Tesla and SpaceX CEO Elon Musk’s visions are being realized well in and out of this world, as the past week reveals. Elon Musk’s life has been surfing through land, sky, and space this week. Last fall, Musk tweeted, “Pace of innovation is all that matters in the long run.” He is certainly demonstrating that’s his companies’ mutual obsession.
The news about SpaceX getting the go-ahead by the Federal Communications Commission (FCC) for its next phase in deploying the low orbit Starlink satellite internet made me wonder how that many satellites would actually work together to provide the very high throughput and low latency network that Elon Musk has in mind.
As anyone who’s stuck paying an onerous bill to a local internet monopoly will agree, there’s a great market opportunity out there for any company that could offer a global wireless internet connection. SpaceX has been working on just that since 2015, developing a broadband satellite constellation called Starlink. A recent article in SmarterAnalyst proposes that Tesla could be an integral part of the plan.
This story is about Tesla’s moats, but I don’t mean to imply that Buffett would invest in Tesla. Tesla is far from the value investments of the Berkshire Hathaway portfolio. Rather, Buffett’s comments are to demonstrate the importance of moats. Morningstar even has a guide called Why Moats Matter. Understanding the moats a business employs is clearly important to understanding the business and its future.
Two experimental satellites will ride into space this week aboard a SpaceX Falcon 9 rocket. They are “proof of concept” satellites that could lead to a global high speed broadband network in coming years.
