10 ms·

I am guessing Starlink has commercial/military/industrial uses that are already bankrolling the project, and consumer use is the cream on the cake in terms of p

by Andys 6y ago

I am guessing Starlink has commercial/military/industrial uses that are already bankrolling the project, and consumer use is the cream on the cake in terms of profit

modeless 6y ago
I don't think that's the case at all. Consumer should be by far the biggest market. They've focused a lot on reducing the price of the antenna, manufacturing in volume, and making setup super simple. None of that is very relevant for commercial or military use.
- drawfloat 6y ago
  It seems fairly short sighted after the last decade to not assume there is also a military, state, or data collection side to a tech startup's business case. There are definitely applications for this in all those sectors, the onus should be on Starlink to confirm that they don't or assume they are – particularly in light of Elon's recent announcement about SpaceX weapon drops.
  - modeless 6y ago
    There are undoubtedly military applications and it's not a secret conspiracy or anything. The US military has already tested Starlink and it's been publicly announced. SpaceX is already a military contractor in other areas, of course. But the consumer market is bigger. It's not an afterthought; it's the main event. And AFAIK SpaceX's funding for Starlink is a combination of their own revenue from launch services, and private VC. So it's not correct to say that the military is "bankrolling" Starlink, except to the extent that they buy unrelated launch services from SpaceX.
JumpCrisscross 6y ago
> StarLink has commercial/military/industrial uses that are already bankrolling the project These are the obvious long-term customers. But I don’t think they are bankrolling the venture. High-income rural homes are a good beachhead since a partial constellation can deliver 100% uptime to some locations.
- gambiting 6y ago
  How many high-income rural homes would you need at $99/month to pay for thousands of satellites though? In fact, how many high-income rural homes are there? For me "rural" almost by definition means poor(er).
  - JumpCrisscross 6y ago
    > For me "rural" almost by definition means poor(er) Median incomes in counties that are mostly rural skew lower [1] than those in urban counties [2]. But the difference, about 4%, is less than I had thought [3]. Moreover, “median incomes in rural areas of the Northeast and Midwest ($62,291 and $55,704 respectively) were higher than in the regions’ urban areas ($60,655 and $51,266)... Median household income was higher for rural households [versus urban ones] in 32 states. In Rhode Island, for example, median rural household income was $85,278, about 57 percent higher than the median for urban households ($54,324)” [4]. And since these are largely Census data, they ignore vacation homes. [1] https://www.census.gov/library/visualizations/2018/comm/acs-5yr-income-mostly-rural.html https://www.census.gov/library/visualizations/2018/comm/acs-... [2] https://www.census.gov/library/visualizations/2018/comm/acs-5yr-income-mostly-urban.html https://www.census.gov/library/visualizations/2018/comm/acs-... [3] https://www.census.gov/newsroom/blogs/random-samplings/2016/12/a_comparison_of_rura.html https://www.census.gov/newsroom/blogs/random-samplings/2016/... [4] https://www.census.gov/library/stories/2017/11/income-poverty-rural-america.html https://www.census.gov/library/stories/2017/11/income-povert...
  - bbarnett 6y ago
    I agree that rural can mean poorer, and that the average demographic might meet those conditions. Two things though. Thing #1. Definitions of 'poor' vary by countries, and my understanding of 'poor' in the US is: * no safety net * low, or no minimum wage often * no/low quality health care Meanwhile, in Canada (for example) with minimum wage, paid for health care, and a strong safety net, poor is a different thing. I don't want to get into a big health care debate, but essentially taxes pay for health care here, and the less you make, the less tax you pay. And when you live in a rural area, you need significantly less pay to live to the same standard as a city dweller. Everything is more expensive in the city. This means that a rural person pays less income tax, for the same standard of living. And therefore, essentially, less for health care. When combined with housing costs which are immensely lower, the ability to reduce other costs (heating with wood, growing your own food, the ability and room to repair your own car, on and on...), there is more room for extras than one might expect. An example; waiters/waitresses are paid, by law, minimum wage. And in rural areas, this is much more advantageous than in the city. I guess what my point #1 is saying, is that rural poor are often better off than urban poor. And do have some discretionary spending, at least in some countries out there. Point #2.... Definitions of rural. There is a zone around smaller cities which is not 'suburbia', but is indeed rural. And these areas are often well within easy reach of cities. For example, the city I live close to has a tech businesses concentrated on its western side. This means that when buying a rural home, one need to be concerned with reaching the entire city quickly. Only the western side. In as such, drive time from rural -> city, as the region is ~ 1.5M, is not that bad. Less than 30 minutes even. In this rural zone, housing is far enough apart that on side/non-main roads, there is no high-speed internet access. To speak to that, I live on the very last side-road, before high-speed internet access becomes non-existent. This is no mistake, when I looked to buy, I found the zone where high-speed ended, then searched in that area for housing. To give you an idea? My house is worth ~ $200k. 10 minutes away? The same house? ~$400k, and I have a 1 acre lot, versus a 1/4 acre city lot. Anyhow, the above is a bit of rambling, but the point is ; there is 'very close to the city rural, with no high speed' and 'farther out rural'. Close-to rural enjoys city pay scales for higher end jobs, even without remote work. And if starlink comes? People might move further out.
coolandsmartrr 6y ago
This video[1] speculates that Starlink will achieve lower latency than fibre Internet. Latency-sensitive industries like finance are very willing to pay a lot for improved latency. [1] https://www.youtube.com/watch?v=giQ8xEWjnBs https://www.youtube.com/watch?v=giQ8xEWjnBs
- bvm 6y ago
  How predictable/consistent does the latency have to be for those use cases? or do you just assume the p99 and be done with it?
- nickik 6y ago
  Elon hates finance front-running. This market is certainty not his goal or target. Its also only true in very specific situation and probably not as worth as much as some people believe.
  - kortilla 6y ago
    Nit: HFT isn’t front running.

by Andys 6y ago

I am guessing Starlink has commercial/military/industrial uses that are already bankrolling the project, and consumer use is the cream on the cake in terms of profit

modeless 6y ago

I don't think that's the case at all. Consumer should be by far the biggest market. They've focused a lot on reducing the price of the antenna, manufacturing in volume, and making setup super simple. None of that is very relevant for commercial or military use.

drawfloat 6y ago
It seems fairly short sighted after the last decade to not assume there is also a military, state, or data collection side to a tech startup's business case. There are definitely applications for this in all those sectors, the onus should be on Starlink to confirm that they don't or assume they are – particularly in light of Elon's recent announcement about SpaceX weapon drops.
- modeless 6y ago
  There are undoubtedly military applications and it's not a secret conspiracy or anything. The US military has already tested Starlink and it's been publicly announced. SpaceX is already a military contractor in other areas, of course. But the consumer market is bigger. It's not an afterthought; it's the main event. And AFAIK SpaceX's funding for Starlink is a combination of their own revenue from launch services, and private VC. So it's not correct to say that the military is "bankrolling" Starlink, except to the extent that they buy unrelated launch services from SpaceX.

JumpCrisscross 6y ago

> StarLink has commercial/military/industrial uses that are already bankrolling the project These are the obvious long-term customers. But I don’t think they are bankrolling the venture. High-income rural homes are a good beachhead since a partial constellation can deliver 100% uptime to some locations.

gambiting 6y ago
How many high-income rural homes would you need at $99/month to pay for thousands of satellites though? In fact, how many high-income rural homes are there? For me "rural" almost by definition means poor(er).
- JumpCrisscross 6y ago
  > For me "rural" almost by definition means poor(er) Median incomes in counties that are mostly rural skew lower [1] than those in urban counties [2]. But the difference, about 4%, is less than I had thought [3]. Moreover, “median incomes in rural areas of the Northeast and Midwest ($62,291 and $55,704 respectively) were higher than in the regions’ urban areas ($60,655 and $51,266)... Median household income was higher for rural households [versus urban ones] in 32 states. In Rhode Island, for example, median rural household income was $85,278, about 57 percent higher than the median for urban households ($54,324)” [4]. And since these are largely Census data, they ignore vacation homes. [1] https://www.census.gov/library/visualizations/2018/comm/acs-5yr-income-mostly-rural.html https://www.census.gov/library/visualizations/2018/comm/acs-... [2] https://www.census.gov/library/visualizations/2018/comm/acs-5yr-income-mostly-urban.html https://www.census.gov/library/visualizations/2018/comm/acs-... [3] https://www.census.gov/newsroom/blogs/random-samplings/2016/12/a_comparison_of_rura.html https://www.census.gov/newsroom/blogs/random-samplings/2016/... [4] https://www.census.gov/library/stories/2017/11/income-poverty-rural-america.html https://www.census.gov/library/stories/2017/11/income-povert...
- bbarnett 6y ago
  I agree that rural can mean poorer, and that the average demographic might meet those conditions. Two things though. Thing #1. Definitions of 'poor' vary by countries, and my understanding of 'poor' in the US is: * no safety net * low, or no minimum wage often * no/low quality health care Meanwhile, in Canada (for example) with minimum wage, paid for health care, and a strong safety net, poor is a different thing. I don't want to get into a big health care debate, but essentially taxes pay for health care here, and the less you make, the less tax you pay. And when you live in a rural area, you need significantly less pay to live to the same standard as a city dweller. Everything is more expensive in the city. This means that a rural person pays less income tax, for the same standard of living. And therefore, essentially, less for health care. When combined with housing costs which are immensely lower, the ability to reduce other costs (heating with wood, growing your own food, the ability and room to repair your own car, on and on...), there is more room for extras than one might expect. An example; waiters/waitresses are paid, by law, minimum wage. And in rural areas, this is much more advantageous than in the city. I guess what my point #1 is saying, is that rural poor are often better off than urban poor. And do have some discretionary spending, at least in some countries out there. Point #2.... Definitions of rural. There is a zone around smaller cities which is not 'suburbia', but is indeed rural. And these areas are often well within easy reach of cities. For example, the city I live close to has a tech businesses concentrated on its western side. This means that when buying a rural home, one need to be concerned with reaching the entire city quickly. Only the western side. In as such, drive time from rural -> city, as the region is ~ 1.5M, is not that bad. Less than 30 minutes even. In this rural zone, housing is far enough apart that on side/non-main roads, there is no high-speed internet access. To speak to that, I live on the very last side-road, before high-speed internet access becomes non-existent. This is no mistake, when I looked to buy, I found the zone where high-speed ended, then searched in that area for housing. To give you an idea? My house is worth ~ $200k. 10 minutes away? The same house? ~$400k, and I have a 1 acre lot, versus a 1/4 acre city lot. Anyhow, the above is a bit of rambling, but the point is ; there is 'very close to the city rural, with no high speed' and 'farther out rural'. Close-to rural enjoys city pay scales for higher end jobs, even without remote work. And if starlink comes? People might move further out.

coolandsmartrr 6y ago

This video[1] speculates that Starlink will achieve lower latency than fibre Internet. Latency-sensitive industries like finance are very willing to pay a lot for improved latency. [1] https://www.youtube.com/watch?v=giQ8xEWjnBs https://www.youtube.com/watch?v=giQ8xEWjnBs

bvm 6y ago
How predictable/consistent does the latency have to be for those use cases? or do you just assume the p99 and be done with it?
nickik 6y ago
Elon hates finance front-running. This market is certainty not his goal or target. Its also only true in very specific situation and probably not as worth as much as some people believe.
- kortilla 6y ago
  Nit: HFT isn’t front running.