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Shit Elon Says - Transcript - SpaceX Seattle 2015

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What this represents is the official opening of SpaceX Seattle. It is intended to be a significant engineering campus. It's going to be the focus of SpaceX's satellite development activities. In LA we have the rocket development and our Dragon spacecraft, but this is going to be the center of our satellite development activities. What we want to do for satellites is revolutionize the satellite side of things, just as we've done with the rocket side of things. And I should also say it's possible for you to do both, so if you end up working at SpaceX Seattle, you can also work on rockets and manned spacecraft as well as satellites. It's not exclusively one or the other, but in terms of the center of gravity, for satellites will be here in Seattle. The reason for it is pretty straight forward. There's a huge amount of talent in the Seattle area and a lot of you guys don't seem to want to move to LA. It has its merits, by the way. So instead, we're going to establish a significant operation here.

I want to tell you a little bit about what we want to achieve with the satellites and why that's important. The satellites constitute as much, or more, of the cost of a space-based activity as the rockets do. Very often actually, the satellites are more expensive than the rocket. So, in order for us to really revolutionize space, we have to address both satellites and rockets. We're going to start off by building our own constellation of satellites but that same satellite bus and the technology we develop can be also be used for Earth science and space science, as well as other potential applications that others may have. So, we're open to both building our own as well as - we're definitely going to build our own but it's something we're going to be able to offer to others.

The focus is going to be on creating a global communications system. This is quite an ambitious effort. We're really talking about something which is, in the long term, like rebuilding the Internet in space. The goal will be to have the majority of long distance Internet traffic go over this network and about 10% of local consumer and business traffic. So that's, still probably 90% of people's local access will still come from fiber but we'll do about 10% business to consumer direct and more than half of the long distance traffic.

As you guys may know, the speed of light in vacuum is somewhere 40% to 50% faster than in fiber. So you can actually do long distance communication faster if you route it through vacuum than you can if you route it through fiber. It can also go through far fewer hops. Let's say you want to communicate from Seattle to South Africa. If you look at the actual path it takes, it's extremely convoluted. It'll follow the outline of the continents. It'll go through 200 routers and repeaters and the latency is extremely bad. Whereas, if you did it with a satellite network, you could actually do it in two or three hops. Well, maybe four hops. It depends on the altitude of the satellites and what the cross-links are. But basically, let's say, at least an order of magnitude fewer repeaters or routers and then going through space at 50% faster speed of light. So it seems from a physics standpoint inherently better to do the long distance Internet traffic through space.

And then space is also really good for sparse connectivity. If you've got a large mass of land where they're relatively low density of users, space is actually ideal for that. It would also be able to serve as, like I said, probably about 10% of people in relatively dense urban/suburban environments - cases where people have been stuck with Time Warner or Comcast or something this would provide an opportunity to do [unintelligible due to cheering]. It's something that would both provide optionality for people living in advanced countries/economies as well as people living in poorer countries that don't even have electricity or fiber or anything like that. So it's a real enabler for people in poor regions of the world and it gives optionality for people in wealthier countries. It's something that I think definitely needs to be done, and it's a really difficult technical problem to solve. So that's why we need the smartest engineering talent in the world to solve the problem.

At the same time, "we also need to make sure we don't create SkyNet." Ironically, the server room at SpaceX jokingly was called SkyNet. Fate has a great sense of irony. We really need to make sure that doesn't come true. I think, because I'm talking to a technical audience, I can say that if there's some AI apocalypse it's going to come from some collection of vast server farms terrestrially based, not via the space based communication system. I did think about that though.

Anyway, I think that this is a fundamentally good thing to do. I can't think of any major downsides. I think it's an important thing to do. It should happen and I think that it is something where, properly designed, it could give people gigabit level access, 20 to 30ms latency, everywhere on Earth. That would be pretty great. That same system we could leverage to put into a constellation on Mars, because Mars is going to need a global communications system too and there's no fiber optics or wires or anything on Mars. We're definitely going to need that. We're going to need high bandwidth communications between Earth and Mars. So I think a lot of what we do in developing an Earth-based communication system could be leveraged for Mars as well. Crazy as that may sound.

So yeah, that's the basic story and I'd encourage you to spread the word and tell people about it that you think are great. As I said, the office is going to grow slowly at first. We're not going to hire a zillion people. So, if at first SpaceX doesn't respond to you, or something, please come back again in the future. It's just really hard to add 500 people all at once and have that be good. We are going to grow and make this a very significant SpaceX Seattle campus but we want to do so very carefully by adding the right expertise at the right time. So, like I said, if for no reason you don't get a response because - I don't know, our recruiting team is deluged or something like that, please reapply in like six months and don't take any offense by that. We're just trying to grow in a careful and considered way.

Okay, I'm happy to take some questions from you guys if you want to just yell out some questions.

I wouldn't worry too much about the space junk thing. Actually, we should worry about ourselves creating the space junk, but at the altitude in question there's really not a lot out there. We're talking about something about the 1100 km level and there's just not a lot up there. The thing we need to make sure of is that we obviously.. we don't want to create any issues. So we're going to make sure that we can deal with the satellites effectively and have them burn up on reentry and have the debris kind of land in the Pacific somewhere. That's what we need to make sure of, because the number of satellites we're talking about here is ultimately around 4000. Actually, technically, the number under discussion was 4025 but there's probably false precision there. That's kind of what we're thinking right now. There's less than half that number of active satellites currently in existence. So this will be more than double the number of currently active satellites.

Timing.. yeah. In the past I've been a little optimistic on schedule. So, I'm trying to recalibrate, but I'm thinking we should be able to get version one active in about five years. That wouldn't be the full half of long distance and 10% of all Earth's connectivity, but a useful version one that has global coverage, except at the poles - we're aiming for about five years. Then there would be successive versions every two or three years after that. To get to where the system is really at full capability, I think it's probably 12 to 15 years. But yeah, major revisions certainly every five years, maybe a little sooner than that. If you figure in terms of major revisions, version one in five years, version two maybe five years after that, version three five years after that, is a rough time line.

It's going to be, I think, quite a lot of software. Like, all in software and firmware it's probably half of the office. It's probably half software, half firmware - sorry, half software/firmware, half hardware. That seems like - and then over time the software might actually exceed the hardware number because it's just - if you have something that's highly configurable then it tends to, over time, weigh towards the software.

This would be not using cubesats. Satellites we have in mind are going to be quite sophisticated. They'd be a smallish satellite but with big satellite capability. By smallish I mean, in the few hundred kilogram range.

Well, it can't be free, because then we'd go out of business. No it can't be free to the user, I don't think so. I mean, this would cost a lot to build. I mean, ultimately over time, the full version of the system, we're talking about something that would be $10 or $15 billion to create, maybe more. Then, the user terminals will be at least $100 to $300 depending on which type of terminal. "This is intended to be a significant amount of revenue and help fund a city on Mars." "Looking in the long term, and saying what's needed to create a city on Mars? Well, one thing's for sure: a lot of money." So we need things that will generate a lot of money.

Yeah, we're not going to - yeah. Spectrum that is omni-directional and wall penetrating, that spectrum is extremely rare, and limited. Spectrum that is not wall penetrating and that is very directional, is not rare. It's sort of the difference between a laser beam and a floodlight. You can have lots of laser beams, in limit that would be a real tight beam communication. Whereas there's high scarcity for cellular bandwidth, there is not high scarcity for space to earth bandwidth. As long as it's not roof penetrating. So I don't seen bandwidth as being a particularly difficult issue.

Compared to the Iridium Satellites which was a mere 70, we're talking more than an order of magnitude larger volume. This is something I don't think we're - I mean, there may be some similarities to the way the Iridium network was done but we would have - in terms of the production waste produced, it would be similar to the way a car is produced or consumer electrics. So, if we take things even a step further, if a satellite didn't work you'd just take it out of the constellation and deorbit it. As opposed to going through this super-intense acceptance procedure to make sure the satellite works. Normally the way satellites are done is they're like Battlestar Galactica - there's like one of them and it's really giant and if this thing doesn't work it's terrible, like the whole business collapses. But if you have a large constellation, you can afford to lose individual satellites and it doesn't affect the constellation very much. An analogy might be between, say, mainframes and PCs. If you want to have a big data center serving millions of people, it's way better to have an array of cheap PCs then it is to have a few mainframes. Basically that's how the Internet is served, with millions of PCs on racks instead of mainframes.

Teaming with local propulsion companies? Not really. I don't think so. We're going to build our own propulsion unit. People in the space industry have a really difficult time manufacturing things. They're pretty good at designing them in the first place but they don't actually know how to make them in volume. It's possible we could license some technology or something but the main propulsion system we have in mind for the satellite is a Hall effect thruster which, not to trivialize it too much, is basically like a loud speaker, okay. It's like a magnetic field accelerating ions, it's pretty easy to make. I mean, there's degrees of Hall thruster, like how good it is, but at the end of the day it's not that hard. So it's not clear that it would make sense to outsource something that's not that hard.

There's multiple elements to the regulatory things. There's the ITU filings and the financial qualifications you need, and we've done the filings associated with that. That says whether you can actually put the satellite network up. Then there's the - whether it's legal to have a ground link. Obviously any given country can say it's illegal to have a ground link. From our standpoint we could conceivably continue to broadcast and they'd have a choice of either shooting our satellites down.. or not. China can do that. So we probably shouldn't broadcast there. If they get upset with us, they can blow our satellites up. I mean, I'm hopeful that we can structure agreements with various countries to allow communication with their citizens but it is on a country by country basis. I don't think it's something that would affect the time line. At least, it's not going to take longer than five years to do that. Not all countries will agree at first. There will always be some countries that don't agree. That's fine.

Okay, this would be a low Earth orbit constellation, so it would actually be moving quite a bit.

The base station would have a phase array antenna with a switching time that's of the microsecond to low millisecond level. So it would only take a few milliseconds seconds to switch from one satellite to the next. So, as opposed to having a dish that has a slew rate.

How do you power satellites? With solar panels, and then batteries for low Earth orbit satellites because they go through Earth's shadow then you have to have batteries to handle when they're in shadow. Yep.

Umm, biggest concern about success, well, I think it's important to assume that terrestrial networks will get much better over time. Ya know, one of the mistakes that Teledesic made was not assuming that terrestrial networks would get much better over time. So we need to make sure that the system we design is good, even taking into account significant improvements in the terrestrial systems, but I do think there's an important difference between what we're doing and say Teledesic. In the case of Teledesic they were trying to talk to phones and that gets back to that problem of a roof penetrating situation and particularly with a signal that's coming from space. If you're in a skyscraper it's got to go through 27 floors to reach you, it's not going to happen. There's nothing that will, ya know short of like a neutrino, but you're not going to have a neutrino phone. In the case of Teledesic, I think they had some fundamental issues there.

I think we're going to have to pay a lot of attention to security. It would really be unfortunate if it got hacked and taken over. That would be bad. Whether it was by AI or by some group of whatever. I think it's going to be important to have some sort of low level ROM chip that's got a code that you can like - go into a safe mode. So, it's like listening for a code, and then that ROM chip can't be updated. So we could always trigger a safe mode situation to regain control of the system but it's going to require a lot of thought to make sure we are able to protect it from any hacking attempts. But it's much like Google or Facebook.. they handle these kinds of issues.

I'll try to answer a few questions in the back there.

I think we won't take SpaceX public for a very long time. What I've said is: when we're doing regular flights to Mars, that might be a good time to go public. But, before then, because the long term goals of SpaceX are really long term, like - it takes a long time to build a city on Mars - that doesn't match with the short term time frame of public shareholders and portfolio managers that are looking at the sort of two to four year time horizon. So I think we'll need to hold off going public for a while. Now, that said, what we do do is we do offer stock options and restricted stock and we do liquidity events every six months. So, we have the company valued by an outside firm every six months and we will do stock buybacks every six months. It sort of, I think, gets the best of both worlds where you have stock liquidity but you don't have the massive fluctuations that you have with a public company where at any given week - like, for example with Tesla, with any given week it's like dealing with a manic depressive. It's very confusing. I'll say things that I think if people understand what I'm saying the stock should go up, but it goes down, like what the hell, and vice versa. I think it's actually quite distracting to have public stock and the time to go public, ideally, is where things are fairly stable. Then we will go public, but like I said, I think we get the benefits of stock appreciation over time without the downside of going public, and then we'll go public maybe twenty years from now or something like that.

There needs to be some sort of architecture for establishing a city on Mars, which means huge numbers of people and ultimately millions of tons of cargo. How do we do that? It really comes down to an economic question. Which is - there's some economic activation energy, a cost-per-unit-mass to the surface of Mars, at which point we'd have a self-sustaining civilization there, but beyond which we would not. It's up to debate about how much that might be, but I think at a personal level there needs to be enough of an intersection of sets of people who can afford to move to Mars and people who want to move to Mars. If those two coincide then there will be a colony, otherwise there will not be a colony. I will eventually go to Mars. ...But to put that in concrete terms, it needs to be at least a half a million dollars or less to move to Mars, I think. Ideally much less, ya know, but if it's much more than that then there probably won't be a colony. So that's the basic idea. What I hope to present, hopefully towards the end of this year, is a transport architecture that I think could achieve that number. There's a big difference between thinking that I can achieve that number and actually achieving that number. There's lots of people who suggested, 'hey, wouldn't it be a good idea to go the Moon?', but much harder to actually go to the Moon. It's a hard execution problem. In fact, I think with most ideas it's the execution is really the hard part, and in order to make it happen you have to have lots of talented people working together towards a common goal to achieve that. That's what I want to put together at SpaceX.

Alright, thanks everyone.

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