This is very exciting. While Google might have strayed from their original "Don't be evil" mantra a little bit, I couldn't think of a better partner for SpaceX to work with on this. Not only does Google have the drive and deep pockets, they've got the incentive. If this works out as well as everyone is hoping, not only will it upset the internet industry, I can see this having benefits for the telco/cell carrier industry as well. With cheap, fast internet available worldwide, nobody is going to pay $30 for a 2GB cap on their mobile phones.
> While Google might have strayed from their original "Don't be evil" mantra a little bit
I don't know. I'm getting more and more the impression that Page is cut from the same cloth like Elon Musk. Both seem to be balls-to-the-walls visionaries who accept nothing less than the utmost limits of what's possible - and then aim a bit higher than that.
I'm starting to think that, for Page, "evil" means "anything less than the greatest possible good for the largest number of people, over a very long term".
I dunno... The first thought that ran through my head was "Jeez, I hope they don't screw it up."
By which I mean that I hope that SpaceX's mission to lift the human race out of Earth's gravity well, colonise Mars and explore the galaxy doesn't end up playing second fiddle to some elaborate ploy designed to sell more online adverts.
SpaceX would drive the product and Google will be a great partner and investor. It is a good match. If Google drive the product, that would raise a lot of concerns across many governments - like EU - as if they didn't have enough problems already.
I find it fascinating that through the business lens, Google is competing with Facebook to sell more ads by going into low earth orbit. We didn't get flying cars like they promised in the Jetsons, but that sounds pretty futuristic.
This is a bit like claiming that Google is investing in radical medical technology because people will watch more ads over their newly extended lifespans.
While this is something Google earns most its money on, I don't think it's the sole reason for its actions, nor that it wants to stay in that business forever.
When your trying to grow you either make the glass bigger or add more water. By providing more internet to people who don't already today, you're simply making the glass bigger, which means more ads can be served up.
No. WhatsApp is used by billions of people daily. SpaceX is a really good government contractor.
What % of AT&T's market cap ($175B) is its SMS business? What % of Lockheed Martin's market cap ($65B) is its space business? Think about the incumbents WhatsApp & SpaceX are trying to dislodge. Generally speaking the ones WhatsApp (now Facebook) are larger by market cap than the ones SpaceX is targeting. That reflects the fact that something everyone uses a little bit every day is generally worth more than something used by very few people, intensely.
Stock valuations are based on what investors think the earning potential of a company is. While rocket companies are beyond cool it's a pretty difficult business in which to actually make money.
Not sure why you're being downvoted, that was my first thought as well. Sure, I understand the concept of defensive acquisitions, valuation as what people are willing to pay, per-user value, developing world markets, etc. But rockets are still rockets, and a messaging app is still a messaging app. I think it's the incredible disparity in total embodied energy for WhatsApp vs SpaceX that makes this intuitively hard to accept.
One thing that needs to be considered is that SpaceX is operating in a space that has far higher risk for a (relatively) indeterminate reward right now. A single accident could severely damage the company's reputation and revenue stream, and I think their valuation might reflect this cautious approach to their business model.
SpaceX has tremendous potential, but most of what will make them lots of money has yet to be proven--both technical and economic.
It's possible they'll never figure out launcher re-use, or get it working well enough to matter. It's possible they will and no one will care that space launch is now 10% what it was, and flight rates will stay the same, and they'll just end up dominating a relatively small and stable niche. It's possible the incumbents will quickly copy their techniques and push them aside. It's possible they'll fail in enough launches to drive off every customer and bankrupt the company.
I don't believe any of that, but it's possible and you have to take the uncertainty into consideration of value. Whatsapp has users and works and will continue to work. You know what you're getting there.
I guess this is an old discussion, but WhatsApp seriously threatened the dominion of Facebook, a company that is valued at $209B simply for owning a significant amount of the daily attention span of consumers world-wide.
Essentially, the value of WhatsApp is based more on what it could have destroyed than on what it could have created. Advertising is kind of funny like that, since it's not a product that consumers actually want. No value is lost to consumers by switching to a platform without advertising, even though the economic damage to advertisers can be huge.
This is what I wondered too. I think there must be something we are missing. SpaceX has 3,000 employees and tons of capital equipment. They have contracts worth billions of dollars and loads of proprietary technology?
I thought they were already profitable? But is that incorrect? It would seem disingenuous to claim that they lowered the price of space travel by 90% if they actually weren't even breaking even? hahahha.
The difference is straight forward - Facebook "owns" Whatsapp, and the deal was paid majorly through stock, if I remember correctly, vested over a period of time.
SpaceX still has it's independence and fresh infusion of $1billion in cash. It would probably fetch much more than $10 billion if it sold out now, but I doubt Musk would want to do that.
Had a similar realization when I caught up with my old boss at a big aerospace/engineering conglomerate. I looked it up and it had an $11 billion market cap. He (being in a smaller town) hadn't heard of Uber, which has ~$16 billion market cap.
The WhatsApp acquisition was an aberration. Zuckerberg was desperate and the WhatsApp founders knew it. Trying to rationally justify it is a bad idea that just leads to wrong conclusions. Nothing should be compared to it.
I would much rather be an investor in whats app than spacex. It may be decades before spacex develops anything beyond the prototype level, whereas whats app can quickly scale and become the next Facebook or Google with a few years.
Before anyone mentions that Satellites can only deliver inferior internet service, previous threads have taught us that with low earth orbit satellites latency is not a problem.
Plus, inferior/high-latency is fine if it's global. I'm guessing people won't generally be trying to play Call of Duty on these universal links, but rather getting essential services like wikipedia, email, etc.
Down thread there are a lot of numbers thrown about, some slightly wrong or only in miles, so let me summarise them! The values are taken mostly from wikipedia, with some data double checked against [1]
Low Earth Orbit (LEO)
altitude: 160 to 2,000 kilometers (99 to 1,200 miles)
orbital period: ~88 to ~127 minutes
latency: 20 to 40 msecs
Geosynchronous Earth Orbit (GEO)
altitude: 42,164 km (26,199 mi)
orbital period: 1 day (approximately 23 hours 56 minutes and 4 seconds)
There is this fairly sparse press-release on the SpaceX website:
Space Exploration Technologies (SpaceX) has raised a billion dollars in a
financing round with two new investors, Google and Fidelity.
They join existing investors Founders Fund, Draper Fisher Jurvetson,
Valor Equity Partners and Capricorn. Google and Fidelity will collectively
own just under 10% of the company.
SpaceX designs, manufactures, and launches the world's most advanced
rockets and spacecraft. This funding will be used to support continued
innovation in the areas of space transport, reusability, and satellite
manufacturing.
Think about it this way, if they truly are the first company to start laying claim to mineral deposits (or provide service to whatever govt does lay claim) on asteroids, satellites like the Moon, and other planets the amount of value in this company - even over the upcoming centuries - is going to be greater than the East India Company, General Electric, or Apple ever where.
Now that's an investment well worth leaving to our kids.
No, "laying claim" to mineral deposits not on Earth is valueless. Even if, in a rather fanciful world, said claim was in some way legally enforceable.
"Having technology able to recover said deposits and deliver them to an area of meaningful economic activity without costing several multiples of the value (or, more realistically, several thousand multiples of the value) of the minerals in question" would certainly justify a very high valuation for SpaceX. But they do not have such technology, and it is far from clear that they are on the path to having that technology anytime soon.
And nothing has much present value today based on its prospective value in centuries. In 100 years, we could be superintelligent nanotech swarms. Or extinct. Or anything in between. Only a fool would place much certainty on the value of a mineral deposit that far out.
That's the optimistic view, yes. But if they aren't truly the first company to start laying claim to mineral deposits? That's the nature of investment.
If I set up a company tomorrow claiming to have solved cold fusion, I'd argue it was beyond undervalued. Until I deliver on that promise an investment would remain a risk. Not that I wish to demean what SpaceX have done so far - it's fantastic. But rocket science is, well, rocket science. And a lot can go wrong.
SpaceX is all about getting into Earth orbit. It has no capacity or projects to go beyond there at present. Elon Musk has expressed a desire to do such things, but the company is not yet engaged with them. Doing so would likely involve fresh investment (for much larger amounts of money) and revaluation.
Earth orbit is hard in terms of energy costs, but relatively easy in other terms: you don't need to solve the long-term independent life support problem, manufacture things off-planet, or figure out how to do supply lines in space.
Once, long ago, I thought Google would have bought Radio Shack and installed wireless network hubs in all ~5000 of them to bring internet to the masses. I guess this is a subsequent option.
That said, on the verge of bankruptcy, Radio Shack currently only has a Market Cap of 25MM.
[+] [-] mtrpcic|11 years ago|reply
[+] [-] Florin_Andrei|11 years ago|reply
I don't know. I'm getting more and more the impression that Page is cut from the same cloth like Elon Musk. Both seem to be balls-to-the-walls visionaries who accept nothing less than the utmost limits of what's possible - and then aim a bit higher than that.
I'm starting to think that, for Page, "evil" means "anything less than the greatest possible good for the largest number of people, over a very long term".
[+] [-] jackgavigan|11 years ago|reply
By which I mean that I hope that SpaceX's mission to lift the human race out of Earth's gravity well, colonise Mars and explore the galaxy doesn't end up playing second fiddle to some elaborate ploy designed to sell more online adverts.
[+] [-] moca|11 years ago|reply
[+] [-] apaprocki|11 years ago|reply
[+] [-] nl|11 years ago|reply
There seems to be plenty of evidence that Google's top leadership is more focused on finding alternate revenue streams that just "selling ads".
[+] [-] YokoZar|11 years ago|reply
[+] [-] TeMPOraL|11 years ago|reply
[+] [-] mbesto|11 years ago|reply
[+] [-] lochieferrier|11 years ago|reply
[+] [-] gaius|11 years ago|reply
[+] [-] krschultz|11 years ago|reply
What % of AT&T's market cap ($175B) is its SMS business? What % of Lockheed Martin's market cap ($65B) is its space business? Think about the incumbents WhatsApp & SpaceX are trying to dislodge. Generally speaking the ones WhatsApp (now Facebook) are larger by market cap than the ones SpaceX is targeting. That reflects the fact that something everyone uses a little bit every day is generally worth more than something used by very few people, intensely.
[+] [-] tsotha|11 years ago|reply
[+] [-] Tossrock|11 years ago|reply
[+] [-] tsunamifury|11 years ago|reply
[+] [-] rcchen|11 years ago|reply
[+] [-] jccooper|11 years ago|reply
It's possible they'll never figure out launcher re-use, or get it working well enough to matter. It's possible they will and no one will care that space launch is now 10% what it was, and flight rates will stay the same, and they'll just end up dominating a relatively small and stable niche. It's possible the incumbents will quickly copy their techniques and push them aside. It's possible they'll fail in enough launches to drive off every customer and bankrupt the company.
I don't believe any of that, but it's possible and you have to take the uncertainty into consideration of value. Whatsapp has users and works and will continue to work. You know what you're getting there.
[+] [-] TeMPOraL|11 years ago|reply
https://news.ycombinator.com/item?id=8915524
EDIT: but to answer your question - yes, I very much feel like that.
[+] [-] jgreen10|11 years ago|reply
Essentially, the value of WhatsApp is based more on what it could have destroyed than on what it could have created. Advertising is kind of funny like that, since it's not a product that consumers actually want. No value is lost to consumers by switching to a platform without advertising, even though the economic damage to advertisers can be huge.
[+] [-] wuliwong|11 years ago|reply
I thought they were already profitable? But is that incorrect? It would seem disingenuous to claim that they lowered the price of space travel by 90% if they actually weren't even breaking even? hahahha.
[+] [-] shenoyroopesh|11 years ago|reply
SpaceX still has it's independence and fresh infusion of $1billion in cash. It would probably fetch much more than $10 billion if it sold out now, but I doubt Musk would want to do that.
[+] [-] stdbrouw|11 years ago|reply
[+] [-] danielha|11 years ago|reply
Oh it says here that my dream to solve world hunger is worth north of a gazillion dollars.
[+] [-] SilasX|11 years ago|reply
[+] [-] onewaystreet|11 years ago|reply
[+] [-] api|11 years ago|reply
[+] [-] ekianjo|11 years ago|reply
[+] [-] jacquesm|11 years ago|reply
https://news.ycombinator.com/item?id=8914756
[+] [-] mliker|11 years ago|reply
[+] [-] _pferreir_|11 years ago|reply
[+] [-] unknown|11 years ago|reply
[deleted]
[+] [-] threeseed|11 years ago|reply
Yes I believe we are living in Bizarro-world.
[+] [-] elberto34|11 years ago|reply
[+] [-] bronz|11 years ago|reply
[+] [-] devindotcom|11 years ago|reply
[+] [-] Cogito|11 years ago|reply
Low Earth Orbit (LEO)
altitude: 160 to 2,000 kilometers (99 to 1,200 miles)
orbital period: ~88 to ~127 minutes
latency: 20 to 40 msecs
Geosynchronous Earth Orbit (GEO)
altitude: 42,164 km (26,199 mi)
orbital period: 1 day (approximately 23 hours 56 minutes and 4 seconds)
latency: 240 milliseconds
[1] http://iml.jou.ufl.edu/projects/Fall99/Coffey/INDEX.HTM
[+] [-] sillysaurus3|11 years ago|reply
I know nothing about these sorts of things, so sorry if that's a stupid question.
[+] [-] ihsw|11 years ago|reply
[+] [-] maaaats|11 years ago|reply
[+] [-] sandstrom|11 years ago|reply
[+] [-] BigChiefSmokem|11 years ago|reply
Think about it this way, if they truly are the first company to start laying claim to mineral deposits (or provide service to whatever govt does lay claim) on asteroids, satellites like the Moon, and other planets the amount of value in this company - even over the upcoming centuries - is going to be greater than the East India Company, General Electric, or Apple ever where.
Now that's an investment well worth leaving to our kids.
[+] [-] aetherson|11 years ago|reply
"Having technology able to recover said deposits and deliver them to an area of meaningful economic activity without costing several multiples of the value (or, more realistically, several thousand multiples of the value) of the minerals in question" would certainly justify a very high valuation for SpaceX. But they do not have such technology, and it is far from clear that they are on the path to having that technology anytime soon.
And nothing has much present value today based on its prospective value in centuries. In 100 years, we could be superintelligent nanotech swarms. Or extinct. Or anything in between. Only a fool would place much certainty on the value of a mineral deposit that far out.
[+] [-] untog|11 years ago|reply
If I set up a company tomorrow claiming to have solved cold fusion, I'd argue it was beyond undervalued. Until I deliver on that promise an investment would remain a risk. Not that I wish to demean what SpaceX have done so far - it's fantastic. But rocket science is, well, rocket science. And a lot can go wrong.
[+] [-] asuffield|11 years ago|reply
Earth orbit is hard in terms of energy costs, but relatively easy in other terms: you don't need to solve the long-term independent life support problem, manufacture things off-planet, or figure out how to do supply lines in space.
[+] [-] stevenjohns|11 years ago|reply
[+] [-] jacquesm|11 years ago|reply
[+] [-] james33|11 years ago|reply
[+] [-] ourmandave|11 years ago|reply
[+] [-] unknown|11 years ago|reply
[deleted]
[+] [-] walru|11 years ago|reply
That said, on the verge of bankruptcy, Radio Shack currently only has a Market Cap of 25MM.