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Wiki Tesla, TSLA & the Investment World: the Perpetual Investors' Roundtable

hobbes

Active Member
Feb 11, 2013
2,749
15,613
Germany

Singuy

Active Member
Jun 28, 2018
4,598
36,702
US
The discussion of Tesla adding in-car purchases made me think about how much it will be earning from the premium connectivity subscription service ($10 USD/month). This is available in pretty much every country Tesla sells cars and for all models. Cars purchased before June 30, 2018 had free connectivity for life; after that date they get a free trial (I’ve read 1 month and 1 year, my Y had 1 year). After the trial people must pay to have the service.

I will assume a 75% uptake by owners - it may be higher since the car loses useful features without it like traffic on nav, Netflix/YouTube, internet radio and others.

Financially this will become a snowball of very high margin (probably 90%+) recurring revenue every month, compounding faster as production increases since all new cars will eventually add to the fleet and eventually pay for this.

Cars available for premium connectivity (2021 and 2022 estimated):
2018 (2nd half): 150K
2019: 350K
2020: 500K
2021: 850K (total 1.7M end of 2021)
2022: 1.25M (total 3M end of 2022)

Assuming a 1 year free trial, 75% uptake and $10 USD/month, I would expect Tesla to have revenue from this service of $40 million per quarter by end of 2022 and $67 million per quarter by end of 2022. And of course the numbers will just keep growing from there as the fleet gets bigger and bigger - another nice cherry to add to the financial health of the company and of course TSLA valuation long-term.
Why do you assume the margins are 90% for premium connectivity? I am thinking the margins are almost nothing as Tesla needs to pay att for the cellular service with the money collected since Tesla owns about 0% of that infrastructure.
 

Baumisch

Member
Jan 3, 2013
154
899
Germany
IMHO StarLink Terminal consumption at the moment is too hight with ~100watts for mobile use - of course we expect them to improve on next version of the dish
 

Prunesquallor

His cardinal virtue? An undamaged brain.
Supporting Member
Dec 19, 2018
3,497
38,767
Houston/Galveston
This is great to see, although I would live to know how they came up with 27k as the break even for emissions because this study in 2015 says for a mid size EV it's 4,900 or for one the size of an S it's 19,000. And the grid has only become cleaner since then....

Here’s the latest data I’ve seen. Model 3 overtakes Corolla after 15,000 mi with typical US grid mix.

3ED31A0F-6101-4A23-95FB-0A2D32A7FD80.jpeg
 

jbcarioca

Well-Known Member
Supporting Member
Feb 3, 2015
5,734
31,877
What will work is, StarLink Terminal on WiFi tower.

Maybe they can make a power with integrated solar and batteries with a rapid install, permitting is the problem.
There have been some seemingly reliable reports that Starlink managers have had negotiations with multiple cellular providers. Among the topics has been use of Starlink to supplement terrestrial links in non-fiberoptic areas, using cellular service links to feed data through Starlink. There are numerous possibilities, some of which might make mobile access cheaper and easier, mostly still using cellular technology for the vehicle because Starlink dishes are so expensive and they still need terrestrial support anyway.

I do not have the links at hand because I do not have the time to look them up. I'm sure others have them too.
 

mongo

Well-Known Member
May 3, 2017
13,460
42,009
Michigan
There have been some seemingly reliable reports that Starlink managers have had negotiations with multiple cellular providers. Among the topics has been use of Starlink to supplement terrestrial links in non-fiberoptic areas, using cellular service links to feed data through Starlink. There are numerous possibilities, some of which might make mobile access cheaper and easier, mostly still using cellular technology for the vehicle because Starlink dishes are so expensive and they still need terrestrial support anyway.

I do not have the links at hand because I do not have the time to look them up. I'm sure others have them too.
Direct from Elon at MWC:
 

Knightshade

Well-Known Member
Jul 31, 2017
13,157
21,769
NC
In a perfect world Tesla buys/absorbs Starlink, rather than it having an IPO. Elon keeps promise to favor Tesla shareholders, who rejoice in HODL ecstasy!

A Starlink receiver is designed for Tesla cars, becomes standard on new, easy retrofit on old, and Starlink becomes the default connection for all OTA updates on cars so equipped, reducing some current connectivity costs.


Starlink remains a terrible solution for a car you plan to sell many millions a year of that will often be driving in dense urban areas, parking in places with no line of sight to sky, etc..

That's apart from the antenna being too big, sucking a ton more power than cell, and the other drawbacks.

Starlink is a AWESOME solution for non-dense rural areas where internet choice is terrible. Likewise for relatively small numbers of large transport units that tend to always be outside/remotely located (cruise ships, aircraft, RVs etc)

Elon himself has said Starlink makes no sense for the cars multiple times.

Why do people not believe him?
 

nativewolf

Active Member
Jul 21, 2015
1,009
2,777
viena va United States
Starlink remains a terrible solution for a car you plan to sell many millions a year of that will often be driving in dense urban areas, parking in places with no line of sight to sky, etc..

That's apart from the antenna being too big, sucking a ton more power than cell, and the other drawbacks.

Starlink is a AWESOME solution for non-dense rural areas where internet choice is terrible. Likewise for relatively small numbers of large transport units that tend to always be outside/remotely located (cruise ships, aircraft, RVs etc)

Elon himself has said Starlink makes no sense for the cars multiple times.

Why do people not believe him?
Ok you are right but the funny reply would be FSD
 
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ammulder

3P, X ordered
Supporting Member
Apr 11, 2019
1,283
4,744
Philly area
Yeah, always have to stay vigilant on the road. Good that everyone is safe!

Still curious - manual braking or on AP/AEB?
Manual, FWIW. AP was not engaged, and if AEB or any other safety features kicked in, the driver was not aware of it. (Though, the whole event was a massive enough shock that some things may have gone unnoticed.)
 

elasalle

driVIN(188xx) it !!
Jan 26, 2016
4,586
26,946
VA
I don’t think there’s any chance Tesla buys starlink. Elon wants to extract maximum value from that via an IPO to fund SpaceX Mars effort.

The boring company is a different story entirely - would make a lot of sense for Tesla to buy that.

Here is how I see it .. (and could hack into EM's brains via neuralink)

Steps:
1.Have Shareholder vote for Tesla to acquire X% of Starlink on IPO ($2B sounds reasonable with 20B war chest and after spending same amount for BTC ;) )
2.Tesla purchases X% of Starlink on IPO or in some pre IPO deal
3. Provide purchased Starlink shares as divident to existing Tesla shareholders.

Pros:
..Approved by TSLA shareholders, -- no Rive brothers in Starlink :)
.All TSLA shareholders get Starlink shares. (+no long term holders crap)
.Dividend -- and watch TSLA SP do another short squeeze on the infinity/manufactured/thin-air shares

Reason. All TSLA cars will have remote/portable Starlink terminals. Tesla/Starlink starts harvesting the premium internet revenue with exponentially growing number of cars all around the world.
 
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Brunel

Member
Jan 26, 2015
162
100
Bristol, UK
Why do you assume the margins are 90% for premium connectivity? I am thinking the margins are almost nothing as Tesla needs to pay att for the cellular service with the money collected since Tesla owns about 0% of that infrastructure.
As someone who has sold wholesale connectivity to MVNOs and had colleagues who have dealt with Tesla on B2B level I think Tesla will have very, very attractive data rates; they negotiate continent wide deals; they have sunk costs in terms of having to have their own upload and download when not on wifi meaning users paying for connectivity will be high margin and excellent annuity income. Data is cheap, but gaming and video streaming may have notable dilution on that margin per user.
 

goinfraftw

Supporting Member
Supporting Member
Jan 1, 2017
982
7,772
USA
As someone who has sold wholesale connectivity to MVNOs and had colleagues who have dealt with Tesla on B2B level I think Tesla will have very, very attractive data rates; they negotiate continent wide deals; they have sunk costs in terms of having to have their own upload and download when not on wifi meaning users paying for connectivity will be high margin and excellent annuity income. Data is cheap, but gaming and video streaming may have notable dilution on that margin per user.

As an aside, I'd be surprised if Starlink doesn't acquire or significantly partner with Twilio at some point.
 

jhm

Well-Known Member
May 23, 2014
9,629
34,050
Atlanta, GA
4 years of priced in TSLA growth puts our PE at what.....20? Less?

In what world do you average 65% growth and sit with a 20 pe ratio?

This leg up is a certainty, its just how long it can be held off. As we've seen in the past, the longer they coil the spring....
Even if 20 PE were to stay fixed, this would be an awesome thing for shareholders. As the company grows EPS 65%, the share price would also gain 65%. Sign me up.
 

Drezil

Spirit Animal: Short Puts
Jan 14, 2021
524
5,002
Germany
I had no idea starlink could do so well in Germany.
It will.
Having fiber is the exception.
Fastest is Internet over Cable (in some places .. you need cable in your area).

Otherwise you get offer from Telekom that they can give you 250mbit (in certain metropolitain areas) for 40 bucks/month.. If you dont live in a city, then 64mbit is still quite good (for the same price of course... -.-).
If you live rural .. well.. they just stopped serving dual-channel-ISDN (2x 64kbit) due to digitalisation .. but you can choose Internet via LTE! If the weather is good! ....

I am one of the lucky who get 400mbit over cable for a decent price (50 bucks/month) - but i still consider ordering starlink to also have a decent connection if i am on vacation or visiting my parents. They only have 16mbit or so .. and they live in a commercial area. Near the box on the street. The other companies(!) down the road have it worse.

You can watch
to get an impression (auto-translated subtitles should be ok .. otherwise all you need to know is visible on the screen... Carrying harddrives via horse for some hours is STILL FASTER than transferring the data via internet...)

But hey! We have decent streets to drive on ... :D
 

The Accountant

Active Member
Aug 6, 2019
1,016
37,282
Connecticut, USA
Words of a perma-bear who posted today about giving up the short bet.

Well, if @Claire Musk has had a small short position in Tesla, I say "Get a Life".
They set up a new special account in January dedicated to Tesla and tweet and retweet up to 20 times a day and only with a small short position in the past.
This individual is full of BS or unstable or both.

1626443279492.png
 
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