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Speaker 1: Bloomberg Audio Studios.
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Speaker 2: Podcasts.
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Speaker 1: Radio.
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Speaker 2: News.
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Speaker 3: You're listening to Bloomberg Business Week with Carol Masser and Tim Stenevek on Bloomberg Radio.
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Speaker 4: Well, bonds issued by Verizon Communications and AT & T weakening today following SpaceX's announcement that it will buy U.S. Spectrum that will help the company become a major mobile carrier in the U.S. And Jess, we've seen it play out in some of these wireless names.
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Speaker 3: Especially, we were just talking about AT & T, T-Mobile, Verizon, among the top decliners in the S & P 500 today just because of the back and that tied with SpaceX.
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Speaker 4: It does feel like disruption, innovation in a big way, possibly for the cellular space. Hey, let's get a roundup of the SpaceX universe. No one knows it like Lauren Grush. She's a global space reporter at Bloomberg News. She joins us from Austin, Texas. Lauren, good to have you here with us. Let's start with this story. We increasingly, when it comes to the SpaceX world, we talk about Starlink. This feels like they are spreading their wings here.
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Speaker 1: Well, I think it doesn't really come as too terribly of a surprise.
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Speaker 2: We knew that they had really grand ambitions for Starlink and specifically with its direct-to-sell technology. capability, which is this idea or this design of being able to provide cell service to an unmodified smartphone with their satellites that they have in orbit. They have a fraction of these direct-to-cell satellites up there right now.
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Speaker 1: But I think.
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Speaker 2: They've talked a big game about wanting to expand and to actually be a competitive platform. mobile service provider that could actually take on some of the incumbents.
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Speaker 1: And so I think.
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Speaker 2: There was a lot of criticism or at least skepticism about them being able to do that. But I do think that this is a big piece of the puzzle if they are going to work towards that ultimate goal.
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Speaker 3: Well, talk to us more about that criticism because what's the reality and how likely they'll be able to really compete in that space when we were just talking about those wireless carriers down today, whether it's obviously AT & T or Verizon or T-Mobile, but in reality, could this happen for SpaceX?
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Speaker 2: Yeah, I think the biggest criticism that came from a lot of the incumbents is the physics of the issue. And, you know, there are some limitations with the cell service and the spectrum that they have right now, which is that, you know, it's hard to penetrate through walls, through buildings. Obviously, that's not going to work if you want to use a Starlink system for your average cell service, we do take calls frequently inside of our homes. And so this specific band is supposed to help with that interference problem. I think that there is still speculation that if they really want to compete and actually have a comparable service, they're going to need more elements, right? So specifically more terrestrial infrastructure, like towers.
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Speaker 1: And it's unclear exactly how they plan to move forward on that.
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Speaker 2: But I think we'll probably see some play in that in the.
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Speaker 1: Months and years ahead.
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Speaker 4: I'm glad you went there, Lauren. You were part of the team reporting this out today, the story on the Bloomberg. You do get into the build-out.
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Speaker 1: And they also have to launch more satellites.
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Speaker 4: We've talked so much about Starlink, the growth, the bet on this requires developing the company's Starship rocket. So where are we on that? Because And just give me some timeframe around all of this, because I think we read the story and we're like, oh, this is happening tomorrow. But all of this is going to take time.
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Speaker 2: Right.
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Speaker 1: I was just about to say this.
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Speaker 2: You can't go out and buy a Starlink cell service right this second, right? And yes, it does rely a lot on launching a new batch of Starlink satellites into orbit. Now, right now, SpaceX has 11,000 plus Starlink satellites in orbit right now.
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Speaker 1: So they've shown their chops.
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Speaker 2: At being able to launch a bunch of these satellites into space and to operate them seamlessly at the same time. However, only a fraction of those are available for direct to cell service. And ultimately, SpaceX wants to upgrade those massively with their new V2 Starlink mobile satellites, which are supposed to launch on SpaceX's massive Starship rocket, which I'm sure you've seen has been being developed and launched on those test flights down in South Texas.
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Speaker 1: Those are supposed to start launching in earnest next year.
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Speaker 2: But Starship still has some ways to go on that front too. They just reached orbit for the first time on Starship in September, so I think like two weeks ago. And they had a little issue on that flight, so it's unclear how they're gonna move forward. I think they'll probably be in a place to start launching satellites to orbit with some regularity in the months ahead. I just don't know that timeline. So, you know, that's always the case with SpaceX. I feel like the timeline is always a little murky. But yes, a lot of this will rely on launching a big batch of those V2 Starlink mobile satellites, which are separate from or different from the broadband internet satellites that they also launch.
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Speaker 4: As you well know, the timeline with Elon is always tricky, but he kind of often gets there. And everybody always reminds me, don't rule out Elon Musk when it comes to anything. Having said that, In the reporting, you guys remind us that SpaceX could partner up with one of the large telecom companies who already have
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the infrastructure. SpaceX is doing a lot of different things, spending a lot of different money on things. How likely is that?
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Speaker 1: Oh, I guess I don't know if I want to make a prediction on that front. But yes, that is one of the options, right?
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Speaker 2: Obviously, these cell companies already have a vast array of cell tower networks that they use here on the ground. I think maybe the speculation for that is because building out a separate infrastructure of cell.
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Speaker 1: Towers would be extremely.
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Speaker 2: Complicated, probably really hard and take a lot of time that would really set SpaceX back on that front.
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Speaker 1: So one of the easier.
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Speaker 2: Ways for them to get into the game would be to be like an MVNO where they lease the cell towers and the excess capacity that these incumbents already have.
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Speaker 1: That is one option.
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Speaker 2: It will be interesting to see how the major telecom providers respond. I think there might be some animosity there between some of these companies and SpaceX. So I'm not ruling it out, but yeah, it'll be definitely something to watch moving forward.
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Speaker 4: Well, and you do wonder what kind of pressure it puts. Piper Sandler analysts Alexander Potter and Ben Johnson say the deal could be a strategic move aimed at pressuring the carriers to team up with SpaceX as the company becomes closer, although it's going to take time, as you so rightly point out, to being a direct rival. So I guess, I don't know, Jess, time will tell. We'll keep a watch on this, Lauren. We'll continue to watch all of your reporting.
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Speaker 3: Well, we've already seen when it comes to those kind of dead zones for the cell service that they're working with. What else are we going to see with that? Because I know you've had some recent reporting expanding it out and also some things that got approved with the FCC, right?
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Speaker 1: Right.
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Speaker 2: Well, this news did coincide with a really big win for SpaceX, which is that the FCC approved up to 15,000 launches, or they approved SpaceX is able to launch up to 15,000 of their next generation Starlink mobile satellites.
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Speaker 1: And that is a very high number.
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Speaker 2: You know, right now they have 11,000 plus Starlink satellites in orbit. So 15,000 Starlink mobile, that's huge. And that's that's going to relate to those new and upgraded satellites that they want to launch on Starship. So they got the green light from that and then paired with this Spectrum acquisition.
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Speaker 1: That's a big deal for them.
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Speaker 2: And I think the whole point of this is that they actually want to go beyond dead zones, right? Like right now, the Starlink direct-to-sell service is just kind of this supplemental add-on service that you could get through T-Mobile where if you are in a dead zone, then you might be able to, you know, send
out a text if you're in an emergency situation. But SpaceX is very clear that they are not stopping there. They ultimately want you to go and purchase their mobile service.
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Speaker 1: In lieu of an AT & T or a Verizon.
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Speaker 2: And I think we're seeing them put those puzzle pieces in place to make that happen. I think there might be a few more puzzle pieces to go. But as you said earlier, I think a lot of industries and CEOs have underestimated SpaceX's ambitions to their own detriment. I wouldn't necessarily count them out of this fight, especially with this new acquisition.
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Speaker 4: Yep. The t-shirts never rule out Elon. Hey, two other stories we want to get to while we have you. Some great killer reporting that you've been doing. NASA is close to announcing a bulk purchase of rocket launches to fuel its $ 30 billion drive to build a permanent base on the moon for humans to live and work. What do we need to know about that?
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Speaker 2: Yeah, so it's actually a really interesting time to be talking about Starship because as SpaceX is going all in on this massive rocket that they're building, at the same time, they are indicating that they are going to be retiring their Falcon 9 fleet and their Dragon crew and cargo capsule, which the space industry has really come to rely on over the past decade. In fact, I would say the Falcon 9 has a de facto monopoly on the launch market right now. So it's a very interesting time because here SpaceX is really dominating the launch market and they're saying, okay, we're actually going to phase out this rocket in favor of putting all of our resources into Starship, which will ultimately be a rocket and a crew transportation vehicle in the future. So at the same time, it kind of puts the rest of the industry into a bit of a pickle because, you know, NASA, for instance, needs to get a bunch of material to the moon to start this massive moon-based project that they've announced earlier this year.
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Speaker 1: And the Falcon 9 would have been a big.
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Speaker 2: Part of that.
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Speaker 1: So NASA is saying, look, we understand the problem. We see it.
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Speaker 2: We're probably going to announce these bulk purchases of alternative rockets in order.
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Speaker 1: To get the materials we need to the moon.
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Speaker 2: But the truth is, there aren't a lot of rockets that are currently available right now that launch with the frequency and the reliability of the Falcon 9.
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Speaker 1: So it's going to be an interesting few years ahead because....
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Speaker 2: It'll be interesting to see how that plays out, honestly, because it takes a while for rockets to ramp up, so we might actually see a really Really a tough bottleneck for getting things into space over the next few years. Yep.
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Speaker 4: It takes a while to do all of that.
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Speaker 3: It also takes people.
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Speaker 4: I love this story that you have out on the terminal. SpaceX has 2,500 open jobs and Elon Musk is reviewing resumes. Tell me what it's like if you want a job at SpaceX, what you have to go through because you also have to have stamina from what I understand.
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Speaker 1: Yeah, absolutely.
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Speaker 2: Well, from the sound of it, it's a regular recruiting process.
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Speaker 1: Like most tech jobs, most engineering jobs.
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Speaker 2: Recruiter reaches out, you work with a recruiter, you go through multiple rounds with managers. One thing I did hear is that SpaceX really loves to hone in on a project that you've worked on in your past. So they really like to dig deep and they love candidates who can talk about their projects in detail. Yes, they also, in their job listings, They mentioned the stamina that you need just because from reporting on SpaceX for years and years, I just know that's not.
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Speaker 1: Your typical nine to five job. A lot of engineers there pull lots.
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Speaker 2: Of long hours and long work days. Weekend work is frequent. So I think a lot of people know that going in. And then, yes, you know, there is the possibility that Elon might review your resume.
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Speaker 1: I don't know if that's so much anymore.
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Speaker 2: You know, he's a busy guy, but I'm sure at some point your resume will get forwarded to him, whether or not he actually looks at it before you get hired.
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Speaker 3: That's what I was wondering. Like, are you going to get a cold call from Elon Musk after he looks at your resume?
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Speaker 2: You might.
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Speaker 1: I mean, that is the possibility, right?
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Speaker 2: But I think he might be more focused on other things than to individually review each and every resume.
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Speaker 4: But people want to work there, don't they?
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Speaker 2: Yeah, I would say when it comes to the space industry, SpaceX poses a very great opportunity for people to actually see that the materials and the designs and the software that they're working on actually go to space and work in space. There are a lot of other companies, I hate to say, but a lot of them are still in the startup phase or they have a hard time with hardware or they don't.
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Speaker 1: Have access to a launch vehicle like SpaceX has.
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Speaker 2: And so it can be difficult or take a lot longer to see the projects that you're working on actually go to space. And so SpaceX is, you know, by far the biggest hire in the space industry. They have all these projects that they're working on. I could definitely see the attractiveness of going there. And it's probably when you're younger, when you have more stamina.
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Speaker 4: And you do get access to equity, right? That's a big perk.
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Speaker 1: Right, exactly. And we saw that.
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Speaker 2: Become a very big perk earlier this summer when SpaceX IPO. And a lot of those stock options that people did have access to made them very wealthy on paper.
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Speaker 1: So I think that we're.
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Speaker 2: Still in the phase of them slowly unlocking the ability to sell those shares. But still, it definitely turned out to be pretty fruitful for employees who sometimes do take a slightly lower salary that compared to the industry average, but then they have these stock.
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Speaker 1: Options on the side.
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Speaker 4: So I suppose if you walk in with a sleeping bag and a pillow and say, hey, I'm ready to sleep on the factory floor, that's probably a good sign or maybe a good thing to do that maybe- Lauren, thank you so much. You're incredible reporting about all things SpaceX and just the world at large in terms of space exploration. Really love that we could tap into it on this Friday.
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Speaker 3: Thanks so much.
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Speaker 4: Have a great weekend. Lauren Grash, she's global space reporter here at Bloomberg News. She also has written the acclaimed nonfiction book, The Six, which chronicles the stories of America's first female NASA astronauts. So really cool stuff.
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Speaker 1: Love it.
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Speaker 4: Getting to tap into her brain about all this stuff.
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Speaker 3: Yeah, and all the company culture stories they've done, too.
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Speaker 2: Right.
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Speaker 3: About Musk, SpaceX, inserting themselves into some of the projects. Yeah. Fascinating greens.
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Speaker 1: Oh, wait.
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Speaker 4: You mean he's not shy? Not a surprise.