Kook's Weekly - The SpaceX IPO Global Market Realignment

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[00:01:03] Speaker C: This is the AST SpaceMobile Podcast. It will just basically come to your phone and be seamless regardless of where you are.
[00:01:12] Speaker D: 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. Okay, sorry for running an hour late. I was at a neighborhood party and we were watching the hockey game, and then my wife wanted to chat, and I was like, I got a podcast. And then people were like, no, no, stay. And I'm thinking, well, I have a double life, but I didn't really in that moment, you know, it's kind of new to our neighborhood, and it would certainly make the HOA all of a sudden if I'm like, well, I'm a stock influencer and I have to go talk to my anonymous Mob about my pre-revenue satellite stock, which incidentally too, when it's like, well, so how do you afford to buy this new house? It's like, no comment. Some YOLOing might have been involved. So anyway, sorry for being an hour late. I will do some extra pushups tonight, although I did do my 100, or actually I did my 85 that I'm owed. I no longer will do the actual stock price. I cap out at 100, but if it's under 100, I get a rest day. So I did my pushups. Have you done your pushups? If not, asshole. If yes, amen. The reason why the pushups are so important is it's a way of focusing the mind in a way, in my view, of showing commitment. I'm really a big believer in these little things. I'm sure there's a lot of kind of coaching psychology that would better explain this, but when you're trying to have a hardcore investment, I really do think you have to find ways to Mentally train and be really prepared. And with that, we'll get into what mental preparation really can mean over the long term. But obviously this week started with SpaceX. And so the IPO went amazingly well. And so the allocations were pretty tight, obviously. And people are buying the shares. It's trading well. I see it right now, overnight market, $168. That's great. I personally don't have a view on it in terms of if the stock is going to go up or down, but what I do have a view on is that SpaceX is an insane company and they did the impossible and have been incredible at how they've innovated and that they have some very tightly held core first principles, which both guide how the company will operate, but also what opportunities are going to be available to competitors because of how they operate. We'll get into that in a second. But the key thing is now these guys are out there educating the world on space and everyone has to listen. No one has to listen to Rocket Lab. No one has to listen to Iridium. ViaSat Link or AST SpaceMobile. These are not market-driving companies yet. Everyone now has to listen to SpaceX. And so when SpaceX talks, it's going to be on the news every single night whenever they have something to say. So importantly, CFO Brett Johnson started off as a public company discussing their plan to roll out Starlink Mobile globally To compete with MNOs over the next two years, they're focused on attacking terrestrial markets from space. How do you think the MNOs feel about that? They point out that the TAM is $1.6 trillion a year. So from SpaceX's perspective, this is amazing. This is a huge market opportunity with clunky incumbents. That's ripe for disruption. And so if you do five minutes of diligence, you might see that exciting opportunity. If you do five minutes in one second of diligence, you realize that taking out the world's MNOs is an unbelievably complex proposition. The simplest thing that you have to overcome is the lack of spectrum that is available to you. And we could go on and on for a very long time about all the other difficulties with it. And we will not do that right now. But the real takeaway for me is that when SpaceX's first message to the market is we are coming to disrupt the MNOs, the MNOs already understood this, but now it is the story of the newly minted $2 trillion public company that is now plainly saying, we are coming for you. The response of the MNOs is going to be very simple. The great global bear hug of AST SpaceMobile. We've talked about this before. We'll talk about it again, but all eyes are on us. Everyone is going to have to focus now on space. There is no escape. We've had this guy who I actually really like. You know, some people say that I might be Sean Maguire and we'll never know. Works as a VC guy, knows a lot about space. You know, this is, the similarities are striking. Maybe he's my brother, maybe he's my cousin, maybe I am, you know, who knows? But Sequoia Capital partner Sean Maguire, AKA the Kook, Projects massive growth for SpaceX's direct-to-cell technology. Interestingly, his vision for this space strongly reflects the industry-leading capabilities and pioneering work that AST SpaceMobile brings to the direct-to-device market. That is a quote from The Spectator, a well-loved account, and then also elevated by his pumperness himself, Anpanman, who just Makes the simple observation, Sean, have you heard of AST Space Mobile? I can assure you Sean McGuire has heard of AST Space Mobile. I can feel very comfortable in such assurances. AST Space Mobile was not a venture-backed company. SpaceX was. But rest assured, people who are knee-deep into SpaceX are going to know AST Space Mobile. Now, all of the new people. That are first of all have an allocation in SpaceX, but are now responsible for covering it and knowing it, are going to learn about AST Space Mobile. They're going to dig into Starlink. They're going to dig into the current fixed broadband market. They're going to start to wonder about competition. They're going to look into product roadmap. They're going to look into mobility services. They will arrive at AST Space Mobile. We now have an inescapable. Attention machine that will be. I'm sure I could have thought of something more elegant than that, but we're going to have a lot of people focusing on us forever because of SpaceX. And so I think that the SpaceX IPO is a godsend for us. It doesn't change SpaceX's capital position or what it means for them to be as a competitor at all. All it really means is now the rest of the world has an economic. Ability to participate and learn, and again, they're telling everyone where the opportunity is. They're telling you that the big opportunity is in mobile. Gwen Shotwell, on her CNBC interview, Brendan Morgan says, "Starlink Mobile, how big is that opportunity?" Gwen, I think the opportunity is huge. If you were to look at numbers of subscribers, I think Starlink Mobile will far exceed Starlink Broadband in the home. Holy moly. So again, you have the largest, one of the largest companies in the world saying that the thing that is going to make them even larger is not the current business growing, but the new business that basically doesn't even exist in material size yet. For which anyone that does more than five minutes of work will realize has critical flaws and is likely to be outflanked by AST Space Mobile. This makes me really excited about what I own, and this is where again the push-ups come in. I reflect every day. I'm present in thinking about my investment. Those push-ups are my reminder every day. 100 times on each part of that thesis that I need to believe and the risks that I believe will be overcome. That's why you do the pushups. It's your daily penance.
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[00:10:35] Speaker D: As a focused investor. And so what are we going to be focused on this week?
[00:10:42] Speaker F: Launch.
[00:10:43] Speaker D: And so I think I might have mislabeled this. I call it Block 1. It's of course Batch 1, but Batch 1 is locked and loaded, stacked as tuna cans with simple mechanical releases for their separation in space on the Falcon 9 vehicle, which is the Toyota Camry of spaceships. It runs as reliably as anything. So I'm really excited for this launch, but even What's more exciting is the fact that we're going to have batch 2 right behind. So we're going to have more satellites than we know what to do with. The bears would argue we're going to have more satellites than there are rockets available. They might be right. To be resolved. But the flight is coming and the flight will be exciting. I've heard through the grapevine that a bunch of these knucklehead space mob people with these red A's, and you just can't stand these people, this red A, My God, that these people are even flying to Florida for a launch event that the company isn't even sanctioning. And so what a cult. Can you imagine a bunch of people showing up to Florida in June for a 2:39 AM launch? Get a life. Just kidding. I would totally be there. And so it's awesome. That's, that's how strong the cult is. The company, even when they don't host launch events, like you can't, you can't keep us down. You know, we're going to hold our own goddamn launch event. We'll invite the company and do our own swag bags and the swag bags are just going to have Diet Dr Pepper and it's going to be awesome. And so 2:39 AM launch on Wednesday and it's going to be about a 1-hour mission. Thanks for Tanner Kirk Otaway giving every single detail. And so hopefully it all goes well, but you know, shit happens. And even if it doesn't, We just showed that we can put satellites in a fairing. We advanced the ball, but the probability of successful Falcon 9 launches is 99 plus out of 100. So never jinx it, but it should be pretty fun to watch. And we learned more. And so the market learned that we can in fact stack these satellites. And Katzy did a really nice job. outlining exactly how this works. And so the flanges that hold it together, and this is useful just for your own education, but it's also useful in terms of thinking about the risk. And so as Katzi points out, the mechanism they're using to stack the satellites avoids a single point of failure. It's really important. They use 2 actuators, not one, and these have incredible Redundancy. So the probability of one failing is one in four million. That's good to know. And the bears again said that this wasn't possible, and it is. And it seems that they're all using things that have incredible flight heritage. And so again, Tanner Kirk Otway just highlights you know for those that keep score at home what the bears had said. And so the bears had said blah blah blah. Um, my favorite is Free Speech said SpaceX has never allowed another manufacturer to physically stack satellites on Falcon 9 and multi-satellite deployments have always required a dispenser, including the Block 5s. Not to mention that SpaceX held a patent on the implementation of the stacking contest. And then Tim Ferrara is quick to chime in. That's a problem because they can't put a dispenser and they continue to say that it is impossible to stack Bluebirds in an F9. And so if you were a passerby on this, let's say you were a normal person trying to do well in life and make an investment and haven't spent 10,000 hours on this, you could have read this. You could have Googled who is Tim Ferriss. It would've come back, you know, I don't know, expert in space. I don't know if we've been able to SEO him out of existence yet, but you would've seen, hey, this is an actual guy that focuses in space. You would've read his comments. You would've seen things that are very specific in their Uh, in what he's saying about there's a patent that SpaceX has and what the dispenser versus stacking, and they're not going to let them do it, you would have freaked out and you might have sold your stock. You know, if you had sold your stock at $130, you might actually be like, thank God for Tim Ferriss. But many people sold their stock because of stuff Tim has done along the way, sold their stock at $2, $3, $5, you name it. And this is why we're just so adamant about calling them out, because they are, are clearly being paid to mislead. So again, no, you know, ironically I'm saying know your sources as an anonymous, um, account, but never— don't take what I say for granted for sure, but definitely don't take what the so-called experts say without doing your own work and really checking it enormously. Because they've truly been catastrophically wrong on all substantive predictions they've made about how things work over 5 years. And they've cost a lot of people a huge amount of money by lying and deceiving people. And it's important that we bring that to light so we can try to reduce the harm to others. ASTS will invariably have delays, overruns, all sorts of these other sort of things people call risk, you know, not to diminish those things, but the large thrust of what's happening, the secular winner that's emerging, the massive market opportunity, the huge commercial moats of the company, the regulatory moats of the company, the technology moats of the company, these big idea elements that I believe are what drive the ultimate return of a stock. These are the things that people in the space mob, I believe, have always done in a very authentic, truthful and honest way. I certainly hope that people view that about me. I'm not a paid pumper, despite the jokes. It'd be awesome if the company would pay me for what I'm doing anyway. Hint hint, come on, Scott. But, uh, they don't. And these other guys that are persistently negative who don't own the stock clearly are paid, because why the hell else would they waste their time doing this? Like, I know why I spend my time on this. I just got back from a party. I really want to go to bed so I can wake up and surf tomorrow, but I'm doing this Uh, because I get a lot out of it from the community then supporting my research with their own, because I have a humongous stock position and I care deeply about knowing everything about it. So that's my incentive. Um, ask yourself, what is theirs? But just also don't get tripped up by their, by their lies. So let's look about, um, let's look at how far things have come. And so Npanman had a really cool tweet that just showed what the Block 1 Bluebirds look like versus Block 2. And again, you can see what this dispenser looks like, which is actually kind of cool, and versus what a stacking looks like. And so we're able to put in a lot more array. And so Bluebirds 8, 9, and 10 are the equivalent of 11 Block 1 satellites. This is a very efficient stowing configuration of these arrays. Very efficient use on fairing constraints, which is going to come to play later. I believe when the market moves to AI data centers in space, which is going to really be, I think, a game of scale on these array sizes as it relates to solar power production. But we'll get there in a little bit. And then I think we're going to very quickly be talking about when is batch two coming. And so if I were a betting man, I would, let's put it this way. If I were Scott, I know I'm going to have launch on Wednesday. I'm going to have a press release ready to go on successful deployment of the satellites. Great. I'm also going to probably have ready a readiness of shipment, shipping release for batch 2. Probably pretty soon. I don't know if batch two is ready to ship, but it is probably pretty close. And we are also pretty certain that FM one, the Bluebird, also known as Bluebird Six, has commenced operations, which eagle-eyed readers would have realized it had not done that as of the date of Q the Q one ten Q. And so there are some again. Developments that are still happening that are exciting for the overall progress of the company. And I would imagine that we're going to get these other press release— press releases starting from Wednesday onward when they're ready, but, but probably not before Wednesday would be my guess. And what's neat about this stock, so we have all these cool events, Batch 1 launch being the most imminent, but then FM1 operations, which I don't think the market is going to care about is my guess. But I care about FM1 a lot. So if you're a terminal value thinker like me, clearly the successful operations of FM1 are crucially important to my long-term thesis. One would argue it's also already discounted in the stock price because the stock price is above zero. And, uh, if for some reason the technology just fundamentally didn't work, then the stock should, should not be at $85. And so this is one of those things where I'm going to look forward to the FM1 press release just Because it will absolutely confirm things that I think I already know. And then batch 2 is going to be important because someone could say, oh, they really just had to kill themselves for batch 1. And we don't really know how long that took. Maybe it was actually like a year and a half to build those satellites, which is not true. But having block batch 2 ready to go will do wonders for people then realizing that we have in fact hit operational cadence. This isn't just like a job shop pushing out panic birds. This is actually a shake, you know, a shaken down production line. So batch two is gonna be a big unlock, I think. And so then let's check in with this guy at Clever Name TBD. How clever is the name at Clever Name TBD? I mean, the it's like inception. It's a riddle wrapped in a handle. As a screen name. And so @CleverNameTBD did a cool seasonal study, which we all kind of knew, is that ASTS is a summer stock. It's kind of like a kid. It's in school all year and it tortures you and it's terrible and it doesn't really do its homework and it won't sleep and it gets in trouble and sent into the principal's office and steals from the ATM. But then once school's out and summer starts, it just rips that shirt off and goes to the beach and is awesome. And so ASTS is a summer stock. The seasonals are awesome on it. One of life's great mysteries, but this stock likes summer. Summer tends to be when the news flow is pumping, and this year is no exception. So I hope that the rest of the summer's really strong and just put that out there. But when thinking about the long-term trajectory, we're gonna revisit this topic at least one more time during this Spaces. We talk about product roadmap. And so Tanner got some notes from the annual meeting, which I actually missed. I forgot about it. It wasn't on my calendar. And some interesting things came out of the ASTS annual meeting. They talked about the mid-band BBs could be launched by the end of the year, and they're expecting to manufacture those after Bluebird 45. So we're already into, I believe, like Bluebird 32. So we're actually Chewing through that first shell of low-band satellites, and Block Three, I believe, means that that's building against Legato, which is its own statement around the FCC approval. If that's what in fact happens, the ASIC Bluebirds are expected to be two times the peak data speed as the current field programmable. arrays that we currently have. And so that's going to be 200 megabits per second. They confirmed that they're fully funded for 100 Bluebirds. That's great. And accelerating commercial DAs and possible prepayments. I'd like to see that honestly, because this is a company now that has such an amazing balance sheet. I've kind of got addicted to the idea of us having kind of infinite cash. I'm not in a hurry to see us draw that cash down. And so I'd like to see more of these DAs, which I would expect will come, some prepayments. And, you know, around the edges, if this company wants to just boost its balance sheet, I know we're not doing a convertible bond, but I'd like to see them have certainly not less than $2 billion of cash. And it seems like there's multiple pathways for that to be true. So then again, zooming out, we have some really cool product roadmap. Aspects that are coming. And what's neat is this tweet from Banyan Lane Capital LLC about really the product roadmap evolution and the resultant market cap changes of Tesla and SpaceX, and then juxtaposing that against AST SpaceMobile. Now, last weekend was Cool. I was going to this car cafe because I like cars and they out in front, a guy had gotten there in a Tesla Roadster. So my daughter just can't quit talking about this. She's like, Dad, I want you to get a Tesla. And at first I was like, let me pull over on the shoulder of the freeway and throw you off the freeway. You know, that was my first reaction is it's time to get a new daughter. But then she clarified and what she really meant was, Dad, you should get a Lotus because that is actually what a Tesla Roadster was, and she thought a Lotus was pretty cool. Who's to disagree with her? Now, I don't know if it's too light for me. It doesn't feel very safe, but the Tesla Roadster was just an electronic Lotus, which is cool. And that's where it started. And I, you know, I still remember that when Tesla was a new company, and it just goes to show you the power of the minimum viable product. You know, they got something out there. And SpaceX with the, whatever it was called, the Falcon 1, whatever the little rocket was, they got something out there. And then with, you know, they led to Falcon 9, then they had their first Starlinks, and now they have Starship, which may or may not work. But the rate of value change goes nonlinear. It has this convex curve because good things travel in packs. And once good things start happening, it tends to be the case that a company's competitive moat—
[00:25:52] Speaker G: Hey, it's Ryan Reynolds here from Mint Mobile. Now, I was looking for fun ways to tell you that Mint's offer of unlimited premium wireless for $15 a month is back. So I thought it would be fun if we made $15 bills, but it turns out that's very illegal. Uh, so There goes my big idea for the commercial. Give it a try at mintmobile.com/switch.
[00:26:13] Speaker D: Upfront payment of $45 for 3 months, $90 for 6 months, or $180 for 12-month plan required. $15 per month equivalent to taxes and fees extra.
[00:26:19] Speaker C: Initial plan term only.
[00:26:20] Speaker D: Greater than 50 gigabytes may slow when network is busy. See terms. Compounds, and they get breakaway velocity. And so I really do like this chart from Banyan Capital because it really just shows, you know, the the phase from a company started in a garage to proof. So for ASD Space Mobile, Blue Walker 3 was the proof. Then the first product, which is now, that's where we have the next generation Bluebirds coming out. And I believe we're a little further along because we've already gone through production hell. I hope we've gone through production hell. If what we have over the past 2 years wasn't production hell, then I'm really not emotionally suited for what might come next. But I'm pretty sure we're done with production hell. That is where these companies tend to have liftoff, where it just becomes clear that there is a breakaway move. And that's pretty consistent with a tweet that I did back on May 19th. I think I was kind of in this like dark state of taunting the shorts at that point, but it's when I was sitting there in a board meeting and really thinking about what it would take for ASTS to go to $900 by next year. So by next May, And so that's 10x from here. It's actually kind of where the stock price was because I was literally just thinking of what, you know, 10x. So from $90, what does it take? And the exciting thing for me, and I really believe it, is the path to that is nonlinear. And so the agony that it took to get to $90 is going to be rapidly compressed on the path to $900. not saying we hit 900, but I think it's reasonable. And it really just goes like, we've done the hard part and we're about to start this path of scaling massively. And of course there's still a wall of worry, there always will be. The wall of worry right now is on launch vehicle availability, but you know, these things will, will be resolved. Some exciting news that could really catapult the market discounting, um, and really for me this is after batch 1 gets up there and deploys, because then people will really be able to extrapolate. But we're likely going to have a T-Mobile partnership with ASTS. The video of SpaceX's CFO directly taunting the MNOs right on the 1-year anniversary where the T-Mobile SpaceX deal expires or goes non-exclusive or whatever the contractual term is. Boy, there's a lot of stuff that's about to happen. Right as all eyes are on SpaceX. So were AST to get a T-Mobile deal 2 weeks ago, it would be a big deal. Now, because SpaceX is public, if T-Mobile partners with ASTS, it is going to be the only thing that the market will be talking about because you're going to have SpaceX probably trading down a lot on something like that because people go WTF. And then they're going to be going, hold on, what is AST? You have a lot of people now focused on SpaceX. And if you're focused on SpaceX, the corollary is you, you don't know it yet, but you're focused on AST SpaceMobile. Our tent has broadened in a bigly way. And then people are going to start to realize more and more this idea of data sovereignty. Last week, India paused Starlink approvals over national security concerns. In a prior world, people might not have noticed this as much. Now people are going to start to ask more questions. We're having more and more of this data sovereignty topic come up with AI. And so people are getting more conditioned to thinking and understanding it. And it makes sense why there's data sovereignty. Over the weekend, as I'm sure most of you knew, Anthropic had Fable 5 turned off. In a way, because of data sovereignty, it was really an export control issue on who can have access to some of these models. But the world, in a way, is getting more Balkanized over these issues, and ASTS is Balkan compliant, whereas SpaceX was built for an open, borderless, free market world. They don't have the ability to let these systems be closed and managed by each sovereign. Nation, if desired, whereas AST does. It's another big thing that I think will become more and more important. But the thing that people will really understand is, and it is a big thing, is literally that it is a big thing. Size matters. There was an expert call, and it the expert said. ASTS is proving out that large arrays on orbit are useful for really high, for a really highly paying customer. Telecommunications continue to be the biggest commercial payer for space infrastructure. The defense implications here, even Golden Dome initiatives could benefit from this. ASTS just got a $30 million contract for SATCOM, which they could play with. Really, I think it's just a matter of partnerships. If they build it, there's people that will come. people that are already commercially executing that could leverage your capability. Big satellites matter. Just to add to that, we had this guy on Instagram, um, just casually dropped that SEAL Team 6 is using the technology and said it's the most extraordinary technology they've seen. And so big satellites can, can do cool things. Cool things are cool, but they also result in lots of revenue. And that's what I'm particularly excited about. FirstNet should result in revenue. We once again have FirstNet talking about the importance of ASTS satellite coverage. There's some really cool videos of FirstNet Technologies where they have these mobile communication systems that they go set out when they have to respond to disaster areas or other issues. I've seen this firsthand when Your neighborhood gets leveled and all of a sudden you have these Verizon and AT&T trucks out there for years on end because the infrastructure's all gone. And so this is the type of stuff that FirstNet has to do. It's super expensive currently, and they're going to be able to light it up with AST SpaceMobile in a year or two and really change the nature of that. And these are going to be really high ARPU clients. And so if we want to check in with Dr. Mike, At Cytoplasmic ANA, we've been guessing on FirstNet for years and we will be right if we keep guessing about FirstNet for the next 10 years. It will probably be the case that at some point in my life, ASTS will have a formal deal with FirstNet, given that FirstNet only talks about AST SpaceMobile. So I am willing to keep a broad time horizon of my life and maybe eternity. And guarantee that in that time frame, we will one day have our first net contract. And so, at some point, we will. They literally have our stuff in their documents, and we've tested their spectrum and have approval for their spectrum. So there really shouldn't be a lot of doubt. And it just goes to show you again how important the government business can be. And so I did actually looks like I had this SEAL Team Six reference in a tweet. I had been actually waiting for permission from the guy who shared that with me before I formally tweeted it out. But ASTS had requested an STA to support non-commercial programs for the Space Development Agency. So that's now in the FCC docket. SDA spectrum approval. This is what we believe is the tip-off as to why FM1 has started commercial operations. We'll find out, but it probably will be the case. And the government business can carry the water. And we have a cool tweet from @PKFund, and you know, he just goes into talking about how big that government opportunity can be. And if you remember the Hennessy letter, I feel like they were just like a little bit too specific On the government opportunity, which led me believe that they have been able to refine their estimates maybe more than we have, and they were certainly bullish estimates. And when thinking about how the government looks at this, there's a really great thread by Katzy this week about the SDA PWSA T1TL satellite made by York. Now. That's a lot of acronyms. So Space Development Authority Proliferated Proliferated Warfighter SA from satellite something, and they're big satellites. So what? The whole point of it is they're really not that big, and so their arrays are 3.4 cubic feet. Our control sat is 800 cubic feet. And so we are much, much, much, much bigger. And the real thing that struck me is our difference in power is 100 times more powerful than theirs. And the government is spending something like $1.8 billion for these York satellites. And so when you take a step back and realize that we're going to be able to add these capabilities to the government, their avoided cost is so amazing that we should be able to extract a considerable amount of economic rent from this because of the low-cost scalable nature of our technology. I don't know what the actual dollar amount will be to us, but when you kind of take Scott at face value for what he says, we can really easily start to bridge to over a billion dollars of revenue pretty quickly from just some of these narrow government programs. And that gets me really excited because those are going to trade at huge multiples. People are going to look to sort of the Palantir type things, I believe, and I'm excited about it. And we are ready to get to work on radar. That's what's exciting. And Katzi found a really cool quote with, I think it's Senator Mark Kelly talking about the active radar capability that we already have in space. And so he put out this mega thread, which goes through all the particular details. And he also says that the STA that's filed is a strong indication that FM-1 is operational and, you know, we're in business. These are the really exciting things and the narrative that could evolve pretty quickly can then pivot to other non-communication use cases like AI data centers in space. So SpaceX, in order to pump its stock, was real fast to come out with its AI satellite. And Elon came out with a lot of information about their AI satellite. I don't know if it's vaporware or not, but there's fancy pictures that show big solar arrays. I don't know why this would be vaporware because SpaceX knows how to make solar arrays. So it seems like they should be able to make one of these. And it just comes down to the efficiency. And then, you know, I think, can you have radiation hardening on the chips? I think they're probably the big, big issues because the other stuff seems like pretty surmountable engineering challenges around the radiators and stuff like that. So SpaceX has now pushed this into the front. They've now, they're now showing us these designs. There's videos out there, which are cool. I've linked, I've linked them out in the tweet and this SpaceX video about AI satellites got 25 million views. People care. It's an exciting market opportunity. And certainly the more I've thought about AI, It does kind of seem inescapable that this is really going to have to move to space because of the power consumption. It's one of those things that might— people can kind of get jaded by it first, and then, you know, 6 months later or a year later, in hindsight, it was the most obvious thing. I remember I was taking a bunch of crap from my analysts this week because I sat them down. I said, guys, you know, it really is the big problem with AI is this AI networking. And They reminded me 6 months ago they'd call my office kind of pitching me on these AI networking things and I'd say, guys, get outta here. Like if you guys talk to me about AI network anymore, like you're fired. It's just not my firm. Really can't invest in this stuff. I was just kind of tired of these like super technical things that aren't very tangible. And then they reminded me, they're like, well, ironies of ironies is now you're looking at Marvell and things like that. And I said, look, yeah, you guys are right. You guys were totally on top of what this bottleneck was going to be. More power to you. Call me out when I'm wrong. And I reflected on it more and sometimes it just takes you a while to really come around to what the big problems are and what the big solutions are. And I'm not purporting to be the leader on anything, much less everything. And on this AI data centers in space though, I feel like I'm starting to see it pretty clearly. Where it's probably dismissed by most as kind of hype and hopium of Elon just kind of pumping things. But the more I sit and think about it, the more intuitively it really starts to make a lot of sense. I can't bridge the math because I just don't trust my ability to bridge the math, but I do trust other people's ability that they're probably going to figure it out. And the costs of doing it terrestrially seem like they're only going one way. But more broadly, it just points to this really exciting product roadmap, in particular for SpaceX. I mean, if you're a SpaceX investor, it is really cool to think about how that company has a flywheel. So if they can make it work with AI data centers in space, their cargo creation is wild. And so then they're going to be able to underwrite a launch cadence that no one else can really do, which is going to drive their launch costs, you know, lower than everyone else's, so on and so forth. These are, these are exciting, exciting things if you're a SpaceX investor. And then you got to ask, well, other people are going to respond. And ASTS seems like it is because of its IP in a particularly unique situation to do the same or better, and then also just be the big gorilla in the industry of who has the most cargoes. And so they are the third-party Starlink equivalent for all these other launch vehicles. If they're looking to underwrite a ton of high-velocity launch programs to drive their own costs lower, partnering with ASTS is the way to do it. That's how I'm seeing it, and I hope I'm right. And then kind of going back to communications, which is What this company is all about. We're going to quickly check in with our European correspondent Peter Lindmark, who hasn't kept his who's kept his eye on the ball on everything related to Satellite Connect Europe, which is the ASTS and Vodafone JV. And there's an interesting interview where they just point out Europe has a pattern: we write the rules for a market, and then there's no market. Well, yes, this is what happens when you overregulate things—is people. You get less of it, and this unfortunately seems like it's going to happen to the space industry in Europe, where when you have this many countries with their own national agendas, don't really have the risk capital culture. You know, da da da da. It's hard to get this going. America has a unique attribute of a really great aerospace market. aerospace industry, and then a huge singular market that doesn't compete with itself, um, in the same way that France and Germany can kind of divide things up but then paralyze things. And so—
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[00:43:27] Speaker D: If Europe really wants to make something happen, Satellite Connect Europe is probably the way to do it because it's going to be the fastest path to market. With the best leading-edge technology, so don't sleep on the European market opportunity for ASTS. I know there was some noise around this because of the latest FCC rules about S-band spectrum, but there are exceptions and also the latest rules out of the EU of of foreign-owned JVs. These things can be structured around, and I'm pretty optimistic that we're going to get a bunch of spectrum from this. And these are the types of things that can add pretty immediate and high magnitude value to the company because Wall Street analysts understand the value of spectrum. So now let's go back to what I think is the primary worry in the market, which is the availability of launch capacity. What was exciting is the MHI rocket, and it's JAXA and MHI have this H3 rocket. And it had a successful launch. It's an interesting looking rocket. It sort of almost looks like it's like a Soviet era design, but you know, whatever. I'm excited to add this one to my collection if we're using it. And they had a successful launch. And then interestingly, we had just redoubling of the Blue Origin timelines. And so Jeff Bezos was out there talking about how lucky they got. A lot of this long lead time equipment is fine. The boosters are fine. There's pictures of it. Then Bezos is out there doubling down that they're going to fly before the end of the year. I know a lot of people are very skeptical of this. I don't have a view. I just sort of take them at their word. I don't know how to question it. And it will be very exciting if Blue Origin can get to orbit this year. They're certainly saying they can, but again, in the meantime, MHI was successful. And then coming out of nowhere, you know, Relativity. If I could have shorted one space company, Relativity would've been high on my list. It looked like it was a dead duck. And then out of the blue, Eric Schmidt decides that when you have $40 or $50 billion, who cares about $2 of those billion? He seemingly has turned this thing around, which, you know, I guess it's kind of funny, just like people doubt Blue Origin and then you remind yourself, you're like, yeah, this Jeff Bezos guy is pretty hardcore. He's done a thing or two, you know? And then right when you think that Eric Schmidt, you know, ah, what has that guy done? You know, And so when these guys focus on something, I'm not quite sure what the special sauce is, but their ability to move mountains is really kind of unbelievable. And so as I just keep following these Relativity Space updates, they're moving ahead and this is a big rocket. This Terran R is a serious thing. And it is, I believe, bigger than Neutron. And so while all eyes are on Rocket Lab, you know, don't sleep on Relativity Space. And they're building their launchpad. They're going at it. And they also have the benefit of the infinite money glitch because they have Eric Schmidt. And I just don't think a guy like Eric Schmidt would go this deep into something and then give up. That's kind of my current view. So we have the launch market really evolving pretty quickly. Pretty nice to see. And the last thing we can talk about this week is Rocket Lab, of all things. They got added to the NASDAQ 100. And so what Rocket Lab has going for it is big market cap. It's an exciting company and it has a lot of revenue. Now, I'm not going to be the guy that points out that a lot of that revenue is pretty low engineering services margin that does not exceed, you know, 30%. And say what you will about revenues with those margin characteristics, I will not be the guy saying that, um, but other people might point that out. But they have a lot of revenue. And so when ASTS starts to get a lot of revenue, I think you could very quickly see ASTS become a NASDAQ 100 company. And that puts us in the big leagues where it should be, because I believe we're one of the very few, um, Super exciting secular growth winners of, of this decade, and our rightful place is going to be at the top. So sorry again for starting an hour late. Stuff happens. And this week is going to be high drama. So we have the launch. For the intrepid soldiers going to the launch, godspeed. And I hope Everything goes very smoothly. And the commitment of this investor group, I think, is second to none. And I know the company probably really appreciates it. So they know that there's this global team of people rooting for their success. So that's all I got. And looks like there's literally peace in the Middle East. Count me as skeptical. But the macro certainly, let me just check 'cause I haven't even checked, but last time I checked the market was up big. Yep. So market's still up big. Oil is crashing, which is good news for me because of the very inefficient vehicles that I drive. But the macro is switching super fast and ASTS stock got absolutely mauled last week, which we didn't really talk about, but It seems like there are a lot of people that once they wanted to start buying the Momo stock called SpaceX, they just blew out of the space basket to make room. And then I'm guessing that people on the sideline just saw the stocks going down and figured, glad I don't own that shit. And then there was no bid on an OpEx Friday. Let the dust settle, because again, I think people are going to start looking at SpaceX and realize there's a lot of exciting things happening in this overall industry. And there's some torquier ways to play the theme than to buy SpaceX, which is exactly what happened in AI is the first leg of the trade was Nvidia. And then Nvidia has really underperformed all of this stuff as everyone goes to the torquier pure plays on various bottlenecks. I don't think ASTS is a bottleneck, but I believe the broader analog is going to hold. People are going to see the exciting things of SpaceX and then they're going to find the smaller pure play parts of the most exciting parts of SpaceX. And discover that that's actually the area maybe of max return. Certainly how I positioned. So I'll end it here. Thanks everyone for joining me an hour late. I hope everyone has a wonderful week, and we will talk soon.
[00:50:37] Speaker C: Thanks for listening to the AST Space Mover 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. Listen, waffles.