Charles Miller: Satellite Technology and the Future of Mobile Connectivity — #49
Welcome to Manifold today. My guest is Charles Miller. He is the founder and CEO of Lynk Global a satellite communications company Charles and I have known each other. I, I hesitate to say this because it makes us seem old, but we've known each other for actually about 40 years now. Uh, I met him.
He, he was a couple of years ahead of me, I think, or at least 1 year ahead of me. Uh, he was in Fleming house at Caltech and I was in page house and we've known each other since then. Charlie, welcome to the show. thanks to, thanks to be here, Steve. I got a little more gray hair than you. And maybe I'm wondering if you color your hair.
So, uh, Yeah, I think if you look carefully, you can see some white hairs in here, but, um, it's clean living, man. I, I'm, I'm living clean. So that's why I'm doing.
Okay. And the aging department. Well, it's great to be here. Um, I, uh, I still treasure my memories from Caltech and the friends we made and, and, you know, that's been a part of my path to both, both of us for where we are today.
Yep, so I always start out by asking my guests about their, a little bit about their life history and how they got where they are today. Um, for my audience, Charles has been involved in the commercialization of space for, you know, roughly the last 30 years and has been a pioneer in many ways. The company he's currently CEO, he's going to tell us about is pioneering satellite communications from an ordinary cell phone. So we'll focus on that. But Charles, tell us something about your background that, uh, maybe the listeners would find interesting.
Well, my passion for space started before we ever knew each other before Caltech. I, I, uh, grew up loving space, reading science fiction, wanting to be an astronomer. And in high school, I decided I was, I wanted to be an astronaut and I ended up going to Caltech with the purpose in mind to become an astronaut, uh, be a mission specialist, do not be the pilot.
I also applied to the Air Force Academy and got in, but decided I'd rather be a, you know, be a payload specialist, fly, fly to space, but always in the back of mind, it was of a larger mission. Because when I, I also grew up in as a kid deciding I wanted to do something great with my life to make a difference and I was thought I was going to do that through space. I've been living out of that decision of that little kid for all my life. It's been 50 years. I was, I was in fifth grade when I decided I wanted to make a difference in my life and it was in space. I'm just You know, for my mom who's passed away years ago, you know, I'm just really stubborn.
I got, I think I got that from her. Uh, and uh, you know, and so I've been, you know, never give up, never surrender. Right. And so they have a saying, you know, knock down nine times, get up 10. And so I've been doing space all my life. I love what they do.
Uh, the people I work with love what we do, and, and so that's been the overall arc, is we're, we're doing amazing things in space these days, the, the whole space industry has changed recently, but I've, I've seen the whole arc before, it was cool to be in space, right? Now, maybe it was always cool to be in space, but it was commercial space, you know, investors would look at you strangely if you said you were doing that, and they would think you were in real estate, not in building rockets or satellites. Yeah, so let's talk about that a little bit. So, you know, now correct me if I'm wrong. I have a perception of it being a little bit pre Elon and post Elon in the sense that, you know, prior to Elon, there would be a lot of people like you and me who are kind of nerdy.
Uh, guys who love space, you know, space shuttle, you know, space station, stuff like that trips, you know, mission to Mars. But I think most of the activity was either sort of national governments doing it or huge corporations, you know, Lockheed Martin or something like that and not much idea that the little guy, uh, could really get involved. And but now we see this kind of renaissance where there are many smaller companies, typically venture back companies. Uh, in the U. S. And also in China and other places that are trying to have a go of it in areas ranging from launch to, you know, micro satellites to commercial services like yours.
Um, how do you perceive that? Was was there like a phase change because of Starlink and Elon or or was it? Well, you're absolutely right, and I was actually part of that phase change. So back, you know, after I left Caltech and we were there in the early 80s and in the mid to late 80s and 90s, I was part of a small group of people, pirates kind of like, revolutionaries, who said, we need to have much more private innovation in space. We need to have You know, uh, commercial space. We need to have what we call new space. We, in fact, I helped invent the term new space. But for several decades when you wanted to start a space company, I know a lot of the early pioneers.
If you start a space company, they would go ask, you know, their, you know, friend at NASA. What do you think of this? And the government always didn't think commercial space people could do anything. And so they couldn't raise any money and, uh, space was the domain of governments, not a private innovators.
And so it was a big problem. And so my first real startup in the nineties, we changed national space policy and law to force NASA to buy commercially. To buy commercial space station cargo delivery service.
In fact, one of the first big breakthroughs of my life is we passed a law called the Commercial Space Act of 1998 that required NASA after shuttle was retired to buy commercial space station cargo delivery services. They were not allowed to replace the shuttle to deliver cargo to the space station. And so when The Columbia was retired in 2003. NASA had to, under law, buy commercial cargo from commercial companies. Now, when we, we had, we passed this law in 1998, we didn't know who was going to do it. It turned out it was a guy named Elon, in 2008, 10 years later, got a $1.8
billion dollar contract because of the law we passed 10 years earlier. Now, the fascinating thing here, Elon was within a month of running out of money. He had spent all his PayPal money. He, the housing market collapsed and nobody would invest in him. Everybody invested in Elon now.
He said, Elon says, I'll start a company and people throw checks at him. But in 2008, he couldn't raise money. And he was within a month of Tesla and SpaceX going out of business.
And the head of human space flight from NASA, a gentleman named Bill Gerstenmaier, who I, I know pretty well, used to work with him. He called up Elon and said, Elon, you've won a 1. 8 billion dollar contract for space station cargo delivery.
And it saved SpaceX, and I actually think it saved Tesla as well, because he was able to immediately raise money for Tesla and SpaceX after he got that contract. So, there is a before Elon and after Elon, but I would argue it's before, you know, the revolutionaries changed national politics, policy and law. If it hadn't been Elon, it would have been somebody else. We didn't know who it was going to be in 1998, but there is a major inflection point. That's great history. Um, I was involved in the 1st Internet bubble in right around 2000 and.
So I, I could see a little bit of the earlier venture, venture capital landscape before that bubble happened. And boy, in the old days, you know, you would give up half your company and only raise half a million dollars to do a hardware startup or something. It was, it was blood, sweat, and tears to really start a company, you know, in the 1990s, for example, compared to today, it's just totally different situation today. So I guess there are a lot of people like yourself who laid the groundwork for everything that we're enjoying now, which is a, which is a renaissance of innovation, wouldn't you say? It's a total renaissance of innovation.
Lots of the ideas, great ideas being invested in by private investors today. They've been around for decades. It's been another thing is when you get these gray hairs. It's very few new ideas.
You've, you know, now you get old ideas with little new tweaks to it that make them better and the technologies here. Now, a lot of great ideas. It's just a matter of timing, right? That's been observed many times that this is a great idea, but maybe it's 10 years too early and you go back and look at thing, the big breakthroughs in the 2000s, there were people had those internet ideas in the 1990s. They were just a little early. And same thing in space. And so that's sometimes the hardest thing to get right.
Yeah, I got to tell you another story, which I don't know if I ever told you this story, but, um, my co founder, the co founder of a company called SafeWeb, which was my first startup, he was my PhD student, uh, when I was a professor at Yale and we started SafeWeb together. After we sold SafeWeb, we started another company and, uh, we wanted to do two factor authentication. But this was around 2004 ish and cell phones didn't yet have full penetration and, you know, some VCs couldn't quite see their way to that point. So we, we built the first server that could actually send text messages. And would hook into a standard authentication, uh, infrastructure framework and people could then just store in addition to your standard password, uh, you know, a random or have a random key generated that then you would enter as your second factor.
So now, of course, it's like, totally, Well, that was a great idea, Steve. You're just a little early. we couldn't, we couldn't raise money.
We couldn't, we, you know, we had just sold our company. We were successful entrepreneurs. Our previous startup was in security and encryption, and we just couldn't raise money there.
There weren't people interested in it, or maybe we just weren't good enough to raise the fascinating part is. you know, messaging started in the early 2000s to it was taking off and nobody believed messaging would be a big business. It became a, within a decade, it became a huge business. It was like 200 billion a year messaging revenue to him and others. Then it got disrupted by, you know, by WhatsApp and I message, right? And you got given away free over your data channel. But until then, You know, you know, they, the mobile network operators, you know, Verizon, AT& T, Timo type companies around the world may or making huge money on messaging and all kinds of things were being done on messaging.
Yeah. So we were just too early, but now everybody, of course, now I have to use this second factor five times a day to log into various websites. So, um, so let you just to find a term MNO mobile network operator. It's going to be very important for what we're going to discuss next, because those guys are primarily our customers right now at Lynk. Is that Yeah, so there are partners there, uh, they, they, uh, they, and there's 5 billion mobile phone users in the world and they almost all of them are through a phone company.
You know, a mobile wireless company like an AT& T or Verizon or. Or T Mobile here in the United States. But there's 800 of them around the world. There's, you know, 3, 4, 5 dominant M& Os in almost every country.
And so they're, they're the, they're the big kahunas for the mobile wireless business. Which is about a trillion dollar a year business. You know, everybody talks about Apple. You know, and they sell a lot of mobile phones. But there's about 900 billions of dollars a year of mobile wireless services sold a year.
And that's all through these mobile networks. Yep. And what you would like to bring to them is the ability for someone with an ordinary phone, no matter where they are, they could be in the middle of Alaska, very far from any cell tower, and yet able to communicate through, I guess a low Earth orbit satellite, is that right? Well, that's what we're using you can actually and I think we're going to get into it. You can do it from satellites and higher orbits. You trade. There's some, you know, you lose something by doing that, but you can do it from higher orbits.
So it's a fascinating discussion. You have to be in the physics and I don't know if you're in the physics, Steve, and we could talk about that. Um, but yeah, the best the best solution is in low Earth orbit. And that's an interesting geek question. reasons for that. But we're doing that and we're not planning to do it.
We're already doing it. We're actually Lynk Lynk if anybody wants to look it up as lynk.world. L-Y-N-K dot world is the world's only proven and commercially licensed, satellite direct to standard mobile phone company in the world.
We invented the tech. We actually have, are rolling it out, and we're, we're have market access in five countries, we're rolling it out in multiple countries right now. We have signed contracts with 34 mobile network operators covering over 50 countries. And what this really means. And so for your audience, that almost every, I bet everybody in your audience has a mobile phone. There might be one person who doesn't have a mobile phone, right? So in their pocket, if that's our satellites in orbit today can connect to your existing phone in your pocket.
No change, right? And so we've proven that we're connecting to mobile phones in dozens of countries. We've, we've, uh, have, we're licensed in 27 countries. We're connecting to thousands of phones.
Uh, we are, we're doing messaging and we're, and we're doing voice calls. Um, and eventually we're gonna do broadband coverage everywhere. And so the, the end in mind here is we've proven the tech, um, what's coming for everybody is you are gonna stay connected everywhere in the world no matter what. Right? So using, and you don't need to know it's a satellite.
Your mobile network operator will choose the tower. And you'll just have a layer of ground based towers. You already have two layers today. You have a Wi Fi layer and a ground cellular network layer.
And your phone picks among the two of them. In the future, you'll have a third layer called the satellite layer. And your phone will just pick among the three of them. With that, you'll never even know it.
You'll be connected to a satellite, uh, for your communication services. And you'll never even know it. Like today, many of your customers, your listeners today, Steve, don't even know they're connected to the satellite right now. It's called GPS.
Yep. Right? People, people says, why do I need satellite services? I, I know where I am right now. Well, that's because your phone is connected to a satellite. It's listening to the, the global positioning system, Right, right now. Right.
So, Charlie, I think you, you've explained to the listener now what Lynk is going to provide to the world. In other words, there won't be dead spots. There will be, no matter where you go on the planet, you're going to have signal and your phone will do this automatically. Um, you know, there may be some agreement between the MNO, uh, that you buy your phone service from and Lynk, but totally transparent potentially to the user, the individual person.
But tell us. The innovation that you guys had to produce, because I understand people did not believe you when you told them investors or early people, you know, before you, you've now proved out this technology, but long before you proved it out, I think, from first principles from physics, you said, Hey, this is possible using the existing antenna existing modem on the handset. And how many years ago was that? And just just go through the journey for you as an entrepreneur of Yeah.
So every great. And so this is for the entrepreneurs in the audience and most existing entrepreneurs know that every great breakthrough for a commercial business starts with finding, usually finding an inflection point where it creates new things that nobody people thought of before, right? And then you need to find a secret, right? That nobody knows, right? If everybody knows it, then it's, you know, like all the ideas have been wrung out. You need to it's all, it's all, priced in and there are 10 other guys already doing it. Yeah, there's already 10 or 100 and then it's commoditized and you can't raise money.
So you need to find something that, where conventional wisdom is wrong. Right? And so, I, we were looking for that. The inflection point was Moore's Law came to space and was building small satellites. And it was basically the parallel to the personal computer revolution in the 70s, that Moore's Law came to computers on your desk.
And nobody thought, well, You're never going to have it. You know, everybody have a computer in a desk. That's crazy. Ken Olsen apocryphally said that, right? And then people in the 70s, late 70s, Steve, I remember this. I'm sure you do too. People said, what are you going to use a computer for? Mom's recipes? Maybe games? What else? Well...
A whole bunch of killer apps emerged in the late 70s and early 80s, things like spreadsheets and desktop publishing and MCI mail. The first internet connectivity program was 1984, seven years after the apple to, you know, laser printing, right? So all kinds of killer apps emerged. And so I, I had the thesis, same thing was going to happen in satellites with Moore's law coming to satellites and small satellites. You can, the size of a shoebox have supercompute of what 20 years earlier was in the size of a school bus, right? And so this just was clearly going to happen. You just have to have faith.
There's going to be some new emerging killer apps. And so I went, had a team looking for it. And, and in 2014, um, we had one of the, the team members, Margo Deckard, my co founder. She was looking, doing data analytics on the Ebola crisis in Africa and how satellites were being used to connect public health workers to try to cure people and, and prevent Ebola from spreading.
And so... She, she, uh, and I talked about it. We immediately knew that this didn't make sense. It couldn't scale. These things were, you know, 50 pounds in a backpack and big dish and you couldn't give every public health worker one of these satellite dishes.
It you're talking about Starlink, no, just kidding. Well, it's the, the version of Starlink thin. It's, yeah, it is kind of like Starlink. It was actually in Marsat Vegan Terminal, but Starlink's a little better than them, but it's the same issue. It's not going to scale to everybody.
I was just kidding because it's still true though. That Starlink is, it is Yeah. It's a, it's a dish.
And if you've, if you took the Starlink dish in the jungle, you would actually have to put a big batter in your backpack too. It's really expensive. It doesn't scale to everybody. Right. So.
And so you can't put, put it in your pocket. And so we realized this and she did the data analytics for the donors to these nonprofits, trying to help with Ebola. And, and she discovered 80 percent of the, of the public health workers were just doing messaging and they could do everything they wanted with just messaging. And so she was very bright. She knows her physics, the RF Lynk budget.
And she knew, well, you can get, you know, you can get lower data rates, right? With a smaller antenna. And she came to me and said, Hey, can you connect a satellite directly to an existing mobile phone? All you need to do is messaging. That would be a breakthrough killer app. And I turned to to, uh, one of the other members of team Ty Spiedel, who's our CTO now.
And I looked at him and I said, What do you think, Ty? He goes, There is no way you can connect a satellite directly to a phone. And the issue is not you can always overpower the downLynk from the satellite down to the ground. But the, the phone can't change, right? It's got a really dinky antenna. It's, it's got 200 milliwatts of power. It's very low power.
He just like his gut said, no way. And I looked at him, I go, well, why not? And so he knew right then he had to go do the Lynk budget and ties very knowledgeable. And so he knows the Lynk budget of satellites, but You know, 10 years earlier, he didn't have no idea how to figure out the Lynk budget in the phone. But it's now all available on the internet. So he just went home, put together the Lynk budget on both ends, with the satellite on one end and the phone on the other, and all the information about the processing gain and the RF Lynk for the antenna and the power of the phone is now easily available on the internet.
And he put together the two way Lynk budget, and he came back the next day and he goes, Oh, I was wrong. We can do this. And then the first thing we did is like, well, this is amazing. And, but as you know, Steve, the most precious resource for an entrepreneur is your time.
And you don't want to waste that. So it's like, well, we better get this right. Cause if we, if we're going to invest our time on this, we don't want to spend a year on this and find out we just got the math wrong. So we went to a bunch of experts to say, to ask them to check our math. So. Now, I worked at NASA for three years, a senior advisor for commercial space, and we had people on our team from NASA, former retired NASA engineers.
We went to NASA JPL, the Deep Space Network Oh, I I've heard of that place. Yes. So they're, you might have heard of Pioneer, right, and Voyager, or V'ger if they say in Star Trek. And so these satellites have left the solar system. So this is the proof.
Physics worse. You can connect to satellites outside the solar system and what people don't read, the data rate is really low, but you can close the Lynk two ways with Voyager and Pioneer. And so we went to them and said, you guys are world class RF engineers.
And their first reaction was, you can't close a connection to a phone. that's, that's that's like a same gut reaction, even really smart people like should know better, right? And we said, here's our Lynk budget. Tell us what we missed. What's, where'd we get it wrong? And they came back the next day and they said we were wrong. You, you could do this. So that's how it started.
Now we had, that was 20, late 2014, early 2015, when we completed that diligence, asked a bunch of really smart people to prove. Now we had a couple other problems we had to figure out. So we were starting to focus all in on this, but the thesis here is like, no change of the phone. There's been a, quite a few other people who are doing satellite communications phones, and they add some device, they add a radio chip, they add a, a wrapper, they add a plug in gadget. Uh, and so we said, no, that this, the thesis here is no change of phone.
If we have to change the phone, that's expensive. Nobody's gonna want it. It's gonna be no uptake. We said, what if we could change the phone? Let's, like, that is the holy grail, no change of the phone.
And so we invented two new things. First of all, we've invented. Uh, a frequency, innovative frequency use of how we use existing spectrum in the phone without causing harmful interference. And basically, uh, if you remember your Star Trek, the Wrath of Khan, there's a, I, uh, there's a scene in the movie where, where, uh, Captain Kirk is asking, commander Spock what he thinks about Con and he, and he says, he exhibits two dimensional thinking. Well, we live on a planetary surface and we have two dimensional thinking.
Right. And if you actually think about how cell towers operate, they're two dimensional, they're pointed over the flat, the surface of the earth, and they overlap each other. And you add a new cell tower, it overlaps the old cell towers.
So they have rules of thumb of like how much signal can transmit into the other area of the other cell tower without causing harmful interference. And they created these rules. Well if you think about it, a beam coming down from space. Can plug into a black spot and it can overlap into the two dimensions of the cell towers on the ground and as long as it doesn't Violate the same rules.
It shouldn't cause harmful interference and that was our thesis and that's what we've proven So that was the second innovation and we had one more innovation, which is probably the hardest part Ty that I was giving Ty, I always give Ty a hard time about, you know, you can't, you know, there's no way you could do that. So the third part is no software change of the phone, right? So if you think about it, a phone and a cell tower are, uh, talking to each other, this global standard. So we said we need to be backward compatible with this global standard, which means we put the software stack that's supposed to go in the cell tower in our satellite. And so in 2017, the spring of 2017, Ty was looking at this. And he realized two things break the satellite in the cell tower.
Five satellites in a 500 km orbit going really, really fast, right? That's the physics in Earth orbit. You're not a geosynchronous is way up. You come bringing down to have much stronger Lynk margin gain, right? But the satellite is coming, going very, very fast. So lots of dynamically changing Doppler from the perspective of the phone, right? It's very high here. Your phone can tolerate a little bit of Doppler, like bullet train speeds, 200 kilometers an hour. But orbital speeds are two orders of magnitude.
It's like 25, 000 kilometers an hour orbital speeds, right? And it's, it's, it's, uh, if you know your trigonometry, it's a fraction of that, but it's still significant. And it breaks much more than the phone can tolerate. When it, it's very positive Doppler, it gets here to zero and then it goes negative very fast, so the phone can't tolerate that.
The second problem is the phone and the cell tower were designed to figure out how far apart they were, and if they're too far apart, break this connection. In 2G or GSM, it's 35 kilometers, and in LTE or 5G, it's 120 kilometers. And so you have that, the, the, the phone on the ground, if it figures out the satellites in a 500 kilometer orbit, it's going to break the connection. Yep. And so we figured out how that works.
So the, the, the cool thing that Ty figured out is there's two types of latency. It uses the latency of the signal between the phone and the satellite and back to decide how far you are. Mm But it's one type of latency, it's supposed to break it like distance.
But another type of latency it's. designed to tolerate it, which is congestion at the cell tower. hmm. Hmm. So what I realized is you could do a trick at the satellite cell tower to make, you can't, you can't divide the laws of physics and just like have the latency from distance go down. There's going to be latency.
A little bit. It's four milliseconds. Not that much. It's much less than human, you know, perception can tolerate. But the phone definitely say there's something going on. It's too slow.
But what you can do is a timing offset at the satellite such that when the signal comes back to the phone. The phone thinks it's, oh, there's congestion, congestion at the satellite, right? So you trick the phone, the phone thinks the satellite, instead of a 500 kilometers and changing, right, is actually right next to it, five or 10 kilometers away, but it's, it has congestion. So it tricks the phone.
In the thinking that it's, it's perfectly fine, just a little bit slow and I'm going to tolerate this slow cell tower. So in that way, we invented the technology that we're backward compatible with all 5. 4 billion people who have mobile phones in their pocket with the existing phones in their pocket. Yeah, it's incredible. and some of your users, we probably connected to their devices.
Yeah, it's a great, it's a great story of basically hacking the existing protocol so that you know, your setup works. Now a question, though, that does the, you know, the Doppler shift switches sign, right? Because first you're kind of heading toward the person, then you're heading away. Does that happen? have to dynamically, you know, so when you're, so when, so the way it works is the satellite is in orbit and it's sending down every cell tower, sends down what's called the broadcast channel. The only reason your phone knows cell towers are there because they're, they're sending out a broadcast saying, I'm here if you want to get on me, my cell tower, let me know.
And it just repeats that. And so your phone can hear all the cell towers around it. And it can decide which, which cell tower to get on. Well, the satellite cell tower does the same thing.
It's sending out a broadcast channel saying, I'm here if you, if you want to let me know. When the phone makes a request to get on, it's in technical jargon, it's called a random access channel request, but it's just the phone asking you to get on. Hey, I want to get on. The satellite can instantly detect the amount of Doppler shifts, right? And that, it can, because of that, it can estimate how far the phone is away. And because the satellite has been programmed with the curvature of the Earth in there, it can do a dynamic offset going back to the, to the phone, such that the phone doesn't notice much Doppler, Yep. right? And so in that way, you know, it boasts and it also uses that sensing of the Doppler to, to, to trick the, do the, the timing offset for tricking the phone and thinking it's right next to it.
Right. All that's done at the satellite. Right, the Doppler compensation, and the satellite has to dynamically compensate for Doppler because the, basically the satellite assumes the phone doesn't move because it really is comparatively stationary, even if it's in a car or a plane, and as it's moving it has to keep adjusting the Doppler compensation for the phone because, because of what you described. So, um, one question is, do you own all the IP for all those clever solutions? Like, can Yes. We have patents in 55 countries on those fundamental technologies. Fantastic.
Now, the, the idea of doing Doppler compensation and timing is not, is an old idea. But what happened is everybody figured out they could do it from both sides. They were going to make a satellite phone and a saddle and a satellite, and they were going to solve the problem on both sides. What is unique and non obvious is you could solve it from one side with no change to the phone.
And so that's our path. Now, between 2017 and today, were there, did you have to assume some increase in compute power that your satellite could have, or was that already available so that you could plan on it being there? Like, did you have to bet on improvements, further Well, it was already good enough, but. We wanted better. You know, my engineers always want better, right? So, um, and, and it certainly has gotten better in the, in the last six years. And so you can do, you know, more devices on, on, uh, 5G and LTE simultaneously you can process.
So it's, I've noticed the engineers are, are less worried about the amount of compute they have today than they were four years ago. Got it. Now, how many of these low Earth orbit satellites do you really need to, let's suppose you get a contract with a carrier in Italy, Yeah, you're really concerned at that point about coverage in Italy, but then there are going to be times when some of your satellites are, you right. Every single satellite is periodic, right? Depending on your latitude, you pass more more times a day. Um, for for global real time continuous coverage.
You know, all the time three, you know, 3 65 24 7. You need almost 1000 satellites in in lower earth orbit. But you can do some pretty cool things before you get to continuous coverage, right? You can do, you know, I. O.
T. Right. There's some use. It depends on the use case.
There's some I. O. T. Use cases. They want one connection a day.
Right? Well, with one satellite, we can do about one connection a day. Right? So, um, and do global cellular IoT services. Yes. so, but, uh, you know, with, uh, we think one next inflection point, we have three operational commercial satellite cell towers in orbit today, where we have the world's only operational commercial satellite cell towers in orbit today.
But we, everybody wants more. So we're, we're starting commercial services in several countries. We have, uh, MNOs who say, let's go, um, some, someone a little bit more.
The next major inflection point, it's still periodic messaging. We're going to, you can do messaging everywhere in the planet from your existing phone, or you can do IOT messaging from devices. So those are pretty cool use cases to start with, with just a small number of satellites. Everybody of course, wants more. When we get. Our next inflection point is still periodic, but it becomes invisible to the user.
We call it seamless messaging. Right now, if you're, if you're using our service, you need to know when the satellite passes over, because you put the message in the outbox, your phone will try for about 15 minutes and it'll stop. It'll say, ah, I'm not going to stop wasting power. Right? So, but the moment we get to enough satellites in orbit, so you get at least one satellite every 15 minutes or less, You just put a message in your outbox anytime you like, and you don't even have to think about it, it just goes. And then it downloads your messages. We call that Global Seamless Messaging.
That's about, um, for near the Canadian U. S. border, it's, you know, 40 or 50 satellites. But, uh, for everywhere on the planet, it's about 130 satellites, you know, that you have Global Seamless Messaging. And then, of course, Yeah, everybody wants continuous messaging, and that's getting close to a thousand satellites. So what do you, what's your plan look like? What's the, the number of Lynk satellites in orbit as a function of time for the next few years? What do Well, as we raise money, we start ramping up productions, um, so we're, we're, uh, almost done building in the next two satellites to la planning to launch this fall, and then five more satellites early 2022 24, and then we're ramping up in, uh, mid and late 24s, ramping up to six a month and 12 a month.
Uh, for our gen one system to get the global seamless messaging, and then we will start our gen two system focused on broadband data everywhere because what, you know, we have a multi billion dollar business just with global seamless, seamless messaging, but that's never good enough. Every user always wants more speed and better, right? Okay, this is only messaging. When am I going to get broadband everywhere? Well, that's that's a little bit longer.
But that's our Gen 2 system, and we got to build more satellites. And, uh, we have a straight line path. We know how to build those satellites now.
The Gen 2 system is just a straight line extension of our Gen 1 system. And broadband data is coming to everybody, no matter where you are on the planet. It's, it's, uh, four or five years from now.
So that, that Gen 2 system though, ultimately, are you, are you not going at that point head to head with Starlink? Because it's the same customer, right? If I, if I'm kind of out in the woods and I want broadband, I could buy their big bay station or I could get it from you. Well, that Starlink is going head-to-head with 10 other companies. It's called, we call it Wifi Backhaul.
So Hues, ViaSat, OneWeb. The new big emerging competitor there is Amazon Kuiper, right? There's a Intelsat, Epic, Inmarsat. There's a bunch of companies that are doing wifi backhaul or cellular backhaul. And the backhaul, it means you have this device and dish that you have to take around with you, right? That's really expensive. It doesn't fit in your pocket, right? So you put it on your home and you get a Wi Fi hotspot in your home. You, you can do that with Starlink, but you know, 10 years ago, you'd do that with somebody else.
And, and uh, Hughes, you know, had, you know, so there's a bunch of competitors there. Starlink is... is lowering costs, increasing speeds and making everybody sharper. But it's, it's, it's a different category.
It's the moment you, you're going to get 50 or a hundred megabits a second with Starlink, but the moment you walk out of the wifi hotspot, you're going to use link Lynk I'm surprised, though, over time that Starlink, they haven't been able to shrink their base station that you need to install. Like, what, is there some physics limitation they're, they are, they have, I think been shrinking it, but they're giving up speed for, for that there's a, there's a direct trade. They're, they're tied to KU and KA band spectrum.
and so they have larger versions of it that they're selling to cruise ships and they're selling to airplanes. Right? So they're, they're going into that and, and, and supposedly they're selling one to, you know, the U. S.
military that's smaller. So they can carry around, but they're giving up something for that. Right? So, uh, still very expensive. Those are very expensive devices that you have to carry all the bat the moment the batteries run out, you, sorry. It doesn't work anymore.
So in five years, when you're providing bandwidth to every handset in the world. Will you still take my phone calls, Charlie? Of course, Steve. So That's great. I I'll can take, I take, can take 'em from you everywhere, right? So, you'll you'll be out hiking in the Himalayas and you'll take the phone call for me. Great.
So, I think you've given the listeners a good. Sense of what Lynk is up to. Um, there are a fair number of investors that potential investors, either super high net worth people or people who are partners in venture funds who listened to this podcast. And I found this out kind of by accident because when we were raising money for Super Focus, which is a. Large Language Model, AI company, a lot of people just heard me talk about it on the podcast and just reached out and said, hey, I hear you guys are raising what, what, what are you guys doing? And so is there a short message you want to send? Like, I don't know if you guys just completed a round or you're still raising or is anything you want to oh, we're, we just completed our A and we're actually have, uh, signed a term sheet for our B and, and, uh.
They're wrestling very quickly coming together, right? So, um, and we have, uh, you know, we looks like we have a strategic investor who's going to partner with this, a major satellite company, but there's a lot of deep interest with this. But down the road, raising more capital. There's, uh, we're always looking for new partners. But I think what any investor needs to, to think about this has major disruptive consequences across many industries, right? Many different things.
You don't have to invest in space or satellite. The fact that your mobile phone will stay connected everywhere. That has some profound implications for lots of other industries, right, that 90 percent of the planet where the most important consumer electronic device of our era now is, is, can be taken anywhere and do all kinds of things that has major implications for lots of new categories. Right? And it has profound implications for the mobile towers.
We're going to disrupt other satellite companies. We're going, you know, and it's not just us. There's a bunch of companies jumping in and saying, Me too.
Ground based tower companies are going to be disrupted. Right? The, one of the various interesting insights is, is satellite direct to phone is a zero marginal cost business. But ground based cell towers are not. Yeah, Ground based cell towers, you pay a ton of power, particularly the farther you go out in the remote area, the more, more your power budget is that you're paying because nobody else, the power company, the electric company says you're the only customer out there. You know, you're, you're going to pay the whole bill, right? And then the backhaul and the taxes and the maintenance and, and you're, you're on somebody's land.
So you're going to pay them rent. those are all operational costs. Well, you don't pay rent for your satellite in orbit. Rent is free, right? Once you get there, it's a it's high fixed cost, but zero marginal cost.
We have our own solar power, zero marginal cost. So our marginal cost per square mile is four orders of magnitude lower than a ground based cell tower. So on the margin, um, as long as we have enough capacity satellites Satellite cell towers are going to take away business from ground based cell towers. So it's not just in rural remote areas, it's over Japan.
Right? In Europe, in North America, right? Where you, South Korea, they'll shut down ground based cell towers for satellite cell towers. So it's quite disruptive, and it's a, it's a very interesting category for, for your investor listeners who think about Yeah, no, I love that. I think, uh, that that longer term extrapolation is super interesting. We have to get Masayoshi Son to think about it a little bit or something. But, but Well, he does think about it.
He was an investor in a company called OneWeb. He, he didn't realize that OneWeb has the same problem Starlink has, right? It's huge subscriber acquisition costs. yeah, Um, Lynk does not have any subscriber acquisition costs.
So when we sign up Verizon or AT& T, they have a hundred million subscribers. We don't have to sign those subscribers. They already have the device in their pocket. We don't need to get them a device.
So they're, they use their existing device. Now it's connected everywhere. They've already signed up.
AT& T, Verizon, they bill the subscriber for our service. So, um, our subscriber acquisition costs is like maybe our, maybe it was huge legal fees to negotiate the deal with Verizon or AT& T, maybe 100, 000 in legal fees. Well, they have 100 million subscribers. That's a thousandth of a cent per subscriber for acquisition. yeah. And then, you know, they, they, you know, AT& T and Verizon bill the subscriber, right? They, we don't have to bill them.
We don't have to market to them. We don't have to take their customer calls. The M& O does that.
So it's zero marginal costs to operate, zero subscriber acquisition costs, and zero subscriber maintenance costs. It's a great business. It looks a lot like a software as a service business, or maybe since it's high capex, more like a data center with zero marginal costs. So it's got great economics once you get into it. When you, uh, when your network is fully built out, what level of connectivity will I have? Like, suppose I'm away from all cell towers. I'm just using Lynk.
Uh, will I be able to get 4G, 5G data speeds? Oh, absolutely. Now, what, what we, what the, the key issue to, to understand is, is in any cell that's coming down from the satellite, It's, you have to share the capacity in that cell with everybody else that's in that cell. Just like, that's why your speeds slow down in a stadium, right? There's a, even if it's a small cell, there's, everybody's packed in, you're sharing spectrum of that cell. Um, so if you're, you know, if you're, uh, just in a rural area that's outside the suburb, and there's tons of people there, you'll share the capacity there, it'll slow down a if you're in the middle of the Pacific, You get all the capacity, right? So what we think is reasonable to expect is in the future, you'll get megabits a second from your mobile phone. And that'll do almost everything you really want to do.
You can easily, even with 5 a second, you can watch a small video on your phone. Right. You can get all your website, your email, your favorite apps, you know, so we, we're not going to allow you to stream 40, you know, video to your big screen monitor. There'll be a few things to say, you know, we're going to limit you to 10 megabits a second. Steve, you don't need to watch your, your latest TV on your monitor through your phone. Yeah.
Well, that's great. That's fantastic. I think we've covered Lynk, uh, hopefully some, big thinking, big visionary investors are going to come to you on the base of what you just told me. Um, they're in the LLMs these days, Steve, I don't know if you, you knew that. yes, uh, yes, we could discuss that too. Um, that's definitely the hottest investment area.
Um, and we, you know, we, we were. So we were able to raise our seed round pretty straightforwardly. It wasn't difficult.
But, uh, I'm, I'm thinking, um, now that you've proven out your technology and it's more just a demonstration or maybe an analysis of the future economics, because no one would doubt that you could get to a thousand satellites in orbit, then like just those calculations of how the economics work and stuff could, if, if, if somebody with the resources were to actually spend the time to like, look into your calculations and say like, Yeah, those guys are gonna get there. I think that people who do their work can quickly get there. It's a when you solve a problem for five billion people, you know, the numbers get big very quickly.
Yeah, that's fantastic. So, let's, uh, maybe I mentioned to you that we would talk a little bit more broadly now than about what's the future of satellite technology. What's the future of maybe global competition in space? Maybe you could just say a little bit about what, what you think the, the or 10 years. Well, um, it's I think there's going to be a repeat of several other sectors is going on on an international level. Most of the innovation in satellite is starting in the United States right now, um, and I know it's the, the, the, uh, the, the, uh, issue is near and dear to your heart is like how this plays out is, is China, you know, is very clearly coming, right? And, uh, they, they are, they are jumping in to rockets.
They're, they're the near peer competitor to the United States on, on launch. They've, uh, done, started their own version of Starlink, launching them. Earth Remote Sensing Satellites, they're launching lots of smallsats. Um, we're, we are, At least 5 to 10 years ahead of them on launch, and I think we're 5 to 10 years ahead of them on satellite as well.
And that's also playing out in satellite direct to phone as well as, as, as, um, um, in a, in a slightly different way. Good, uh, yeah, I wanted, one of the things I wanted to ask you about was this new Huawei phone has, I guess, right now, Uh, satellite based calling using, I think, three geosynchronous, if I, if I'm not mistaken, they're actually geosynchronous. So at much higher, uh, Yes, and that's actually an example of what I just said, that this is a copycat. They, they, they reportedly use the Ting Dong, uh, geosynchronous satellites that China's launched three of. I think they launched the first one in 2016.
These are, uh, appear to me and people I've talked to to be a copy of the TerraStar satellites. The, in fact, the former CEO of TerraStar, Bob Brumley, is a good friend of mine, he's an advisor to Lynk. And they built the satellites in the mid 2000s, and they demonstrated the ability to, to have a geosynchronous satellite connect directly to phones here, here on Earth. Do voice calls and, and it appears China copied it and did the same.
We could do that too. Uh, and, and so it sounds like with the Huawei, um, 60 mate, um, they've done that, uh, most of the, uh, comment commentaries have been on the seven, the seven nanometer, uh, silicon. But, uh, you know, they, the cool thing from my perspective is interesting is they have actually two different types of satellites. They reportedly. One is the Baidu system for doing messaging, and the other is the Qingdong satellites for doing voice calls.
They're very, both very cool. They're actually one up on Apple in, in multiple ways. Um, but, uh, they, they still leave a lot on the ground of what you really desire. But they're, they're, they're very cool capabilities. Happy to chat a little bit more about that if that interests you. Yeah, I'm curious because, uh, so in this case, because it's their handset, they, they modified the handset, right? There are specific chips, uh, in the handset, which are, uh, serve this purpose.
So it's not, so it's a modification. It's not a standard phone. They put chips in there to talk to the Baidu system and to Tingdong system in the frequencies, those satellites use. And, uh, there's a interesting trade offs in doing that. Um, they clearly were like, uh, saying, well, Apple, you can do it.
We can do it too. Um, and so I would say. In this way, they are better than the Apple iPhone 14, 15. But they're not, you know, they're not better, neither Apple, nor the new, the emerging Qualcomm Iridium chip that they, uh, there's a lot of rumors that'll go into the Samsung phones, nor this phone's, you know, um, are really competitors with what lynk is doing. Right. So is that, is that because of the difference between having lots of near earth orbit satellites and, you know, just one big geostationary one.
Yeah, so the geo, when you put satellites in geosynchronous orbit for the Baidu system, which is a very high inclined orbit You give up a lot in capacity speed, uh, of, of the, uh, what it can do. Right. Uh, and so this goes again, you can put the satellite outside the solar system you want, and you're going to get, you, we get communications back with these humongous telescopes that for the JPL deep space network, uh, bits per second. Right. So the Baidu system supposedly, which is in very high altitude, does messaging to the Huawei, uh, phone supposedly in the reports are tens of bits a second. Well, yes, you can do a message in tens of bits a second, and a and an SMS is, you know, about three kilobyte kilobits, right? So tens of bits a second.
Over a few, a couple minutes, you can get an SMS through. Um, and so the same thing is goes on with the voice calls. The terror star satellites, which had the largest commercial antenna ever built at the time back in the mid two thousands, um, could do. A maximum capacity of 50, 000 voice calls.
It was never designed to satisfy the millions or tens of millions of people who are on, online at the same time. And, but it was for emergency response. It was, it was designed after Katrina.
And to, to deal with, uh, provide a service for emergency responders when the network goes down because of, uh, some, you know, big emergency. And so, same thing for Ting Dong. It's gonna be very limited. I don't know how big the Ting Dong...
Antennas are in space. Um, but, uh, it's going to be probably limited to thousands or tens of thousands of simultaneous voice calls. I'm sure that is way below the capacity of demand it will have in China, right? That's a large population, but it will be really useful for if there's some emergency it takes out of the network. If some, you know, earthquake or fire or something hits, the emergency responders in China will have instant backup and it's going to save lives.
I I've seen a video online of people with the new Huawei phone making these satellite calls while on commercial flights and things like this. And I'm assuming they're going to price it at some level so that people are not just for fun, clogging up the whole system. Uh, gonna let it be cool for people doing it. But once every if it's too cheap, there will be so many people trying to get on right that they'll clog up the network. Now, the other thing I hear Steve is they did a cool trick with how they built these phones and there's a very limited supply of them.
I don't know what the supply actually is, but I'm hearing That, uh, the, the ultra, the version of ultraviolet equipment was the old, old generation of ultraviolet equipment that was designed for 14 nanometer chips, but you can do an extra steps, which, uh, very much lowers your production rate, but you can get it down to seven nanometers with the old tech. But that, that means there's a, you know, you've got a very limited supply. You really, you got, it's a neat hack to get it down to seven nanometers.
But, uh, that's going to limit your production and drive up the cost for per device as well. So, this particular point, you might want to listen to the episode of Manifold, which is out right now, where I interview somebody about this question. And for people who are closely following the cell phone industry there, it looks like they're planning on selling tens of millions of these handsets in the next year. okay. think that's the key thing is how, what's their production bottleneck? How many of these can they produce? That'd be that that I think that people who are more expert on the multi patterning with that question and then also like, projections on their what Paul has publicly said about projections for their sales and things like that. So they do.
There is evidence. One can make a case that they aren't going to be capacity limited that they actually will be able to Well, that actually makes it worse for the satellite. There's some, if there's tens of millions of phones, they're going to have to drive the price up because they're Yeah, I don't. I don't know how that's going to work out. That's that if people are just doing this for fun, eventually, you know, this will be able to handle it. So, That yeah, they'll have to drive up the price or they'll have to artificially reduce demand by some other means.
Yeah, well, I think that there's a chart. It's it's unlike, like, the usual thing we're used to now, which is unlimited voice calling on our plan. I think for that feature, you're paying by the minute so that that's 1 way that they throttle. Have you heard have you is there any data on what they're charging by the minute for voice calls? That I've seen it. I don't recall the exact number.
I want to say it could be like a dollar a minute or something. So it's pretty it's pretty high. Like, no one's going to do it that pretty high. Yeah, People will try it for a few times and they'll say, you know, stop that. But if, but if you're, if you're stranded in the Gobi desert dollar, no problem.
Right? So, No, this is, you know, you know, and this is a, you know, this is a good problem for Huawei. Right. And whatever the China mobile or whoever is selling the phones, it's like, oh, we're charging a dollar a minute. We have too much demand. Like, oh, woe is me.
Right. It's like, it's like, that's, that's a good problem. They have. By the way, I, someone might, I could be wrong on that number. I'm not saying I know it's a dollar a minute, but it just registered in my head is a kind of significant cost. It kind of back in the old days, Charlie, when you and I tried to call our families from college, it was like a dollar a minute.
And so Yes. Yes. No one, no one thinks of that. We're used to that. We grew up with that. Yeah, but I could be wrong on the number.
That's just kind of what lodged in my head. I saw it out of my peripheral vision on some article or video or something. So, No, I'm I'm very interested in this is a how much the uptake on it.
It's very it's a very interesting thing. So goes back the economics when when the demand is so large, it's gonna it's just drives huge economics and you know this addressable market. So there are independent analysts who are looking at this in both the mobile wireless industry and the satellite industry, who have you know, now concluded that solving this problem is going to create the largest new category, or the largest existing category in all of satellite that it's a, it's a hundred billion dollar plus total addressable market for just satellite direct to phone. Yeah, which, which you guys have solved. Right? So, we have solved where the world, where the world leader in it, there's a bunch of fast followers coming on. We knew this would happen.
That's what happens every time is like, first they tell you that you can't, can't be done. That's crazy. And then they say, well, that's a great idea. I'm going to do it too. Yeah, we, we say that in, uh, in physics too, that like, when you submit your paper and the referee looks at it or your colleagues, the first thing they tell you is it's wrong. This is wrong.
This is, this, you can't be right about this. And then they, then you kind of explain to them why it's not wrong. And then they say, oh, I see. Well, okay, maybe it's right, but it, it, this is trivial. This is, this is ridiculous.
And you know what? I did it first. Yeah. So, so, uh, that's the cycle. Now in, in entrepreneurship, it's more like they tell you it can't be done. And then once you get it going, a bunch of people are jumping in to try to try to take the space away from you.
So. Fast followers of, you know, there's been a few people who've made, uh, you know, a couple bucks being a fast follower. Yep, yep.
Good. So I think we covered what we want, what I wanted to cover. Um, if you don't mind, maybe there are a lot of young people who a
2023-12-07 14:47
