"The Future of Connectivity" Impact.Tech Seminar with Siamak Ebadi from UTVATE

for those of you who are joining for the first time it's 50 years um on seminar series these days we say online seminar seminar series we hope as probably all of you that it comes back to just being a general uh event series where people meet people in person um but for now it's online this is actually our fourth online seminar and three of them were focused on different and in the general form formula for these seminars is that we focus on an area of tech where we think um um technology entrepreneurship uh can be applied and deployed to uh positively contribute to solving one of uh you know big systemic problems in in the world so uh we have run um seminars on you know cellular agriculture technologies on plant-based food production quantum computing you know longevity and aging synthetic biology in other subject areas and then recently we also started our sort of how seminar series which is not focusing on specific areas but focusing on specific skills and strategies that could be applicable to in multiple domains so the last actually the seminar we had uh two weeks ago was focused on intellectual property for deep tech companies and it was you know kind of a deep dive on how um you know how to approach it and how not to kind of bankrupt your company vis-a-vis legal fees and and you know really what what are the best strategies to deploy so we're hoping to do more of these if you're not on impact tech and 50 years newsletter yet you can you can sign up to be to be informed about these today we will have um this seminar will be divided into two sessions there's going to be a break in between for a q a and there will be some additional q a at the end we'll also have um small breakout rooms so that all of you can meet each other the you know as i said before like the our old uh formula used to be that everyone comes to fifth years hq and we get a chance to connect and and you know great great connections are formed and we know for sure that companies got started this way and really that's the most um rewarding part for us to know that those things are happening so so it was only a few years ago that i was told by a new founder uh hoping to build a uh internet satellite constellation that half the world's population four billion people um have never been online and this isn't uh slow connections or infrequent connectivity um this is never online and given how important connectivity is for economic development education health outcomes and overall well-being this was pretty astounding that number a few years later is a little bit better in 2020 but it's still well over uh 3.5 billion people who are unconnected um so why is this um what are the economic and technological realities that drive this who's working to fix it what are the potential solutions and where are the opportunities in solving this um these are some of the things that we're going to be covering in this seminar we have a really great person leading it siamek has spent his career addressing various aspects of satellite connectivity and long-distance telecommunications he is a phd electrical engineer from tmu iran is a senior member of a couple ieee societies has more than 50 patents to his name in antenna engineering he was lead engineer for spacex's starlink constellation before leaving to run antenna engineering at astranus a small geostationary satellite internet startup and in 2019 he left astronauts to found his own company utivate um to address one of the major hurdles uh in global connectivity um and there'll be more on that from siamek a bit later so siamek thank you so much for joining us and please take it away dude you guys see him as well yeah we can awesome awesome thank you everyone for for your time i'm sorry about the echo here we are at our new office here in san francisco but as you can guess you know not much happening at the offices these days so uh we are not fully furnished yet uh hope it doesn't bother you much um yeah it's it's my pleasure to uh spend the next hour or two with you and uh thank you steph and ella for uh giving me the opportunity i've had really the the pleasure to know you for the past uh couple of months getting close to a year actually and i've experienced firsthand how much you deeply care about word problems and i really consider ourselves really lucky to have your support so i'm trying to um what i'm going to do is really not uh a general presentation on the status of you know connectivity in the world or things like that it's more of really my personal um path and uh experience going through these problems you know really just sharing firsthand what was surprising to me the type of you know research i did to kind of prove to myself that you know these are actually real problems out there and uh just hope hope these are useful for for you and uh would be happy to of course you know uh have uh as much q a as uh needed afterwards let me start sharing my screen so this is really the uh high level agenda we want to talk about connectivity by numbers and i'm going to share with you um really a few slides in about 10 slides you know this is for the first half in the 30 minutes that we are going to talk and that just tells you a little bit about the problem and um not really just uh people's thoughts of the problem but you know i'm trying to gather real uh data and charts reliable in sources that can give you really the status of this problem and afterwards you're going to have a break and i'm going to basically walk you through some thought process here and you know an exercise of what it takes to actually connect a country that is not online you know basically the least connected country in the world and just go through that exercise maybe before i start i give you a very brief uh background about myself i access said uh my name is siamak i got my degrees uh back in iran born and raised over there and uh moved to the u.s in 2010 and uh did two and a half years of postdoc and after that i worked for a couple of companies started from intellectual ventures in seattle and then at a startup called osteos and then spacex the starting program then moved to san francisco worked for astronauts and for the past close to the year uh as utv and uh really i've experienced firsthand that just a couple of times uh some of the key pain points with the satellite industry specifically and of course the the uh the wish to solve connectivity problems so with that background let's jump into this and uh see what is going on outside outside going on out there um these are my sources and you can basically have this slide i'm not going to provide you know specific links to different charts that i show but you know it's basically all from these and i'm kind of trying to mix and match here for you to have the best uh like holistic view of the problem so i want to start with the um's sustainable development goals and i'm sure you know you have seen this different people would interpret these differently what i want to say here is that you know the interesting thing about connectivity is that almost all of these goals for them to come to fruition they need connectivity you know you need people to be able to understand this you know in order to educate people you need connectivity so basically none of these would happen if you can't have people go to places go and reach people who need these uh and then basically tell them what the problem is try to gather information send it back so nothing we can do without really having like connected people across the globe for literally every single one of them even for the ones that may sound the least uh connected you know like you know life below water you know you're gonna need sensors you know you're gonna need basically measurements all across the ocean you know you have to basically gather data for every one of these you know if you actually uh go deep inside you know you will realize that connectivity is a source of really enablement you know personally they will need different technologies but none of that and it would happen if you don't have proper connectivity so we want to start here you know of course it's uh something everyone here you know in on this call appreciates that okay we need to have connectivity but this is like a deeper problem because and it's not uh just you know for the sake of having fun and people kind of being online and browse internet it's really that deep i would say even human rights that if you don't have it you know you can't really uh approach these levels of uh improvement you know in the in the quality of life that you want to have this is something that you know will come up um often and i thought i would just show it before we go through the deck uh there are three definitions for the development stages of countries and we have developed countries you know shown in blue here we have developing shown in yellow and uh kind of darker orange or red you know uh the least developed countries or ldc's as of now there are uh depending on how you can count over 40 uh basically least developed countries and this is a term to kind of keep in mind as we go through the effect and then we can try to uh i guess understand you know we have people from different uh parts of the world now you know we can kind of have a sense of uh what's rather a small portion of the organ is considered developed and uh still the majority of basically africa and a big part of the whole world is considered uh basically either developing or least developed so i i thought these two charts would actually show the status of this problem better than anything else as uh seth said we are talking about slightly over 50 percent of world population connected you know if you look at the the chart here in grade and you know it's shown here as those will be 53.6 about 54 as of 2019 are connected you have to actually understand this chart really well this is not about access to connectivity so there is internet as we will show you know in the later slides no coverage you know way higher than this this is affordability meaning like are people actually for real connected and using the internet and this is the percentage uh can they use it yes but you know it's basically too expensive for them that they can't afford so there is really a very important distinction to be made here the other thing is you know i mean the one on the right uh you can see this number gets much much lower and you know for the uh least developed countries we are talking about over 80 percent or about 80 percent of the the people in those countries are not online so when we say 50 that's kind of you know the average in the world but if you look at actually the regions and countries in the situation can be way worse depending on where you look at uh of course we have the developed countries approaching 90 percent you know we have europe america's you know cis basically uh former um soviet union countries and we have the average and arab countries are actually doing pretty well slowly you know coming up and uh asia pacific and then we have the developing which again if you remember from the earlier slides uh when we talk about the developing countries we are talking about a huge portion of the world so uh less than 50 and then the approach uh please develop you're talking about less than 20 so this is really like you know what i wanted to to start with so everyone kind of understands the situation of the problem and we want to kind of dive deeper and understand more about the underlying reasons for this this is a very interesting slide i would say i it was a very big surprise to myself as well early on when i started uh doing the research it's more surprising than the half of world population being offline because in that we've heard enough or you know a lot and i could have um so of course when i look start with these two lines you know that's straightforward so you have word population you have internet users so you see like you know hey half of our population does not use internet but it gets interesting as we start to actually look at these numbers that almost all of world population 97 live within reach of a mobile cellular signal so it means that you know the infrastructure is there so you know you can actually literally uh connect to these people almost hundred percent out of this 97 82 percent uh has basically high speed you know lte broadband coverage and another 11 is still data coverage a little lower speed so what is the problem then it's actually amazing to know that 97 percent of old population is within a reach of a cellular signal uh 82 percent of that is actually high speed data internet coverage but yes almost half of work population basically 53 is actually using it so this is like a the second level level of i guess no problem definition that i wanted to offer that it's not like you know because you know i was under that impression early on that you know like we have half of the world population that you know there is no uh basically cell tower close to them you know which is basically a wrong fact you know the some extent is there the coverage is there but yes they're not using the internet now of course the question is you know why and we will get to that later um a little bit better about a little bit more information about the distribution age distribution this is you know where things get uh again uh more sad and surprising that you may think that uh these four billion people who are not connected you know probably most of them are you know kids or elderly people but it's actually the opposite uh the the portion that is least connected is actually the age range of 22-36 which are arguably the people who need it the most you know these are the biggest contributors to the gdp of countries and those are offline which again you know makes this problem a little bit more serious and important to pay attention to the other concern is of course you know is this uh distributed uh uniformly between different genders and for the developed countries you know it's actually pretty uh evenly distributed you know between male and female but as we get closer to developing and then these developed countries you know you can see that the gender gap becomes uh very significant and of course you know it goes alongside in the other understanding we have about you know various uh access to a personal human rights and healthcare all those things that uh you can actually find a lot of direct linkage between you know the uh prosperity of people you know from different genders and you know their access to information so those personal evidence here this one this was supposed to be like one slide before but if you look at that stage range of 22-36 and uh basically you ask them why are you not connected so you know we go back here and we're talking about this 35 percent and we want to know the reasons uh and again not surprisingly the reason is cost so first one is you know that's basically hardware they need the computer mobile phone or access to the internet is just too expensive for them so that's kind of when they can consider this as equipment or the hardware they need and then after that even if they have it the the subscription basically the services is just too expensive so so far you know we have observed you know big part of the work population doesn't have access uh we looked at basically some specific you know age range and then the reason why they're not connected and now you want to talk a little bit about what is expensive now let's basically define that this is a very interesting chart and i found this to be probably the most useful in terms of the future conversation we will have in the second half about really the business case here of you know we're all you know here talking about basically how to have profitable business cases that can actually solve this problem and at the same time you know make money for the companies for the investors and all the people involved um so this will be really like one of the key factors that you have to keep in mind uh the two are kind of similar the one on the left is fixed program meaning like not uh internet through your mobile device you know it's basically anything fiber fiber and cable and the one on the right is basically uh for mobile what it is saying is that uh in order for you to become basically eventually a prosperous country you know uh a country and kind of a population that can actually comfortably access internet the cost of the internet for let's say in this case in a 1.5 gigabytes gigabytes of uh basically connectivity should be less than two percent of just gdp or gni in this case in the per capita and uh now you can see this kind of you know uh line in the sand has been put in a way that it's showing you that in the developed countries almost all of them that are individual studies by the itu are you know within that range basically ourselves uh if you look at how much you're paying compared to the monthly uh gross income that you have you know you're for sure less than the two percent but then as you start to look at you know of course a lot of uh the developing countries and then almost all of the basically least developed countries are paying way more than that two percent and what this means is that you know this is basically the cost of access to the service it doesn't mean that you know they're paying the result of this basically problem is that people simply give up uh the need for internet and basically they just don't get it so exactly you know a lot of countries you can see we are talking about in the 10 countries here 20 countries for them to have access to 1.5 gigabytes of data they have to pay like more than 20 of their income so they're just going to simply give up and don't do that this number is important because you know later on as we try to kind of come up with hypothetical business cases you know for countries that don't have any access to internet this is how we decide how much basically is reasonable to charge them down the road so another chart that you know based on what we learned so far that two percent of your gdp for internet access this kind of you know this rule of thumb you can actually look at uh on the left the situation the percentage of population not using internet in the world you can see a lot of countries you know in africa all the you know least developed countries basically we are talking about 75 to 100 percent of the population with zero uh connectivity and then you can actually very nicely match that to the cost of antenna so here is the two percent you know two point five percent uh bar that we have you know you can see like you know three four countries you know have that but then after that a lot of countries are you know around you know 7.5 to 12.5 and then you know go higher even 20 20 25 and 30 percent and some of them don't have any data you know which means that they're for sure very very expensive so this is an interesting one because now you can actually see uh where this comes come from you know uh this comes from basically really a mapping to how much people uh are willing to pay and in reality are paying you know in the developed countries and they realize that okay if we are within the uh two to three percent then people actually are willing to pay for that and basically get the internet and you know uh have all the benefits from that but if not you know basically people just need to stop uh even making the effort to have access and as a result basically you have population without internet access that was really the first part of what i wanted to talk about which is about the situation of connectivity and uh statistics on you know what is the problem how bad the problem is so we started by um talking about you know how essential this issue is in internet connectivity we mentioned that basically a big portion of the world in half of the world population on average is offline we briefly mentioned that basically in least developed countries that percentage reaches 80 percent uh we also mentioned that cost of internet and hardware services is really the main reason and uh really like what i want you to take away from this all other than the percentages of connectivity is that two percent golden number for your uh gross income that you know if we reach that number and you know if you can actually make such successful business cases with that percentage then we can potentially solve that problem great so now i thought we can really go through uh the process of actually evaluating this basically you can call it a a business case you can call it just you know a mental exercise but it's a real problem and i've had a chance to uh at least hear about this problem and i thought you know you guys uh whoever is really interested in the uh situation of connectivity in the world would appreciate knowing a little bit more about uh this problem how this will be solved uh i mean to be determined and i guess we can all at least observe and years from now go and check and see what the real solution has been but i thought it would be a really an interesting way to have a conversation about this problem because you know it's specific to the country so we are talking about eritrea it's uh this country here in the northern or north eastern side of africa close to uh saudi arabia and yemen and on the other side you know it has ethiopia and sudan ethiopia is a person of a very more uh advanced country in terms of connectivity and they managed to kind of figure out a lot of these fundamental issues earlier but eritrea for many reasons of personal uh political situations you know uh and all the problems they've been through unfortunately they are the last country in the world in terms of connectivity so they're ranked 215 in the latest uh statistics and data that is available out of five million people living in that country they have a little more than one percent one point three percent uh of their population is connected now let's just start by looking now we know that you know we are looking for that two percent of gdp so this country has basically per capita gdp of about 1300 uh dollars and if you do the math people are expected or are willing to you know for them to all basically become online or get online you know they're willing to pay two dollars per month per person so that's really uh the hardest part about this problem you know when we all you know say that hey let's connect the whole world um it's easy to say but you know when you look at these real numbers uh one thing one of the two should happen either you should be able to actually offer a solution that is this cheap or you have to just wait for them to basically somehow you know in a magical way increase their gdp and reach whatever number that you have to offer and then you'll say that again the problem is so one of these two should happen how much are they paying now uh and this is of course based on various data points you know it's not really uh as easily available online but people who do have internet at home and this ends up being basically really limited to government officials and uh really no no more person can afford this but we know that price of you know getting a very basic internet connectivity at home eritrea is about like a thousand dollars per month so in order in other words i can actually conclude that no one is actually connected so that's really the problem and i want to make sure that you know we all kind of digest this you know before uh jumping into further details because uh it's really important to get this and there are so many things that can be said about the various solutions that you can offer but i want to kind of walk you through um some again you know at least experiences i've had here and hopefully that is helpful for you so if you want to um rephrase this as a business case i i want to kind of provide some more uh clear numbers and you can basically take it and in the future conversations you're having on this topic and you can use this so the problem here you know we kind of limited the problem we said okay let's just make it simpler and say that okay how about we only provide internet connectivity to anyone who is an existing cell phone customer meaning like people who are already within their reach who already have basically their uh device in their hands and uh what does it take to actually give them all high-speed internet so what it means is that you know let's take from one percent which is in the the current population and take that you know uh ratio all the way to 25 20 percent which is the current actually cell phone user and by this we mean uh basically just voice and text the potential revenue for a project like this so twenty percent of five million people we are talking about one million users that's the twenty percent of their population um we said that like a perry year uh about 26 dollars that would be two percent of their gdp so we're talking about 26 million dollars per year if you are assuming that you know you build a project you know these satellites however you do that and this is going to work basically with one basically with a one-time investment it's going to work for 10 years for you so you end up basically with you know a potential of you know 260 2600 in revenue over 10 years uh and of course you know this can be five times more if you go from 20 to like the whole population but really like what we take from this is that whatever investment you know you want to make whatever solution you want to support or kind of bring to the table propose to their government it has to be meaningful enough that over 10 years the whole return you know basically the whole revenue is going to generate over 10 years it's going to be 260 million dollars with that you know you can argue that maybe a project um with capital investments you know as much as i do 100 150 million dollars would be the max and again you know that's up to you you know how you want to kind of uh optimize your investments but uh this is like how accurate the solutions that are being offered are going to be evaluated now let's compare two solutions and i i have of course not in the q a we can talk more about the details and i can provide you know some more information of the record but uh really at high level i really want to at least you know without going to the numbers and compare this to these two solutions these are solutions that are actually being offered you know and being provided to the um basically the people who are kind of making decisions and uh there is a path towards actually bringing these you know to the attention of the government there and uh let's talk about them so one is any solution that is based on anything that needs point-to-point communication based on ground infrastructure so it means you know a combination of fiber and cable you know you can argue that it's a uh fiber is here in the ocean you know you can kind of bring the fiber in and uh start digging uh these the whole country you know giga grams uh pass basically fiber and cable whenever you know you couldn't have microwaved links you know basically that also needs towers from point a to point b so that's one solution the other solution you want to talk about is a small geo satellite and unfortunately there are other solutions at the end i'll kind of mention them and you know would be happy to do a q a on those for the ground-based methods what are the pros so in general they are less complex meaning uh there is actually not much uh scary things that can happen there so it's let's say you know you want to really lay down you know fiber or cable uh it's been done for many many years there is really nothing you know that can go uh wrong you know at a fundamental level it's not really like a very advanced technology um the other advantage this has is that you know it has very low latency you know it's a speed of light you know um a piece of line you know that at the end of the day is very small so you know things can go from you know the whole country very very fast because it's actually relatively small um it can provide higher data rates because you know you have pretty much one of the best mediums for conveying data in which can be fiber it has lower operational uh costs because when you lay down you know it's all done you know there is really not much to take care of and the maintenance everything is inarguably small the problems is uh that of course the the capex as we said you know we are talking about a project in a construction you know all across the country you know because you don't do these type of projects unless you cover the whole country because you know you either do it right and once and or you just don't do it because you know it's meaningless to start and all the pyramids and everything and then realize that you have to do the whole thing all over again uh the other problem is that you know in the case of eritrea the country is mountainous you know you can see that you know there are mountains in between so going from the uh where the fiber lands you know through other parts of the country uh it's actually hard to do all these inner ground based constructions uh you also for point-to-point line of sight microwave links and that's also very hard because again uh it's not a flat country there is a lot of terrorist regulatory issues that need to happen so that's also a cons especially when you talk about a country like eritrea all the politics that can be involved in this thing you know these things and it can take uh forever to actually uh get done trying to deploy is again as i just said you know these things because of their nature of you know construction you know different time you know somewhere can be very hot over there uh projects can be delayed you know it's actually not a very uh straightforward process to get things done as quickly and then at the end of the day uh these are susceptible to damages and cuts in the reserve lines you know people intentionally unintentionally they can actually like uh cause harm to these transmission lines and uh there is some risk there when you look at satellites and uh i especially you know uh want to focus that you know we're talking about a small geosatellite because you know this is something that you know if you take these two words out and just mention satellite it's it can be actually a very different solution because you know satellites of you know five years ago uh used to cost uh easily two to five hundred million dollars so if you remember we just agreed on a potential revenue over 10 years of 260 million dollars so let's keep that in mind that you know we are talking about a project that if it's successful if it works for 10 years overall you know it's going to generate 160 million dollars so it has to you know our investments should be kind of in a very uh reasonable basically so that kind of leaves us with the choice of a small geosatellite so the advantage is there is no ground construction work needed um very minor you know you can argue for the gateway things like that but almost you know you don't need to do anything in the country so uh people will not see any actually real work you know happening around them um sallop is being built somewhere else they just see it in the sky turned on and overnight after two years or whatever in the country is online there is uh the coverage is a big thing you know so you can you will get perfect full hundred percent country coverage you know if you sign a contract to get your city salad coverage you know in your country you know for eritrea for example it is going to be either one very large salad bean to to cover the whole country or maybe you know three four smaller beams next to each other but regardless uh you will only do this if you get like 100 coverage there is no point in actually not doing that which is very different than you know like any uh ground-based solution because here even like you know saving on 10 miles you know here and there you know uh it can be a big deal you know so you would probably in this situation cut as much as possible and limit it to only the uh the most populated areas of your country but you know if you go with the satellite solution you just cover the whole country hundred percent um there is almost no maintenance you know sales is launched now it's launched uh which of course goes with the cons part that um it has you know the launch and failure risk so it's uh you know of course nowadays satellites are being built with a lot of um redundancy included in them to make sure that they're reliable but regardless there is that risk that okay you know it's a single hardware in a new space you don't have access to it and if it fails uh it's gone you know it's the launch day you know that you're you're done and of course you know you do insurance and there are so many ways to handle that but you know you have to uh include them in the conflict latency is an issue you're talking about uh 500 milliseconds of latency you know if you go to jio and come back and again unless you are doing high-speed gaming and for certain applications that is not going to be a deal breaker but nobody is the problem to mention here compared to those personnel when you look at ground-based infrastructure and then you know finally there is shorter lifetime so a project like this when you have fiber and cable these can work for decades and there is really almost no lifetime associated with them which kind of started placing different pieces you know from here and there but uh this worked for for a very very long time as opposed to the case of the satellites which you are talking about uh ranging between five to ten years you know let's say average seven years so i thought i would basically talk about these two solutions so you kind of have an idea of you know the pros and cons of each and i'm going to now tell you a little bit more about the value chain uh for the satellite part of this problem and hopefully that kind of helps and uh opens up some um rooms to kind of further investigation when you come across in the companies you know trying to do things here so it's also understand where they fit in this you know bigger uh scheme of things here so i will go slow here and uh let's make sure we we all understand this because you know that uh that is really the key into uh solving this problem so we have four major players here and let's just start from the left we have a satellite operator then we have what is called the satellite service provider then there is what we are calling a last mile enterprise and then the end consumer and uh you may not be familiar with some of these stems you know they're not really as commonly uh used in kind of a day-to-day but it's actually the the strength of this industry and at the same time you know you can argue that this is actually just by looking at these four and what it takes actually for a hardware to reach the end consumer uh that kind of tells you a little bit about the the problems that this industry has at its core and how we can actually change it and improve it but let's you know understand this because at the same time there is decades of experience behind this structure and why it's done the way it's done so the operator and i'm providing some examples some uh old examples and i mean kind of established companies and we have intel stats and scs and some of the biggest in the u.s and in europe and basically globally and uh i'm putting also astronauts here you know a startup that um a lot of the names that i mentioned actually falling into multiple categories but i'm specifically mentioning astronomers here as also like a satellite hardware manufacturer but also as an operator because i want you to think about different parts of this value chain that a single company can potentially down the road manage and handle and eventually become a more and more uh kind of vertically integrated company to be able to cover more and more of you know these pieces and as a result of all of that you know kind of bring the cost and i'll talk more about that so we have the satellite operator what do these companies do they basically handle various pieces of the satellite physical layer if you will we have the satellite hardware we have ground cargo which is the gateway which is all the user terminals that you have they also handle launch you know they probably go to and talk to spacex you know and then you know they would go to a company like boeing or astronomists they go to a company like hughes or gilot and then all together they can put together a proposal for basically or you know a kind of a project for actually making the satellite happen from day one of defining the specification all the way to uh receiving it making sure they deliver making sure you know it's launched put in orbit and the outcome of a company like this is basically what we call raw capacity what does it mean you know it means that they don't really care who uses it they don't care how it's being used they don't care you know for what vertical you want to use it of course they do a lot of you know planning for that but what they're offering is you know as as raw as it gets and you know it's intentionally like that because they they want it to be usable by as many people as possible so really that's the first part and i want to make sure we all understand these four here that you know if you think about a successful launch of a satellite and then um showing that hey it's working connected to the ground uh there are hardware manufacturers or operators in between and uh the operator can be a hardware manufacturer as well so you know kind of not poverty after that uh we have companies that can exist here you know you can potentially skip this space but you know you can have it and these are companies that are more of a provider what it means is that they want to be uh closer to the end consumer but not necessarily directly operate the satellite so a great example is you know how you get your internet on uh for in-flight connectivity gogo uh these guys are operators uh sorry they're service providers that that means that they would go to someone like encapsulate and they say that hey you know we need you know such a satellite um operated for us but give us wrong capacity and we will take it from here to the next step which is really um one of the before end consumer and you know we call those you know last mile enterprises so in this case you know gogo would go to an airline like united or you know american airlines and say that hey i have some raw capacity here do you want to buy it and basically sell this to them and i i hope you know you're still you know you're sorry slowly appreciating how much overhead this system you know can have and uh um how much kind of you know uh add up in charge and the cost we are actually seeing as we go through these because here you know at these uh levels we are talking about really um real value generated by hardware being manufactured you know there is you know like you know higher level of value being generated by all the coordination operations and uh further on you know then there is more of more and more of business value generation so a company uh like for example gogo in this case and they can go talk to 20 different uh airline providers and airliners basically and kind of have very efficient deals with them and make sure that you know they're all coordinated you know that's something that you know intel cell probably won't have the damage to do or you know they can you know a company like panasonic you know same thing you know internationally a lot of the implied connectivities are happening through that you know so these panasonic can be the company that goes to you know all these international airliners and uh basically have very efficient deals for them to provide them with internet after that uh basically these companies and of course you know other examples can be really like um utility companies uh internet providers you know you can think about comcast and you can think about apnc you know we had the question that they say you know these uh cell services do exist and why is this not so expensive for them to provide broadband internet because you know they are not getting uh an input to their network that is cheap enough but a service provider can actually solve this problem that they can have you know very uh interesting novelties in terms of uh bringing together so many companies that are providing you know like you know utility services internet in different countries and kind of have a nice deal and link them to a salaried operator and after that of course we have the end consumer so this is kind of a change that um honestly like you know it's not easy to even put together you know that the industry is not really that transparent out there that you can see all these things you know uh super clearly but i thought you know this would be really useful for us to actually walk through because again we can go into numbers and i can later on and offer some more examples and um what would be the portion of the tie that you know these uh different companies want to take and uh but really as short you know i want to again go back to the key number that we had we want to have a project that brings internet to the end consumers uh over 10 years maximum revenue of 260 million dollars how can you really put together a consortium of like all these companies that can actually efficiently work together so at the end of the day this project cost uh low enough that uh would actually make financial sense uh for someone to actually manage this whole thing and try to solve this problem i want to really very briefly touch on two different ideas here first one is the global leo constellations because now that you understood this um you can actually understand the alternative very well the alternative is one company doing everything so that's really like uh what at least you know a lot of the constellation companies are trying to to do to say that okay why why would i know for example space section in this case why would i just do the launch if i can actually build a satellite if i can potentially build a ground partner if i can actually build an operation center i can actually then build another you know huge sales team to go talk to all these companies then after that uh have uh use their portal and all that for customers to be able to sign up and all that and then basically reach the consumer so it's a it's a big ecosystem but it's doable so let's you know look at it from this perspective and see what it takes and what are some of the challenges the advantages are pretty clear um at least like the first one which is the global coverage and of course and i don't have you know illustrations here but i'm sure you know you all know uh with leo constellations for for each to work you know you have to have a global coverage you know for it to make sense actually to because you know the satellite is moving you know it's not in sync with the earth so the only way that you know you can always have coverage at one point is to have coverage at every point so that's kind of you know uh how the constellations work so that's great you know you you do the projects where you have global coverage and uh because they're closer to the earth you have low latency as well so that's also great the disadvantages the cons are um very interesting and you know uh debatable you know we can talk about them and i'm sure you know you've heard a lot about these so first one is the high capital so we are talking about uh anywhere you know for the simplest constellations and the two billion dollars for kind of the more um global ones you know like spacex and fighter uh about 10 billion dollars so you have to again repeat this problem literally for the whole world and come up with a math of you know how many of the users and they can converse what is their gdp they have so basically go through the whole you know exercise once more and try to understand okay how much money am i going to make and is it worth putting 10 million dollars there of course you know the math will uh check because you know you can see you know if you if you try to say that okay i'm gonna like connect you know um one billion people over the world and if like you know each person pays ten dollars per year you know that's 10 billion dollars in one year so you're done there you know but uh the big question is of course can you sign up one billion people and you know that's of course a big issue then there is a long time to market we are talking about five to ten years if you are one of the first players um no big deal you know probably not even after five ten years and i think there are still an attractive you know in the case of the spacex uh it has passed its uh five-year i guess anniversary for the starting program um i joined them in 2015 so you know it's certainly just more than five years um so that's the problem though for example when you look at the project like project fighter in amazon just starting it uh you can argue that there is a big risk uh five to ten years from now what is the situation and uh that's of course the degree but to me like uh the major one which is uh again an amazing one and i hope these constellations can come out of it successfully is the regulatory issue and i'm just gonna putting an example there you know if you look at china and india combined you know we're talking about a big big number you might put half of the world population you know it may be a little uh less than that but think about it you know just these two countries if you go to them and say that okay let's understand these constellations when you talk about the constellation we are telling them that the source of the internet which is internet going to the constellation going off to the satellite you know which is the gateway that can be in the u.s all you do you know in your country is that you know we talk to your users so basically you are telling them that you know there is almost no uh control from your side on what um internet what content you know is being provided it's actually really like a global totally free you know internet coverage to everyone and free i mean like in terms of the content not cost but meaning like totally open sorry so that can be a big problem and a lot of countries i i mentioned china and india here but even a lot of uh least developed countries developing countries a lot of the governments will not feel comfortable with this notion that you know their internet is being provided by basically a global constellation without any oversight on that so that's kind of a big thing that you know these constellations have to overcome and that's to be seen and finally of course the big big problem with these constellations because as opposed to geo which you know you have a fixed satellite and on the ground if you are not moving you know you just need this antenna and pointed to the satellite when you have the leo constellations the satellite is moving so you have to constantly track and compensate for the movement of the satellite so you need basically either a mechanically moving dish antenna or you need basically a mechanically fixed but electronically a steerable antenna to kind of compensate find the satellite uh rotate the beam but without any mechanical movement so that's of personal uh to date the biggest challenge and obstacle with new constellations and uh there is a lot of effort uh for solving that so i leave you with this you know for the new constellations the first happy to talk more uh very brief mention of balloons as well you know that's also of course another um solution that has been tried the advantages of personal low capital you know it's rather cheap to send up one of those and the latency is also very small because you know you're pretty close to earth but the disadvantages come it's of course low availability you know for it to be to have a global coverage that's a major problem um or even not global you know national coverage so i mentioned limited coverage and as of now it's basically limited to backhauls so through this hour it's very the type of year so it's really limited to providing internet you know to the towers to the back also kind of enable internet but very limited coverage uh so if you want to summarize uh the cases study we looked at the connectivity situation in eritrea we defined the business case for solving the problem i just hope you know the numbers and kind of the perspective will help you have a more meaningful conversation with uh companies you will engage with in the future and we can actually uh have a better understanding of how to approach the problem we looked into details of um one standalone solution you know basically geosatellites a small geothermic and we who will the partners be in that uh solution and we remove reviewed some of the alternative solutions and the last slide i have is uh really future problems that we need to solve i i have a list of things that i want to briefly mention and this is really mostly my own experience being in this field what i observe especially in startup companies is that and a lot of this you know is also um i would argue you know an investor's fault that people are more interested in easy problems versus heart problems you know they're interested in problems that you know can have overnight success um mostly really just you know one magic software uh solution that you know you kind of put together and they have like two software engineers and you know in a week in a month or even like in a year can really like you know uh build a unicorn and uh the unfortunate thing uh again with the reality of the connectivity issue is that you know we are talking about a really really hard problem you know you're talking about infrastructure and you know you cannot uh solve infrastructure problems you know with really light uh solutions you know you cannot really provide electric electricity to the world you know with some you know like innovation in software tools and i'm saying it because you know at least myself you know being through the latest batch of y combinator uh you can really see a big big trend in uh again what i call you know easy overnight successes and you know people really are trying to optimize their effort towards those and as soon as they see a problem that needs um time to build you know that needs you know some investment money to building a hardware that actually takes some time and some money to build the test doesn't immediately become the no go so i think you know that's uh one change that i would love to see in the um in the field and then uh these two are rather similar you know i would say these three so they go into the three is basically these three so i think the fundamental problem in this solution as a whole being expensive is not in this section so these are all uh parts of the chain that you know can actually scale you know with uh with software with automation you can actually make a lot of progress and then you can actually take out some extra middlemen that are not needed and you can actually do a lot of innovation here that you know rather quickly uh make it more efficient but when you look at the underlying um parts of the chain that are basically all one way or the other hardware these are parts that really really need to be improved you know you need a lot of investment you know in all three and even the launch side you know there are a lot of new startups these days that are kind of optimizing their uh efforts towards building uh rockets for smaller satellites and to do it more efficiently so all three are you know things that i certainly consider as uh important parts of the innovation and then uh the service markets you know with less overhead and fees and so that's basically everything else in between the user and hardware company so i think there is certainly a personal room for improvement and new companies to become basically isps of the world and have really efficient models to be able to connect and consumers to hardware manufacturers and uh i think also we need to have in a novel go-to-market solutions for the end consumers and the new um basically market generation is actually you know what i want to say with this bullet that uh the existing way of pitching to consumers and trying to convince them to use your services may not work in these least developed countries and you may need actually new ways of you know uh i guess pitching and proposing your internet connectivity to these people with with their two percent of another gdp uh you may need actually really new uh marketing solutions and then one thing that is really key and again it goes to anthony's question as well there is a big disconnect you know i'm kind of you know going through this thing i would say you know myself you know every day talking with different companies that um companies which are actually doing the uh backhaul and uh providing internet to the slow services uh operator those have actually major disconnect with the satellite operators and the companies who have the satellite service so i think there is going to be some either mergers in the future or some way of actually these two currently very separated parts of the links should be connected you know example you know here would be you know for example atm t uh they have you know their back home they make it get it from someone else but just think about atm as a company there is actually very very little um useful and efficient linkage between a company like atmc and just an example making up you know like in the cases and providing examples here with like a stylus operator like intelstat but you know if these two can have a more streamlined uh relationship with between each other and can basically if htnt can switch back and forth you know whenever you know it makes more sense to get data through salaries or whenever it makes more sense to get through fiber if that linkage is improved i think you know that will also result in a huge uh decrease in the cost of internet i think that concludes what i had to say here thank you

Channel: Fifty Years

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Id: vv4LvKCLWxI

Length: 58min 55sec (3535 seconds)

Published: Tue Aug 18 2020