Kook's Weekly, January 25 - Terawave Theories, FCC Green Lights, and The Flaw in the Bear Case

[00:00:06] Speaker A: This is the AST SpaceMobile Podcast.
[00:00:09] Speaker B: It will just basically come to your phone and be seamless regardless of where you are. We don't want the user even to know that it's connected by satellite. Listen, the opportunity that we have is very, very, very large.
[00:00:29] Speaker C: All right, all right, all right. A little bit earlier this week, per the request of someone in the comments, and then he just said he was going to go to bed anyway, so that's what you get. Some pretty awesome football games, which kind of blew my day, but at least if we do the Spaces earlier, there's a shot I'll get to the gym so I can get strong before doing 120 pushups tomorrow. Although, is in the aftermarket, looks like I might be doing more like 110 because of government shutdown. What else do we have going on in the world? Civil war, Japan blowing up. I think tariffs in Europe are off the table for the next 15 minutes or so, but you never know. But all this stuff really just goes to why you gotta know what you own because when everything's looking great, sentiment is, has obviously been very positive on ASTS. that's usually when there can be some random whip, like, you know, the yen. And so you don't, you know, especially if you're new, all the battle-hardened crazy people that suffered $2 are certainly like tuning me out right now. But anyone that's newer to the stock that's still doing their diligence, that's why it's important for you to really study it carefully because these short-term price movements can be very tricky because they usually correlate with some other news, like, you know, Elon will do something or some industry expert will say something, then it's very easy to go, well, my God, they said this thing and then the stock price is going down. It must, they must be right. And why don't I play it safe and set a stop loss? Oh boy, the stop loss has certainly cost some people some money. So back to helping people understand what they own. Let's start off with the fun news this week is that FM2, which is our second SDA satellite, which is Satellite Development Authority. If people don't remember, the company was awarded something called the Halo Award, which is part of a prototype program for the government, whereas part of being an awardee, you send up 2 test satellites to show your capabilities. And so we already did FM1, And now it's FM2, Flight Model 1, Flight Model 2. And importantly, both of these satellites went up on less traditional launch vehicles or will go up on less traditional launch vehicles. And so we had FM1 go up on the ISRO launcher, which was perfect, but that had a higher probability of failure than your typical F9 launch. And New Glenn 3, even though they're 2 for 2, so it's batting 1,000%, which is certainly pretty good. It's still a rocket that is getting its certification. So while we have every belief that that will be a successful launch, it's a little bit more dramatic than say your everyday Falcon 9 launch. But my belief in what we were sort of studying and talking about is the company really probably just needed to get one of two of those satellites up for the, to basically fulfill their evaluation period with the government. And these satellites, to our belief, really don't play a part in the main communication constellation that's going up. They're really testing the big bus. They've got a lot of government payloads on it as well. But the main entrée of our constellation starts with batch 1, and then shortly thereafter batch 2. That's when the game really gets going. So it's important also to study that. And understand, well, we obviously, I have every expectation that FM-2 will be a successful launch. Just always understand when a failed launch would be a real problem versus when a failed launch will just be a minor nuisance. And so in the past, if we had had a failed launch of BlueWalker 3, which was the first prototype satellite, that would've been catastrophic because the company wouldn't have been able to raise money and probably would've gone bankrupt. And if Block 1 had failed, I think it would've been a little less clear, but I think you could safely say the company would've been at extreme risk of failing if that hadn't happened. But now the company is really in a position where if there's an anomaly, which is really kind of the nice way to say, you know, something blew up in space, then it's really no big deal for this company anymore, which is important if you're an owner of the stock, because if you knew, you know, you're at a craps table and all of a sudden you're like, oh God, I'm dead. Well, useful to know that before you ride something down to zero as opposed to a minor setback. And so at this point, any, anything with an anomaly with a satellite is really just a minor setback. So if something does happen, just do what you want to do. But I, for example, would not blow out of my position or something because it would again, just be a minor little thing in the context of the company's wherewithal. So we got the flight patch too. It's a beautiful flight patch. I can't wait to get this on the merch store and add to my launch vest as a total nerd would do. But other nerds include the FCC. And so it's nice that the chairman says, quote, I'm geeking out over D2C. And he goes, quote, truly high-speed service. And this is really part of his legacy during his tenure. And he's clear that they're gonna open up spectrum. And another quote was he wants this to flourish and flourish in America first. And so when he is talking about D2C and specifically truly high-speed service, he's talking about AST SpaceMobile. And the actions that we saw this week beyond the words are the quick turning of comments on our application. Which is the next tweet: FCC actions, not words. And this is going to go toward the ultimate approval for market access for the entire constellation. As we've talked about for frankly years at this point, the ultimate regulatory kind of green light for this constellation will end up being a very material de-risking event. And so. I personally believe that it's clearly reflected in the stock price that this company is going to be approved. There's always some probability in that's less than 100%. So just because I think it's reflected and it won't really be news to me, it is a big fundamental accomplishment. To the extent that the market has taken some percent of that into the market cap already is, first of all, very reasonable because anyone that's focused on this would clearly see that Brendan Carr will approve this constellation. But that's not to say that it won't be a good event for the stock price, but I think I've proven myself to be a very poor judge of the stock price. And so I wouldn't really take a strong position on what that's worth in terms of market cap. Whereas I was willing to take a more constructive view of what something like Golden Dome would do, because that's something that I thought was not reflected in the stock price and would have meaningful step change in revenue versus what prior expectations would have. The FCC approval doesn't really change prior expectations of revenue. It just changes the certainty of achieving those revenues. So that's coming. Looks like we're getting closer and closer, and it would make sense that this might actually be timed around the batch 1 shipment date, which could be any day now, frankly. But I don't know if there's any grand plan in terms of the FCC timing. Nigeria is following suit. And so we're going to see this over the next year is other countries are going to launch their own consultations for frameworks on D2C. And this is something the company always communicated to people. So originally ASTS was going to launch with an equatorial constellation and they subsequently changed, but When we first started doing our diligence, of course, we were looking at this equatorial constellation, which is exactly what the FCC filings were reflecting, and thinking, oh, okay. Oh, so there's a lot of countries actually where they already have approval, which is very interesting. And so in my earliest drafts of the DD, it pointed out that there's different regimes in different countries, and sometimes you really could already get approval and go. And so then the FCC approval in theory could take a a second seat to these other countries and you could get it up and running. Now, that was a very naive view of myself, and the company really set me straight on that course too. And so they would make it very clear that FCC approval is absolutely crucial. It's the largest, deepest telecom market in the world. To not operate in the US would be a very significant impairment in value. It doesn't mean they wouldn't still have a business, but it would be a significant impairment of value. Moreover, when you get FCC approval, that's the light on the hill. And so when the FCC approves it and creates the frameworks for that, that's going to be the domino that causes global adoption. And that's what I, that's what we're seeing. And so as you see countries like Nigeria, Australia, the EU, UK, I'm sure there's many others, those regulators are all following the step of the FCC, and that's why that FCC approval is doubly important, is it effectively is a global green light, which I believe is at this point you could almost take for granted. But a couple years ago, I think you could have had a much more fervent argument with the bears on the pathway of regulatory approval. Tim Farrar infamously was adamant that this would never, ever, ever get FCC approval. And that there was no framework in Europe, and that would take a decade. This, that, and the other, all proven to be absolutely wrong. But that was also when the stock price was, you know, below ten. And so that's when the the regulatory risk, coupled with the financial risk, coupled with the commercial risk, were all these massive discount factors on the stock price. And the slingshot to one hundred and hundred plus dollars per share is a result of a de-risking of all those components of the stock. So we've massively de-risked financing. We've massively de-risked. Operating execution, massively de-risked technology, and the writing's on the wall with the regulators. So again, massively de-risked. And that's great. That's what gets you to a real market cap that starts to have this other dynamic for the short thesis. So no longer are people saying it won't get approved. Those guys all got their brains blown out. Now it's really centered on, well, it will work and it will get approved, but We don't think the market's big. Fine. That's exactly what we thought would happen in terms of the bear dialogue. The bears are never just going to flip. They should, you know, a good short, frankly. And this was an interesting hedge fund trick is if you're short a stock and then you start to not feel great about it, the answer is usually to flip and go long, not just get flat, but actually go long. That's in my experience. You know, if you're already so galvanized to be short and you start to really lose your Your conviction on that, it usually means that it's so much better than you think it is because you're already such a negative bias toward the stock that you just want to flip it and go long. Traders like Stevie Cohen would do that. Mere mortals like myself would just come up with this funny little pithy statement to tell people anonymously on Spaces, but never actually do it myself. But that is what I think these shorts should do once they start to realize their thesis is falling apart. But they don't do that. They change the goalposts, which is great because we want to have these bears create this wall of worry. And it's easy to rekindle that wall of worry. And so just a reminder of how fragile sentiment can be. Corey kind of nailed it where, you know, the meme where the cat is looking at a chart that's straight up and then has like a little bit of a red dip and it's like, why is it going down? You know, that's how I felt on Friday. And then I reminded myself, well, the stock's $115. I guess I should chill out. And you know, there's a lot of debate actually in the background as to whether or not the Kook bottom is still a valid indicator. And all I could say is the Kook bottom is uncontrollable. My emotional immaturity when the stock goes down is unlikely to ever truly be fixed. It just might take deeper levels for the Kook bottom to Reveal itself, but don't don't portend an early death of the kook bottom in my emotional stability. That's all I got to say. But do stay focused. But let's talk about the bears. So Peter Adderton is the CEO of Boost Mobile. No, sorry. He was the founder of Boost Mobile. He's the founder of Mobile X. This is a real guy. He's a real telecom executive. For reasons unknown to me, he likes to troll the space mob. And you think that a CEO would have a better use of time. And King Tut actually brought this up to him of, don't you have a better use of time? And he actually had a great answer. He said, well, not really because I have a great team. So I have plenty of time to troll retail investors on a pre-revenue satellite stock. I guess that's an interesting way to talk about your skill as a CEO to build strong teams, which is in fact the job of a CEO. So good for him. But he does bring up this point of AST SpaceMobile has a white label strategy and he believes it's fundamentally flawed when measured against Starlink's strategy. So this is an interesting point and one I've thought about for years, especially when the stock price was low. I thought, well, does this company strategy violate sort of simple VC logic 101? And one might ask, what is simple VC logic 101? And you wanna own your customer. That's kind of a good thing to do when looking at a consumer company. You wanna have a direct relationship with your end consumer so you're not disintermediated. You own the value chain and the delivery. These are logical things. And so Peter makes the point that Starlink built a global brand and not just a backend feature. Well, true, but they did that with fixed broadband, not with DTC. And this is the issue that Pete, if I may call him Pete, is missing. So normally you want to go direct to your consumer. Well, if what I just said is true and direct to consumer is therefore always good, why is it that VC DTC companies are heaping piles of crap?
[00:15:27] Speaker B: Yeah.
[00:15:30] Speaker C: Maybe with very, very few exceptions, but they are heaping piles of crap because what Peter misses— take a standard D2C model, for example— is that while you're going direct to your consumer, and he would say, well, that's great, they are not a backend feature, you got Mark Zuckerberg standing there on his palatial estate in Hawaii. having the last laugh because he's taking 60 to 70% of your entire gross margin in the form of customer acquisition cost. That's the killer, is how do you acquire those customers and keep them? And so Starlink went into a market with Elon Musk, who is a one-man marketing team, truly an N-of-one individual. I don't believe Tesla has really run ads. And Starlink has, but they haven't had to run many because it's a very unique product that was kind of markets itself. That's a very rare thing to do. But importantly, the current Starlink product is self-sufficient. You buy the dish, you connect to the internet, done. D2C isn't gonna work that way. You cannot right now offer a direct D2C. plan because that would involve replacing the MNO or worse, selling a complimentary service directly to the consumer on top of the MNO, which really doesn't make sense to me. I don't know how that could possibly work given a phone really has to be tied into one core network. And so D2C is fundamentally incompatible With D2C. So direct-to-sell is incompatible with direct-to-consumer. You need the channel partner because you are having to tie into the MNO back core, which you could not possibly recreate yourself because your service would be— it just, there's a real reason why the terrestrial networks are probably going to have a very strong place in a typical user's journey. The capital intensity would be mind-boggling to do for one. And then the customer acquisition would be mind-boggling as well. Anyone that was just watching all the football games, who do you see advertising? It's the MNOs and they're fighting viciously for your business, offering promotions and things like that. So their customer acquisition cost is not just the ad that you saw, but then it's the subsidies on the iPhones and things like that. It's enormously expensive to acquire customers. And so has this model been tried before? Well, let's call Raging Capital real quick because, you know, Grandma, it's reminding me of the Iridium IPO. That's what they did. They went direct to consumer. They had their own Iridium phone and they were offering an integrated system. And guess what? Bankrupt. It's super expensive to acquire customers. And it's super impractical to offer a redundant standalone service for supplementary coverage, at least in the current state of technology. So what he misses is that direct-to-consumer is simply not an option. Never mind that Starlink itself is not going direct-to-consumer for its D2C product. It's going through T-Mobile. Checkmate, Peter. And then what he's also missing is the unbelievable breadth of distribution that you get. By pairing with the DDCs. So what would be the analog of the distribution that ASTS is going to get? Imagine if you had the App Store to yourself. That's what ASTS has. To an AT&T sub, there's an App Store. It's the things you add on to your AT&T plan. There's going to be one option for this. Type of very important service. And that is going to be AST SpaceMobile. AT&T is giving us a monopoly on the equivalent of the App Store for every user in America. And then we have that same deal with the largest MNOs around the world. That's a distribution advantage. That's how the money is made. Peter, I don't think has the same background I have. And which is to say that he's not a smart person in his own respect, but a business strategist, I don't think he is. And so I think this is fundamentally a point that he's not understanding. It's one I've thought deeply, deeply about because I'd ask myself and go, God, Kook, why did you have a screen name called Kook? That's really the first thing I was thinking about. I'm like, does it mean you're the kook or are other people the kook? Who are you reporting on? Or is it a self-report of a kook? Or are you reporting other kooks? It's just so confusing to me. I don't really even remember how I did it. I had COVID at the time. It's all a blur, but you know, it's one of life's great mysteries is why the hell did I call myself the Kook Report? But the other great mystery I had was why did I have my entire net worth in a company that is a B2B technology play that doesn't own the end consumer? You know, the great outcomes of this world have an incredibly strong consumer relationship. think Meta, Google, Apple, um, Microsoft, even though people seem to hate Microsoft, I love Microsoft. Um, so I would say they have a very strong consumer relationship with myself. Um, but then you have the other things that don't, like Nvidia. Nvidia, at a time you had the hardcore gamers who have a, you know, pretty strong relationship because they were building their own rigs. Now it's just selling to data centers. And so There's an exception to that rule. And sometimes I think you just have to have some light exceptions to your own rules. And for me, this issue about the relationship with the consumer is something I think deeply about. And what I hope happens is that AST SpaceMobile is smart enough to forge its own brand identity with the SpaceMobile service, the Red A, things like that. That's why it's all very important that we pester AT&T to death to kind of go, you know, red AT&T and create a brand identity for this service so that it isn't truly invisible to the consumer, which it otherwise would be. People would just be like, wow, my phone works. That's amazing. It is cool if there's actual real differentiation, just like T-Mobile users know they're using Starlink. I want AT&T and Verizon users to know they're using Space Mobile. Not that it's a big deal, but you always want optionality around consumer identification, uh, because you never know what the future will bring. But if we want to talk about things that are purely B2B backend, let's talk about Terawave. So Terawave came out this week, drilled the stock, and it was one of those things where, uh, Katzi was saying like, this is the most positive thing I've ever seen. And the market was, you know, gapping down, whatever it was. Quite a lot, if I remember correctly. And it was interesting because TerraWave is the sum of many coincidences, and we'll get to that in a second. But let's talk about what TerraWave is. So Blue Origin announced its TerraWave constellation, which is different from Amazon's Kuiper. It's a space-based transport backbone. So think of global crossings. But in space, and it is optimized to move big boy amounts of data between fixed endpoints. So I, for example, am not a fixed endpoint as I tweet out of my pickup truck. I am not going to be a Terawave user. A data center moving massive amounts of cloud data or AI workloads is. Especially if there's any flaws or downtime with the fiber network. And this is a network that will be used really by government data centers and some enterprises. And it should, from what we could tell, it can be very complementary to other things because it provides sort of the freeway system up in space to get data up and around the world so that you don't necessarily have the same dependencies on terrestrial infrastructure at all points at all times. Pretty neat. It's going to have a 5,300 satellite LEO layer. That's where you access the network. And then that LEO network beams things up to the MEO network, Middle Earth Orbit, which is going to have 128 satellites. That's what provides sort of the I-90, if you will. And so think if you're just trying to think of any city where I actually know the roads, think of Boston. So you're on the, you're on the 1 kind of driving through Revere, and then that's your, your LEO network kind of can be kind of slow sometimes. And then you get on I-90 and bang, you're on, you're on the Middle Earth orbit layer, uh, going ideally faster than you were on the 1. So that's TerraWave. The market very quickly figured out that this is not Blue Origin competing with AST SpaceMobile. People immediately went to their dark little Gremlin space of thinking, oh my God, if SpaceX has Starlink and they won't launch our satellites, asterisk, SpaceX launches our satellites, then Blue Origin having their own constellation will mean that Blue Origin won't launch our satellites, asterisk, Blue Origin is launching our satellites. So even though these things are already contractually baked and continue to happen, people always go to this dark little place thinking that all of these space companies have a deep-seated desire To scream in the office of the FTC saying, "I am abusing my market position. Please sue me." They are not doing that. They will do the opposite. But in any respect, it's literally not competitive, and it might be complementary. And so the TerraWave constellation is very useful to Amazon, for example. So with all of the data center. They, they have with all the AI workloads they have, you're adding a very crucial component to communications infrastructure through this, but then you're also adding a lot of demand for your New Glenn launcher. So they can't just rely on AST SpaceMobile. And I guess they could rely on Kuiper, but New Glenn is very quickly having a very big book of business. It's very exciting for them. That crew, that crew, you know, not crew, but that team working on New Glenn launcher knows that they have demand for that rocket. It's going to be underwritten by quite a few large customers at this point. Kuiper, AST SpaceMobile, TerraWave, Golden Dome. All of these are actually highlighted by Blue Origin themselves. They're specific about highlighting the importance of AST SpaceMobile in their book of business. So what's interesting though is TerraWave coincides with quite a few other things. And so just recently lawmakers eliminated MilNet, which was gonna be a government-operated constellation built by SpaceX to provide data transport services. Gone. Why is that? The money instead went to the PWSA, which is really more the umbrella that ASTS operates under. Interesting. That is one big thing. So that program got killed right as this is getting launched. And then we go back to that photo of Jeff Bezos and Abel saying congratulations. Now, what did they agree to? Well, obviously Blue Origin launch was one. We had speculated for some time that there was going to be some co-investment and things like that. That has Not happened. And frankly, we might be wrong on that. It doesn't make all the sense in the world for that to happen. If it did happen, it wouldn't really surprise me. But then a partnership for military and government work utilizing our satellites, but then having the backhaul so you don't have terrestrial dependence by way of TerraWave actually starts to make a lot of sense. And so these coincidences add up. It was literally the first thing that went to my mind when I saw that. article from Military Daily or whatever about the cancellation of MilNet, I think my initial tweet off the cuff was just, you know, diversifying away from SpaceX to ASTS. It just seemed pretty clear to me. Katzi found out that the frequencies between TerraWave and ASTS match. And so these systems are actually compatible with each other.
[00:28:22] Speaker A: Very interesting.
[00:28:24] Speaker C: And all of the pieces are there. And so ASTS has the optical inter-satellite laser links. We have the DC service links. Um, you have the PLM, which can put the eNodeB on the satellite and not necessarily rely on ground stations, which could be useful for the military. We've got these big QV feeders that we saw on the new satellites. It all kind of adds up. Lately, as in the past 5 years, whenever Space Mob sort of sees these coincidences, we've, we've actually been right on everything except the NROL-69 program. And that we might've been right on, we'll just never know. 'Cause it's, um, the NRO is the most secretive and most important sort of defense department from what I understand that no one knows about. And it's entirely possible that we actually are part of NRO, but We had thought that we were actually the NRO 69 satellite, and I believe we were wrong. So that might be one instance where our speculation was wrong. But then we look at the FUDsters were quick to come out, but thank God not for us. And so people start to really hone in on the technical aspects of TerraWave. Really, I don't know if this is our problem, but they're just saying, you know, this is a complex system for them to build in terms of having the Scalability of the QV band and things like that. At this point, I tend to believe that Blue Origin had figured it out. But again, not really our problem to solve. But within stepping back, it's just another piece in the puzzle where, as Theodorus the Atheist says, once you have high throughput links through something like Terawave, Why not just have the data centers in space too? And so you're, you're seeing, and I think this is going to be one of these gradual than sudden types of things. It gradually, you're going to just see the pieces necessary for space-based AI data centers. And there's going to be the same cadence of people trying to make the math work. I've tried. It is not immediately obvious, but there's a lot of things I for sure don't know. But then you're going to have more of these systems up there that underwrite their use cases in other ways, which therefore buys down the incremental cost of capacity for doing other things. So it's a good economies of scale type of asset up there. And all of a sudden you can really have a transport layer of data around the world that normally would've been handled by fiber. So yeah, maybe we are a step closer from having big data centers in space. Elon certainly thinks that that's true. Other really big things that are moving forward are Golden Dome. And so I took a lot of heat from Europeans last week on my Greenland comments. Everyone's super sensitive on everything nowadays, and I just call it as it is. I don't, like most people at first, I was like, wait, what? We're going to take Greenland? I mean, I don't, I certainly wasn't born to be a politician, I guess, but As I studied it, it made more and more sense in studying, you know, this stuff. And ultimately, you know, nothing, you know, there's no rules in the jungle. There's just suggestions. And so this all went to a peak last week. Greenland now, frankly, now seems like yesterday's news. But Trump seemingly struck a deal. Was it with Trump? You actually really never know if he struck a deal or tacoed. Unclear. Sometimes they can look like the same thing, but he was very explicit that the US Golden Dome will be involved with whatever deal he negotiated with Greenland. So he's secured the real estate for what are likely to be a lot of interceptors and ground systems for Golden Dome, which for those playing at home, it is important for the pieces of Golden Dome to come together if expecting the rest of Golden Dome to get bought and paid for. And it looks like it's taking shape. And I don't know if Greenland was actually a critical path for it. It makes sense that it might have been just because of the importance of those polar orbits. But, um, anyway, now we don't have to speculate whether or not that in particular was a critical path item. Sticking with our theme of kind of government Coincidences, we also had a program called RGPS, which was a Space Force program, and it was canceled. So in this world where what we've seen is that the electronic warfare is as important as ever, why in the world would the Space Force cancel A GPS resilience program. Well, there's only one answer: is they found other ways to do it. And so what I really like what we're seeing is Milnet, you know, a dedicated solution. GPS resilience program, dedicated solution. These are getting canceled. And so I believe that they're being harmonized with these commercial systems, and I believe they're being harmonized with. SpaceX, NASD, SpaceMobile. That's great because that just means these economies of scale are happening. We're able to be the Swiss Army knife and do many things for many people. That expands the TAM, that puts nitrous oxide in our economic model because all of a sudden in the models that I've built, you're really modeling like what percent of your capacity can you monetize? You know, For that one sailboat in the middle of the Pacific, that's, that's not as great as monetizing 5 million people moving in and out of service over New York City. So all of a sudden, some of these other programs could actually allow us to monetize our capacity kind of where they ain't. And so where is GPS resilience going to be really important? Well, it will be important over the US in the event there's ever an outage. But it's going to be really important in other parts of the world where there can be the denial of that service, which is then an opportunity for us to monetize what is otherwise kind of dormant capacity we have. So these things are happening, happening. And, um, and then Golden Dome again, just seems like a lifetime ago. That was Monday. It really hurt for me to believe, or I guess it was, it was announced Friday, but then the follow-through was Monday. And so let's look to our resident expert, Tough4R, who really breaks down what he thinks some of the timelines could be. I won't read his whole post. He put a lot of work into it. So I recommend you look at the post that I did called Remember Monday, Golden Dome, dot, dot, dot. And it just talks about some of the timelines and things maybe to expect. He also interestingly brings up the noble process. So that's the MDA Nobel Award that I was talking about last week, which I frankly had not had on the top of my desk, but other people like Kevin Chen, for example, were totally on top of it. These sort of accelerated procurement models can reduce processes that otherwise could take, I don't know, a decade to 2 to 3 years, which is great because that means that all of a sudden we start to have revenue coming where it otherwise would have been bogged down. You know, when I think of bogged down, I think of Scotiabank because these guys just are totally bogged down. So this guy was out with a note on MLK Day, not seemingly knowing that US investors don't work that day. And he's working hard, apparently too hard, because he should have just saved it for Tuesday when anyone would've actually traded. But he's just been trying to downgrade this thing. as hard as he can. And I, it makes me wonder, is there a proposition that Scotiabank might have that they're getting stuffed on? It's unclear because his behavior is pretty weird. He's just coming after this thing kind of every day. He was out on the 6th, he was out on the 13th, the 14th, the 16th, the 19th. It's wild. So he really wants AST SpaceMobile to go down. It's almost like he had sold one call Call option or something, and was praying to God that he could get it below the strike price. But sorry, Andres, not possible. But then the good guys came out as usual. So Deutsche Bank, unlikely hero, has upgraded us again. They came out and upgraded the target price from $81 to $137. So good, good for them. What is Interesting is they start to give their own assessment of launch predictions. So they think there's gonna be 47 Bluebirds by year end. And some guy was saying, you know, well, I'm playing from home and I think it's pretty unlikely they're gonna have 5 launches by Q1. I agree. At this point, it seems like it would be a surprise to me if there were 5 launchers by March 31st, because we're gonna have the New Glenn launch probably in early March, and then maybe there's a shot for a batch 1, batch 2 launch. And I mean, that is very optimistic to me that that would happen. That's 4 launches. So I don't personally see it, but I don't think it matters. Anyone that gets all huffy-puffy with histrionics over that is levered, has short-term calls, doesn't know what they're doing, or shouldn't Shouldn't call themselves a long-term shareholder because the whole point of the stock market is the discounting mechanism. And so if and when the company ships block batch 1, so long as then batch 2 follows in a reasonable time, and then there's a look on the other satellites coming, which they're giving us data in terms of how many satellites are in various stages of production. They are going to smooth out this production cadence and they will start to get in sync with launch availability and the market will see that. So whether they have 2 launches in Q2 and then 1 in April, it just, I don't think it's gonna matter. Maybe some short-term volatility that's gonna be pretty meaningless. But when thinking of the big stepwise functions of value, which is what I care about, it's do we have $50 stock, $100 stock, $150 stock, $200 stock. I'm thinking in those types of buckets and the sort of bouncing around the trend line, which guys like Reformed Trader do a great job of tracking. That's just kind of the noise. That's just the ebb and flows. It's the macro, it's the little stuff. And as long as the company in the broad arc of things is executing, then anyone that's a long-term shareholder, which I count myself as one, is in good is in good stead. And so the people sort of counting the peanuts on what exactly will happen by March 31st and then slinging invective at the management team, I find to be quite inappropriate. And so one guy was saying, well, this management team is so grandiose. I mean, Abel literally doesn't talk. It's hard to be grandiose when he is ungrandiose. And so like, did they put out some guidance that they might miss? Yeah. But you know what? I don't want an owner-operator of a disruptive company giving guidance of like, I don't know, guys, let's like be chill. Let's make sure we're all friends and happy. And like, let's focus on the reviews we give each other so that everyone has good feedback. No, he's like, hey bitches, 5 launches. And if they miss it, I'm sure he's gonna break some glass. And he's setting the cadence of impossible goals. There's another guy that's created a little bit of value that takes crap from time to time, but sets ambitious goals and misses them. And his name is Elon Musk. And guess what? It works. But the other stuff I really liked about the Deutsche Bank report was the subtle hints on the TAM. And so Deutsche Bank, Models in some real government revenue, and at ASTS investors did a nice job creating a little infographic of just what the government and other revenues are, which for example in 2027 is $200 million. Finger in the air, I don't know anyone could really predict that, but it's nice to have some estimates coming out. I think this could be a much larger number in short order, but then other things that are happening, Catsey. was tracking the Joby filings and noticed that their telemetry testing is firmly within the types of bands that ASTS operates in. And so this is the type of stuff I don't think the shorts really dial in when they say, well, you know, there's only so many people going to Yosemite Park that are running from a bear at any, at any moment. And yeah, sure. But We can get into the normal use cases of this technology until I'm blue in the face, but things like eVTOLs that are gonna need to have constant connections, who knows how big this market is gonna be? It's gonna be, as we saw, dialed into cars. So India has that cool program of making all the cars talk to each other so that you can literally see around corners. This goes to the ASTS platform effect of once you create the flexible platform, People are going to build on it. People who have specific use cases that only they understand and know are going to leverage and utilize your technology from which you benefit by selling them capacity to solve new problems that are not current markets because they don't yet exist, but then they do exist and they are big. And then people are surprised why so much revenue occurred. One fun thing is that Theodoros also just checked the price target predictions of Deutsche. I tend to ignore price targets, but this is actually pretty funny. And so they had originally predicted $22, bang, hit. Then they had predicted $121, bang, hit. And you know, they have this out-year price of $672, which would be really cool if they hit as well. We also had ClearStreet come out with a report. Interestingly, the exact same $137 target price. So I didn't look too much into that, but it struck me as kind of odd. And, you know, then as much as people call us the paid pumpers, which for the avoidance of doubt, we're not, no one here to my knowledge is a recipient of consideration from the company in return for quote unquote pumping the stock. I find that just so crazy to believe that Anyone would think that this level of diligence is paid pumping. The actual paid pumpers are Bank of America, Goldman Sachs, JP Morgan, and Morgan Stanley. They are literally paid pumpers. And so SpaceX is hiring them to pump their IPO. And so ironies of ironies, SpaceX is the paid pumper and you can see it because then we get iced by all of those banks except Bank of America. They're cool. But Morgan Stanley kind of will do whatever they can to not say the forbidden word of AST SpaceMobile.
[00:43:44] Speaker B: Why?
[00:43:45] Speaker C: You don't want to piss off Elon.
[00:43:46] Speaker B: I get it.
[00:43:47] Speaker C: The fees involved on the SpaceX IPO are going to be year— it's going to make their year. It's great. But those are the paid pumpers, not us. And sometimes the paid pumping is exhausting when you have nothing good to pump. And so Ben Longmire, he's thrown it up. He's done as a paid pumper. He's the CEO of Starlink's DTC business and he quit. He's going now to work on his home garden or something, or he's going to redesign the hull thruster with a small team and go to his garage and build rocket parts. Good for him. And so ask yourself, is that what you would do? In one of the most dynamic, exciting new telecom markets, if you had a leading position?
[00:44:34] Speaker B: Nope.
[00:44:35] Speaker C: It's what's happening when your product sucks and Elon is either kicking you out. The most likely scenario is Elon is kicking you out. And Sarah Spangelo also, she was there from the Swarm days. She's left. And so it seems like SpaceX is doing a wholesale overhaul of that business and we'll see what they do, but it's not bullish for those guys to have their key leaders leave. It's very bullish for AST SpaceMobile because it just highlights what we all know in terms of the problems and the challenges that Starlink has. And seeing their execs leave kind of confirmed that they see the same problem too. The problem that we're still looking to really understand is Starship. And so Starship crunched itself again, like a, Coca-Cola can under pressure, which isn't positive. And so there's another failure during testing, which is just add one to the long list of challenges of this Starship program. And it's just a stark contrast of maybe there is a limit to scale of Elon's approach of kind of go fast and wing it versus Jeff Bezos doing step-by-step. ferociously. We're now seeing maybe the edge case of technical limits in terms of big rockets with a certain managerial approach, but I don't count Starship out. It's still unbelievable to me that they've launched the booster and caught it, but they haven't gotten the integrated system to work much less reliably. And that's a problem for SpaceX. So that's all I really have this week. Only thing I'd flag is this really cool piece that Crossroads Capital put out that just really kind of goes into their impression and own history of the Space Mob. And obviously, as someone that is deeply involved in the Space Mob, it's difficult for me to remember the whole journey. It just kind of happened. I don't really remember when My life became Space Mob when all of these different communities and working groups formed. It was just so natural. I do remember the first time I reached out to Antpinman and he iced me, and I'll never forget because he viewed himself as such a big account that he wasn't going to talk to some rando with, I think I had like 15 followers that were bots. But then we ended up somehow making peace and being friends. But it is cool when you look at this group and he makes the point, this is not a bunch of your paid pumpers. This is really a dynamic principal expert network, unlike the Wall Street expert networks, which I use. I'm a subscriber of them. That's where you get the platitudes. That's when you get the guys that are hanging it up that will kind of, oh cool, I can make $300 an hour to kind of talk about what I know, which is dated by a couple years. And Crossroads make the point that you actually do those calls to take the opposite position of Wall Street because that perspective is commodified. Space Mob has created a market-driven expert network because I have a lot of money involved. You know, I am an enthusiast, but contrary to Dr. Schlaberberger's assertions that I am just a paid pumper, I actually do have a long position in this company. And so my work is driven by my own desire to be right on this investment. As is everyone else's, which is very different from typical expert networks. They don't have skin in the game. They don't have that same jungle fury to get it right or be eaten as we do. And that's what makes this community really unique. And the research is real. It's, there's a lot of memes and stuff like that, which is fun. I enjoy it. But the research is real too. And the people behind the cartoon accounts, for the most part, are also real with varying professional backgrounds that all come together to be able to put together very complex things. And so I know the people I talk to regularly, especially in my DMs, are coming from vantage points that I cannot replicate. And then I think that when they give me their perspectives through my lens, as I give it back or articulate it on the, you know, in the DD, on the weekly or on the spaces, I think they get value from too. And so it's this really cool virtuous circle of trying to contribute. And Crossroads did a really nice job of highlighting that, and I'm appreciative of people taking notice of it. And I think it's really cool, and everyone should be really proud that they've been able to contribute in this way. So that's what I have this week. Thanks for joining me, and I would just buckle up. It seems like there's going to be a lot of volatility because there might be another government shutdown, there might be Iran strikes. I think it seems like tariffs are off the table for a little bit, Intel blew up. I mean, who knows? And so don't get tricked by the volatility is my only advice. If you don't like the stock, sell it, but don't sell it because of a bunch of macro noise, which then usually coincides with FUD. And if you want to buy it, buy it. And maybe you get to take advantage of some of that volatility as well, which a lot of people have been really good at trading. So I'll end it here. Thanks again. I appreciate everyone joining and have a wonderful week.
[00:49:56] Speaker A: Thanks for listening to the AST Space Mobile podcast. If you enjoyed this episode and you'd like to help support the podcast, please share it with others, post about it on social media, or leave a rating and review. To catch all the latest news about AST Space Mobile, make sure to subscribe. Thanks again, and I'll see you next time.
[00:50:19] Speaker B: We are doing something very, very big, and I think with this technology we can really affect a billion lives. Safety Space Mobile is the only company that has proven technology to deliver cellular broadband connectivity directly from space to the everyday smartphone. People will just basically turn on their phone and be seamless regardless of where you are. the user even to know that it's connected by satellite. Our role is to bring this into reality, always in partnership with the end user. Listen. Mmm, waffles.