Transcript.

Erik: Tarun, thanks for joining us on the podcast today. 

Tarun: Thank you, Erik. Thanks for having me. I'm excited to be here. 

Erik: Great. This is always an interesting topic for me. I've hosted a couple of other companies in the tech space. By space, I mean, space space in the past year. It's always fascinating because I think it's something that's really evolved, really, just over the past decade or so. When did you start becoming aware or interested in this domain? 

Tarun: You know, I've been actually interested in space for quite a while. Back in high school, back before electricity, basically, I was involved with satellite communications. So, we did a bunch of C band communications but to geostationary satellites. Satellite has gone from being in favor and the hottest thing to going away and then back and forth, and whatnot. 

Recently, those satellite has come back in favor, and become really the new technology because cellular is pretty much built out. Cellular has been around since the mid-'80s or so depending on where you are. You find that cellular coverage is frankly actually shrinking in a lot of cases, because 5G requires higher bandwidth, higher frequencies. Therefore, the cell sites go down. What people don't recognize is, as cell sites go down, what you find is you have to do — because it's an R-squared type of problem, you need for X number of cell sites to cover that same area. Because of that, people expect ubiquitous coverage. They expect coverage wherever they go. "I have a cell phone. I expect coverage. I expect and want it to work wherever I am." Therefore, satellite really becomes the default option, because it's the most cost-effective. It really becomes the solution that is ubiquitous and already there, frankly. And people don't recognize it. 

Erik: Interesting. So, it is actually cost-effective. Cost-effective under what circumstances? For what type of bandwidth or use cases? 

Tarun: So, that part is evolving as well. You look at new constellations and new applications like Starlink and Kuiper and those things. You find that when rural market is getting a high-speed broadband type of service, it makes a lot of sense, that $100 a month type deal. I think that's a brand-new application that, again, wasn't there probably even five years ago, and using this greater and greater adoption. 

When you look at sort of covered areas, I'll call it, or where people are traditionally using satellite services, you look at two things. One is, you look at a very, very expensive connectivity from a device standpoint to devices that cost a couple of hundred to thousands of dollars. You look at very, very high dollar per bit scenario. So, you're looking at satellite coverage. Satellite ARPUs are basically $50 to $100 a month. Whereas now when you look at standardized technologies, standardized 3GPP services, you're looking at satellite-based solutions that could frankly be in pennies per transmission. 

Erik: Is this transformation of maybe the cost structure, also connectivity availability, is this just happening over the past five years? When did this transition really start to make an impact in the market? 

Tarun: It's starting to come out now. I think what you're finding is that, recently, within the last 12 months, you see the 3GPP has certified what they call Release 17. Release 17 is this hybrid mix between cellular and satellite or NTN, non-terrestrial networks, and really the combining of the two entities and the two forces. So, you had this world of cellular that was billions of devices per year spread across cell phones, IoT devices, trackers, all these things that are happening. And you had a satellite industry, which was really measured in the thousands of devices per year. 

When you bring the scale and the magnitude of the cellular ecosystem into the satellite ecosystem, what you find is, you're able to leverage the cost structure of not just the hardware, but then you begin to leverage the benefits of spectral efficiency. You begin to leverage the benefits of sort of, "Oh, I can use this stand, the same core. They're the same building system, the same building platforms," and recognize the scale and the efficiencies that cellular has brought into the satellite world. Spectrum cost or spectrum costs. But when you look at the entire ecosystem and what I'll call the TCO, the total cost of ownership, that's really bringing everything down. 

Erik: Let's say, I have a device. It could be a track and trace device. It could be maybe a pacemaker. If I'm in the city, is it the case that it's then going to be connected to a telco network, but then if maybe I get on a boat, I go into a forest, then it's shifting over to satellite based on best connectivity? How do those two— 

Tarun: You're absolutely right, Erik. This is exactly what 3GPP was thinking about. Just like today, when you're at home with your cell phone, you're probably on Wi-Fi as my guest. You're on Wi-Fi. You're doing your surfing or whatever you're doing. Then when you leave your home and get onto the cellular network, it's a seamless handoff. And so, it's a handover onto the cellular network. You, as a user, really don't see any change here. 

Just like when you're transitioning from Wi-Fi to cellular, you're looking at now transitioning from cellular to satellite. Now, from that standpoint, for you, as a user, you expect actually connectivity. You expect that you're connected. You don't really necessarily care how you're connected. You don't really care if you're on satellite, or cellular, or Wi-Fi, or Bluetooth, or some other mechanism. You just want to make sure you have that connectivity, and you can be found when you want to be found, or you want to be connected wherever you are. So, it's kind of interesting. My daughter — one of our daughters that does a lot of hiking and things — she's out in Yosemite. She's like, "Dad, my Wi-Fi is down," when she's hiking. So, she equates connectivity to Wi-Fi as opposed to connectivity being 3G, or 4G, or 5G, or anything else. Very similar in that regards. 

Erik: It's funny. Different expectations for different generations. 

Tarun: That's right. 

Erik: I guess if I'm switching from Wi-Fi to 5G, I might have a better connectivity with one or the other. Actually, it probably depends a little bit on the case. If I'm switching from my 4G network and then I'm switching over to satellite, am I going to expect an immediate change in terms of the service level, or is that going to be relatively smooth? 

Tarun: I think about it in two buckets. One is the consumer bucket, and one is the IoT bucket. If you look at the IoT bucket in terms of track and trace, location sharing, sending an hourly or a minute, every 10-minute status on the temperature or humidity, you're not going to notice any difference because you're sending an IoT packet. That IoT packet is a 50-to-100-byte packet or something like that and not really real-time. The NTN, the non-terrestrial network satellite type services that are there today are really around IoT type of applications and small use cases. So, it's not really meant for satellite communication for Netflix, as an example. So, if you're watching YouTube or Netflix and you're at home, and you go out to the middle of some national park, you're probably not going to have the same experience on satellite because it's not designed for that yet. 

I would say the satellite connectivity to a device is very much like the 1G services for cellular. Then eventually, you'll find, as new constellations come up and the ecosystem comes up with new spectrum, new powerful satellite, better frequency planning, and moving from geostationary to medium Earth orbit, to low Earth orbit, you're finding higher capacities and a higher bit rate and a lower cost structure. It's what you'll find. But that will take some time. That'll take the entire infrastructure to be upgraded. It just won't happen. But specifically, today — again, depending on the use case — from a cell phone side, if you're texting, you probably won't find any difference. But if you're watching any broadband or even medium band type services, satellite won't support that today. 

Erik: Let's take a step back. Before we get into what Skylo is doing, I'm interested in how you personally made the decision to co-found the company. You have an interesting background. You were the chief architect of FiberTower until about a decade ago. Then you joined Parallel Infrastructure building telecom infrastructure services. Then most recently, you were head of strategy and ops for Google Fiber. So, clearly, you have a lot of experience more than the terrestrial network here. It looks like it's about two, two and a half, three years ago, that you co-founded Skylo. What was it that led you personally to decide this is a mission you want to take on? 

Tarun: Erik, it's interesting. It's a great question. Sometimes I find myself asking the same thing every day. But I'll tell you. I've been fortunate enough to come through some pretty pivotal times in our industry. And so, the first one was, when I first graduated from college, I was part of the first PCS rollout as part of California. I helped build the first PCS network here. I remember thinking to myself at that time, like, "Who wants a cell phone? I have a great landline. It works well. I'll wait 10 minutes till I drive home and be able to call whoever I needed to call or something." Only after did we deploy the network and it became sort of popular and ubiquitous, and people began to really adopt the service that I realized the fundamental shift that happened around the cellular industry and what it could really do. You went from just voice to becoming SMS. Then the Apple launched their phone with the app store and did all sorts of brand-new ways for people to communicate and interact with the wireless space network. So, that was very eye-opening for me. 

Then when I left the cellular side of business, I went over to Google. When I was part of the GoogleFiber, at that time, we launched gigabit fiber to the home. I remember at that time thinking, again, "I have 30 megabits to the house, 40 megabits to the house. Why do I need something different?" I remember being in meetings, and people would be like, "Why do we want a gigabit? That's ridiculous. No one will ever need it. And you can't even use that much or whatnot." 

As we deployed our first network in Kansas City, we were running out of gigabit to the house because people had multiple 4K TVs. They had cameras, and they had all sorts of use cases that were pretty interesting. People from the industry, whether it was the telco providing DSL or whether it was the cable TV or the cable provider providing docks type services, it was like, you don't need the service. But when we began to see the uptick and really created this floor for all new fiber, all new deployments — I mean, my parents now who are in their 80s have gigabit to their house. It's interesting because it was the second shift that I saw just transformationally about how telecom networks were really fundamentally changing how people were living their lives. 

Then what happened a couple of years ago, back when I was talking to the co-founders at the time, my partners here at Skylo, we recognized that connectivity was taken for granted. You realize that people want connectivity wherever they are. They can choose to turn it off or whatever they want to do. But we recognize that cell networks were not continuing to expand. There's a lot of infill and a lot of small cells, and a lot of capacity and all those things that were happening. But no one was talking about, "Well, what do we do outside of cell coverage?" Granted, people are like — it's very interesting to me when you hear the major operators, cellular operators today. They talk about, "Hey, we have 99% coverage or 98% coverage." They talk about people. They don't ever talk about geography. You think about areas that, over the water, they'll never have coverage, as an example, from a cellular-based system. Because you can't put a cell site in the middle of the ocean. 

And so, this was a a fundamental shift for us to think about. How can you provide connectivity to where you've — Just cellular doesn't make cost sense. How do you make sure that people always are connected? Because people take connectivity for granted. Again, I go back to my daughters. When they're hiking, or they're out, or wherever they are, they're like, "Dad, the Wi-Fi is down." It occurs to me that they just expect coverage. They expect their phone to work wherever they are, frankly. This was one where we were pretty excited about — bringing that cellular cost model, that cellular infrastructure into the satellite world on a standard basis that would allow people to communicate, frankly, how they're used to communicating today without any change of behavior. 

Erik: Yeah, it's interesting. There's this expectation. Then there's a whole set of industries that have just been underserved, if you're talking about mining, agriculture, fisheries, shipping, logistics. Even in an airplane, right? I mean, you've paid a fair bit of money. I haven't been on an airplane probably in four years. I've been stuck here in China. So, maybe I'm out of the loop here. But that was always a pain point, of getting on an airplane and saying, "Okay. How am I going to manage to get connected for the next five hours?" 

Tarun: Yeah, sometimes, on a plane, that's the way to get away from people. But I completely agree. I remember — look, Ive been, unfortunately, in this quite a while. But I remember picking hotels because they have free Wi-Fi. Because you need that ability to connect, and you want that ability to connect. Again, I completely agree. It's interesting to me when we look at the use cases that exist. I think about, like we've been approached by people who want to track cattle, as an example, who want to track sheep, who want to do methane sensors out in the middle of whether they're drilling for oil as an example. It's very surprising to me, the use cases that are coming out as a result of having this connectivity. 

Again, what I find is it's not necessarily the broadband side of it. It's that same cellular evolution where they're talking about, "Hey, now that I have connectivity, what can I do with it?" I had a customer come to me or a potential customer come to me a couple of months ago wanting to talk about measuring the inclination of every power pole in a state. Because as a power pole is starting to lean over, that's how power lines fall down, cause fires, et cetera, cause human safety issues. So, this is a pretty interesting use case for me. Because, again, it's a couple of bytes a month saying, "Hey, here's my location. I'm still at the right angle, et cetera." Again, new use cases come out that I hadn't even considered. I didn't even think it was a problem until people are bringing it up. 

Erik: I guess there's a few ways that we could approach looking at this business. Maybe we can take it first from the business standpoint, and then get into the tech stack separate. But from a business standpoint, obviously, you have a long tail of industries and potential companies that could use this. So, it's going to be very diversified on the industry side. But then, because of that, you have probably a challenge as a business. If you know these are my 20 customers and they all have the same use case, that's one key account way of selling. I imagine that's not going to necessarily be the case in a lot of situations here. You're going to have niche use cases that might end up being somewhat small, small businesses, farmers, and so forth. You have a solution that to them might appear quite technically complicated. When you think about satellite connectivity, you don't think simple. How do you deliver this as a product to customers in a way that it's easy for them to roll out? 

Tarun: Yeah, that's a great question. That was a lot of meetings we had back and forth and turned into a lot of discussions. It's interesting when you think about our customers today. We made a conscious decision not to go after, for example, the farmer, or go after the utility. Our view is to go after someone who's servicing that person today or that end consumer that customer pays. For example, our customers are the MVNOs, or the MNOs, or people that have an IoT service today. Frankly, we're augmenting their cellular connectivity with satellite, or we're supplementing their cellular connectivity with satellite. For example, again, if a utility has a million power poles in the state, I'm not trying to go in and say, "Hey, let's replace all the million with satellite." I'm going to their existing customers, the existing providers they have today and say — for example, AT&T — let me supplement you with an NTN service that you can go to your customer and provide 100% solution. 

Think about us as an insurance plan. Think about us as a safety blanket that goes over everything that we can offer when cellular doesn't exist as an example. The good news is, because these are existing cellular devices that with a firmer upgrade can do satellite, these customers or these users already have a connectivity need. So, I'm not going in re-educating anybody. I'm not going in and saying, "Hey, buy a different platform." I'm not saying, "Hey, go in and buy a different device or a different GUI or a different interface." It's their same chipset, same device, same use cases with a software upgrade — again, this 3GPP Release 17 — that allows them to integrate with what they do today. Again, they don't really care. The user doesn't care if they're on Wi-Fi, cellular, or satellite. If they have connectivity, that's just one less thing they have to worry about. 

Erik: Okay. That's interesting. From the user perspective, nothing has changed in terms of the hardware, software interface. Even their relationship with their vendor is not changed. 

Tarun: That's right. 

Erik: What you're doing is, you're getting a service level up from, let's say, 85% to 99%. You're filling some kind of gap on the service level. 

Tarun: That's right. And if you think about that a little bit, we hear back from customers. It's interesting, because what they're saying is, "Wait a minute. Now I don't need to have two sets of spares in my truck — one for satellite, one for cellular. I don't have to have two sets of training manuals — one for satellite, one for cellular. I don't need to have two relationships — one, again, for satellite and one for cellular. I just have to have one relationship that I can expand." So, it's very interesting. When we talk to MNOs, one of the biggest complaints that they get or the feedback they get from their customers is, "Hey, you don't have coverage where I need you to have coverage." This allows our customers — the MNOs and MVNOs — to frankly expand coverage with zero CapEx. So, they're able to go back to your point. It's to say, "Hey, let me take your 80%, 85% solution to 98%, 99%, or maybe even 100% solution. 

In other cases, they're opening up brand new verticals. For example, maritime. Cellular could never really go after maritime as a connectivity customer, but now they can. Think about all the shipping containers, all the shipping vessels, all the fishing vessels example. Think about all the fishing lines that are lost at sea. These are now customers that have access to connectivity, where they can do SOS, or track location, or be notified in the event of a pending hurricane or tornado or whatever it ends up being. Absolutely. 

Erik: Then if we look at the tech stack here, you have the satellites. My understanding is you're not launching satellites. You're using satellites that other companies are operating. So, what does it look like to go from the satellite down to the farmer? What does that tech stack look like? What layers are you then filling in there? 

Tarun: When I think about it, there's an entire ecosystem that Skylo has to create. It's really frankly what we call an NTN alliance. This NTN alliance traverses the entire value chain. When I say the entire value chain, think about it as, from the device, from the user terminal, think about it as we're building and helping to make sure that the modem itself has 3GPP Release 17 type of firmware. So, the modem can support terrestrial, as well as cellular. Sorry. Cellular as well as satellite type of communications. The modem has the embedded firmware. We then work with the module vendor to certify the modules and do the same thing, just like PTCRB does on the satellite side today. Then think about the OEM from the OEM device, from IoT certification. That sort of ecosystem has to make sure that that is working and compliant with the Skylo network. 

Once that's there, that is transmitted to a satellite of what exactly you said. We don't want any satellites. We work with existing satellite partners. The main reason for that is, the satellite companies are extremely good at designing satellites, launching satellites, operating satellites, frequency planning, power management — all those things that made them where they are today, those multibillion-dollar organizations. Frankly, launching another satellite is: A quite expensive, B has tremendous regulatory challenges, and C is just another thing we'd have to do, which just doesn't make sense. 

The way I think about the satellite operators are integral part of the puzzle. But I think about them as the tower operators, where the cellular operators don't do anything on the real estate side, yet they own the RAM, the core, and the building system. The satellite operators to us are pure 100% partners, where we are working with them. We're bringing traffic to their network. We're bringing them a scale of devices that they hadn't seen before. Once the traffic goes up to the satellite, comes down to an existing ground station — again, already licensed, already manned, already has procedures, policies in place as to what you can touch, what you can't touch, the right thing from an operational perspective — lands on a Skylo base station or eNodeB, which is something that we have designed, developed. We operate and maintain this. This was because there is no Release 17 base station today. We have this. It's the first commercial vRAN that is in the marketplace. We integrate that to our network. Then that then feeds into, frankly, a standard core, our standard mobile core. Think about the mobile core in terms of, again, HSS, a P gateway, and an S gateway and a SKF. All the things that are how we interface to a mobile operator. 

When we talk about interfacing the traffic, and when you think about that farmer who says, "Hey, I don't know if my cow, let's say, is in a cellular covered area or on a satellite covered area," that traffic still has to flow back to their dashboard in their own way that they know how to act and use that data. We then integrate and use that traffic from our core to our MNO partners' core, which then goes to the farmer. We have, again, our own authentication. We have our own traffic handover. So, the way we work is, literally, we are a roaming partner to the mobile operators. No special handoff, standard S6A interfaces, SA interfaces. Just things like that. We are, frankly, a mobile operator whose network is in space from our space partners. 

Erik: Okay. Interesting. So, you're a mobile operator. It sounds like you're building out the middleware to make all of these glued together. Then, also, you mentioned the importance of the ecosystem here, that you have all these other players that are maybe providing value-added services or developing other solutions, and you're helping them to plug into this. 

Tarun: Right. If you think about, again, the farmer. The farmer has, again, a tag on their cattle. They're putting a SIM card on that tracker. We are a profile on that SIM card for that cow. And so, when the cow roams or is in the cellular, they're in the cellular network, and when they're out of cellular, they roam, that device is scanning. It's searching for a network. It sees Skylo. It'll latch on to the Skylo network. When you think about our ecosystem, again, it goes from the chipset side, all the way to the SIM side. Kigen is a great partner of ours, as we might have mentioned. This is our SIM partner where we are an NZ. And we would be on that device. 

Erik: Great. Yeah, I think it was the CEO of Kigen on here, but probably a year or so ago. A great company. You have quite a number of other partners, Media Tech — I guess that one's a bit intuitive — Druid. What are the different roles that these partners are playing in the ecosystem? 

Tarun: If you think about the NTN alliance that we've created, again, it's the entire stack. This ecosystem here is really — everyone has to play together. Again, the good news is, for the large majority of the Skylo network — again, the RAM, the core, the pieces here — these are all cellular-based items and all cellular-standardized items. So, these are things that there's a bit of build, a bit of buy. 

But when you look at Druid, Druid is our core provider today, a great partner of ours. Again, when we go to our customers and say, "Hey, we have a 4G, 5G core," a standard core on how to interface, they're like, "Oh, we get it. We know how to interface with you. We know how to hand over traffic. We know how to get a building record from you. We know how to understand how to get a bill, understand how much traffic were used. We understand roaming in that regard." 

As we talk to our customers, because we're using these industry names that are well-respected, there's frankly not a lot of conversation or education that needs to happen on the network side. It's very simple, standardized, all things that have been in place for the last, frankly, 20, 30 years. 

Erik: Got you. Okay. A few more details that I'm curious about here on the operating model. Coverage, I see, online, you have 13.6 million. I think I'm remembering that US is something like 2 point something million square miles. So, that makes me feel like you have what the earth might be. What is it? Like 100 million square miles in total or something like this. 

Tarun: The good news, Erik, is when we think about satellites, these are — because the other benefit, as I alluded to earlier, the benefit of using existing satellites with existing satellite partners is that they already have coverage. One of the reasons we're going with geostationary satellites, frankly, is that three geostationary satellites cover the planet. When you read the press around Starlink or Kuiper — again, these new networks that are being launched — these are thousands upon thousands of satellites for that complete global coverage. From a geostationary standpoint, three satellites cover the globe. And so, by partnering with the existing players, you're able to cover huge, huge swathes of land for frankly very little infrastructure. Because everything is in the cloud today, not only is it redundant but it's a lot cheaper and a lot faster to deploy. So, you think about these larger stations. You think about these satellites. You're able to move into new geographies very, very quickly. 

Erik: Got you. Okay. A small set of existing infrastructure already provides most coverage that you would need. Hardware, we touched on this already. No hardware updates. What percentage of existing hardware on the market would you expect to be compatible with today? Because I guess there's going to be some legacy stuff that it's less likely you're compatible with, and then maybe things that are being put in devices and shipped today much more likely that you're compatible. But what does that portfolio look like? 

Tarun: That's the other great news about going with a standardized technology. Because, again, we're using standards-based infrastructure and standards-based — there's Release 17 devices. These are all using existing chips that are made today, using a standard NB-IoT protocol. When you think about those devices, again, it depends on the device. It depends on the application and the use case and whatnot. But theoretically, those devices can be upgraded over the air in the field. 

For example, again, there's a lot of nuances there. But we have taken multiple devices, devices designed for cellular. Whether they are a track and trace device, whether it's a wearable, for example. We've been able to do a firmware upgrade, connect those over satellite. No change in hardware today. When you think about NB-IoT as a protocol and NB-IoT as a chipset sort of modem, basically, those are made in the scale of — in the next couple of years, it will be more than a billion a year. That's the type of scale of devices we're talking about that we can bring onto the satellite network. Those, if they're upgraded again, via over the air firmware or even in a warehouse or whatever, those can be satellite-enabled. 

Erik: Got you. Okay. Good. A significant portion of the hardware coming out of the market will be— 

Tarun: Yeah, things that are already there or coming out in the future. Absolutely. 

Erik: Then the pricing model. On your website, it seems very transparent and clear. $6 a month for every connected device. Is that the default for every device, or does it end up mattering a lot on the bandwidth or other variables? 

Tarun: Skylo, we're a network service provider. So, we provide a network service. Think about us as a Vodafone, as an AT&T, as a Verizon or whatnot, where you are paying for the amount of bandwidth that you use. What we find is that — the way we work today is, because we've worked through MNOs and MVNOs, we actually are a wholesale model to them. They would then provide packages or price plans to their end customers or their end subscribers. And so, the reason we put out that figure on our website is because it's less around the fact that it's $6, or $4, or $10, or whatever it is. But more to help communicate that we are in a low single-digit dollar per month ARPU type of environment, where people can add satellite at a fraction of the cost of what they currently are used to. Because people typically think about satellite. They think about, "Oh, my gosh. This is $100 a month for this type of connectivity, and then plus hardware, plus these other types of costs." But this was helped to really set the stage that, "Look, we are affordable for your types of connectivity, types of solutions." 

Now, because we offer a wholesale package to MVNO customers or our customer base, we recognized that they have different ways they can price to their end customers. For example, they might be able to say — when I say they, I mean our. Our customers might say, if they have a million subscribers or customer with a million devices, they might say, "Look, we're going to add $0.5 to every single device, and you have the ability to use satellite or not." That way they treat it like an insurance package or some sort of amortization. Or they can go back and say, "Well, or you can log into your portal. Click this one for satellite, and this one for just cellular only." Then they can choose to do another way to price it. 

We've seen our customers do and package pricing models very differently, because they have different customers with different needs. And so, our desire is to be as transparent as possible and be as flexible as possible for our customers for their end subscribers. 

Erik: Yeah, that makes sense. That model makes sense. I think it's useful for folks to have an understanding of the ballpark. Because then they can build a business case around that. Let's assume it's $6. But in the end, your distributors or your partners are going to have a business model in place, and they're going to work around that. 

Tarun: Look on customers that are energy, for example, or they're measuring — we talked about the inclination of a power line or a power pole. Frankly, that's probably what a heartbeat a day. Then if there's an alert because the pole is greater than a certain angle, then send an alarm. Those types of applications are probably maybe 10 pings a month or some variant like that. I mean, that definitely wouldn't be $6. It would be much, much cheaper than that. But again, I think what we're trying to do is we want to make sure that people can adopt this service as rapidly as possible and without any friction. Because as you begin to require or force a change in behavior, then people aren't going to adopt it. So, we want to make sure that people have a frictionless way to adopt satellite connectivity, just like, again, roaming or anything else. 

Erik: Yeah, it makes sense. This, I feel, is really a critical element of a lot of IoT value propositions right now. It's, how do you take technology that's been built up and is arriving at a certain level of maturity? But how do you make it so simple that people can just integrate it into an existing behavior, existing process? 

Tarun: Yeah, people shouldn't have to think about, what's the cost justification for this? Is $2 too much money? Is $10 too much money? Clearly, when you look at cellular-based IoT pricing, one of the reasons that it's just frankly so low is because those networks are subsidized by the billions of people paying, at least in the US, 200 million people paying $50 a month for that type of service. So, that's one of the reasons why IoT pricing is just so low. As IoT continues to really expand and grow at a really rapid pace here, you want to make sure that people or devices are connected. Frankly, you almost erase the line between how's it connected to, am I connected or not? 

Erik: So, if we look out into the next 12 months, next 24 months, this is still a very rapidly evolving ecosystem of technology providers. What is on the roadmap for you? What are you excited about, either for your company directly or just in the ecosystem as a whole? 

Tarun: When we started the company several years ago, our focus was on IoT. It was interesting because what we found was, there was a — frankly, this was my days at fiber that taught me this or showed me this in cellular. But what you recognize is, where telecom companies typically deploy is to those people that can afford it. It makes sense. You're going to invest a dollar, and where do you want the best return for that dollar? And so, you began to create this divide between the people that could afford bandwidth and the people that couldn't. What you found were, the communities that can afford gigabit fiber or could afford the first 5G networks were the people that had higher income, as an example, that could afford those types of services. Then only over time did the people in the lower income brackets get those services over, just as the networks began to build and cost justify themselves. 

What we wanted to do was turn that around a little bit and make sure that everyone had access to ubiquitous cost structures and ubiquitous technology, so they could take advantage of lower cost of compute, the drop in silicon prices, and making sure that they have the ability to take advantage of cloud compute and, again, efficiencies in the marketplace. 

Over the next 12, 18 months, I see two different work streams that are happening. It goes back to IoT as one. In IoT, I think you'll see just a tremendous growth on IoT services. Because, again, you see this rapid, precipitous drop in costs and compute, and those types of things, and better business models, and better business efficiencies, and AI, and how people can learn from the data. But what's also very interesting to me now is finding this, frankly, coming out of nowhere, for me, was this growth in the consumer space. This is largely led by Apple and the iPhone 14 about how that device can connect to satellite. How that consumer device connecting to satellite today is frankly giving everyone on the planet who has an iPhone 14 a lifeline in the event of an emergency. That feature has probably been out for four months now. We've already seen half a dozen or so lives saved as a result of it. 

I think over the next 12, 18 months, I would be surprised if you didn't see probably the next 100 million smartphones that come out or more that don't have satellite connectivity. They're going to have it. If you had the choice between picking a cell phone with satellite connectivity or one without, it's very clear you're going to pick a cell phone with satellite connectivity even if you never need it to use the service. Because you want that backup. So, I think what you'll find is, IoT will continue to do as people expect it to do. But you will see a tremendous growth in consumer devices today just because, frankly, people didn't know that that technology existed. 

Erik: And on the consumer side, do you expect it to be, for the foreseeable future, an emergency backup in the case of some event that doesn't occur frequently? Or do you expect it to be people that are living in rural India or in rural America for that matter, just saying, I'm going to use this 30% of the time. I'm going to be using satellite because it's cost effective. Otherwise, I just don't have a good option. Are we going to reach that point? 

Tarun: I think this is no different to me than, one, the first days of cellular, where people would buy a cell phone and put it in their glove box in their car and say, "Hey, I'm going to use it when I break down," as an example. Then I think, over time, they recognize that, "Wow, I can really use this thing." As speech got better, as costs got better, those types of things, people recognize that, "Hey, this could be my main phone, communication medium. And really replace my landline." I don't know if this will be used frankly for people that live in rural America. They don't have access to internet today. Because this is a low bandwidth messaging type of application or message type of service. 

Over time, as you move to 5G NR high bandwidth, I think that will happen. But where I think this will end up being initially is a lifeline type of service, like SOS as an example, or tracking. Again, just to give you a personal anecdote here. The same daughter, she was working in Yosemite last summer. Due to the fires that were happening here in California, she was evacuated from her house or from her location in Yosemite three different times. And so, my wife and I were literally at wit's end. Because we're watching on the news. What is going on here? We didn't know where she was. We gave her frankly — she had her phone. She had a SIM from one provider. We got an eSIM from a second cell phone provider in the US, and she still didn't have coverage. And so, it was very difficult to know where she was. We were afraid. We were calling her. Obviously, it didn't get through. We're texting her. It didn't get through. We only knew where she was when she happened to go past the library that had Wi-Fi there. 

When I think about sort of the use cases, it absolutely is, first and foremost, a public safety thing. But I also think about, again, just standard communications. "Hey, I'm safe. Hey, I'm okay." I look at this natural disaster — what's happening in Turkey, as an example. Look at the catastrophe that's going on. I think about the networks that are down. Just people being able to say, "Hey, I'm safe," that's huge. To say hey. There's always things that are happening on the planet. Just a single ping, "I'm okay," I think that's the first sort of thing. 

The second thing that I see now is tracking. Again, for people that are hiking all day. I mean, not all day. But people that are hiking as a recreation, people that are mountain biking, people that are out skiing as an example, backcountry skiing. Just, "Hey," once an hour, "I'm safe," or, "I'm okay." Just where are you, as an example? It's important. When I think about backcountry hikers, not only do they register at the check in point of where they are, but the government should know or the national park should know where they are at all times. In the event that there's an issue, hey, I know where to go. I don't have to go searching, do the search and rescue, or fly a helicopter for hours on them, looking if I happen to find a red fabric out there. I can find to make sure that you're okay and you're tracked. We can make sure you're safe. 

I think about automatic detection. We are talking to a company today that wants to build satellite connectivity to a bicycle helmet, in the event of a crash. I think about in those scenarios where you don't have access to your cell phone because you're pinned, or you're trapped, or there's some situation like that. You want to make sure that there's an automatic alert. So, there's a lot of these applications that will come out, in my opinion. What's really surprising to me is, again, we're just I think starting to scratch the surface of what you can do once you have connectivity, even though it's a narrow band type of application today. 

Erik: Absolutely. Yeah, my wife would definitely put one of these in my son's shoes. Maybe just in his arm, she'd get a battery that's small. Great. Tarun, I think we've gotten a good bit of understanding of the business here. Is there anything that we haven't touched on that's important for folks to understand? 

Tarun: I think people have an interesting view of thinking about when you think about cellular, I think people kind of forget where we were and how we got to where we are. People are like, "Oh my gosh, this doesn't work for me because I can't surf Netflix, or not surf YouTube," or whatever it ends up being. But people need to recognize that this is a journey. This is sort of step one. It's a tremendous shift of what's going on in the industry, of having this dual-mode cellular, NTN type of service. People need to recognize that the industry is just now starting to mobilize around this hybrid infrastructure. And really, not think about cellular or satellite, but really think about both. 

I think, for me, the question people should be asking is, do you want connectivity? Yes, or no? Not really, how do I want connectivity? Because the applications are going to come. I think, again, 10 years ago or before the iPhone, maybe 2007 or so, I think the phone was largely a talking type of application. But now it really does so many more things. I don't see this as any different. 

We talked to somebody. I talked to somebody a couple of months ago. He was saying — it was interesting — he locked his keys in his car, obviously. Then because he was in an area where there's no cell phone, he couldn't call the service center to unlock the car. He had to get his car towed five miles to inside cellular coverage just to get the car unlocked. So, when you think about some sort of satellite connectivity, that's something you could have done by pressing a button. It's really remarkable to me what people can do when they have connectivity. It's remarkable. I'm excited to be part of the transformation that's happening here. 

Erik: Yeah, now this will be exciting to watch. I'm very confident that the use cases are there, because I'm in reviewing people all the time on the podcast that have use cases around track and trace and all these different situations where there's basically a gap in the model. So, it would be interesting to continue to track Skylo over the coming years. Maybe I can have you on the podcast in another year or two, and we can see where we are as an industry there. Tarun, thanks for taking the time today. I really appreciate it. 

Tarun: Thank you. I'm looking forward to it. I appreciate the opportunity.