Anpanman - Verizon and 100pct Connectivity - A Paradigm Shift

[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.
[00:00:27] Speaker C: Good morning, everybody. What a crazy few weeks. If you can hear me, please give me a thumbs up. I'll wait to start, or can someone send me a message and let me know that they can hear me?
[00:00:45] Speaker D: Anyone?
[00:00:46] Speaker C: Okay, I see a thumbs up. Yeah, what an exciting morning. This is something that was expected, that was supposedly priced into the market, and now we have it. And this is on top of just a massive— I'm kind of beside myself because, oh, what a long journey. 5 years, 5 years of suffering, and now we're seeing all the hard work, due diligence, stress, sleepless nights, you know, everything just coming together. And, you know, as I talk about how the puzzle pieces are clicking in, they truly are clicking in. And so, yeah, this morning, the big piece of news, AST SpaceMobile signed their definitive commercial agreement with Verizon. For the folks who maybe perhaps are new to the story, last year in The end of May 2024, the company did enter into a memorandum of understanding in addition to, with Verizon, in addition to getting a strategic investment, which was a $65 million convert, and then $35 million of commercial prepayments, which by the way, with this definitive agreement, I think those, some portion of those commercial payments actually get released, if not the whole thing. But yeah, so when that announcement happened last year, that's what caused the stock to re-rate. But it was a bit open-ended, meaning that while we did get an investment and of course Verizon, which was crazy, they decided to work hand in hand with AT&T to support AST SpaceMobile. They both contributed their 850 megahertz spectrum, which as we all know, terrestrial spectrum is is highly valuable and it's their scarce asset. It's the lifeblood of the carriers. Contributing that in a partnership to your biggest rival is not a trivial thing. But yeah, that happened last year. And so AT&T, for all intents and purposes, locked up 60, you know, two-thirds, 66%, 70% of the most profitable wireless market in the world by now having AT&T, which signed a commercial defender agreement, and then of course Verizon, which now formalizes that agreement. And I think it's important to underscore what this means, and which I'll talk about in a little bit. But needless to say, given the stock price reaction today, clearly, you know, to the extent there was the expectation that this was coming, but it was not priced in. And I'll explain why, what that means. You know, had this been announced, call it at, in fall of last year, it would mean something very different to what it means now. And that's why it truly wasn't priced in. But someone in a chat that I'm in came up with this term, which I think was good, is that the, not the invisible hand, but the pimp hand of the market just slapped all of our collective faces. This morning, and that includes long investors. It includes short sellers. It includes all the Fudsters, Dim Spacebar, and his his ilk. All the legacy guys. I remember, and and somebody who runs the website, you know, that that covers how all the terrible takes of Tim Tim Farrar. But whoever runs that website, that that. That preserves his tweets for posterity. What was it? I guess it was like a few weeks ago. He was claiming that it was likely that Verizon was going to leave AST SpaceMobile and go to Starlink. What a fucking tool. What an idiot. That guy, he's basically paid by legacy satellite guys, also Globalstar. I mean, you name it. And so he'll come up because he's paid, he'll come up with every reason under the sun to create a point of view, which of course ends up, you know, on the one hand is to create FUD and to speak negatively about AC Space Mobile. But then, you know, I guess he's kind of like a streetwalker, like he sells his services and then he doesn't mind being completely wrong. So it'll be interesting to see, not that I care, but it'll be interesting to see, you know, what he, how he tries to spin this today. Because, um, yeah, this is— there is no spin. Like, there's a definitive commercial agreement with AST SpaceMobile. But, um, yeah, I'm going to go through a few things here. First, I think, you know, kudos to Scott Wisniewski, the president and chief strategy officer at AST SpaceMobile. Um, he's just been executing master strokes in terms of strategy. And so it was what, 2 weeks ago? I mean, he was giving everybody fair warning, whether you were long or short, that this was coming. And to be fair, like he had hinted Verizon was coming a number, that it was close, but obviously it took longer than expected. But his little conviction in talking about how there were 2 or a handful of agreements that were coming soon. Yeah, he gave people fair warning and a lot of us in the space mob had put together that Verizon was coming. That's why I had like tweeted all these hints, like, you know, Verizon soon. And then of course, you know, we got the news that Bell Canada announced successful testing. And by the way, like, I'll reiterate the fact that Bell Canada announced successful testing results from the summer. For them to do it now means like, You know, I would assume that Bell Canada is going to announce a definitive commercial agreement with AST SpaceMobile probably within the next few weeks. So that's another thing to look forward to. We talk about like catalyst season being upon us. It truly is. I mean, we've got FM1, FM2 launching in the next 2 to 3 months and the multi-launch campaign going off as well. I think, you know, if we're fingers crossed, we'll have 3, 2 3 launches before the end of the year. As I mentioned before, we just had successful testing with Bell Canada. And by the way, like Bell Canada, you know, they're a strategic investor. They were there early. And so again, I expect that definitive commercial agreement to drop anytime now. And the other thing, of course, we saw, and I joked about it, the Prime Minister of Canada was here with Trump and they were meeting. Trump made some comments about Golden Dome, about how it's going to cover Canada. Um, guess who covers Canada as well? AST SpaceMobile. Guess who has, and this is really important, guess who has Legato L-band spectrum that covers Canada? AST SpaceMobile. Guess who doesn't have satellite spectrum covering Canada for truly 100% coverage? Starlink. Starlink only bought EchoStar's, um, spectrum here in the US. They're going to have to pursue spectrum rights in Canada, but we happen to have it already. So if Trump is pushing Golden Dome coverage over Canada, there's one specific player that can provide that coverage. And as we all know, we all have a very high level of conviction that the company, and including Scott, who's been more vocal about it, I think the company is going to get Golden Dome. When does that happen? You know, it's up for debate, but like I've kind of changed the, how I express these events on these spaces is that I think we should all kind of, in your collective minds as you kind of go through the day-to-day machinations of the market and rethink, you know, re-underwrite your investment in these things, mobile, I think the key word to think about is inevitability, right? Because I think These things, whether it's the Bug Canada Defender agreement, whether it's defense use cases, what 100% connectivity means, this stuff is all inevitable. Like AST, yeah, there's going to be, because it's space, there's going to be delays. It's going to take longer than you expect. The company, the engineering mindset is to get things right the first time and every time. So they're not going to ship a satellite and put it up into space without absolutely without making absolutely sure that they've accounted for any possible scenario and that, you know, you've got full redundancy, that, you know, the satellite has every chance to succeed, right? And so when you're under that engineering mindset, sometimes things take longer than expected. But given the type of service we're about to deploy and how critical it'll be for all these other industries, which I'm going to talk about, and that's what got me and Cook last night Totally hopped up, which is why I tweeted, you know, past midnight that our discussion basically, you know, informed me that we're not bullish enough. I truly believe that. So anyway, yeah, this, as I mentioned before, there was this narrative out there from short sellers, skeptics, you know, industry consultants who are clueless. that Verizon was somehow going to switch. And in all honesty, that was a true potential risk because there was no definitive commercial agreement that was signed just yet. And obviously Verizon was already half pregnant. They had already contributed their spectrum. They've already gone through the FCC review process with us and continued to be very supportive. They also made overall $100 million investment part of that commercial prepayments, part of it in the convertible debt, which then became equity. Now they're a shareholder. But, you know, never say never. Like there's always a risk. You know, if you, in any transaction, it's not done until it's done. And anybody who's worked on M&A transactions knows that at the 11th hour they can fall apart. And sometimes that happens for a reason, right? Like people, People want to get better economics or there's personality issues or any number of things, or maybe competitor comes in and tops your bid. And so, but they got it over the finish line. That's great. And so I think it'll be interesting to see how the press and media and everybody reacts to this because the EchoStar, Starlink, Starlink, and by the way, like It is totally like 100% a great signal. And I think Space Mob gets this right. Whenever Starlink starts putting out PR about like, oh my God, we did the first video call, which was, by the way, absolute bullshit. They never did the first video call. And when they did that call, they had 2 engineers standing next to each other, next to their building, their office in, I forget where it was. Maybe it was in Washington or something. That's not a true test. Like, that's within Wi-Fi coverage. Those 2 engineers are sitting next to each other. They could be actually being— they could literally be routed through the same exact satellite, and that doesn't really demonstrate anything. Like, anybody can do that. Link actually does that. They do a video call between 2— between the exact same satellite. Satellite connects to both phones. The true test is like, if you are in a remote area that has no coverage, And you do a video call to a satellite, which then beams it down to the operator's network and then connects that to someone further away, you know, much further away. So, but anyway, my point there is that, well, first that test that Starlink touted is absolute bullshit. But then, but putting that aside, whenever Starlink, which over the last, gosh, I don't know, 2 weeks, they have just been pounding PR. going to the press and like tweeting stuff like, oh, we're doing all these things and we're going to release these like dumbed-down apps that can deliver services, you know, basically with hundreds of kilobytes of data throughput, which is great. And that's a great service, by the way, like in the absence of no service at all, people will, I mean, even if it's 100 kilobytes a second or half a megabit per second, like That's a good service. And even for me, like if I'm using my Bloomberg on my phone, I just need to see prices moving and news. So that's a good service, but it's not broadband. And that's what we're doing. But my point is that when Verizon starts beating, or sorry, when Starlink starts beating the drum and starts putting PR, it's almost as like, as if, you know, the sun rises. It's in anticipation. And you know that AC Space Mobile has something coming. The reason why I say that is, you know, the industry is pretty small and I'm sure, you know, AC, for example, one way that Starlink can get a speed on what's happening is obviously SpaceX launches our satellites. So they know, they probably know, you know, when launches are happening, they probably hear from different competitors. I'm sure Starlink was talking to Verizon too, like over the last several months they were begging like, hey, sign an agreement with us, do a deal with us. And maybe that's why it took some time with AST, right? Like maybe the definitive commercial agreement took time because Verizon's like, oh, you know what? Let's see what Starlink could do. Well, guess what? They signed it with us. They re-underwrote the transaction, the relationship. And so, and this is why everything isn't priced in. And so what does that mean? So you'll have, and look, the market for it in general over the long term is is pretty smart. Obviously it gets things wrong many times. Like anybody who thinks that the market is efficient or fully efficient is kidding themselves, right? Like if the market was fully efficient, the 2008 financial crisis wouldn't have ever happened, right? But that was when the system was overleveraged and, you know, you had the cascade of events and obviously we were in a bubble. And yeah, if the market's efficient, why do we have bubbles? But Anyway, I won't go down that rabbit hole, but the market for the most part is efficient to the extent players are rational and capital is properly allocated. But the reason why this was not priced in, now the expectation is that Verizon was eventually going to have a definitive agreement with AST SpaceMobile and people were expecting it, but they were still biting their nails, right? And you had FUDsters saying, oh, what if it doesn't happen? Or Where does Starlink sign some horizon? So there was a high degree amount of uncertainty and with every passing month, that degree of uncertainty increased, right? So we were, what was it, a year? So last year, last year they signed at the end of May. So you were basically, you know, a year and 4 months from that initial partnership to get to this definitive agreement. So every passing month, the probability of that agreement kind of edged down a little bit, right? But more importantly, and yeah, it was a bummer it took so long, but as they say, good things come to those who wait, and especially by waiting to sign this different agreement, it tells us a lot of information that the market now has to reassess. And what do I mean by that? Well, so what has happened since June of last year? We've got the Block 1 Bluebirds that are flying around Earth and there's been you know, testing that's happened with that. You've got, you know, obviously the administration in the US has changed, the FCC has changed, they've become much more supportive of the service. So what was viewed as kind of something interesting and great now, I mean, was it the FCC? Brendan Carr just announced that October is Space Month and direct-to-device connectivity and broadband connectivity in general from space has become the tip of the spear for American competitive leadership globally, right? Like we, obviously China is developing a Starlink knockoff. They are also doing a knockoff for a directed device, which, you know, there, some of us have seen the satellite that looks very similar to our Block 1 satellites. And China's going to get there. They're going to make a competing service. However, due to sovereignty issues and the like, you know, you're going to have this bifurcation of the market where it's going to be US and US-friendly countries and allies will be using Starlink and AST-6 Mobile, and you'll have everyone else, meaning it'll be China, people in Russia maybe will be using the service. Um, who else is there? Iran, North Korea, maybe some African countries. Um, yeah, there's going to be this other group of, of folks who use the Chinese service and they're going to be comfortable with that. Like, you know, if you're, if your country is using Huawei technology, maybe you're okay with, with the satellite using their satellite services. And there's some, there's some problems with that, but then, you know, I'm not going to, that's a totally different Twitter Space. But yeah, the important thing is that the administration has changed. You know, now we're ramping up production, you know, we've expanded space, but a lot of things have changed over those, that, you know, what is that? 12, 7, 16 months, right? So for the definitive agreement to be announced now, the reason why the market has to re-underwrite this, or the reason why it was not priced in, is that the probability of it not happening had gone up over time, but now obviously it's happened. So the stock is re-rating for that. But most importantly, what this is today is a validation of where we are. So what does that mean? Like, yeah, people are pissing their pants about launch being delayed. You know, we should have got our first satellite, the first Block 2 satellite up back in what, April? Or that was the original target, which by the way, like I've talked about this before, space companies, you put forward aggressive targets because everybody, your employees, your suppliers, your service providers, everybody works towards that target with the understanding that it's aggressive and it may slip. And then if it slips by a month or 2, then great. But if you put out targets that are, that are, you know, I would say more conservative or realistic than, than oftentimes things will slip beyond that one. And so you, generally speaking, you want to put forward more aggressive but realistic targets. And that's just kind of how the way the world works in space. But yeah, what this means As I was saying before, is that launch being delayed, production getting ramped up, you know, more, most importantly, Verizon, you know, they, Scott has talked about working with like 100 different folks at Verizon, you know, network integration, testing, operation, you know, um, doing all the backend stuff. But, but most importantly to me, testing with, you know, on the Verizon network and their spectrum and their phones, like that's all happened to you. Uh, Verizon also, as part of due diligence, has probably looked at AST's funding plans, um, their, their ramp of, of launching service, like all these different things, right? And then, and so over the past 16 months, a lot has changed and the information that the decision point of what Verizon made at the end of May was very, to be quite candid, was like pretty uncertain. Versus the decision they're making today, they have a ton more information. And a lot of the, for example, you know, some of the AST SpaceMobile investors' criticisms and also the FUDsters of like, oh, these are, things are delayed and there must be problems or whatever. Verizon's looked over all that stuff. And I guarantee you, they've been talking to Starlink too. And all through that 16 months, they decided today, we're going with AST SpaceMobile. We're signing this contract. And that's powerful. That's the market. No, it's not priced in. They just re-underwrote this investment. And so did, so do all of us. And so do institutional investors and so do short sellers and so does the industry. By signing a definitive personal agreement today, they've looked at everything that has happened up to this point and they look at the future plans and the multi-launch campaign and they Initial commercial service, and they're they're voting with their feet. They're saying, "All right, we're signing this agreement today." That is powerful. We're not we're not signing with Starlink. We're not signing with some of these like legacy players. Like this is it. This is where we're making our bet. We've looked at everything, and you know we're not we're not like some fly-by-night shop. You know mobile virtual network operator like Boost Mobile or something. Like no, we're Verizon. We're like the mo— we're the most profitable carrier in the United States, you know, along with AT&T. And we're making our bet and this is our bet. And based off of everything we've seen and the future potential, this is where we want to go. It's AST SpaceMobile. And so that has ripple effects, right? Like you're going to have all the industry press, you know, Verizon's going to be talking, but then You know, just as importantly, regulators like the FCC is going to be like, oh, okay. So now there's 2 definitive commercial agreements with Verizon, AT&T. I know Verizon was like working with you guys, but, but, uh, they're, they're serious. So yeah. And by the way, like the, um, our application for US commercial access just got, uh, the comment period closed, I think it was yesterday. And so commercial access, I mean, that's going to be a huge event, right? Like, and that's, that's going to be coming. And we talk about catalysts, you know, that's gonna be in the next few weeks, right? Next few weeks, maybe a month or two. Um, but when we get granted US commercial access, that is a total game changer, right? Because then you can actually start service. And that's a hard thing to do. I mean, for AST SpaceMobile, I think our initial application for commercial access was like in 2018, '19, I forget. But, um, I think it's important when people talk about, yeah, no problem, we're going to get into this market too. It's like, that's a long, arduous process to do it. And obviously the FCC is trying to be more accommodative to helping foster innovation and they want to speed up these regulatory processes. But you've got to prove that you can do this. You've got to have partners, you've got to have the technology, you've got to have spectrum, whether you own that or you partner to utilize somebody else's. It's a very long process, right? And then not only just terrestrial, I mean, spectrum to feed or things, or sorry, to the device, you also need to get spectrum to, you know, from your ground stations to the satellite. Like it's a big deal. It takes a long time. But anyway, but that's one of the big moats. And I think the most important point is that Verizon, by signing this agreement today, is basically given, at least, you know, this is how I feel, they validated everything up to this point. And so there's always going to be like some nagging questions in anybody's mind of, you know, does the technology scale? Is it, is it, is it going to do well if there's like a lot of users? Well, well, guess what? They've been testing with these 5 Block 1 satellites with Verizon and they like what they see. And so I highly, highly doubt that Verizon would be signing this agreement if there was any question that the service is not going to be successful. And credit to Verizon, like they, they dragged their feet. They wanted, it's just like when you are, you know, you have to do something, uh, like you buy a house or, uh, or, you know, you make some big financial purchase and commitment. But it's like a really big one and you're, you know, it's tough. You know, you have to do it, but it's tough. You drag your feet, you wait, you wait until the last minute because you want to have more information. You want, like, you know, if you're buying a house, you want to have the inspections, you want to get an engineer in there. You want to drag your feet. Maybe rates go down, so you want, you don't want to close yet. And then in the meantime, maybe you're like looking at other houses too. And then, but you drag your feet because you want absolute perfect information before closing the deal. And that's what Verizon did. They drag, that's my perspective. They dragged their feet. They waited till the last minute. And of course, last minute meaning like we're on the cusp of commercial service. So it's like shit or get off the pot. And they, they're doing it. And by doing that, you know, Verizon has done us a favor by validating.
[00:25:46] Speaker B: Yeah.
[00:25:47] Speaker C: Up to this point. So that's super powerful. I think, I think anybody who kind of tries to poo-poo that this Verizon definitive agreement should have been priced in or that it doesn't really mean much, they kind of are missing, they're missing the plot. They're missing the whole point. Like it's going over their head. And that's what, and by the way, like we saw this back in the end of May last year when Verizon announced a deal with AT&T SpaceMobile. The market had to completely shift its thinking and it was a true validation, right? Like based off of everything up to that point, Verizon was like, yeah, we evaluated Starlink and we want to go with AST. And in May of, at the end of May 2024, and the stock completely rerated, went from, was it like $13? Or sorry, not $13. It was like in the $8 or $9s. And then it rerated along with, of course, other news, but it went to like a peak of 39 and settled at 26. And that's because, you know, they're, for AT&T to work with AC, they, you know, to make an investment and have a commercial agreement, you know, the company was working with AT&T back in, back, I guess, as long back as 2018. And so, you know, that was a great, you know, great validation. But for another party to come in later to do all the due diligence and evaluate all the solutions out there, but then decide and, you know, also decide with, to work with a big rival, Verizon, to do that back in May of 2024, that was a big validation point. And so today we have a slumber tug event where this definitive commercial agreement is a huge validation of what the company has done to date. As I mentioned before, Bell Canada, like that definitive agreement is coming soon. You know, if it's going to happen, you know, Scott, please give us a break. You know, please, you can do it like in a few days. I'd be fine with that. You don't have to, you know, drop it now. Give the market like some time to breathe. But I think an important thing as well is that Scott has become super savvy and perhaps it's like through the help of retail, The space mob, but he's become super savvy in terms of PR. And I know people have criticized the company from time to time, but when they do PR, they slap the shit out of people, right? Like, it wasn't, it's not lost on me and nor should it be to any of you and especially to, you know, institutions and short sellers. Like they dropped the ATM yesterday full well knowing that Verizon was coming today. Right. And so they put the A-team in place. And I mentioned this before in my talk yesterday. They're, they're pretty in place for a reason. Like there, there's opportunities for them. And, you know, people will say, well, the first constellation is fully funded. Yeah, it's fully funded, but there's other stuff to do. There's other stuff to do. Like we, whether it was Legato in January, we bought that spectrum, which in hindsight, of course, everyone would question, but then One Echo's Starlink did EchoStar, it was like the smartest thing, the best thing since sliced bread, right? Which it is. And then now fast forward to today. Yeah, we're fully funded for the first constellation, but we also have other shit to do. Like if you get Golden Dome or if you get any other defense awards, you're going to have to pre-fund some of that CapEx. I mean, there's a reason why we got manufacturing space in Homestead, Florida. Like that's where defense It's not, it's not for commercial stuff. And so that takes money. And so if, if the government were to come to you tomorrow and say, hey, we're going to award you a billion-dollar contract, but you're going to have to plow in like $100 million of your own money, are you going to say no? Of course not. You're going to, you're going to raise money and you're going to go do it. And so I think, you know, it's like that whole thing was lost on people. It's like people are just whining about, oh my God, the company puts an AATM in place. By the way, like every time the company has recently put an ATM, the stock has rallied tremendously because people know at this point the company is a great steward of capital. They're doing these things for a very specific reason and they're looking at highly accretive opportunities. So like, who knows, tomorrow they may announce an acquisition of some S-band spectrum rights globally. And so there's a whole host of things where they're You know, they might need to ramp up satellite production from, you know, Scott has already talked about like, if we get some military stuff, we might have to ramp up production from 6 to 12 satellites a month. Like he's telling us now that is in the realm of possibility. He's like told the market and the market kind of just shrugged it off. But for people who are paying attention, like that's a fucking big deal. That's crazy. Oh, you need to like build another constellation for the government? Potentially. And so you have to put an ATM in place just in case. Yeah, take my money. And so it was funny because like Cook has talked about this where, you know, when you get to a point where the narrative has changed and the market understands why you need capital and it's for highly accretive opportunities, when you do a fundraise, And by the way, the company does not do, is not doing marketed offerings anymore. They're going to do this through ATMs, which are very efficient if done the right way. And if supported by the market, you know, you have like little slippage and you can take advantage of when the stock price is in your favor. When the market understands that and you're going to be a good steward of capital and a good fiduciary, then they reward you. They reward you for it. It's like why some companies, when they do follow-on offerings or converts, you know, the stock may trade down a few percent, but the next day you see it up. And so yesterday we saw that shift, that paradigm shift where the company announced an ATM, you know, the market shit its pants to a degree. And of course, I'm sure short sellers, you can always count on those clowns. They shorted the stock. down to 6% in the hole in the morning. And you had our favorite short seller, he's kind of like a Keystone Copper. Just some of these guys, I mean, they truly are the bottom signal. God bless 'em. I hope they keep going because I've made a ton of money by just following them. And by the way, like, I do think Pivotal Capital and Adada Capital, they're definitely worth following. I should actually follow them today. But they truly are the bottom signal when they get very confident and they say it's over and they tweet like FUD. That's the time when you want to, if you're trading any part of your position, that's when you want to get longer, add exposure because they just never miss. They're so good. And so, you know, kudos to them. I believe like Pivot Capital, Pivotal Capital, I think he probably works at a pod shop, but if I was, like I said, if I was his boss, I would pay him like 3x whatever he makes. And I would just tell him, you know, just keep giving me your best ideas. And then I would have a separate book so that I wouldn't, you know, hurt his feelings, but I would just take the other side of everything gaming. 'Cause I mean, he's just an absolute moneymaker. But anyway, I digress a little bit, but yeah, so I think, yeah, just thinking when I talk about this paradigm shift, Actually, where was I? That tangent kind of threw me off. But yeah, so I think like the fact that the company can raise capital and people view that, know that they're going to do highly accretive things with that, that changes things quite a bit, right? You go from a, what is a pre-revenue startup, which by the way, like we're going to We're generating material revenues this quarter and it's going to continue to ramp. But when we do fundraising, like that's going to be, I think people are going to view that positively. Now, obviously there's like a bunch of retail investors among the mob who are like, oh, dilution's bad. But no, it's not. It's people sometimes forget, like growth companies need capital to grow and pursue opportunities until they get to a point of profitability where they become self-funding. We're not there yet, but we're getting every day, we're getting closer and closer. And then when you do have inorganic opportunities, meaning, you know, something beyond what's in front of your face, but, you know, you need to, whether it's M&A or there's like a completely new business that you have to pursue, sometimes you need to raise capital as an accelerant to go pursue them. Right. And so that's kind of what we're seeing. But the other thing I wanted to talk about, So this is what got me bulled up last night when I was talking with Kook. You know, we were, I guess a few things we were talking about. One was when, where, where can the stock price go? This kind of, I see Reformed Trader down there. His analysis kind of got us thinking about it. And I think anybody who throws around like the potential of $500 stock price, it kind of, it's hard to comprehend. But when you think about where the market is now, and I'll be the first person to say like we're in a pretty frothy environment. But the question is, what part of the cycle are we in, right? So we're in this mode now where more rate cuts are coming because of what's going on in Japan, and we're basically in ZIRP again, like zero interest rate environment, or heading that way soon. And so my guess is like, you know, are we in the third inning? Are we in the fourth inning? But we probably have another, I don't know, 6 to 12 months, and there's going to be like gyrations along the way and corrections, but This is a very accommodative environment. And then especially given what the US government is doing, and I'll talk about how this plays into space, but yeah, I mean, it's, you have a president who watches the stock market every day and is highly supportive, and whenever the market sells off, he calls people panickers. And then when things go well, he like takes a victory lap. So clearly they're focused on managing the market. in addition to, you know, the economy and other things. And now what does that mean long-term? It's probably not a good thing for the economy to get too, you know, to get basically juiced up. But I think it's important to recognize the game and to understand it and to play it properly. And what I mean by that is during this period of time, things are going to work and things that are speculative are going to work. And so do you, you know, you can take one side of the view of, well, I'm not going to participate because I think it's all, everything's kind of overvalued or, and sit on hands, or you can actually look at trends and situations and take advantage of it. Right. And I think, and how does this relate to ASUS Mobile? I think the opportunity for the stock price to get to several hundred to, you know, a thousand, like That's all in the realm of possibility, but it's going to take a long time, at least in a normal distribution, like a normal market. It would take time of execution, of rolling out service, of getting the service, getting to a level where you've got like a number of subscribers, maybe hundreds to then billions of revenue to eventually get to some of these prices. But then when you're in a market that is basically pulling forward expectations and discounting that, crazy things can happen, right? So what I mean by that is, what was it? I guess it was like a year ago, 2 years ago, like we all knew about AI and there were some people who were early in terms of touting the benefits and how it's going to be disruptive. But the second order and third order effects, I don't think people fully understood, right? And so the ones that did started buying I remember when some of the Bitcoin miners started that first deal. I think it was like CoreWeave or somebody did a deal for an AI to host AI infrastructure, which I did some cursory research and I was like, oh yeah, these crypto mining companies are probably going to be great hosts, great providers of basically AI data centers, right? And so, but I never acted on it because I was so busy with AST and of course things were going well. I just didn't really focus. And by the way, like there's a lot of things that are going on. It's okay to stay focused on what you do. And when you realize like there's a lot of opportunities, sometimes when there's so much noise and you can't focus, you end up missing or not doing things well in everything. Like you just really have to stay focused on the thing that you know well. But if you had kind of made that connection, it's like, okay, well, there's going to be a tremendous demand for AI and these processors are going to need power. Then I should go buy like these crazy concepts of next generation modular nuclear companies that are out 10, 15 years out. Like maybe I should take a punt on some of these and even quantum computing, like some of these names when they were trading at a dollar or so it's like, oh, maybe I should take a punt. Now, obviously, like, there's a huge question about, you know, the modular reactors. I think those eventually will come to, you know, that the, those will become commercially viable. And, but, but now they're being discounted to all of them are being, the valuation is being discounted to today as, you know, they're all a decent amount of them to be successful and we're going to need them. And by the way, like, I've just started doing some work around solar, like, Every type of energy source, whether this administration likes it or not, like all of them are going to be important, right? Because there's going to be this huge demand for electricity and whether it's nuclear, hydro, wind, solar, like everything's going to need to be tapped. And so some of these solar names, you've seen them rally quite a bit. I think we're starting to see, you know, the big, the movement of that. But the reason why I mentioned these things is that we're in this market environment now where people can see that they're not looking at just 1 or 2 years out now because of rates and it's frothy. But then people kind of see where things are going. They're looking at 4, 5, 6, 7 years, 10 years out. I mean, for these nuclear names, it's 10 to 20 years out. And so going back to what Reformed Trader was saying is like, you have these sectors where there's like, there's multiple ways to express the investment. of the thesis, whether it's nuclear, quantum, you know, AI. But then for this particular market, which is going to be massive, and I'll talk about why it's going to be massive, there's only 2 companies to express the bet, right? I mean, there's like a few legacy guys that are doing text messaging and very intermittent type of services. That would be Iridium, which got— has gotten destroyed. Globalstar, which has rallied because of its Apple association. And then there's a few others as well. But if you want to focus on direct-to-device broadband connectivity, well, I guess broadband connectivity, then that would primarily be AST SpaceMobile. And then if you're looking at emerging broadband connectivity, or eventually that would be Starlink. The only way to invest in Starlink is through, for most normal investors, is through a special purpose vehicle that somebody is shilling you. which then you, you know, in order to, which holds Starlink shares, and then you've got to pay $220 to participate in that vehicle. That's one way. And by the way, like SpaceX is worth $450 billion. So, you know, how much upside is there? You know, could it trade over a trillion? Sure. But it's going to take some time to get there. But then the other way to play it is, In the public markets is a space mobile. There's like one true, and by the way, it's not like you're getting exposure to rockets and you're getting exposure. I mean, in SpaceX's case, that's good because they're a dominant provider, but here you're getting very exact exposure to the niche that you want, which is direct-to-device connectivity, which is an exciting market. It's going to transform and disrupt the wireless industry. And this is the only true way to express a bet. And it's a great way to express a bet because this is the company that Has the technological lead. It's working with over 50 MNOs globally covering 3 billion subscribers. It's got regulatory backing in the US. It's about to, you know, get regulatory backing in Europe. It's already gone through the regulatory process in Japan and so on and so forth, right? Like this is the way to play it. You've got LDAN spectrum through Rigado, which, you know, depending on how people value it. Is it worth $15 billion? You know, once fully deployed, $20 billion, you know, the market cap of AST SpaceMobile recently, I haven't looked as of today, but it was like $26 billion. So you're already getting like a highly valuable asset that the company owns for the next 80 years, right? But the reason why I think, so going back to what Reformed Trader was saying, like if people are pulling forward expectations in this this frothy environment. Like, you know, I talked about how once we get to the launch campaign and we get into launch, like, I think a stock price of $100 is likely. And that was putting aside, like, we're not even discounting, you know, Verizon definitive commercial agreement, which, by the way, just happened today. And then Bell Canada, FirstNet, some of these other things are getting commercial access to the US. But just on launch, I thought we were going to go from It was at $49 to call it $100 or at the low end, $70. I think in my post, which I was PIMM like $79. So we're already past that. And we know like these things can overshoot because like in the first launch campaign, the stock went from $13 to as high as $39 and then kind of settled at $26. So I don't know what the ultimate high is going to be and then we'll obviously pull back from that and settle. You know, once launch happens. But yeah, once people, I think, and Kevin Mack had mentioned this before yesterday, he's like, I don't think it's short covering. I think it's people who are rerating the stock higher because they see the fundamentals are improving, which I agree with. And so yeah, I mean, we're, as institutions are, you know, they're getting to the office today and they're like, oh wait, they see Space Mobile, they signed it. To finish agreement with Verizon. So it's good to see that. That's another milestone. What does that mean? Oh, I guess these guys are going to be one of 2 big winners of this massive market. But then I would argue they don't really know what the market is yet, and this is kind of the next section I'm leading into. But yeah, that's how the stock price could re-rate much higher beyond what we think, because we as investors think we know most of the story, but then once the market, the rest of the market decides like this is the name to own and you have a ton of demand for the stock, then that's when the numbers of 100, 200, 300, like it's possible, it's possible. Or 500, as a former trader said, under the right conditions, you could get this like high level of euphoria, which is why I go back to what my space the other day, which is like, make sure you have a plan. Like even these scenarios that you thought were not possible until maybe 1, 2, 3 years later. Have a plan in case those things get pulled forward because it's possible. I'm not saying it's likely and I'm not saying it should happen, but it can happen and there's a decent chance it will. And I'll explain why here shortly because I think this next segment is like why there's a great chance it'll happen. So to the title of this space, like 100% connectivity is a true paradigm shift. It's like it's going to transform mobile connectivity, what it means to be connected, and it's going to be required. It's not going to be something like an aspiration. It's going to be absolutely required. And I think I see Ryan O'Connor down there and, and, and Pramya as well as had written about this in their recent letters, but you know, when you have a true paradigm shift, that's when the real rerating happens, right? And I think it's something that I didn't really appreciate. And, you know, we all, we've all talked about it and, but it kind of hit home when I was speaking to this industry consultant who knows the telecom side very well. He works with like all the major MNOs and he was saying one of the killer use cases of this is the fact that everything needs to be connected at all times, right? And so his analogy was like, Imagine Domino's Pizza. They want to go deliver pizzas by drone. The FAA is going to ask, the first question's going to be like, so are you going to, are these drones going to be connected all the time? And they're going to say, oh yeah, you know, they have these like 3GPP modems and they're going to have service with Verizon or AT&T. But then, and so yeah, they'll be connected. And then the FAA will say, well, no, you have to guarantee me that they're going to be 100% connected. There can't be Even through dead spots, they need to have connectivity. And then Domino's is going to be like, what do you mean? It's a dead spot. They can't have connectivity. So during that period of time, like the drone will have autonomous functionality where it'll figure out where it is through GPS and it'll make it through that dead spot. And the FAA will say, this is dead on arrival. I'm not approving this. Because like, I think for public safety, imagine a world where, you know, we talk about like internet of things and and drones and robots and autonomous vehicles. Forget about autonomous vehicles, even just regular car, your day-to-day car today, right? Everything in the future will need to be connected and it needs, it's not just connected, but it'll have to have 100% connectivity. So for these companies that are looking at drones or robots, like you cannot, from a regulatory point of view, you know, and if it's like an autonomous truck, like a semi barreling down a highway, but it goes into a dead, dead spot of coverage, um, the regulator's going to be like, there's no fucking way I'm approving this because they need a human operator that's monitoring these things at any point in time to have their finger on a kill switch that basically turns the thing off. Because, um, if you don't do that, then, then human lives are at risk. Right. And so going back to the pizza analogy, like if there's a, if there's kids playing in the yard and this drone is in a dead spot of coverage and the kid and the drone decides to land on the kid and the kid gets injured or or the pet gets injured, like the company Domino's can't afford that type of liability. And you would have a huge backlash of like, fuck these drones. Like we're, no one's, no one wants to use them. And so it's going to be a bare minimum requirement that you have 100% connectivity no matter where you are for these types of vehicles or services. And so terrestrial networks can't do that because you have to build a tower And if you want 100% connectivity, you're going to have to overbuild. You're going to have to build in areas where it's uneconomic. But even then, you're going to have dead spots because towers aren't perfect. They may not overlap perfectly, or there may be valleys, or there may be different areas where they don't work. And so the beauty of ASTX Mobile is one, it uses the cellular spectrum and it'll cover those dead spots. But then just as importantly, this is where the company's truly visionary, they will leverage their LDAN spectrum, which covers the entirety of the US and Canada. And then, you know, they're going to expand to other countries as well. But that's true ubiquitous 100% coverage that overlaps with the terrestrial network. You can go to the MNO and say, hey, look, I'm going to leverage your spectrum and we're going to use cellular spectrum in these dead areas, but then we're also going to provide you with this MSS spectrum, For to augment your capacity, like you're going to be able to leverage our network in areas where perhaps you know it's congested. Like let's say football game, like we'll help. We're gonna we're gonna put in. We're gonna give you additional connectivity options where then you're aggregate like and but then also fit in spectrum connectivity. But then more thing is that they're gonna be able to go to car manufacturers, robot manufacturers, drones, and say, "Hey, look, I." AT&T and Verizon are going to say, hey, we can give you 100% guaranteed coverage. And then those guys are going to be able to go to regulators, the FAA, the Highway Safety Administration, whoever, NHSTA or whatever. And they're going to be able to say, hey, we, these vehicles are going to be connected all the time. They're going to be monitored by humans. If there's any issues, then we'll be able to control it and we'll be able to shut them down. And that's like a true game changer. And that's just like, You know, we talk about the MNOs having 3 billion subscribers, like forget about the subscribers, like how many devices are going to be, if there's like 3 billion subscribers, there could be 15 billion devices that need to be connected or 20 billion. I don't know. You make up the number. I mean, my family, we've got like 4 phones, 2 watches, no, 3 watches. We've got like all these AirTags, which by the way, like Those things eventually are going to get a cellular modem or some type of ability to connect. Like, just imagine the proliferation of devices in your house and then imagine like those devices, some number of those devices going outside and needing to be connected anytime, anywhere. And so that's a huge paradigm shift. And it's not, you know, the other thing is like AST's large satellites are able, because of the other large phased array and the spectral efficiency and You have cellular and also MSS spectrum being able to penetrate walls, houses, but also like cars. That's going to be really important when people want to use the service, right? You don't want to be dropped even if you're in your— I mean, I think I talked about this before, like 80% of device usage is in the house, but then that 20%, when you're out, half of that, call it 10%, is in your car and you want it to work through roof of your car. But having ubiquitous coverage is going to be important, not just for physical human subscribers, but it's going to be required for all these devices and vehicles that, especially the vehicles that are going to provide services that will need to be connected all the time. And that's not going to be something that a company just decides how come, it's going to be required by regulators. And so, um, and you can, and then of course you can like imagine that into the defense applications and the battle space. Um, we don't need to go through that, but I mean, all the things that are connected, Anduril, I mean, you name it, like all these things are gonna have to be connected. Uh, and there's gonna have to be redundancy. The, the enemy is gonna try to jam one network, and that's why like AC Space Mobile, Starlink, uh, even some of these other players, like the, the US government's gonna leverage everybody. because you're going to want to have resiliency. So if something is jammed, then something else works. So there's going to be like a seat at the table for pretty much everybody. But I think like when talking about rerating, most institutions are focused on the consumer side. You know, they haven't even thought about Golden Dome defense applications. I mean, everybody sees AC Space Mobile and they think of like, hey, that's a mobile phone company that can connect to satellites. No, it's way beyond that. And And Paranya in his investor letter yesterday covered like in detail, because the guy's been studying, he's been basically become an engineer at night. He's been reading a lot of books about spectrum and the different applications that can be used with spectrum. And so in his letter last night, which I posted, you can see, to me it crystallized what it meant. Like, yeah. And, and Kasey's written about this too. But like being able to utilize our 2 satellites in order to do basically like radar imaging and tracking is pretty damn cool. And the accuracy that you're able to get from those 2 satellites is amazing. But yeah, so I think for institutional investors, once they kind of, you know, they scratch the surface and get involved, then they start peeling back the layers of onion. It's like, oh my God, this is not just a mobile phone connectivity company. It's a defense company. It's like 100% connectivity for drones and, you know, all kinds of things, right? Kind of enabling the next generation of applications where, as some people have said, manipulating photons or spectrum, you know, basically spectrum is going to be key to enabling these other areas of growth, which are drones and AI, you know, any number of things. But anyway, but yeah, it's an exciting time. I think, as I mentioned before, today is a big validation point that the market, it's going to take time to digest. And before they're able to digest it, there's going to be another news event, which will be Bell Canada, I'm sure. But I think it's important to know, like, Scott, like from a investor perspective, like the guy knows how to, he's a killer. He like dropped, I didn't get to finish this point before. Now I'm thinking about it, thinking back about it. He dropped the ATM. He, but before that he told us like all these great things are happening, but he dropped the ATM. I'm sure a bunch of shorts and other people like, you know, the short sellers sold and, or sorry, shorted the stock. And of course for those of us who knew, oh yeah, the company's dropping the ATM, it must mean like something big's happening. And by the way, like I gave credit, to Rocket Lab holders, like they understand Rocket Lab, like sets up an ATM. Oh, Peter Beck must be, he sees like some really accretive like acquisitions. So, so this is good. Whereas like, I think some of our, our shareholders need to be conditioned as such that when the company's raising capital, they're raising it for a reason. The last time they, they spent big money was on Legato and, and that was like a highly accretive transaction. They're putting this ATM in place for a reason. It's not to fund the current constellation because it's fully funded. It's to go pursue other opportunities, many of which we don't even, we can't comprehend. And so I'll end the space with that, that, you know, as we enter into catalyst season, there's going to be a lot more great news. I just dropped or reposted my old post from August, in which I need to update. On milestones that have passed and upcoming catalysts. Now, several of those catalysts have already come to pass, but I think near term, what we can look forward to are FM1, FM2 launch, and then FM3 through 5 launch, all of which I think should happen before the end of the year. Bell Canada Defender agreement, Golden Dome, and any other defense awards. And then, yeah, there's other partner MNO partnerships that can come to fruition. FirstNet, you know, we've been pounding the table on that for quite some time, but we do know that they're close to making some type of investment or contract. So that should be coming soon. And yeah, there's a lot of things that, I mean, you can just read the list. But anyway, I hope that was helpful. The market's about to open. I need to get ready to make some moves. So I'm going to end the space here. But yeah, thanks everyone for joining. I hope this was helpful. Um, but yeah, very big day to be excited. Verizon signing this commercial agreement, huge validation point. Um, after 16 months, uh, everything that's happened since then and about to happen, Verizon feels really good about, and they signed this commercial agreement. So a big fucking deal. Take care, everyone.
[00:57:37] Speaker D: Det står en man vid portarna på stadens ölcafé. Han spelar på sitt dragspel så att alla sjunger med. Han är glad. Alltid lika glad. Alltid samma rader, alltid samma människor. Ett språk som alla känner, alltid samma ceremoni. Han är glad. Alltid lika glad. Han står där lika lycklig om regnet öser ner. Och han blir alltid lika glad när han har ingen mer. We are all the winners. We are all the best. Avi på bakgrunnen av alt. Det er det de er mest. Det er den andre grunnen jeg har med gående om og med. Så har vi enda mulighet om alle er enige med. Så står han där på alla arenorna vi ser. Han står där med sitt dragspel och alla bara ler. Han är glad. Alltid lika glad. Sen lyfter han sitt dragspel och vinkar glatt till sin publik. Man känner sig förtrollad, en underbar mystik. Man blir glad, men alltid lika glad. Så sjunger alla samma vackra rader som man har. Sträcker upp en hand och väntar på ett svar. We are all the winners. We are all the best. Happy for party sounds. They're the team the best. And on the moon are only going on the moon. So har vi en stor bunnig om man liker meg. Yeah, we are all the winners. We are all the best. Vi skal starte sammen.
[01:00:41] Speaker A: Thanks for listening to the AST. You've been listening to the AST SpaceMobile 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 SpaceMobile, make sure to subscribe. Thanks again, and I'll see you next time.
[01:01:00] Speaker B: We're doing something very, very big, and I think with this technology we can really affect AST SpaceMobile 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. We don't want the user even to know that it's connected by satellite. Our role is to bring this into reality, always in partnership with the NMO.
[01:01:41] Speaker D: Listen. Mmm, waffles.