China faces a tall order in its efforts to catch up to Elon Musk’s SpaceX satellite service.
SpaceX’s Starlink already has nearly 7,000 operational satellites in orbit and serves around 5 million customers in more than 100 countries, according to SpaceX. The service is meant to offer high-speed internet to customers in remote and underserved areas.
SpaceX hopes to expand its megaconstellation to as many as 42,000 satellites. China is aiming for a similar scale and hopes to have around 38,000 satellites across three of its low earth orbit internet projects, known as Qianfan, Guo Wang and Honghu-3.
Aside from Starlink, European-based Eutelsat OneWeb has also launched more than 630 low earth orbit, or LEO, internet satellites. Amazon also has plans for a large LEO constellation, currently called Project Kuiper, made up of more than 3,000 satellites, though the company has launched only two prototype satellites so far.
With so much competition, why would China even bother pouring money and effort into such megaconstellations?
“Starlink has really shown that it is able to bring internet access to individuals and citizens in remote corners and provide an ability for citizens to access the internet and whatever websites, whatever apps they would like,” said Steve Feldstein, a senior fellow at the Carnegie Endowment for International Peace.
“For China, a big push has been to censor what citizens can access,” Feldstein said. “And so for them, they say, ‘Well, this presents a real threat. If Starlink can provide uncensored content either to our citizens or to individuals of countries that are allied with us, that is something that could really pierce through our censorship regime. And so we need to come up with an alternative.'”
Blaine Curcio, founder of Orbital Gateway Consulting, agrees. “In certain countries, China could see this as almost like a differentiator. It’s like: ‘Well, maybe we’re not as quick to market, but hey, we will censor the heck out of your internet if you’d like us to, and we’ll do it with a smile on our faces.'”
Experts say that while Chinese constellations won’t be the choice internet provider for places such as the U.S., Western Europe, Canada and other U.S. allies, plenty of other regions could be open to a Chinese service.
“There’s a couple of geographic areas in particular that might be attractive for a Starlink-like competitor, specifically one made by China, including China itself,” said Juliana Suess, an associate at the German Institute for International and Security Affairs. “Russia, for example, but also Afghanistan and Syria are not yet covered by Starlink. And there’s also large parts of Africa that aren’t yet covered.”
“We’ve seen that 70% of 4G infrastructures in the continent of Africa are already built by Huawei,” Suess added. “And so having a space-based perspective to that might sort of further build inroads there.”
Aside from being a tool for geopolitical influence, having a proprietary satellite internet constellation is increasingly becoming a national security necessity, especially when ground internet infrastructure is crippled during war.
“When it comes to the difference that Starlink technology has played in the Ukraine battlefield, one of the big leaps we’ve seen has been the emergence of drone warfare and the connected battlefield,” Feldstein said. “Having satellite-based weaponry is something that’s viewed as a crucial military advantage. And so I think China sees all that and says investing in this is absolutely critical for our national security goals.”
Watch the video to find out more about why China is building out these megaconstellations and the challenges the country will face.
An electric air taxi by Joby Aviation flies near the Downtown Manhattan Heliport in Manhattan, New York City, U.S., November 12, 2023.
Roselle Chen | Reuters
Air taxi maker Joby Aviation in a new lawsuit accused competitor Archer Aviation of using stolen information by a former employee to “one-up” a partnership deal with a real estate developer.
“This is corporate espionage, planned and premeditated,” Joby said in the lawsuit filed Wednesday in a California Superior Court in Santa Cruz, where the company is based.
Archer and Joby did not immediately respond to CNBC’s request for comment.
The lawsuit alleges that former U.S. state and local policy lead, George Kivork, downloaded dozens of files and sent some content to his personal email two days before he resigned in July to take a job at Archer, which had recruited him.
By August, Joby said a partner that worked with Kivork said it had been approached by Archer with a “more lucrative deal.” Joby alleges that the eVTOL rival’s understanding of “highly confidential” details helped it leverage negotiations.
Joby also said the developer attempted to terminate the agreement, citing a breach of confidentiality.
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Kivork refused to return the files when Joby approached him after conducting an investigation, according to the suit. The company also said Archer denied wrongdoing, and would not disclose how it learned about the terms of the agreement or provide results from an internal investigation it allegedly undertook.
The lawsuit comes during a busy period for electric vertical takeoff and landing (eVTOL) technology as companies race to gain Federal Aviation Administration certification to start flying commercially. ‘
Joby argued in the complaint that it’s “imperative” to protect Joby’s work “from this type of espionage” to promote the sector’s success and ensure fair competition.
Last week, Joby said it completed its first test flight for a hybrid aircraft it’s working on with defense contractor L3Harris. This month, Amazon-backed Beta Technologies, another electric flight company, also went public on the New York Stock Exchange.
Joby shares have more than doubled over the last year, while Archer is up about 68%.
In August 2023, Archer settled a previous legal dispute with Boeing-owned Wisk Aero over the alleged theft of trade secrets. As part of the deal, Archer agreed to use Wisk as its autonomous tech partner.
Every weekday, the CNBC Investing Club with Jim Cramer releases the Homestretch — an actionable afternoon update, just in time for the last hour of trading on Wall Street. Markets : There was an ugly reversal in the market Thursday. Stocks soared for most of the morning in reaction to Nvidia ‘s strong quarter, bullish outlook on AI spending, and pushback that customers weren’t generating a sufficient return on their investment. Nvidia shares climbed as high as $196 on Thursday — a roughly 5% gain — and its gravitational pull helped lift other technology and AI-adjacent industrial stocks. The market’s gains pushed the S & P 500 into positive territory for the week. However, around 11 a.m. ET, the market began to fall rapidly, with technology and industrial names leading the decline. Nvidia gave up all of its gains and dropped 2%. Bitcoin hit its lowest level since late April. Notable defensive stocks like consumer staples held onto their gains, though. That resilience reinforces our decision to diversify further, which we did earlier this week , by adding Procter & Gamble to the portfolio. The S & P 500’s decline has pushed the index back toward the lows of its recent downturn, marking a roughly 5% pullback from its high. It remains to be seen whether Thursday’s reversal is a sign of investors continuing to retreat from risk assets or simply a retest of the recent downdraft. But Nvidia’s earnings report gave zero indication of a slowdown in demand for AI compute. Interest rate cut: Expectations for a 25-basis-point rate cut at the Federal Open Market Committee’s next meeting in December continue to fluctuate. One month ago, a rate cut seemed like a sure thing with a 98.8% probability, according to the CME FedWatch Tool . But the odds dropped to about 50% a week ago after a slew of hawkish commentary from Federal Reserve members. On Wednesday, the odds of a cut plummeted to 30% after the release of the October Fed minutes, which showed that the central bank was hesitant to lower rates again this year. But after the long-delayed September jobs data finally came out Thursday, the probability of a 25-basis-point reduction jumped to 40%. Although the economy added 119,000 jobs in September, more than double the forecasted figure, the unemployment rate ticked higher. The Fed is in a bind, trying to balance a softening labor market against the risk that a rate cut could reignite inflation. Up next: Gap, Ross Stores , Intuit , and Veeva Systems report after the closing bell. BJ’s Wholesale Club will post results Friday morning. On the economic data side, tomorrow we’ll get November’s S & P Global Flash PMI for Manufacturing and Services, along with the University of Michigan’s consumer sentiment survey. (See here for a full list of the stocks in Jim Cramer’s Charitable Trust.) As a subscriber to the CNBC Investing Club with Jim Cramer, you will receive a trade alert before Jim makes a trade. Jim waits 45 minutes after sending a trade alert before buying or selling a stock in his charitable trust’s portfolio. If Jim has talked about a stock on CNBC TV, he waits 72 hours after issuing the trade alert before executing the trade. THE ABOVE INVESTING CLUB INFORMATION IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY , TOGETHER WITH OUR DISCLAIMER . NO FIDUCIARY OBLIGATION OR DUTY EXISTS, OR IS CREATED, BY VIRTUE OF YOUR RECEIPT OF ANY INFORMATION PROVIDED IN CONNECTION WITH THE INVESTING CLUB. NO SPECIFIC OUTCOME OR PROFIT IS GUARANTEED.
Bitcoin dropped on Thursday to levels not seen in more than six months, as investors appeared to pull back exposure to riskier assets and weighed the prospects of another Federal Reserve rate cut next month.
The flagship digital currency fell to as low as $86,325.81, its lowest level since April 21. It last traded at $86,690.11.
The release of stronger-than-expected U.S. jobs data raised questions about whether the central bank would lower its benchmark overnight rate. The U.S. economy added 119,000 in September, well above the 50,000 economists polled by Dow Jones expected.
That report sent the probability of a December rate cut to around 40%, according to the CME Group’s FedWatch tool.
Bitcoin’s pullback formed part of a broader cryptocurrency market decline. XRP was last down 2.3% on the day, and is below $2.00, while ether shed more than 3% to trade well below $3,000. Dogecoin was unchanged.
The world’s oldest crypto also led stocks lower, even after a blockbuster Nvidia earnings report. Traders who are heavily invested in AI-related stocks tend to also hold bitcoin, linking the two trades.
Bitcoin’s price has largely slid since a rash of cascading liquidations of highly leveraged crypto positions in early October.