Anpanman - The Cusp of the Launch Campaign

[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: Hey everyone, thanks for joining. What an exciting time. I know obviously the markets have been quite volatile, but we are pretty much at the doorstep of some big catalysts that are coming up for AST SpaceMobile. In particular, we've got Bluebird 7, which is likely going to launch next week. And so I wanted to fire up a space and talk about A few updates around AST and also talk about BlackSky as well. But, um, but yeah, it's an exciting time. Uh, it's a beautiful sunny day out here in New York City, and, um, you can definitely feel that spring is coming. And similarly, I feel like, um, we are now— we are finally, after much, you know, a, a delay and, and much waiting and patience, of course, um, we're on the cusp of this massive launch campaign. And so, yeah, it's an exciting time. And I think, you know, obviously there's macro has been dominating the headlines. At first we were, everyone was focused on AI and then of course the Iranian conflict. But for space names, especially in the US, the environment hasn't changed. If anything, the environment has gotten better for these companies, especially in light of the SpaceX IPO. Which is barreling along, which I think ultimately will get done sometime in June. And so that's going to bring more eyeballs and attention and awareness to the sector. I mean, it already has started. And so yeah, it's an exciting time to be an investor in AST and any number of other companies. But let's start with the launch campaign update. And so as people have seen, there's informal websites that are now discussing a potential launch date for a Blue Origin New Glenn on either April 15th or April 16th. Obviously, this has been pushed back quite a bit. For those that, it seems like ages ago, for those that don't remember, Bluebird 7 was actually delivered to Florida back in December. And so due to delays at Blue Origin in terms of refurbishing Never Tell Me the Odds, um, you know, the, the booster, that, uh, took longer than expected, um, because this is the first time that they've refurbished it. I think there were a number of mistakes that did happen, which they're learning. And, um, from those mistakes, as in any program, um, you're going to get better from those learnings. And so now we're on the, you know, now we're in the home stretch of, of, um, of that rocket being mated with its payload. And I believe, you know, we should see, um, You know, Blue Origin had tweeted out that Never Tell Me the Odds is being, um, mated with the New Glenn 3, um, New Glenn 3 upper stage. And then of course the, the payload, which is, um, AST SpaceMobile's Bluebird 7. I know that there's been some talk about, you know, whether putting a dummy payload would make sense versus the actual payload. And, uh, in this case, they're looking for a very quick turnaround. And so. Once the static fire happens, which is probably going to be 2 to 3 days before the actual launch, then they're just going to keep the rocket out there, refuel it, and it's going to be all systems go, as opposed to then bringing the rocket down and taking off the dummy payload and then putting the real payload on top. And so that's going to be kind of the order. And I think, you know, Due to the launch being on April 16th, there is a chance I will be able to make it down. So as soon as we get a confirmation of that, fortunately there's a ton of flights from New York down to Orlando. I'm going to see if I can pull it off. You know, the family obligations, hopefully we can get some help. And, you know, my wife is actually going to be gone over the next few days on a trip with a friend. And so What was previously going to be a potential launch date of the 11th, I wasn't going to be able to make, but if it's going to be on the 16th, I may try to come down, stay overnight, or I may just fly in and out depending on when they're planning to launch this thing. So, um, I think it's going to be a tremendous event. I mean, this is going to be Blue Origin's, you know, 3rd launch and the first time using, reusing a booster. So, and then of course you've got Bluebird 7 on top. And so this is going to be a tremendous, you know, occasion, which I think many of us have tried, um, or, or will be trying to get down there. And so, um, if I am able to go, I'll love to meet other people. I think Cook is going to try to make it as, as well as a few others. Um, and so yeah, looking forward to that. Um, and so yeah, we, that's going to be kicking off the launch campaign. And obviously we've got, as I've discussed in the, in previous space, you know, we've got an upcoming batch that's almost ready. For those that missed the space where I discussed it before, you know, the company had run into some issues around the structural integrity of the composites. And so when stacking these things, when testing them, the rings, as we'll call them, the composite rings, you know, when putting vertical pressure, horizontal pressure, and then also angled pressure, I think they were not seeing the performance that they wanted to in the first round of composites. And so what they did is they, um, they modified them and included additional reinforcements, which then, um, those rings were able to pass, uh, testing. And then once you, once you're comfortable with the rings, then you put the folded microns, um, the tail, and then the other parts of the payload into that ring. And then once that's done, you have to then do environmental testing, right? And so from what I understand, the stacking was solved sometime in February, my guess is late February. And then what they did is they went back and reinforced the rings that they had on hand. And then the— What they learned from that, they actually are changing the design and reinforcing the structure at the point of production. And so they won't have to like retrofit the rest of these rings. But from what I understand, you know, the first batch is on target to be delivered in April or to be shipped in April. I'm not sure exactly if it's shipped or delivered, but they will be ready. And due to some eagle-eyed due diligence from some of the Reddit community, there was a picture taken of one of the shipping containers that was on the road heading to Midland. And so from what we know, Um, there are several containers that are, um, on site that are ready to accept, um, Bluebird 8, 9, 10, you know, depending on what batch size they want to go send. But, um, there are containers that are ready and it looks like, you know, potential shipment, um, of those satellites is imminent, right? So whether that's in a week's time or 2 weeks' time, um, you know, we'll see. But, but it looks like everything is pointing towards an April delivery. And what, you know, if you extrapolate that out, that's probably pointing to the first Falcon 9 launch in May. And then there's probably going to be a second one shortly thereafter, potentially in the same month or maybe in June. And so you're starting to see some of these informal websites that track launches start putting placeholders for those 2 Falcon 9 launches. And yeah, so I will say I had caught up with the company, I think it was like 2 weeks ago, and they feel confident in 45, their target of 45 by end of year. And so that's still a very valid milestone for them. And with that, you'd have to assume that there's going to be a sprinkling of, you know, some new land launches as well, which if you look at you know, the post recently by David Limp of Blue Origin, they're firing on all cylinders, right? Like they're, they've got a number of second stage boosters that are already ready and tested. And obviously the, another booster, first stage booster that's ready as well. And then they're also building out from some You know, some intelligence that was crowdsourced on Twitter. It looks like they're actually building out another launchpad down in Florida because they want to have the ability to go beyond what I believe the current launchpad, you might be able to do like 2 to 3 launches a month from the current one. They want to expand the ability to raise cadence further. So maybe double that, maybe like 6, 6 launches or so a month. And so by building out a second launchpad, it'll enable you to do that. So yeah, everything's looking great. I joked about this before, but there was actually some people thinking about buying property in Cape Canaveral, like, you know, buying a house, 'cause there's going to be a ton of these launches. And so maybe economically it might make sense, right, to to buy a place if you're going to go down there quite often and watch these launches. I'm not at that point, but I'm certainly going to try to fly down as often as I can to watch these things and visit our friend Steve Larison, who is buried there overlooking the launch pad. So, but yeah, no, we're in an exciting time. I'd expect once the company has full Confidence and confirmation, they will announce the formalized, you know, formal launch date. And there'll be some type of process where people can sign up and attend the formal event. But then for those that aren't able to get that, then there are obviously, you know, you can still see the launch from a number of vantage points within a several-mile radius of Launchpad. So if you're not able to get an invitation, you should still go because it's going to be amazing. And I'm sure people will be meeting up at various venues around just to hang out with fellow Space Mob people. But yeah, so that's a quick update on launch. The other topic I did want to cover is this idea of T-Mobile potentially joining AST SpaceMobile. And First of all, I'll just caveat this by saying I think it's a low probability. You know, is it a 5%, 10%, 15% probability? Uh, I'm not sure, right? Like, it's, it's definitely a non-zero percent probability, and there's some breadcrumbs pointing to the possibility. And just in terms of the competitive dynamics, um, there's a whole host of reasons why, uh, first of all, it wouldn't make sense, but then there's almost as good of reasons why it does make sense and it should happen. And so I'm not here telling you like it's definitely going to happen, but I think it's, I don't know, maybe a 20% chance, 30% chance it could happen. And that's pretty good odds, right? And so why do we feel this way, right? So there's a number of things that recently kind of point to the potential. You know, so CATSI, there were some recent filings with the NTIA, which is the governing body that kind of coordinates spectrum globally. And so through the FCC, the FCC makes these filings on behalf of companies. The FCC did file T-Mobile's spectrum bands for AST SpaceMobile at the NTIA, which is a very odd thing to do. I don't quite know why you would do that. I guess perhaps for future compatibility, or maybe, you know, I was just trying to think through it, like in situations where Starlink is unavailable and you have a natural disaster, then I think the FCC will want AT&T and Verizon and vice versa, T-Mobile, to be able to use the competitor's satellite service in case of some type of natural disaster. Because I think we saw some of this where, was it Two Degrees out in New Zealand? They said very specifically when they were talking about why they chose AST SpaceMobile over Starlink, they said, well, in the unfortunate case that there's a natural disaster, your mobile phone in New Zealand will cycle. If you're on the competitor's network who uses Starlink, you try to make a phone call, We all know that you cannot do a phone call on Starlink's network because it doesn't support that natively, and it's a roaming network, and throughput is just not there. Your phone is going to fail in that call when you try to dial their emergency number, which is not 911, but it's 111 there. When you dial 111 there on your phone and it doesn't work, then it will start cycling through other carriers. And this is kind of for you know, for emergency services, right? And so it will ultimately, if it's not in terrestrial coverage for 2 Degrees, it will ultimately try 2 Degrees, but then of course 2 Degrees is working with AST SpaceMobile. So when you do that 111 call on your phone in New Zealand, it will then go on to the AST SpaceMobile network. And so that's one kind of, you know, use case where I think maybe that's why the FCC would file T-Mobile spectrum bands to work with ASC SpaceMobile at the NTIA because maybe for emergency services, but it could also be highlighting something that's being in discussion or could be for the future, right? And so why are these breadcrumbs important? And, you know, if it's, you know, it's not saying explicitly that they're going to work together. Well, these breadcrumbs sometimes can lead to and can be indicative of something in the future that is going to happen, right? And so the reason why I mentioned that is I did a post on this before, but let's go back in time. Um, in— excuse me— in 2021, I remember looking at AST SpaceMobile's investment deck, and, you know, they're partnered with AT&T, and I thought, oh great, you know, like, they're partnered with one of the, the, the most profitable and largest wireless carriers in the world and the most profitable market. AT&T is probably looking at this like the iPhone moment and what iPhone did for AT&T when they had exclusivity for 5 years. Because AT&T back then, once they did have this agreement with AST SpaceMobile where they would have, I think it was, if you look at the old agreement, it would be 5 years exclusivity once the service launched. And so for me, I was like, wow, AST SpaceMobile is going to be kind of like the iPhone for AT&T. They're going to be able to go out in their marketing campaign and say, we have 100% broadband coverage no matter where you are. And that's going to be super valuable, right? Like they're going to be able to go pick up subs from Verizon and T-Mobile. And so this is, and then that was, you know, that was the light bulb that went off in my head where I was like, this product is going to be very valuable because even though it's going to be primarily used in areas where there's not terrestrial coverage, The ability from a marketing perspective to tell people that you have the absolute best coverage. Like remember the Hear Me Now guy for Sprint or Verizon? I mean, any of these wireless companies, it was always about coverage, right? And so back then I thought, oh, well, AT&T, this is a great valuable service. They're going to take subs from competitors. You can be able to reduce churn. And so it made sense. And then, and you know, that was the framework of thinking where, okay, AT&T has exclusivity. They're not going to allow AST to work with anyone else. But then in 2024, I remember still thinking like, there's no way, definitely no way T-Mobile would work with AST, nor would Verizon. And AT&T, even if AST wanted to, AT&T would not allow it. But then I remember Uh, Katzi had found some of these FCC filings and Cook as well, um, where, uh, the FCC was kind of hinting that, um, AST should work together with Verizon because, um, in order to get contiguous spectrum, um, you, you probably needed some partnership between AT&T and Verizon to make that happen in the 850 megahertz band. And there were some breadcrumbs, right, in these FCC filings where it's like, You can't do this service unless you get contiguous spectrum and Verizon, they have some of the spectrum that you don't have. Maybe it makes sense to work together. And that was like the interpretation that you could read from it. And I remember very specifically Cook and Katzi telling me like, hey, I think, you know, they should work together with Verizon. Like it's going to happen. And I remember telling both of them like, You guys are out of your mind. There's no way AT&T is going to allow it. Why would they let a competitor in? Verizon, at that time, by the way, Verizon was telling the market, hey, we don't see value in this. It's a small nichey thing. And they were trying to downplay it, right? And they were also at the FCC complaining. And by the way, whenever a company complains at the FCC about another potential service, That means they find it threatening, like it's a real problem, right? And so that was very telling too. But anyway, but fast forward to January, obviously the company was raising strategic capital and you want to, I actually talked about this with a few Space Mob folks this morning, but that was like the painful January, right? That was when AST announced in the morning that they had did a strategic convertible raise, which was good, with AT&T, Vodafone, and this new partner called Google. And so the stock shot up. I think it was like at $3 and it shot up to like $5.50 and it was going up and people were excited. And then of course the press release came right after that, which I don't think was on purpose. The company apparently tried to do this at the same time, but the press releases for whatever reason didn't come out at the same time. There was like a few-minute delay, but then they announced that they were doing an equity offering of $100 million, which they had to do because they had to bridge, um, we learned later they had to bridge, um, what ultimately was Verizon joining as well, right? Because Verizon was in the middle of due diligence and they needed more time. And so the stock went from like $5.50, $5.60, it went down to like $3 or so, and they finally priced that deal like $3.25. Imagine like the company selling 30 million shares at $3 to get to raise $100 million. Whereas most recently, and that was like significant dilution, right? Because the market cap was very small. I think the dilution was like, uh, I want to say like 15 or 20%. It was pretty big, right? And, but you need to, you need to raise money to make money. And sometimes when your back's against the wall, like that's what happens. And And I think at that point, the company, even though AT&T, Vodafone, and Google put money in, people were just at that point, they were kind of fed up or whatever. And so fast forward to May was when AT&T signed their definitive commercial agreement, which shouldn't have been a surprise to anyone, but they did. And the stock rallied to like the $5 level. And then magically a few days later, Verizon announced a strategic investment, a contribution of very valuable 850 MHz spectrum. And yeah, this strategic partnership, it wasn't a definitive commercial agreement yet that was to come, but they announced that and the stock rallied 69%. You know, it went up to like $9 and change. And then it peaked that summer at like 38. Intraday was like 39. And so imagine my surprise that day when they announced Verizon and that AT&T and Verizon were working together. I was like beside myself. And I remember, you know, as people know, I called Cook that morning. I had bought some shares. And, you know, the stock was like still hovering in the 6s, and Cook was like, where's the stock trading? And, and I, you know, first I called him and I was like, you will not believe what happened. Hell has frozen over. Like, Verizon is working with AST. And I was laughing hysterically, like, this is the most insane thing. And, um, and Cook, of course, immediately was like, where's the stock trading? And I told him, oh, it's in the 6s, or it was high 5s or 6s. And then he went out there and just ripped I think he bought like a few hundred thousand shares immediately and caused the stock to like go up. And that morning, I believe, you know, once the stock opened, that's when he went out and bought like quite a few call options, like longer dated stuff. And so, and you know, the rest is history. But the reason why I bring that up is that back then I did not, again, I did not think, I couldn't even imagine the possibility of Verizon joining AT&T to work with AST SpaceMobile? Because then, you know, that's from a competitive standpoint, it didn't, it didn't make sense. Um, and, you know, but then ultimately what, how AT&T viewed it was that, um, in order for the service to be robust and to be good, and from a funding point of view to get this thing off the ground, like it made sense to bring Verizon in. Because once you brought Verizon in, um, that validated what AST was doing.
[00:23:02] Speaker B: Yeah.
[00:23:02] Speaker C: And the cost of capital, obviously, instead of raising money at 5 or 6, now they're raising money in the 30s, which then now is in the 90s. That would make sure that the service was going to get off the ground and it was going to be robust in terms of the spectrum that was being brought to bear. You know, you brought, you bring Verizon, AT&T, and then that brings you scale because once you have 2/3 of the most profitable market in the world, you're going to be able to deploy the constellation. It's going to give you validation. It's going to allow you, if you're AT&T selfishly, you're like, I need you to be successful in Asia and Europe and South America and the Middle East and Africa and all these markets in order for the financial stability and the amortization of costs to support a robust service, which ultimately will benefit me here in the US. And by the way, like I'm on your board and I also own equity in your company. And so our interests are aligned.
[00:23:55] Speaker B: Right.
[00:23:56] Speaker C: And so Verizon similarly, and I talked about this, you know, I guess it was like a month after because obviously there was a lot of interest from Wall Street. It's like, how did, why did Verizon choose these guys over Starlink? And that was like another big point of validation. It's like Verizon evaluated Starlink and they evaluated AST SpaceMobile. And we learned about this because Lightshed, which is a boutique investment bank, they hosted a Verizon executive who was the decision maker in all this. And he told the Street this, he's like, yeah, we evaluated both. We looked at the roadmaps and we chose AST SpaceMobile because it made way more sense. Right. And so that too, that was like a huge point of, you know, all these bears who's like, oh, the tech doesn't work and they're not going to get funding. And I'll talk a bit more about the shifting goalposts of these clowns. But for AT&T to do it, you know, it's like, okay, you know, you have Tim Ferriss like, oh, AT&T, like they're a bunch of idiots. They, their ventures in these areas haven't worked. But then for Verizon to conduct due diligence and say, yeah, we're backing this horse. That's a huge point of validation. Like what you've got, like all these internal engineers who are RF experts, you know, experts in, in cellular data and, you know, all types of areas of engineering who, by the way, like eat, sleep, and breathe this stuff. They're not paid consultants who are complete hacks, right? Like I talk about this idea of those that can do and those that can't consult. Yeah, that's all these like navel gazers out there who talk shit about this company, but they've never done anything in their lives versus like, real-world engineers at Rakuten, Vodafone, AT&T, Verizon, others who, by the way, like for Vodafone, Rakuten, and AT&T specifically, like they helped develop this service. Like their engineers were there. You can't do something of this scale and integrate into an MNO's core network without engineers on the other side working with you, which, you know, for example, Vodafone. had embedded engineers at AST since I think it was like the summer of 2018, right? And so that's the big difference versus like, oh, it's Starlink. We're going to like, we think this is an interesting idea. We're going to slap it together. And by the way, like it's not going to integrate into the MNO's network core. It's going to be a completely separate roaming network because all that other stuff is too hard. Like, and we need to get this thing out the door. And so that's one of the huge key differences, right? Like this is, a seamless integrated extension of the terrestrial, or not extension, it's part of the terrestrial network. And so, yeah, Verizon, going back to what I was saying before, they did due diligence on both and they picked ASD Space Mobile. And so I'm going about this in a very long-winded way, but for T-Mobile, I think it's important for them to really think about where this goes strategically in the long term. Right? So the guy who made the decision to work with Starlink, he's no longer at T-Mobile. This guy, Mike Sievert, right? He was the previous, I believe he was the previous COO under Jean Legere, who is a marketing genius. Genius. He's the one who pulled T-Mobile out of the shit can and really transformed the company buying Gosh, I forget the small carrier before, but then he did the Sprint transaction. And so then Mike Sievert came in as CEO. I don't, you know, this guy's an operational guy. He's not really strategic in terms of long-term thinking. He's like, oh yeah, we're going to do this Starlink deal and it's going to be a big splash. We're going to get ahead of what AT&T's doing. But I don't think he really understood the long-term implications, which is, you know, you're basically Giving your customers away to Starlink because not only is Starlink eventually wanting to try to create their own mobile service, but they also compete with you for 5G home and fiber, right? Because they have obviously their fixed wireless business. And so this guy, for the short-term marketing pop, and maybe he'll get some subs short-term, he wasn't really thinking long-term, which is why he's not at T-Mobile anymore. And And you, you know, it's not a secret that people in the wireless industry don't trust Starlink. There was an informational article recently that I had posted about how anybody who's working with Starlink is very wary of it and don't really view it as something long-term beneficial, right? And so that's why I think now we're at this point where T-Mobile There's a decision point, right? Coming up in— so for Starlink and T-Mobile, they have exclusivity where they have to work with each other up through, I think, somewhere around July of this summer. And then beyond that, T-Mobile could, and they have been trying to get AT&T and Verizon to work with them. But then for T-Mobile, they can also drop Starlink. they can go work with someone else, right? Uh, and so all eyes will be on that. I think that could be a potential catalyst come July, and so people should watch out for that. Um, if July option volatility is cheap, um, it might be a good idea to, to own some, uh, because this is probably not being priced into the market as, as it, as it probably shouldn't be, but it is certainly a possibility. Right. And so, but as I said before, you know, it's highly unlikely because I think for this to happen, it's dependent upon AT&T and Verizon saying okay. And if you're AT&T and Verizon, like, why would you let T-Mobile in? You would use this service to go take as many T-Mobile subs as you can, right? And so why would you agree, allow AST to bring T-Mobile into the fold? The other thing is like, you know, for T-Mobile, you know, what do they bring? Are they going to dedicate some low-band spectrum to the service? It's possible. Obviously they could dedicate the 1.9G block in the PCS band, which they're currently using with Starlink. And, you know, AST could use that for the mid-band Bluebirds. But, you know, what could they bring, right? Which I think ultimately, you know, for T-Mobile, if they wanted to use the service and if they don't bring spectrum, then Maybe they just give up some of the economics to the other 2 carriers, but but it's complex. It's not it's not you know straightforward like how they would they would come into the fold. But let's talk about like why why it would change. Like what why would they work? Why how could T-Mobile join and why why would it make sense? And so first I think it's important to understand some of the competitive dynamics here. So Deutsche Telekom in the information article when the CEO was was interviewed and why Deutsche Telekom? Well, they own T-Mobile. They effectively control it, right? It's a subsidiary, which is kind of funny because like when Starlink goes to the FCC and complains about foreign investors somehow having influence over AST SpaceMobile, their biggest customer is owned by Deutsche Telekom and Deutsche Telekom by owning T-Mobile, they control a ton of spectrum in the US. And so if you want to talk about sovereignty and security issues, that's probably the wrong tree to bark up. And so this guy, David Goldman, by the way, who's the regulatory counsel over at Starlink, he just looks like a complete ass, right? Like he's complaining that Vodafone and Orange and all these foreign MNOs are working with Starlink. Your biggest customer, T-Mobile, is Deutsche Telekom. Like, what the fuck are you talking about? Pardon my French. But anyway, yeah, so we're at this point now where Gojek.com has publicly said we're not—we're working with Starlink, but we're also wary. Like we know that it's dancing with the tiger, and they specifically said this: We are open to working with other satellite providers. And so if your the parent company is saying that, then obviously the subsidiary or the the T-Mobile is thinking that as well because they are one and the same. And so they're already, Deutsche Telekom said, we're open to working with others because we don't trust Starlink. So there's like your opening gap in terms of, can they work together? Yes. Yes, it's certainly possible. It's a non-zero chance. The other thing that's interesting is that Starlink, they've, as Elon Musk has said, We're we're creating this Starlink mobile brand, and one day we might replace the carriers. And of course, you know, he said this publicly in a very candid, you know, interview kind of setting. But then when asked formally on the record, he's like, "Well, no, no, we're not going to compete with MNOs." Of course, he's going to say that, right? Because like they're trying to get MNOs as customers, and they they want to get subscribers, and they want to get the thing about T-Mobile is like. They are a direct-to-consumer brand, and so they need to build their brand and awareness. And one of the easiest ways to do that is to, it's like the scorpion that rides on the, I forget the tail, right? It's a scorpion riding on the alligator's back or something. I forget which, what the animals are, but Starlink is happy to ride the coattails of T-Mobile. You know, they call it T-Satellite Service powered by Starlink. That's like great. That's free advertising for Starlink. And so for all these MNOs who don't have any strategic long-term sense, they're like, oh yeah, we'll use Starlink. You're basically pumping the Starlink brand in by accident. And that's no mistake because Starlink, they bought EchoStar spectrum and obviously like they can't roll out a full mobile service without low-band spectrum, but they're going to stack up As much spectrum as they can because they ultimately do want to compete with the MNOs, right? And so for, in this situation where Starlink has made its priorities known that they ultimately want to compete with MNOs, like you can also see, don't follow what they say, but follow what they do, right? Like the US, in the US, there's an upcoming AWS-3 mid-band spectrum auction. And Starlink is one of the bidders. They join. And who else is there? Obviously there's AT&T, Verizon, T-Mobile, and then T-Mobile's application when they show up to this spectrum, not that it's a physical room where you go, the bidding is actually closed envelopes and you are, it's confidential bidding. You send in what you want to pay for spectrum, then you see if it cleared. That's pretty awkward, right? Like you go to this If you imagine like a pretend auction, you go in there and the strategic partner that you're cozied up with, they show up to the auction too. And it's like, hey, it's funny. What are you doing here? And it's like, oh, we're going to buy spectrum too. We're going to buy the spectrum that you're bidding on. It's like, why? I thought we're working together. It's like, well, ultimately we want to compete with you. So we're going to get the spectrum and we're going to use it against you. And so for T-Mobile, you're sitting there like, okay, maybe I didn't make a good decision here. These guys are stacking spectrum. Our customers are roaming on their network and they're getting all this like customer data. And ultimately we let the Trojan horse, like the fox in the henhouse, they're gonna compete with us. So what are we gonna do? Right. And so from a strategic perspective, T-Mobile is in a really tough spot, right? 'Cause they've wed themselves to this service. They basically opened up the henhouse and you let the fox in and the fox is running riot. On your customers. And ultimately they're going to take your customers, right? Because for Starlink, it makes a ton of sense. Like they ultimately, once they get a lot of customer data and they know where the customers live and they obviously like, oh, for these rural customers, I'm going to go push, not only do I know where they live, but I'm going to go push Starlink fixed wireless service to these guys. And so it just makes a ton of sense, right, for Starlink. So going back to what I was saying before, what could strategically change to allow this to happen? Obviously Deutsche Telekom, they're a big part of that. If they decide they want T-Mobile to work with other providers, then it's going to happen. It's not really up to T-Mobile. The other thing is that from AT&T Verizon's perspective, there might be a scenario where it makes sense to bring T-Mobile into the fold. And so why would that be? Well, if you think that Starlink could eventually get to a mobile service, right? And so let's say like at some point in the future, and just make up a scenario, T-Mobile goes to AT&T and Verizon and says, hey, can I have in on this AST service? And then Verizon, AT&T tell them, to go pound sand, then T-Mobile could say, okay, well, if you don't let me, then I will not only, I obviously will stick with Starlink, but then I'm going to allow Starlink to become a mobile virtual network operator, right? Like I'm actually going to entertain that and help them launch their own cellular service, right? And so an MVNO, Starlink Mobile, that could be Oh, by the way, there's a headline here. Israel agrees to direct talks with Lebanon. Okay, that's good. Market's like up on that. But anyway, for T-Mobile, they could say, well, you know, none of us will allow Starlink to become an MVNO, but if you don't let me join, I will enable them and I'll make it bad for everybody. And so in that type of situation, that's where AT&T and Verizon could say, well, okay. maybe it makes sense to allow T-Mobile to join versus the alternative, which is Starlink becoming a real MVNO competitor. And so for those that don't know, an MVNO is like Mint Mobile or some of these other businesses where you have a marketing brand that will leverage an existing carrier's network. And so for Starlink's instance, they have the satellite-based connectivity, which will be pretty good, although it won't be able to penetrate buildings or, you know, and it can't work in dense areas because there's going to be too many users. But then by leveraging a T-Mobile network and then calling it Starlink Mobile Network or whatever it is, Starlink Mobile, Then you become an MVNO, right? And so then you can compete more effectively. You can actually get customers not only from AT&T and Verizon, but from T-Mobile. But then T-Mobile, from their perspective, they're like, okay, well, net-net, hopefully if I've done all the calculations right economically, because they're paying me rents on my cellular network, it'll be worth some of the subs that I lose because overall net gains from AT&T and Verizon will help. And so from that perspective, by using that card, maybe AT&T, Verizon are like, hey, okay, you know what? We'll let you in on AST SpaceMobile because obviously, you know, the threat of Starlink Mobile via becoming an MVNO and using its satellite network as well, that's too, that's too much. Right. And so that, that could be a situation where AT&T and Verizon do accommodate T-Mobile. where they look at this long-term because these 2 companies actually think long-term, unlike T-Mobile. And they are like, okay, this is worth it. We'll just, you know, we want to keep the risk of Starlink becoming a credible, you know, 4th player off the table, right? So that's like one way where you could see this happening. Another scenario where it might happen as well is Is where the FCC says, hey, you know what? This service is too important. And as a result, like you, AST SpaceMobile, AT&T, and Verizon, you have to open it up to T-Mobile. And so why would that be? Well, if you're in a situation where the FCC says, hey, T-Mobile Starlink, when you dial 911 and you're out of terrestrial coverage, the Starlink can't do native voice. This is unacceptable. Like, T-Mobile needs to have the ability to access that service, those users, because 911 is, you know, E911 is more essential than anything, then you might get forced by the regulators to open it up, right? And so then that situation might also be something where T-Mobile becomes a customer of AST SpaceMobile because Starlink's service is not good enough. And so that could be another situation, which I don't think is Likely under Brendan Carr, but who knows, right? Like it could happen under another administration because I think Brendan Carr, as we all know, is a big supporter of SpaceX. Of course, he's a big supporter of all American companies, but you know, he has a special place in his heart for them. So I don't know if he would do that, but who knows? So if, so going back to, you know, if T-Mobile did join AT&T and Verizon for AT&T SpaceMobile, then In that scenario, we're talking like winner takes all type of situation, because obviously owning 100% of the US market, the most profitable wireless market in the world, that would be game over, right? And so now you would be shifting from a duopoly where Starlink is kind of the weaker second party and obviously AST is the stronger party to shifting from a duopoly to now what is essentially de facto monopoly. And so that would be, as I mentioned before, like what would the stock price do in that scenario? Like previously when Verizon joined AST, the stock went up 69% to like $9 and change, and then ultimately rallied over 600% to like $39 over the course of, I guess it was like 3 months. But if T-Mobile joined AST SpaceMobile, I don't know, would the stock like double? Would it triple? You know, that's something that I can't say with any level of certainty, but that would be a game over scenario. And that in terms of timing, like the potential for that to happen could be anytime starting on June, July of this year and beyond, right? And so I think it's important to continue to watch and see what Deutsche Telekom says about the The Starlink partnership and evaluating other satellite offerings, which, you know, it's no surprise that Elon Musk is not very popular in Europe. And so not only from a technological standpoint does it, you know, Starlink's product is inferior on direct-to-cell, but there's also political reasons to potentially shift away from that. And so yeah, it's something to keep an eye on. And never say never. Like I, as I said before, previously, I never would've thought Verizon would work with AT&T, with AT&T. And so the idea that with a superior technology and business model, T-Mobile could certainly join. So I'll leave it at that. But anyway, I wanted to shift to some bear stuff, bear case. I know Cook had covered this in a recent space, but it is pretty funny, like to see how the goalposts continue to shift for these guys. So initially it was like tech doesn't, it will never work. No one, you know, it doesn't make sense. And of course that got, you know, eviscerated and then the company won't get financed. And by the way, like, you know, recently the company has been able to raise billion dollars at a clip. you know, for 2% dilution. Um, so financing's not an issue. And then of course, you know, there's the arguments that the market's not big enough. It's, it's like so small that, you know, Starlink, SpaceX is spending $20 billion, $23 billion on spectrum, and every legacy satellite player, um, is, and their mom is like trying to enter into this market. Um, they're trying to like grab, grope for some relevancy. Even changing their names. YaSat, which is like this dead company, became Equitas, which is all of a sudden like this hot European-directed device player, but it's just basically the same piece of shit company before. And then now the bears are saying stacking doesn't work and somehow these satellites won't fit into a Falcon 9 fairing, which It's kind of funny, right? Like, I remember the early bears, the technical bears that would say that the satellites, the company didn't build in proper satellite heat dissipation technology. And so the satellites would melt in orbit. And it's kind of funny, like these arguments are for the uneducated where it's like, holy shit, the company didn't think about these like 5 different things. and they're going to go launch this satellite in space and it's not going to work. It's going to melt. And if you look at, you know, if you look at like all the engineers that the company has amassed over the years, and by the way, like I did speak to a headhunter, I guess it was like a few months ago. And, you know, the company has approached a ton of people from SpaceX, you know, any Boeing, a number of different primes, Lockheed Martin, people with real like long historic space spaceflight heritage. Um, it's just funny that these people, these consultants push these narratives, which, you know, for a layperson who hasn't been following the company for a long time, um, it's almost like a gotcha where it's like, oh yeah, I guess this stuff is hard and maybe they didn't think about like heat dissipation issues. And it's like, no, you idiots. Like they're the company. Um, If you look at all the experiences they've amassed, like these people have done this over and over again. And by the way, like the company with its current group of engineers, you know, we've put up successfully, we've built, tested, deployed, unfolded, and operated now 7 satellites successfully. And when people talk about like, oh my God, there's a risk of this batch. It's like, guys, the Block 1 was a batch of 5 satellites. I mean, not only were they built, tested. They were put onto a truck. They were shipped down to Cape Canaveral. They were all put into a single Falcon 9 fairing. They were launched, they were spaced out, and they were unfolded, all of them successfully, 100% success rate. Right. And so like the fact that you've got these consultants who, by the way, they've like never done anything in their job. This latest guy, Stuart Taylor, I think his last name, like he I guess he prides himself on being a good poker player, which I think is good because he's really good at bullshitting. I mean, this guy's not playing with a full deck of cards, but yeah, it's pretty funny where the goalposts continue to move. Like the latest one where 3 satellites aren't going to fit into a Falcon 9 fairing. Dude, everybody has tape measures. Like no one's dumb. Like when you build a satellite, And you design them, you design them to fit in standard fairings. And so the fact, you know, someone trying to push the narrative that they don't fit into a fairing, or by the way, this guy Stuart also was saying like, oh, um, I don't know how I can ship. I don't know how they're going to be able to ship these satellites stacked on a, on a flatbed truck. It's like, are you out of your mind? There's under no circumstance is a company stacking satellites and putting them on a flatbed truck and, and Driving them down to Cape Canaveral. On the contrary, like they are in containers and depending on the configuration, it's probably going to be one satellite on one flatbed truck, or maybe at some point in the future it could be 2 satellites, but that's not an issue. And so it's just kind of funny where these guys are grappling and groping for some type of issues to And I'm not really sure to what end, right? Like, yeah, you know, with institutional investors, by the way, like I think Tim Ferriss is doing some type of call with Deutsche Bank where he's going to talk about the Game of Thrones, like the sat— all the different satellite players and his perspective. Well, guess what? Institutions like Tim Ferriss's perspective on the industry is, hasn't, it's not just zero value, it's actually negative value. Like it's anyone who followed him over the last 5 years has suffered negative alpha, like have lost a shit ton of money. And I know there's several funds out there, I won't name them, but they've lost a ton of money. And when you go to LPs and you're like, oh yeah, I lost money on this short. It's like, well, why? What gave you conviction? Well, I followed this guy, Tim Farrar. He told me it wasn't going to work. Right? And it's like, guys, did you know that Tim Farrar is paid by Globalstar? Like you have to do more diligence about The advice that you're listening to, and if you want to leverage this guy, just look at his posts. I mean, it's been 100% negative on AST SpaceMobile, 100% negative on Starlink, 100% negative on SpaceX. He's been wrong the entire way. So why would you ever put any value on his advice? But I guess people, there's like a sucker born, right? Like no one, especially for generalists who haven't followed the sector and they're like, oh, this Tim Ferriss guy. Like, and by the way, like his His MO is like he gets quoted in articles, and then people are like, "Oh, this guy must be the expert for space," and so they call him. And then you know he he he talks, he writes in his blog, and he writes, he talks FUD. And part of his his shtick is like he'll talk negatively about something, and then it's like, "Well, I better go pay this guy a few hundred bucks an hour to go learn what what it's you know why he's negative." And that's and that's part of the paranoia of being running institutional money is like there can never be enough information, and when you have someone like Tim Ferriss out there spewing negative stuff, then you're going to go seek him out and be like, okay, is this real? I'll pay him. And, you know, I would say like a vast majority of people find out that his advice is worth, you know, toilet paper and then they don't engage with him anymore. But there's always more suckers, right, to go engage. So, but anyway, you know, these guys are, yeah, I mean, I did want to talk about this Stuart Taylor guy because he's been very vocal recently and it's important to kind of look at, and he, I didn't realize like he is a satellite consultant and he's been around the industry, but, and the reason why that is, is that for the last, what, 5 years, he's never talked about AST SpaceMobile, not even once. Right. And I went back and looked at his timeline on his Twitter and there's not one mention of AST SpaceMobile. Until November of 2025, and then from that point on, all of a sudden this guy is an expert on the company, and he's like talking negatively about the company. And his first post very specifically is in support of Viasat. He talks about like how the the Legado deal is is Viasat like somehow was it somehow they're they're rinsing AST like they got AST to pay them $420 million. And then they're going to use their legal rights to block them globally. And they're going to do all this stuff. And so right then and there, you can already see this guy's angle. Like he's clearly paid by Viasat. And I think based off of some other people's work, I think he's also a paid consultant for Iridium, who both, by the way, like are the most threatened by AST, right? And so this guy, the CEO of Viasat, who I call Viachat now, Mark Dankberg, I think is his name. He, you know, they were very skeptical of what AST is doing, but now, you know, lock, stock, and barrel, they've completely shifted their business model to become a D2D provider, right? And so they're using any means possible. So after the Legato deal happened, Viachat breached its cooperation agreement out of the bankruptcy court, and they tried to like frustrate regulatory approval, and then the judge slapped them down. And then they tried to appeal that and the judge got even more pissed and slapped them down. And I think they're trying to appeal it again because this, by the way, Tanner has been doing a great job. This is actually extinction level type of strategic play for ViaSat because if they can't slow AST SpaceMobile down and they can't beat them via lawfare, I think the company's cooked. Right. And so They don't have the cash flow to support their tremendous amount of debt. I think they've got like $6 billion or so of debt and they're losing in their core business, which is providing broadband connectivity over airplanes and broadband. I guess I would use that generously. ViaSat is not broadband, but they're losing market share to Starlink. This is a melting ice cube of a company, right? And so the AST SpaceMobile payment to Legato, which then had to go to ViaSat, of $420 million. That was a huge lifeline for them, right? Like, so they're trying to bite the hand that feeds them. And ultimately for ViaSat, so you might ask, like some people might ask, well, why is ViaSat trading so well? Why is it at $56? Well, you kind of have like this EchoStar type of situation where the company operationally is up shit creek and that's good. That's good. Why is that good? Well, because they're sitting on a pretty decent amount of spectrum assets, right? And so If the company is forced into financial distress, which is what they're currently in, will they ultimately have to sell or lease out that spectrum? And is it basically worth more dead than alive? And in ViaSat's case and EchoStar's case, the answer to both is unequivocally yes. And so for ViaSat, people are playing, you know, from the institutional side, people are playing for the company to die. And then the value of the spectrum assets get realize through some monetization event. They're not betting on the company being a long-term player in broadband airline connectivity or some harebrained direct-to-device strategy. They're hoping that the company dies and monetizes the spectrum, and then once you pay off the debt, equity holders will get a decent amount of value back. So that's the play there. But, and that's why guys like Stewart who are working for Viasat. They're coming up with any host of reasons somehow to sway public opinion, which at the end of the day, like for this guy to show up in November of 2025 and just start spewing negative stuff about the company, it's quite laughable, right? It's like, guys, yeah, we can see through what you're trying to accomplish. And by the way, like AST SpaceMobile, Shareholders, we're not idiots. Like we've been around, we've seen any and everything over the last 5 years. You think you're dealing with unsophisticated investors. On the contrary, I think, you know, Space Mob in terms of due diligence has a higher level understanding, technical and financial, than any hedge fund or institutional investor out there. So yeah, you're playing a losing game. But anyway, wow, this space is going quite long. I'm going to finish that. That's my whole AST spiel. I guess in summary, I think, you know, we've got launch and launch of BB7 next week. We've got a batch update, which, you know, we'll probably have our first batch delivered in April. And the container shipment, the containers showing up at Midland are know, if you look at previous precedent, when the containers show up, that means like we're pretty damn close to putting the satellites in those containers and shipping them out, you know, once they've gone through testing. T-Mobile, I think it's not a high probability, but it is a 30% probability, 20% or 40%, depends on how you handicap it. But if that happens and you're short this stock, that's going to be an extinction-level event for you. So be careful. If you want to stay short, that's fine. By the way, like people who shorted the stock, they've been, they've paid for all of our financings and our upside in the stock and they make things interesting. So I don't hate the shorts. I just think, you know, when someone, if someone were to come to your house and say, hey, here's like $20,000, $40,000, and there's multiple of them. And so you end up making like millions of dollars off these people who are willing to give you their money. You should be quite happy about that, right? You should support them in their continued efforts to give you money as the dumb person at the poker table, I guess, as maybe Stuart would say. But yeah, so that's— so I think T-Mobile, obviously, I think that's a possibility and it's, you know, the market, I don't think is pricing that, but Perhaps it should. And then finally, the bear case. Yeah, it's entertaining at this point. Like moving the goalposts, coming up with harebrained ideas as to maybe why the satellites can't be stacked in a fairing, or I don't know what you pick, like some harebrained negative angle. And these guys have tried and failed. So yeah, that's that. And then Finally, I'm going to close this with just a few comments on Earth observation and Black Sky. I have a small position in Black Sky.
[00:58:36] Speaker A: Thanks for 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.
[00:58:54] Speaker B: We're doing something very, very big, and I think with this technology we can really affect a billion lives. AST SpaceMobile is the only company that has proven technology to deliver cellular mobile connectivity directly from space to the everyday smartphone. People will just basically turn on their phone and be seamless without any interruption. 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.
[00:59:33] Speaker A: Listen.
[00:59:41] Speaker B: Mmm, waffles.