market before, so
18:55
maybe global start didn't count. But but he talked about how the
18:59
three player market and talked specifically about, you know,
19:03
like you said, Starlink, Amazon and AST space mobile.
19:07
So he kind of said the quiet part out loud, which I think
19:10
obviously is a is a positive for regulatory approval to be coming
19:15
in any day now. Just from a layman, that's kind
19:18
of due to this whole spectrum wars.
19:21
I, I just wonder about like the, if I like look at this map like
19:27
not being invested in any of these companies and just
19:29
considering like an end user, you're, you're not going to be
19:34
operating very like solidly in high density environments
19:38
because that's already covered by like normal standard cell
19:41
phone towers, 5G, all that stuff.
19:44
But like when it comes to like if I'm like out at my family's
19:48
property out in like, you know, a county over where we're like
19:52
deep into rural, I don't want to lose signal when I walk into a
19:56
house. Does the G SAT deal also like
20:00
move into lower frequency spectrum and like what?
20:04
What is their exact spectrum assets And what is Amazon
20:07
expected gain when it comes to like penetration of like a
20:12
vehicle or a building or anything like that?
20:15
It is there still an advantage in L band or like lower
20:19
frequency mid frequencies? Yeah.
20:22
So what Amazon, the deal brings today specifically Global Star
20:26
has, I just have some notes here.
20:28
Gold Star has 16.5 megahertz of S band, that's where downlink.
20:32
And then they've got 8.7 megahertz of L band uplink,
20:36
although they share about 1 megahertz of that with Iridium.
20:40
So it's really more like 77.7.7 megahertz of L band.
20:45
And then they use 339 megahertz of C band for, for their feeder
20:50
links, right? But, but this spectrum is all,
20:54
you know, it's, it's mid band spectrum.
20:56
And so it's not, it's not great for penetrating buildings or,
21:00
you know, cars, things like that.
21:01
But it's good for data capacity. However, you know, they, they
21:04
don't have a tremendous amount of it, right?
21:07
And so for Amazon, this is a, this they will be able to
21:11
provide a, a data service that, you know, when you're out of the
21:15
terrestrial network, it'll be pretty good.
21:16
I mean, depends on their satellites too, right?
21:18
Like if they they build a satellite that is similar to
21:21
what Sterling's doing, then it's going to be limited.
21:23
And it depends on the architecture too.
21:24
But then if they try to build something that's like what AST
21:27
is doing, you know, a very large phased array, high power, then
21:31
the service is going to be pretty decent, right?
21:33
And so we're, it's still too early to, to figure out like
21:38
what they're going to do, but I'm sure we'll learn in the
21:41
coming years what their plans are.
21:43
But but yeah, it this doesn't give them any low band spectrum.
21:47
It's L band and it's S band. But that's like split link with
21:51
the L band, right? If they're if they're sharing
21:53
spectrum with Iridium, they're going to have to do like split
21:55
linking and as far as like sharing packets across the
21:58
uplink and downlink and like half the potential bandwidth.
22:03
I think it's one, just one megahertz that they share with,
22:07
with, with with Iridium on that there, whereas the other one is
22:11
the other parts of it are unencumbered.
22:14
Let me just look here. But yeah, it but the, the
22:17
downlink is in the 2.4 gigahertz and then the uplink I believe is
22:22
like 1.61 point 7. And so typically you want your
22:27
uplink to be lower megahertz because you the the you want it
22:33
to be able to travel and propagate versus the downlink
22:35
where you know the you you want more data and so the the
22:39
channels are wider. And so in this instance though
22:42
for global * yeah, what Amazon has acquired is permanently
22:46
spectrum. They have spectrum here in the
22:48
US and then they also have it in for most of the world.
22:51
And so that's the real value, right?
22:53
Like if Amazon wants to offer like one thing where they could
22:57
differentiate themselves, they could say, well, if you are on
23:00
the Amazon network, you'll be able to roam globally, right?
23:03
And that's not something that AST can offer today.
23:06
It would have to be in partnership with M and OS.
23:09
And so if you are on, if you're an AT&T customer and you go to
23:14
Japan, like there would be a roaming agreement with Rakatan
23:16
and you would still have, you know, directed device service
23:19
there. And then, you know, if you're
23:21
flying a plane is the, you know, this, the spec, the service will
23:25
work for you. But what's unclear is like over
23:29
various parts of water, like which MNO has control of that.
23:33
And so whereas Global Star, I think it's pretty
23:35
straightforward, like it's just for most of the world, they have
23:38
coverage and so they'll be able to provide this.
23:41
So it's, it's a very clean way of providing service.
23:46
But you know, the key question is like, who's selling it,
23:48
right? Like is Amazon selling it
23:49
directing to consumers? Is Apple OK with that?
23:52
Or is it going to be resold through Apple?
23:55
Or if it's an M&O, like are they comfortable in selling Amazon's
23:59
service and then handing their customer off to Amazon?
24:02
And, you know, obviously Amazon wants to control a customer, you
24:06
know, does Amazon offer like even thinking further, like do
24:08
they offer some type of service as part of your prime package?
24:12
You know, how does that work? Which you know, today, like if
24:16
you're a prime customer, you can't obviously they can't give
24:18
you any type of service of your phone because the MNO controls
24:21
your phone. But then in the future, like,
24:23
are they going to try to encroach in that somehow, right.
24:27
And, and it's a pretty, it's a pretty complex question because,
24:32
you know, you, you would require some type of esim and you know,
24:36
that would the, the service would only kick in if you were
24:39
outside of coverage of AT&T. Similar to like, you know how I
24:43
think Starlink allows you to roam onto the network if you're
24:47
not a T-Mobile customer, but you have to like get some E SIM and
24:52
then it's pretty expensive. I think it's like $20.00 a
24:54
month. So, yeah, these are all really
24:57
interesting questions. I, I think for the consumer, for
25:00
me, for example, as a mobile phone user, I want something
25:03
that's seamless and low friction, right?
25:05
And so if you're going to roam onto an Amazon satellite
25:08
network, that's going to be pretty high friction in terms of
25:11
getting the service enabled and then roaming when you're out of
25:14
service. Whereas for an AT&T or Verizon,
25:17
it's just part of your plan. And so when you leave, it just
25:20
automatically switches, right, Because it's actually integrated
25:23
into the network core, whereas this is going to be something
25:26
totally separate. So yeah, the the, I mean, again,
25:29
it's all early days, but we'll see how this unfolds.
25:34
OK. At the I'm going to, I'm going
25:37
to got to switch to something else, but I wanted to get these
25:40
couple questions into you real quick answer whatever order you
25:44
want to address them in. There is question around if
25:50
there's any concern with Starling and Amazon having their
25:53
own internal launch, not really for Amazon, but close enough for
25:57
new brand. And then I mean we kind of
26:00
addressed that before, but it it is a yeah, talk about that one.
26:04
And there is somebody's asking is a situation where Blue Origin
26:07
do acquire ASCs and then the last one was around margin
26:13
compressions have having three players in the GDC market.
26:17
Yeah. So on launch, as we all know,
26:19
launch is something where if you're paying customer, you can
26:23
get a ride, right? And so SpaceX, they have a ton
26:28
of capacity. If you pay, you can show up and,
26:31
and launch on them, which you know, the batch, our first two
26:35
batches of Block 2 satellites are going to be on Falcon 9.
26:38
And I think we have a few other Falcon 9 launches this year.
26:42
And so yeah, Blue Origin is separate from Amazon.
26:45
I mean, although obviously they're connected, but we have
26:49
we are a pretty large multi launch customer for Blue Origin.
26:52
So that's not really a concern. That said, we do have we are
26:57
booked with another heavy launch provider.
26:58
I think it's most likely Mitsubishi Heavy, but I think
27:02
there's also a chance that it's Arian as well.
27:05
So, so yeah, so that's I mean within, within space you have
27:10
coopetition like you might be competing in one area and then
27:13
you're a customer in another area.
27:14
So that's not anything new. What was the other question?
27:20
There was just a comment on it. Blue Origin would acquire ASTS
27:24
and then if if the address the margin compressions of having
27:28
three players in the director device market.
27:31
Would blue. Origin After that, we're going
27:32
to switch off. I I don't think I don't think
27:35
it's near term that they would acquire ASTSI think once near
27:40
white can see Amazon working with AST is in 2-3 years time.
27:45
They put some Rd. they put people together, they try to
27:48
come together on a workable solution and it's just not good
27:51
enough. And then they say, hey, you know
27:53
what ASD you have a you have your block 3 mid band
27:56
consolation up and running. Can you light up our spectrum?
27:59
That could be one scenario or, you know, eventually maybe down
28:02
the line, if if Bezos made an offer to about that, he couldn't
28:07
refuse. And perhaps like, you know,
28:09
maybe there's a deal there, but we're I don't think it's it.
28:12
It's too early and and obviously Amazon wants to get this deal
28:15
through regulatory approval, buying AST on top of doing this
28:19
deal. That would not be good.
28:20
Like you probably would get stuck in regulatory mess.
28:24
And so you you need to do the global star deal first in terms
28:29
of margins. Yeah, it's it is a good
28:31
question. I mean, the question is like on
28:34
the one hand with their player, does that does that hurt margins
28:37
versus two players? Yeah, absolutely.
28:39
Like the margins are is are you going to be, is the ASP going to
28:43
be $15 or it's going to be $12.00 or it's going to be $10,
28:47
right. But if you go through financial
28:50
models of what AST looks like, you know, shifting around a few
28:54
bucks here and there is not going to make a huge difference.
28:57
But what this does is, and this is what I had posited earlier
29:02
today, it's like by Amazon pursuing this market, does that
29:06
imply something about the Tam being bigger than people think?
29:09
And I think that's kind of the balance where because Amazon is
29:13
pursuing this and, and it becomes more top of mind and,
29:16
and people are, you know, start figuring out different use cases
29:19
and applications. Does that actually expand the
29:22
market? Right.
29:23
You know, it's like if, if one company would just focus on AI
29:26
and people are kind of poo poo at it, but you've got like 3
29:28
companies focused on AI and there's various applications for
29:33
it that does that expand the market, right.
29:34
And so I think it's important to note that also for AST, you've
29:38
got the defense business and the first responder business, which
29:42
for all intents and purposes, given our technology, like it's
29:45
not going to be impacted. But you know, Blue Origin,
29:49
people forget like Blue Origin is also putting up this
29:52
enterprise grade high bandwidth consolation for AI data and
29:56
compute. And so there's going to be a lot
29:58
of consolations. There's a lot of, you know, AI
30:02
data centers. I mean, the market is
30:03
tremendous, right? And so the key, the key thing is
30:06
to differentiate yourself, have a technological Moat, you know,
30:09
3800 patents, but also lock up those M&O relationships, which
30:13
is what AST has done. And so, but yeah, I think I
30:17
think the market is going to surprise people in terms of the
30:20
size because once you have this technology and platform out
30:24
there, the applications, you know, some of which people
30:27
haven't even thought of, now that's where the real like bread
30:31
and butter comes, right? Not just mobile phone
30:33
connectivity, but what other things you can do.
30:37
I have just one quick one for you just because I know your
30:40
time is fleeting and we're about to switch topics.
30:43
But when you when you brought up patents, that's where I think
30:46
that that's going to be like a significant because you have the
30:49
the SpaceX like their position at one side of the deal of like
30:55
having custom silicon and dishy Mcdish face and all that stuff.
30:58
Like to require it for that to work.
31:00
And then AST being direct to sell using existing hardware as
31:05
Leo enters the market and potentially trying to meet in
31:08
the middle there. What is the minefield of
31:11
intellectual property that they could potentially stumble upon?
31:15
Or what are the solved problems that AST or SpaceX might have
31:18
like come across where they're going to like pretty much trip
31:22
on their afoot and just like, OK, we might have to have some
31:25
kind of a licensing deal or we might kind of have to like do
31:28
something along phase array technology in order to have a
31:32
bandwidth throughput that we need to facilitate these
31:34
customers. Yeah.
31:35
I mean there, there's a lot of fundamental patents that ASD has
31:39
and Starlink, I think they have like 1 or maybe 2 that they've
31:43
they've developed which which is particular to the architecture.
31:47
And so, yeah, those are things that they'll have to engineer
31:50
around or through. And, you know, the key question
31:53
is like, is AST going to be, is it going to allow for fair
31:57
reasonable use for some of these patents, you know, or they get
31:59
what kind of royalties or, or, you know, how could they work
32:02
together? But yeah, that's not something
32:04
the company has been focused on yet, but I'm sure as they
32:08
continue to stack patents, at some point that's going to come
32:10
into play. I I do think the one thing I
32:14
forgot to mention is is the fact that you do have all these other
32:17
players like link SES biosat equisys, which is the old Yossat
32:23
or whatever all these players who legacy guys were like, Hey,
32:26
I'm going to, you know, read him in there too.
32:28
I'm going to enter this market to which I Pooh poohed on, but
32:32
now it's like great. It's the best thing since sliced
32:34
bread. So I'm going to enter too.
32:36
All those guys are now you know, they see Amazon coming in.
32:39
It's I think it's kind of game over for them, right, because
32:41
it's hard to compete against these three players and So what
32:46
are they going to do? And so I I think that's where
32:48
like the strategic, whether it's like leasing agreements for
32:51
Spectrum or potentially, you know, selling themselves
32:54
eventually, I think that's where some of that comes into play.
32:57
But yeah, when you have all these patents stacked up and
32:59
you've got three large players who are working with deep
33:03
pocketed partners, that makes it kind of tough for anyone else to
33:08
enter at this point. Sweet.
33:12
OK, I'm calling it. All right, no more follow-ups.
33:16
Thanks guys. Just kidding, I appreciate it.
33:19
Thanks for listening to the AST Space Mobile podcast.
33:23
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To catch all the latest news about AST Space Mobile, make
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33:38
next time. We're doing something very, very
33:44
big and I think with this technology we can really affect
33:47
billion lives. AFT Space globally is the only
33:50
company that has proven technology to deliver cellular
33:54
mobile connectivity directly through faith to the everyday
33:58
smartphone. People will just basically turn
34:00
their phone and be seamless, regardless of where you are.
34:03
We don't want the user even to know that it's connected by
34:06
satellite. Our role is to bring this into
34:10
reality, always in partnership with the enemy.