SpaceX Just Declared War on Your Cell Provider (Verizon, T-Mobile)

Josh: I got a quick geography lesson for you. 90% of the Earth's surface has no reliable cell coverage. Josh: Oceans, mountains, deserts, jungle, the things that cover most of the planet, they're all dead zones. Josh: In fact, even places that aren't dead zones, like driving, we're in New York, Josh: driving through upstate New York, there is frequent times in which I just completely Josh: lose cell connection and am offline for better or for worse.

Josh: But SpaceX has come along and decided that those days are over. Josh: The day of the dead zone is a day of the past. Josh: It's just we will never have dead zones again because last week they rebranded Josh: their satellite's phone service as Starlink Mobile and announced a second generation Josh: of these satellites that deliver 100 times the data capacity of what's already Josh: up there today with no dish, no special hardware.

Josh: It works with your current iPhone at up to 150 megabits per second from space. Josh: That's enough to stream 4K Netflix video. That's enough to watch anything on Josh: YouTube, FaceTime with your friends. So this is a pretty compelling product Josh: that they're launching, which might come as a threat to a lot of the cellular Josh: providers that we use today, like Verizon, AT&T, and even T-Mobile. Josh: This is going to be a pretty big deal.

Ejaaz: Yeah, I've got to be honest. I started off as a hater towards Starlink because Ejaaz: I was kind of like, okay, cool. We get additional phone coverage. Ejaaz: Who cares? Like, I'm not going to be in the mountains like for 99% of the time during the year. Ejaaz: But I really saw the use of Starlink come to life during the LA wildfires. Ejaaz: This was a major catastrophe event where a lot of LA was on fire and a lot of Ejaaz: cellular the towers were down.

Ejaaz: So you had like millions of people that had no access to data or basic phone Ejaaz: services that could call for loved ones or emergency services. Ejaaz: And Starlink just kind of dropped in and they beamed, I think, Ejaaz: 150 emergency messages in the space of like 48 hours, which helped so many people Ejaaz: communicate and deal with the fires to around 4.4 million people.

Ejaaz: So this is really necessary technology. And I guess like the way that they're Ejaaz: scanning this is like pretty cool now. Josh: Yeah. So let's talk about what Starlink is right now, because as it is, it currently exists. Josh: In fact, there's 10 million users of it right now. So SpaceX launched this direct-to-cell Josh: satellite service back in January of 2024, just two years ago.

Josh: And the first ones went up pretty quietly, but within days, their engineers Josh: were actually demonstrating texts from unmodified phones. Josh: It was the first time that an unmodified cell phone could actually send texts, Josh: video calls, and then actually FaceTime and watch videos in real time. Josh: It was slow, but now there's 650 direct-to-cell satellites that are in orbit, Josh: which is a tiny fraction of their 10,000 total satellites that are in orbit.

Josh: But it's still the world's largest provider of 4G coverage because it reaches Josh: 10 million users, over 32 countries and six continents. Josh: No one has that reach that Starlink has. In the U.S., you've probably heard Josh: of this through T-Mobile. They have T-Satellite, which is their branded version. Josh: And that's the $10 a month add-on that allows you to access this today. Josh: So currently, it does SMS, picture messaging, location sharing.

Josh: It works with WhatsApp, Google Maps, AccuWeather. Josh: And your phone automatically switches over to satellite service if you lose service. Josh: But it doesn't have the bandwidth that this new version is going to have. Josh: And that's the big difference maker is the bandwidth is really going to unlock Josh: a lot of new use cases for this. Ejaaz: Yeah. Speaking of because I was questioning why T-Mobile can't do the same thing.

Ejaaz: And the truth is they just don't have the infrastructure or scale to be able Ejaaz: to upgrade the technology at all. Ejaaz: You mentioned that they have access to Starlink through that package. Ejaaz: They currently have 120 million users, but they only cover around 80% of the US. Ejaaz: Starlink covers literally the Ejaaz: rest of that already with the 650 satellites that you already mentioned.

Ejaaz: So although Starlink is kind of behind right now, you mentioned it's just like Ejaaz: a fraction of the total like 10,000 satellites that they have in orbit right now. Ejaaz: I think they could catch up really frigging fast because they also have access Ejaaz: to the space shuttle as well. Josh: Yeah, and if you look at this chart, I mean, the growth is about as perfect Josh: of an exponential as it gets. Josh: They just crossed 10 million after crossing 8 million the month before.

Josh: After crossing 7 million and starting at zero just six years ago. Josh: So Starlink adoption is up big time. And maybe we could talk about what actually Josh: makes this new mobile version 2 so much better. Josh: And one of the things that I'm going to share, I had Claude make this for me, Josh: so forgive me if it's a little messy, but this is the difference between these Josh: version 2 satellites and the version 1 satellites.

Josh: What we're seeing here in this traditional geo orbit thing, these orange lines, Josh: this is what it used to look like. Josh: So it's basically like shining a giant spotlight down on Earth. Josh: And the spotlight has to serve a lot of customers at once. What we're seeing Josh: in this other part, which is the Starlink V2, it's in low Earth orbit. Josh: So you'll notice that the traditional geosynchronous orbit, 35,000 kilometers high.

Josh: This new one is only 550 kilometers high. It's much lower. And it uses these Josh: thousands of spot beams. Josh: So instead of one giant flashlight, it's using spotlights to point at all of Josh: the users on the ground. And because it's so much lower, the latency is better. Josh: The bandwidth is better. It's much faster to connect these satellites. Josh: And the result is that it delivers a 20 times throughput on versus current models of starlink v1 so

Josh: This is 16 times more beams per satellite. The face-oriented antennas are five Josh: times larger than the current ones, and it's 100 times the data density of version one.

Josh: So it's this gigantic exponential improvement in terms of bandwidth and what Josh: people are actually going to be able to use this service for. Ejaaz: I do want to level set for everyone listening what that bandwidth means. Ejaaz: So it's coming in at around 150 megabits per second, which is really good internet. Ejaaz: Like no one is going to complain about that. But compared to like the average Ejaaz: in the US, which is, I think, around 220 megabytes to 250.

Ejaaz: It's not lightning fast, but it's good enough. And the fact is, Ejaaz: like, billions of people all around the world will get access to this no matter Ejaaz: how remote they are, which is awesome. Ejaaz: The other thing I find friggin' awesome is they built their own custom silicon Ejaaz: chip for these satellites.

Ejaaz: And the media company that I thought of is Apple. Apple's done that entire thing Ejaaz: for all of their cellular phones, and it's given them the ability to operate Ejaaz: or own the entire stack of that technology. Ejaaz: So Apple knows what its chips are capable of. So it knows what kind of products, Ejaaz: apps, or software they can run. Ejaaz: That's why they have the best phones, in my opinion, in the world.

Ejaaz: Elon's doing the same thing that Apple did to phones, two satellites right now. Ejaaz: He owns the Starships, he owns the satellites, and now he'll own the hardware Ejaaz: that builds on or that is composed of those satellites as well. It's just really cool. Josh: And not only does he own the hardware, he owns the Spectrum. Josh: And we recorded an episode about this.

Josh: Last year because it was this like quiet news event that kind of went under Josh: the radar but what they bought is a chunk of spectrum and that spectrum enables Josh: them to handle and essentially take the job of these cellular providers because Josh: the way this works is there's a global spectrum there's a global like bandwidth of spectrum.

Josh: Customers or companies own so verizon owns some t-mobile owns Josh: some starlink bought a chunk of this and it's limited by the fcc Josh: you can only own a specific bandwidth because that's how you Josh: connect to these cell phones with spacex buying Josh: it they bought what is it 50 megahertz of exclusive s-band spectrum Josh: um for 17 billion dollars the deal closed for Josh: this was not a small acquisition by any means but what it does

Josh: is it enables them to act as a standalone carrier Josh: and i think this is a really important point because forever they've Josh: been they've had to partner with t-mobile they've had to partner with international Josh: suppliers to distribute this and with Josh: this new bandwidth that they have they can actually create their own cellular provider Josh: service and i'm not sure who's not going to want to subscribe to a Josh: starlink mobile plan if it is as fast as everything else

Josh: with no dead zones it just seems like they have such an advantage over everyone else Josh: so in summary spacex mobile v2 has some Josh: pretty awesome things going on let's just recap this quickly so it's Josh: available on 40 plus apps and 100 plus devices this service Josh: will offer video calls streaming emails it's available in Josh: 32 countries covering 1.7 billion people the Josh: next generation of starlink mobile satellites version 2 delivers full cell

Josh: coverage to places never thought possible via the highest performing Josh: satellite to mobile network ever built is their quote basically anywhere in Josh: the world there's not gonna be a single dead zone with this new network uh the Josh: v2 starlink mobile satellites also use the custom designed silicon just like Josh: apple did and these satellites will support thousands of beams using phased Josh: array antennas versus the traditional,

Josh: which is a kind of spotlight that is low bandwidth. Josh: And then version two enables full 5G cellular connectivity compared to the current Josh: terrestrial services, which are only available on the ground. And that's lame. Josh: That does not include space exploration. That does not include beaming satellite lasers down.

Ejaaz: You know, it's hilarious that you're talking about satellites and beaming lasers Ejaaz: to Earth, but that's not even the craziest part of this entire technology that's enabling this. Ejaaz: We've got an entire new spaceship that's coming out, right? Like, Ejaaz: how does this help us achieve what Starlink's trying to do with V2 here? Josh: Yeah, so in order to launch these new satellites into orbit, Josh: you need a much larger rocket ship.

Josh: I mean, each one of these Starlink satellites will weigh 2,000 kilograms, Josh: and they're spanning 33 feet long. Josh: And Starship is going to put 50 of these into orbit at once. Josh: So currently, the way that you get these satellites into space is putting them Josh: on a Falcon rocket. There's Falcon 9, there's Falcon Heavy.

Josh: There's only a limited amount of cabin space in there. that unfortunately doesn't Josh: fit these new gigantic satellites that are required in order to enable this Josh: Starlink V2 service. So Starship is necessary. Josh: The problem is that Starship is not working quite yet. Josh: The Starship program has been in the works for many years. Josh: They've been doing many test flights with varying degrees of success and failure, Josh: but it's still not ready.

Josh: So what they're guiding towards now is 2027 next year for the actual launch and distribution. Josh: You got to wait a whole year for this Mobile 2. Not for the current version. Josh: So the current version works with existing cell phones, existing hardware. Josh: Because there's also something separate that needs to happen, Josh: which is a new chip architecture for the cell phones that we use.

Josh: So in order to get 5G beamed down from these new Starlink V2 satellites, Josh: Qualcomm actually is making a chip that works direct to cell. Josh: So it's rumored to be included in the next iPhone 18. Josh: It's rumored to be included in the new Samsung Galaxy phones. Josh: All of the new phones coming out at the end of this year, next year, Josh: they're going to be equipped with the hardware to enable this.

Josh: So there's the convergence of SpaceX Starship actually working, Josh: and then the cell providers getting on board with this new network architecture Josh: so that your cell phone can work without any additional chips inside of it, Josh: without any additional hardware or satellite dishes or anything. Josh: It'll just work the same way that Verizon or AT&T does. Ejaaz: Going back to the math, you said that each new Starship would be able to launch Ejaaz: 50 satellites. Is that correct?

Josh: Yes, about 50 of these. Ejaaz: About 50. Okay, so then I think the idea is you need around 1,200, Ejaaz: this is from Starlink themselves, 1,200 satellites of these new satellites up Ejaaz: there for us to be able to have global continuous coverage. Ejaaz: So that's like what? That's like 24 launches? Ejaaz: So like that doesn't seem like much. Like we could probably pull this off in Ejaaz: like a year once these starships are actually mobile, right?

Josh: Yeah, it seems like this will go fairly quick. They're gonna be able to launch Josh: 50 of these Starlink satellites per flight. Josh: And yeah, once they deploy those 1200 satellites, they're good. Josh: So it sounds like they're targeting six months from the time they launched the Josh: first one to the time that the network will be complete, which is fairly short. Josh: So with this guidance, it's mid-2027. It's looking like there will be complete and total coverage.

Josh: And the V2 Starlight Constellation caps at 15,000 satellites. Josh: So 1,200 will be sufficient. Josh: 15,000 will be fully saturated. And that probably takes a few years to get to. Josh: But man, that ramp up is going to be quick. And it's going to be available to Josh: everyone pretty quickly. Ejaaz: Well, the other thing as well is I don't think there's any competitor to this, Josh: Right?

Ejaaz: Isn't it just Elon versus Elon at this point? I was framing it in my head like Ejaaz: They need Starship for this to work, but also Starlink doesn't exist or no other Ejaaz: competitor exists unless you have Starship. Ejaaz: Like you need the vessel to get into space. Ejaaz: And the cheapest and most performant way to do that is Elon Musk's SpaceX company, Ejaaz: which now owns the AI company and all these other things. Ejaaz: So it really is just a monopoly that is about to emerge.

Ejaaz: And Elon's at the forefront of all of it. That's that's pretty cool. Josh: Absolutely right. I mean, Blue Origin is trying. There are other satellite companies Josh: that are trying, but no one is going to be able to get what Starship can do. Josh: I mean, they're at least five years behind at most, maybe 10, 15. Josh: I mean, the space is really hard and even Starship doesn't work yet.

Josh: So they have to break this like novel problem set just in order to get these satellites into space. Josh: And everyone else is so far behind. But what enables them to do this is this Josh: flywheel that they have, the revenue flywheel, where Starlink, Josh: the residential service that has been powering people's Wi-Fi across the country, Josh: that's generating a lot of revenue, too. I mean, they have 10 million users now.

Josh: So that enables Starlink V2. Starlink V2 generates additional revenue. Josh: And then that creates this unbelievable Josh: market flywheel for SpaceX to continue to grow the market cap.

Ejaaz: Oh, so they put the revenue from that into Starship. Josh: That's how it's funding the Starship program. Exactly. But it seems like they Josh: might need even more money than that because there are rumors on the street Josh: that they are going to IPO soon. Josh: And thanks to our friends over at Polymarket, we have the exact odds of when Josh: they're going to go public this year.

Josh: It seems like it's a near certainty. there's an 88% chance that they go public Josh: before December 31st, 81% chance that it's by September 30th, Josh: and a 62% chance by June 30th. Josh: So it seems like the probable window is sometime middle to late of this year. Josh: I've heard rumors that it's coming sooner. People want to come sooner,

Josh: but it seems like Polymarket disagrees. But it seems like we're getting a SpaceX IPO this year. How, Josh: There's another Polymarket for that, which shows that it's going to be almost Josh: guaranteed over a trillion bucks. Josh: Like $1 trillion plus is $92%. Yeah, so there's a 92% chance this goes over a trillion. Josh: It seems like it is going to be IPO-ing, I mean, well above a trillion, Josh: probably between 1.5 to 1.75 is what the rumors are saying.

Josh: Polymarket confirms. Thank you again, Polymarket, so much for sponsoring this Josh: section of the episode. And I mean, again, SpaceX is just like this unbelievable Josh: company that is seemingly coming for everyone. And they're threatening a lot

Josh: of companies along the way. Josh: These traditional cell providers like Verizon, AT&T, T-Mobile, Josh: they have a serious problem on their hands. Ejaaz: Yeah, the T-Mobile thing is an interesting one because right now, Ejaaz: like my phone runs on T-Mobile. Ejaaz: They're the dominant provider in the US at least. But I feel like it's a ticking time bomb for them. Ejaaz: Like they have this exclusive partnership with SpaceX, right?

Ejaaz: You pay an extra 10 bucks, you get access to the satellites, Ejaaz: but that's only for one year. Ejaaz: So I can imagine that other broadband providers or telecom providers like AT&T Ejaaz: and stuff are going to try and outbid them, but they're outbidding the guy that's Ejaaz: going to eventually replace them. Ejaaz: So like, I don't really understand how the economics of this work.

Ejaaz: Are they just kind of buying an extra lifeline whilst they figure out their Ejaaz: own satellite deployment, but then they need to rebuild an entire space company Ejaaz: to be able to launch that on. Ejaaz: So I don't understand how AT&T Ejaaz: and all these other telecom providers survive. Am I missing something? Josh: Well, there's a lot of strain on these networks.

Josh: Like there's a lot of people who demand a lot of data and starlink is not Josh: going to be able to subsidize all of that so there will still be Josh: the need for these ground-based coverages that work in particular for higher Josh: density areas that need a lot of bandwidth so you'll notice one of the newer Josh: things is 5g uwb ultra wideband and that is the super high power bandwidth that Josh: gives you up to like a gigabit per second of internet in fact it's so good it's

Josh: replacing some of the wi-fi, Josh: setups that people have in their homes because it's very high powered their Josh: local cell towers That is a unique advantage to ground-based infrastructure. Josh: It has much lower latency. It has much greater bandwidth. But if you are not Josh: contingent on needing infrastructure, Josh: a terabit per second, and you value this additional coverage anywhere in the Josh: world, then Starlink is probably for you.

Josh: And we've seen this with the dishes that they have with the Starlink residential Josh: plans. People take it on road trips, people take it camping. Josh: If you live on a farm somewhere, you don't have connection. It's better than Josh: most of the options that we have today, but it's just going to apply to the phone.

Josh: So while it might not replace these cell companies entirely, Josh: it certainly will start to displace some of their customers if they don't partner Josh: with them like T-Mobile is doing. Ejaaz: Wait, Josh, I think I have a answer to my own question, Josh: Which is what do you got? Ejaaz: Well, like I was thinking about like Starlink having coverage for anywhere in the world, right? Ejaaz: Including really rural remote areas where there's not that many people.

Ejaaz: So why would that be useful? Like who are the people and customers that are Ejaaz: going to be paying for that? And then I realized it's probably not going to be people. Ejaaz: It's going to be like autonomous vehicles or farming infrastructure or any device Ejaaz: that requires the internet that can extract or observe data and feed it back Ejaaz: into a system that might be AI, for example, Ejaaz: would be inherently useful for these satellites, for this internet connectivity.

Ejaaz: Sorry, I just had like a mind blown experience whilst realizing this. Ejaaz: I was like, oh, it's not just for humans. It's for any and every detection or Ejaaz: device system that's out there. And you can place that remotely on the beacon Ejaaz: or the top of a mountain or somewhere completely icy and remote. Ejaaz: Like the world's your oyster there.

Josh: This is a really important point for the Internet of Things. Josh: As we start to deploy a lot more hardware that's using AI models, Josh: that's using, you know, inference or reasoning models, there is going to be Josh: a benefit to having it online. Josh: And a lot of places in which these things happen are rural.

Josh: They don't have a lot of infrastructure. and giving it that cellular connectivity, Josh: it's going to be a pretty big deal because traditionally in order to do this, Josh: you need a big satellite. Josh: Now it's compressed down to the size of a small little iPhone chip. Josh: I mean, you could put that on anything and that really enables a lot of the world. Josh: And when you think about the world broadly, three to 4 billion people on earth Josh: have no reliable internet connection.

Josh: Like they just cannot access the internet. And in a world in which it's so connected Josh: and that has so much value, there is such a huge untapped market available for Starlink.

Josh: And what we're seeing is they've, they frequently make it free in Josh: places of chaos or places that are Josh: having issues because they want to help out the people but i'm sure Josh: there will be subsidized plans for even lower income countries or Josh: areas where they can really bring the whole world online and Josh: it's this incredibly powerful technology that is here and it's growing exponentially Josh: and with this starlink or with the starship v3 launches it's going to start

Josh: to be deployed in the real world and by this time next year there's a good chance Josh: that these v2 satellites are going to be very close to launching and by the Josh: end of next year, we'll have a full network of them.

Ejaaz: It's hard to wrap my head around all of this being owned by one single company. Ejaaz: SpaceX owns the Starships. They own the satellites. Ejaaz: They own the AI. They own the distribution layer through the social media company. Ejaaz: And I'm sure I'm missing a bunch of other companies embedded within that and projects within that. Ejaaz: This IPO is going well over one trillion, dude. I'm going to bet like 1.5 to 1.7 probably closes. Josh: That seems like a good bet.

Ejaaz: If it launches mid-year, I'm guessing it's going to be over two trillion by Ejaaz: the end of the year. This might be bull market speaking, but that's my bet. Josh: So are you a buyer of SpaceX? Are you interested in joining the IPA? Ejaaz: But I can go further than that. I'll be a buyer and a holder. Ejaaz: Like, I don't care what the price does. Ejaaz: Like, this company is a once-in-a-lifetime generational company, Ejaaz: probably literally out of this world.

Ejaaz: So I'm going to hold and bet on Elon for this one. Josh: Yeah, you and me both. I'm in it. This is going to be really exciting. Josh: I will be holding my SpaceX shares for an eternity.

Josh: And I'm just, like, admiring from afar and from hopefully close up of all these Josh: amazing things they're doing, Josh: how they're changing the world and how it's just uniquely positioned in a Josh: way that no other company can do they've been building this for so long Josh: and they have such a far head start and they're just continuing to Josh: put their foot on the gas and crush it so that is the starlink update that is

Josh: the cool new technology that is coming to a cell phone near you the days of Josh: dead zones are over and i cannot personally wait because i go hiking a lot i Josh: love being out in the middle of nowhere and i never have connection and some people value that but.

Ejaaz: When you don't those instagrams Josh: When it's emergence is yes someone's got to post the pictures come on Josh: now um or perhaps you just want to like you know reach out to someone or find Josh: a map so you don't get lost or don't get hurt there's a lot of help yeah there's Josh: a lot of use cases across the board regardless of whether you want to be connected Josh: to the internet or not it is valuable having that option and that's what spacex

Josh: enables and that's what starlink is going to do and it's just this unbelievably impressive project, Josh: From Elon and co. And yeah, it's just been awesome. So hope you enjoyed this Josh: episode. Any final thoughts before we leave? Ejaaz: No, it's been awesome. Thank you, folks, for listening. There are thousands, Ejaaz: literally thousands of new listeners to the show. So welcome.

Ejaaz: We are finding you and seeing your comments across X, across YouTube, Ejaaz: and across all other publications that we have on newsletter as well. Ejaaz: You guys are extremely active and we appreciate it. If you enjoyed this episode, give us a thumbs up.

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Ejaaz: that out none of what I just said is unreal it is literally it happened go check it out Ejaaz: and yeah that's it we'll see you guys on the next one Josh: Awesome thanks for watching see ya.