WEBVTT - Tesla Takes the Wheel, Starlink Terminals Have a Black Market Problem 0:00:03.120 --> 0:00:09.000 Bloomberg Audio Studios, Podcasts, radio news. 0:00:11.800 --> 0:00:14.680 Well, Elon Musk is now the richest person on the planet. 0:00:15.080 --> 0:00:17.920 More than half the satellites in space are owned and 0:00:18.000 --> 0:00:23.160 controlled by one man. Well, he's a legitimate, super genius, legitimate. 0:00:23.360 --> 0:00:23.680 He says. 0:00:23.720 --> 0:00:26.320 He's always voted for Democrats, but this year it will 0:00:26.320 --> 0:00:26.760 be different. 0:00:26.800 --> 0:00:27.800 He'll vote Republican. 0:00:28.040 --> 0:00:30.520 There is a reason the US government is so reliant 0:00:30.560 --> 0:00:31.720 on ed Elon. 0:00:31.560 --> 0:00:34.559 Musk is a scam artist and he's done nothing. 0:00:35.360 --> 0:00:38.080 Anything he does, he's fascinating people. 0:00:45.360 --> 0:00:49.440 Welcome to Elanink, Bloomberg's weekly podcast about Elon Musk. It's 0:00:49.560 --> 0:00:53.840 March twenty six, twenty twenty four. I'm your host, David Papadopoulos. 0:00:54.680 --> 0:00:57.760 Our colleagues here at Bloomberg have a big investigation out 0:00:57.760 --> 0:01:01.320 this week into a black market problem that is vexing Starlink, 0:01:01.720 --> 0:01:05.640 the satellite operation of SpaceX. We have a special story 0:01:05.680 --> 0:01:09.040 from our sister show, The Big Take, that digs into 0:01:09.080 --> 0:01:12.920 that investigation and all the places starlink kits are being 0:01:13.040 --> 0:01:16.800 used where they shouldn't be. But before that, there's been 0:01:16.840 --> 0:01:19.160 plenty of news in elon Land, and we're going to 0:01:19.280 --> 0:01:23.080 round it up for you all rapid fire. First, Tesla 0:01:23.160 --> 0:01:26.679 will now do full self driving mode demonstrations for every 0:01:26.760 --> 0:01:30.800 new car buyer. Second, a federal judge tossed out a 0:01:30.880 --> 0:01:33.679 lawsuit that Musk's X had filed against the Center for 0:01:33.720 --> 0:01:38.120 Countering Digital Hate. Last will unpack an intercept investigation that 0:01:38.200 --> 0:01:41.720 found that X fought against the secrecy surrounding government surveillance 0:01:41.720 --> 0:01:45.240 of social media users while it was profiting from user 0:01:45.319 --> 0:01:48.560 data sales. To break all of this Elon News down, 0:01:48.680 --> 0:01:52.240 we have Danahull, who's our full time Elon Musk reporter. 0:01:52.440 --> 0:01:57.920 Hello Dana, Hello, And Max Schaffkin, senior reporter and editor 0:01:57.960 --> 0:01:58.960 at BusinessWeek. 0:01:59.560 --> 0:02:02.040 Good day, David, Good to see you. 0:02:02.160 --> 0:02:07.440 Max. Okay, so we're gonna start with these Tesla full 0:02:07.800 --> 0:02:11.560 self driving demos that are now, according to mister Musk 0:02:11.760 --> 0:02:16.880 Dani Hall, are now mandatory before anyone leaves a Tesla 0:02:17.200 --> 0:02:18.320 A lot explained. 0:02:18.400 --> 0:02:20.840 Yeah, so full self driving is a feature that you 0:02:20.960 --> 0:02:24.079 have to pay for. It currently costs twelve thousand dollars. 0:02:24.400 --> 0:02:27.440 And this is all about margins. I mean, we are 0:02:27.520 --> 0:02:30.040 at the end of the quarter. Tesla has got to 0:02:30.080 --> 0:02:32.960 move cars. It is in their interest to move cars 0:02:33.000 --> 0:02:35.120 that are as fully tricked out with all the options 0:02:35.160 --> 0:02:38.359 as possible, and so Musk is now basically saying via 0:02:38.360 --> 0:02:40.480 this email that we confirm that, like you know, the 0:02:40.680 --> 0:02:44.000 salespeople have to give a demo because people don't realize 0:02:44.080 --> 0:02:45.920 just how awesome FST is. 0:02:46.040 --> 0:02:48.400 Okay, sorry, so Danne to interrupt you. Sorry, So, I 0:02:48.600 --> 0:02:53.680 actually thought erroneously that this was some way, somehow about 0:02:54.120 --> 0:02:56.840 security and safety and making sure they're on the right 0:02:56.880 --> 0:03:00.239 side of the law with regulators. You're telling me it's 0:03:00.320 --> 0:03:03.639 actually them saying, hey, we really got to pedal this thing. 0:03:04.520 --> 0:03:06.960 Yes, perhaps I am a cynic, but we have a 0:03:06.960 --> 0:03:08.960 week left in the quarter, and this is like a 0:03:09.040 --> 0:03:12.720 really important quarter in terms of moving vehicles and making 0:03:12.800 --> 0:03:16.520 that profit. I mean, both things could be happening simultaneously. 0:03:16.600 --> 0:03:18.720 They want to be a little bit more careful about 0:03:18.760 --> 0:03:23.119 how they explain full self driving beta or full self 0:03:23.160 --> 0:03:27.680 driving capability to prospective customers, given the regulatory environment, given 0:03:27.720 --> 0:03:29.200 the fact that we're on the eve of some of 0:03:29.240 --> 0:03:33.320 these big autopilot lawsuits. But at the same time, twelve 0:03:33.360 --> 0:03:36.600 thousand dollars that's just all gravy. That is a big 0:03:36.640 --> 0:03:39.360 way for Tesla to make money. I mean, so I 0:03:39.400 --> 0:03:41.680 think both things are happening, and they're really kind of 0:03:41.720 --> 0:03:42.360 pushing this. 0:03:42.720 --> 0:03:46.360 There's no nothing in this memo about being more cautious 0:03:46.520 --> 0:03:50.160 or emphasizing the limitations of the technology, which is what 0:03:50.200 --> 0:03:53.240 you'd expect if the goal were to like head off 0:03:53.240 --> 0:03:56.640 potential litigation or regulation. Instead, it says just the opposite. 0:03:56.680 --> 0:04:00.200 It says, people don't understand how great this thing is 0:04:00.240 --> 0:04:02.360 from the point of view the regulators. Right, that's the 0:04:02.440 --> 0:04:07.160 opposite message that that Tesla could potentially be conveying. So 0:04:07.400 --> 0:04:09.800 I totally agree with Dana. I think this is about 0:04:10.000 --> 0:04:12.000 this is a sales thing. It's like you're in the 0:04:12.000 --> 0:04:14.360 car dealer and they want you to upgrade to the 0:04:14.440 --> 0:04:17.279 you know, LX package or you know over the GX 0:04:17.360 --> 0:04:18.720 and then whenever they're going to tell you how great 0:04:18.760 --> 0:04:21.039 the leather seats are in the clearcoat. This is Elon 0:04:21.120 --> 0:04:23.760 Musk's version of that. Right, This is a pure margin 0:04:23.839 --> 0:04:27.000 product that if he is able to get more people 0:04:27.040 --> 0:04:30.280 to adopt, would be very valuable, and of course has 0:04:30.400 --> 0:04:34.320 additional value down the road because because at least by 0:04:34.480 --> 0:04:37.360 by Tesla's account, all this data that they're collecting makes 0:04:37.360 --> 0:04:38.040 the system better. 0:04:38.200 --> 0:04:39.599 And I just like to point out, like if you 0:04:39.640 --> 0:04:42.159 go on the Tesla website today, and try to order 0:04:42.200 --> 0:04:45.480 a new model. Why it says you will receive one 0:04:45.520 --> 0:04:48.680 month trial a full self driving capability with a new 0:04:48.800 --> 0:04:52.080 vehicle purchase. So not only are they demoing it for 0:04:52.160 --> 0:04:54.560 you when you're there at the lot, but then if 0:04:54.560 --> 0:04:56.360 you buy the car, you get it for free. It's 0:04:56.400 --> 0:04:58.520 like a subscription, and then the idea is that you 0:04:58.640 --> 0:04:59.200 keep it. 0:04:59.240 --> 0:05:01.680 Is this like an app TV thing where like you 0:05:01.720 --> 0:05:03.480 get the three months and they start billing you if 0:05:03.520 --> 0:05:05.880 you don't cancel, do they bill you the twelve grand 0:05:06.080 --> 0:05:08.400 or do you have to like, you know, wire additional 0:05:08.440 --> 0:05:10.560 funds to like maintain your subscription. 0:05:11.080 --> 0:05:13.240 Well, yeah, you can do a subscription or you can 0:05:13.320 --> 0:05:15.520 just pay for it. I mean, I'd be very curious 0:05:15.520 --> 0:05:16.679 to see how the billing looks. 0:05:17.400 --> 0:05:19.960 What I will say is this, and then we will 0:05:19.960 --> 0:05:23.160 move on to point number two here. But you know 0:05:23.279 --> 0:05:26.719 this must be important for Elon and trying to drive 0:05:27.720 --> 0:05:30.240 sales of this thing. The quote that we have from 0:05:30.279 --> 0:05:33.040 the memo he sent out to all staff was, I 0:05:33.160 --> 0:05:36.719 know this will slow down the delivery process, but it 0:05:36.839 --> 0:05:41.400 is nonetheless a hard requirement for Elon to do anything 0:05:41.480 --> 0:05:44.599 that slows anyone down. That is anathema to him. Is 0:05:44.600 --> 0:05:45.320 it not DNA. All. 0:05:46.680 --> 0:05:48.440 Yeah, but this is a great way to like sandbag 0:05:48.480 --> 0:05:51.320 the quarter because if they have a lousy quarter, they 0:05:51.400 --> 0:05:54.120 can be like, oh, well, we rolled out this new 0:05:54.160 --> 0:05:56.719 thing where you've got where the sales process is longer, 0:05:56.800 --> 0:05:59.479 and this slowed down some things towards the end. 0:06:00.000 --> 0:06:03.159 And it's not just about the quarter, because, as we've 0:06:03.200 --> 0:06:06.560 talked about on this podcast many times, the self driving 0:06:06.560 --> 0:06:10.880 story is crucial to Elon Musk's long term vision and 0:06:11.360 --> 0:06:15.680 maybe even more importantly, the extremely elevated value of Tesla's stock. 0:06:15.839 --> 0:06:20.520 Like this, if the story that Tesla cars drive themselves 0:06:20.760 --> 0:06:22.920 and they're that they're basically going to be robotaxis in 0:06:22.960 --> 0:06:25.719 twelve months, which Elon uns Musk has essentially been saying, 0:06:26.160 --> 0:06:28.480 you know for the last decade, almost if that were 0:06:28.480 --> 0:06:31.640 to break down, the stock would fall apart. And so 0:06:31.640 --> 0:06:35.280 so by demonstrating the value to people, it allows this 0:06:35.360 --> 0:06:37.240 story to be maintained. 0:06:36.839 --> 0:06:39.320 And the stock Tesla stock has gone up today as 0:06:39.360 --> 0:06:42.120 a result. It's like up what five six percent, I. 0:06:42.200 --> 0:06:44.400 Stock that has mostly been going down of late having 0:06:44.400 --> 0:06:46.680 a bit of a rebound today. Okay, very good. Max's 0:06:46.839 --> 0:06:49.520 topic number two on our discussion list, A court tossed 0:06:49.600 --> 0:06:52.640 the lawsuit that X had brought against the Center for 0:06:52.800 --> 0:06:55.440 Countering Digital Hate, tell us what happened here? 0:06:56.200 --> 0:06:59.320 Yeah, Center for Countering Digital Hate is an advocacy group 0:06:59.560 --> 0:07:03.560 that had published a series of reports that other news organizations, 0:07:03.560 --> 0:07:07.240 including Bloomberg, had written about and picked up on, essentially 0:07:07.279 --> 0:07:12.880 talking about white supremacy and racism on X. X sued 0:07:13.040 --> 0:07:17.080 the Center for Counting Digital Hate for, according to a lawsuit, 0:07:17.280 --> 0:07:21.120 like hacking the service. Basically, they were attempted. What it 0:07:21.160 --> 0:07:24.480 really felt like is they wanted to combat these reports, 0:07:24.760 --> 0:07:28.480 essentially silence this nonprofit group. They came up with sort 0:07:28.480 --> 0:07:31.280 of a novel way of doing so, which the judge rejected. 0:07:31.320 --> 0:07:34.960 The judge in the ruling said, it's really transparent, what's happening. 0:07:35.000 --> 0:07:38.080 This is about trying to silence a critic, That this 0:07:38.200 --> 0:07:41.480 is essentially an attempt to do a defamation lawsuit without 0:07:41.520 --> 0:07:44.400 filing one, and he tossed out a case. 0:07:44.680 --> 0:07:47.800 So then what's the takeaway here on all of this? 0:07:48.840 --> 0:07:53.560 I mean, this lawsuit always seemed like spretty thin. Yeah, 0:07:53.840 --> 0:07:55.040 I don't like it. 0:07:55.320 --> 0:07:55.640 Really. 0:07:55.680 --> 0:07:59.720 It seemed, as the judge wrote in the ruling, essentially 0:07:59.720 --> 0:08:03.040 a way to threaten other critics. X has been trying 0:08:03.440 --> 0:08:07.440 very hard to rebut criticism from media outlets, from non 0:08:07.840 --> 0:08:10.440 profit groups, from anti hate groups that there's a lot 0:08:10.480 --> 0:08:12.680 of hate speech on the platform and the problem is 0:08:12.960 --> 0:08:15.520 the problem with this effort to shut down the criticism 0:08:15.680 --> 0:08:18.080 is that some of the calls coming from inside the house. 0:08:18.120 --> 0:08:21.920 Elon Musk himself has been essentially the vector for some 0:08:22.000 --> 0:08:23.840 of this. And when you look at what is slowing 0:08:23.880 --> 0:08:27.760 advertising down, it's not, you know, the Center for Countering 0:08:27.800 --> 0:08:30.880 Digital Hate, all respect to their research, it's what the 0:08:30.920 --> 0:08:31.680 boss is doing. 0:08:32.000 --> 0:08:35.199 Okay, Max. Topic number three and our rapid fire list 0:08:35.800 --> 0:08:39.600 a freedom and information request that was done by the 0:08:39.640 --> 0:08:42.600 intercept that led to a big piece on a very 0:08:42.800 --> 0:08:45.520 thorny topic explained for our listeners. 0:08:45.960 --> 0:08:49.040 Yeah, so this is a story that is probably less 0:08:49.040 --> 0:08:52.480 about Elon Musk and more about Twitter. Of course, Elon 0:08:52.600 --> 0:08:55.240 Musk now owns the company that was formerly known as Twitter. 0:08:55.440 --> 0:08:58.280 But essentially what this is about is two things. One 0:08:58.480 --> 0:09:04.880 is a long standing effort by Twitter to essentially stop 0:09:04.960 --> 0:09:09.480 the US government from requesting information about users without disclosing 0:09:09.520 --> 0:09:13.920 those requests. And at the same time, Twitter's data is 0:09:13.960 --> 0:09:16.960 being sold to these data brokers that are then turning 0:09:17.000 --> 0:09:20.840 around and selling them to governments. So there's kind of 0:09:21.280 --> 0:09:24.880 a whiff of hypocrisy here. I'll say this issue is 0:09:24.920 --> 0:09:27.520 not exclusive to Twitter, although it has been a big 0:09:27.520 --> 0:09:30.920 deal with Twitter for like a decade the company. When 0:09:30.960 --> 0:09:33.320 you think about what it does, it's this real time 0:09:33.360 --> 0:09:36.880 social network. You're seeing what's happening. That's valuable to advertisers. 0:09:36.880 --> 0:09:39.840 That's valuable maybe to pollsters and to journalists. It's also 0:09:39.920 --> 0:09:44.240 of course valuable to police and to you know, in 0:09:44.520 --> 0:09:48.439 certain countries authoritarian governments who might want to monitor protests. 0:09:48.640 --> 0:09:49.800 This data that. 0:09:49.840 --> 0:09:53.920 Is being mined is essentially public data, but it's being 0:09:54.040 --> 0:09:57.360 aggregated through this through what is known as Twitter's fire hose, 0:09:57.640 --> 0:10:00.480 essentially the data feed of all the tweets, and that 0:10:00.640 --> 0:10:01.599 is sold. 0:10:01.480 --> 0:10:02.520 To third parties. 0:10:02.960 --> 0:10:06.480 And it can, as news outlets have pointed out, and 0:10:06.520 --> 0:10:09.400 as this intercept story is saying, can be misused or 0:10:09.440 --> 0:10:13.040 can be used in ways that are somewhat uncomfortable if 0:10:13.080 --> 0:10:16.679 you're a pro free speech maximalist, as Elon Musk says 0:10:16.720 --> 0:10:19.440 he is. So now we have two stories essentially in 0:10:19.480 --> 0:10:22.280 which you know that call in a question in some 0:10:22.600 --> 0:10:27.520 sense how serious Musk is about his commitment to free speech. 0:10:27.440 --> 0:10:30.280 Right and so as you were saying, this case predates 0:10:30.440 --> 0:10:34.240 Musk and X. It began under the previous management when 0:10:34.240 --> 0:10:37.640 the company was Twitter. But Musk and his crew have 0:10:38.120 --> 0:10:39.959 continued to push it. Is that right? 0:10:40.880 --> 0:10:45.600 Yeah, And it's understandable why they've done it because it's 0:10:45.880 --> 0:10:49.720 always been this somewhat uncomfortable situation where social media companies 0:10:49.760 --> 0:10:52.040 are asking users to trust them, but of course you're 0:10:52.040 --> 0:10:54.640 giving all this information to third party, and then that 0:10:54.800 --> 0:10:56.559 third party can be asked by the government. 0:10:56.360 --> 0:10:57.760 To turn it over for the government. Right. 0:10:57.840 --> 0:11:00.400 So, I don't think it's like hugely surprise causing that 0:11:00.480 --> 0:11:03.560 they continued the litigation. It does, I will say that 0:11:03.600 --> 0:11:05.560 to the point that the intercept makes, if you were 0:11:05.640 --> 0:11:09.360 really committed to free speech, and if you were a 0:11:09.640 --> 0:11:11.680 you know, somebody who's worth you know, pushing, you know, 0:11:11.679 --> 0:11:14.720 over one hundred and fifty billion dollars, you might question 0:11:14.800 --> 0:11:18.839 whether that data brokering business, the business of selling fire 0:11:18.840 --> 0:11:21.760 hose data to third parties, is worth pursuing. 0:11:21.920 --> 0:11:24.640 I guess it's a it's a little reminder to everyone 0:11:24.640 --> 0:11:28.199 out there that anything you post publicly can and potentially 0:11:28.240 --> 0:11:32.360 will be used against you. That was great, Dana Max, 0:11:32.600 --> 0:11:33.840 Thank you very much for happing on. 0:11:34.120 --> 0:11:36.320 Thanks for having us, always a pleasure. 0:11:41.120 --> 0:11:43.640 Okay, So now, as promised, we're going to hand the 0:11:43.760 --> 0:11:47.000 microphone over to our colleagues and the Big Take podcast, 0:11:47.360 --> 0:11:51.440 who have a story about Starlink with huge geopolitical consequences. 0:11:53.320 --> 0:11:56.720 Hovering hundreds of miles above Earth is the largest single 0:11:56.840 --> 0:12:01.320 constellation of satellites. It's called Starlink. 0:12:03.080 --> 0:12:06.040 Falcon Starlink LDS go for launch, and. 0:12:06.200 --> 0:12:08.840 There is that call out that we are go for launch. 0:12:09.000 --> 0:12:12.079 Watch as Falcon nine takes our stack of Starlink satellites 0:12:12.120 --> 0:12:12.959 into orbit. 0:12:14.320 --> 0:12:18.600 Starlink is part of Elon Musk's company SpaceX. It's thousands 0:12:18.640 --> 0:12:22.040 of satellites provide Internet all over the world through portable 0:12:22.120 --> 0:12:25.440 kits about the size of a home computer monitor. The 0:12:25.520 --> 0:12:28.280 idea is to reach even the hardest to reach places, 0:12:28.440 --> 0:12:33.400 places where other providers can't operate or don't. On its website, 0:12:33.480 --> 0:12:37.800 Starlink proclaims that it's available almost everywhere on Earth, and 0:12:37.800 --> 0:12:40.880 that's a big selling point for the service. But there 0:12:40.920 --> 0:12:44.040 are some places starlink isn't supposed to be. 0:12:45.040 --> 0:12:48.520 If you look at Starlink's website, they have a very 0:12:48.520 --> 0:12:52.360 good map of global coverage. They duet to fully have 0:12:52.520 --> 0:12:57.240 certain countries blacked out, or they'll have dates when starlink 0:12:57.320 --> 0:13:01.600 services will become available, and some of the countries where 0:13:01.640 --> 0:13:04.679 it's more controversial, they will have no data available. 0:13:04.920 --> 0:13:08.680 That's Alan Crawford, a senior editor at Bloomberg. Some of 0:13:08.679 --> 0:13:11.920 those blacked out countries he's talking about represent places where 0:13:11.960 --> 0:13:16.120 Starlink's services don't have a licensing agreement, haven't been approved 0:13:16.160 --> 0:13:19.080 by their governments, or where the devices have been barred 0:13:19.080 --> 0:13:22.680 for sale because of US sanctions. But a Bloomberg investigation 0:13:22.720 --> 0:13:26.040 has found that those barriers haven't stopped Starling's kits from 0:13:26.040 --> 0:13:28.680 getting into the hands of folks on the ground through 0:13:28.679 --> 0:13:30.520 a burgeoning black market. 0:13:30.960 --> 0:13:36.400 What really struck me was the extent of this issue, 0:13:36.640 --> 0:13:40.160 that it's not just an isolated case here and there, 0:13:40.360 --> 0:13:41.679 it's pretty much everywhere. 0:13:44.720 --> 0:13:47.959 Today on the show, what starlink kits seeping into illegal 0:13:48.000 --> 0:13:51.720 markets could mean for the company and the geopolitical stakes 0:13:51.800 --> 0:13:55.800 of letting that market continue or trying to shut it down. 0:13:56.240 --> 0:13:59.640 Three two one Sarah than. 0:14:01.480 --> 0:14:01.920 I lived. 0:14:03.520 --> 0:14:06.600 This is the big take from Bloomberg News. I'm Sarah Holder. 0:14:10.840 --> 0:14:11.160 Alan. 0:14:11.280 --> 0:14:14.439 Can you start by just telling us about starlink. 0:14:14.559 --> 0:14:19.280 Well, Starlink is a system of high speed Internet. It's 0:14:19.600 --> 0:14:23.160 very dependable, and it's based on satellites. The company is 0:14:23.240 --> 0:14:29.440 launched over five thousand satellites and it's using these to 0:14:29.480 --> 0:14:33.360 provide high speed Internet in parts of the world where 0:14:33.560 --> 0:14:35.040 connectivity is not very good. 0:14:35.160 --> 0:14:39.320 Essentially, SpaceX launched the first Starlink satellites in twenty nineteen. 0:14:39.840 --> 0:14:42.680 In just a few years, it's become the largest satellite 0:14:42.720 --> 0:14:46.680 network in orbital space. It's also become a major source 0:14:46.720 --> 0:14:50.360 of revenue for SpaceX, along with government contracts and contracts 0:14:50.440 --> 0:14:52.600 with other companies to launch their satellites. 0:14:53.120 --> 0:14:57.160 The issue here for Starlink is that a lot of 0:14:57.280 --> 0:15:01.760 countries where they don't have good current are kind of 0:15:01.920 --> 0:15:05.760 keen to get access to this for obvious reasons, but 0:15:06.000 --> 0:15:10.240 at the same time, they're not willing to just freely 0:15:10.400 --> 0:15:13.520 give over control to the company, and this has led 0:15:13.560 --> 0:15:16.480 to an issue that it's come up in the reporting 0:15:16.520 --> 0:15:20.160 for the story that there are many countries around the 0:15:20.160 --> 0:15:25.359 world where there's no licensing agreement between the government and Starlink, 0:15:25.840 --> 0:15:29.240 and the trouble is that people are turning to the 0:15:29.240 --> 0:15:31.720 black market to obtain Starlink devices. 0:15:31.760 --> 0:15:36.160 Anyway, your reporting found that Starlink terminals have ended up 0:15:36.200 --> 0:15:40.120 in places that are under US sanctions, where starlink is 0:15:40.160 --> 0:15:43.680 barred from operating, or just where starlink does not have 0:15:43.760 --> 0:15:47.160 a licensing agreement. Can you give us a brief overview 0:15:47.240 --> 0:15:49.960 of what your team found is happening. 0:15:51.440 --> 0:15:54.880 Yeah, I mean the starlink kits. These are the kind 0:15:54.920 --> 0:15:59.920 of dish and receiver. They're widely advertised over social media, 0:16:00.200 --> 0:16:05.560 usually like WhatsApp groups on Facebook groups. There's countries like 0:16:05.640 --> 0:16:09.560 Sudan in North Africa, which is subject to US sanctions. 0:16:09.960 --> 0:16:14.400 There's a brutal civil war underway there and there have 0:16:14.480 --> 0:16:19.880 been allegations of genocide. Millions of people have been displaced, 0:16:20.600 --> 0:16:24.320 and our reporting shows that the rebel forces which have 0:16:24.400 --> 0:16:28.000 been accused of committing these human rights abuses are using 0:16:28.040 --> 0:16:31.640 starlink because again, this is like a vast country with 0:16:32.240 --> 0:16:36.320 poor internet systems in parts, but the internet's been brought 0:16:36.400 --> 0:16:40.000 down and the two sides are, you know, accusing each 0:16:40.000 --> 0:16:43.000 other of having done that, and in the meantime they're 0:16:43.080 --> 0:16:43.840 using starlink. 0:16:44.040 --> 0:16:47.560 What can starlink itself do about these kits ending up 0:16:47.560 --> 0:16:48.920 in the wrong hands. 0:16:49.320 --> 0:16:52.480 Well, that is really the numb of the matter. We 0:16:52.640 --> 0:16:56.320 put a set of quite extensive questions to starlink and 0:16:56.400 --> 0:17:00.200 they have yet to respond. Nevertheless, people we spoke two 0:17:00.400 --> 0:17:03.720 who are experts in the industry, who work in the industry, 0:17:04.520 --> 0:17:10.200 they said that it is feasible to geolocate these systems 0:17:10.320 --> 0:17:12.560 as soon as they're activated. You can see where they 0:17:12.600 --> 0:17:15.520 are in theory, you flick the switch and you turn 0:17:15.560 --> 0:17:16.120 it off. 0:17:16.119 --> 0:17:18.040 Right, I mean, is that something they've done in the past. 0:17:18.440 --> 0:17:20.760 They have that capability, they have they used it. 0:17:21.119 --> 0:17:24.840 What we were told was that they have moved against 0:17:25.320 --> 0:17:29.960 illegal use in South Africa, and so the technicalities of 0:17:30.000 --> 0:17:32.399 how they're doing that I'm not clear, but they have 0:17:33.119 --> 0:17:37.000 attempted to clamp down on the illegal use there. But 0:17:37.119 --> 0:17:40.119 equally we were told that it hadn't been very successful, 0:17:40.160 --> 0:17:43.120 that they had only managed to shut down some ten 0:17:43.160 --> 0:17:45.280 percent of the terminals that were in use. 0:17:46.760 --> 0:17:49.639 So Dan is just one of the conflict torn countries 0:17:49.680 --> 0:17:53.240 where starlink terminals are being used and where they're banned. 0:17:53.800 --> 0:17:57.240 It's not just that militias want communications devices, it's also 0:17:57.320 --> 0:18:00.520 that ordinary people need access to the internet, and that 0:18:00.640 --> 0:18:04.119 dynamic is not so unique to Sudan. All over the world, 0:18:04.240 --> 0:18:08.000 in places under crisis where blackouts and connectivity issues are common, 0:18:08.560 --> 0:18:11.720 people are trying to get their hands on Starlink kits. 0:18:12.080 --> 0:18:15.320 You mentioned Sudan, and you've got a lot of detail 0:18:15.359 --> 0:18:18.520 about how Starlink is getting into Sudan and then how 0:18:18.600 --> 0:18:23.240 it's being used there. Can you walk us through that trajectory. 0:18:23.440 --> 0:18:27.360 In terms of Sudan, there are intermediaries who are obviously 0:18:27.359 --> 0:18:29.800 looking to make money and selling this in the black market, 0:18:30.080 --> 0:18:32.959 and they're bringing it in from Gulf countries that are 0:18:32.960 --> 0:18:36.159 apparently bringing it through Dubai and there are roots that 0:18:36.200 --> 0:18:39.920 they go through Darfur and South Sudan and bring them 0:18:40.400 --> 0:18:43.119 into the country that way. You know, when you buy 0:18:43.200 --> 0:18:47.360 a starlink system, you get the physical equipment and then 0:18:47.520 --> 0:18:50.840 like a mobile phone, you get a tariff a plan 0:18:51.680 --> 0:18:55.240 and you can pay extra for roaming. And they're using 0:18:55.280 --> 0:18:58.240 it in these territories where there's no agreement to do so. 0:18:58.240 --> 0:19:02.040 So they're buying a kit in a place where Starlink 0:19:02.119 --> 0:19:05.119 does have a licensing agreement, but they're buying this roaming 0:19:05.200 --> 0:19:07.199 plan so they can use it in places that are 0:19:07.240 --> 0:19:08.680 perhaps not under that agreement. 0:19:08.840 --> 0:19:12.359 Exactly. The reporter Sam and Marxy actually caught up with 0:19:12.440 --> 0:19:16.280 traders and spoke to them in person, and so in 0:19:16.359 --> 0:19:20.600 terms of social media, These are essentially like small traders 0:19:20.640 --> 0:19:24.280 that are online that are taking advantage of a loophole 0:19:24.520 --> 0:19:28.960 or black market to import these devices and sell them 0:19:28.960 --> 0:19:32.240 at a markup. In some cases we found they were 0:19:32.240 --> 0:19:37.000 offering advice on how to shelter these devices so that 0:19:37.040 --> 0:19:40.960 they're not detected by the authorities, not digitally but physically. 0:19:41.680 --> 0:19:43.920 You know, they were giving advicely, don't put it in 0:19:43.960 --> 0:19:46.359 an obvious part of your roof, you know, keep it 0:19:46.400 --> 0:19:49.359 to one side. And at certain times. 0:19:49.359 --> 0:19:53.600 This raises questions about local regulators and their responsibility to 0:19:53.680 --> 0:19:55.800 catch that these kids have been smuggled in and are 0:19:55.800 --> 0:19:56.440 being used. 0:19:56.840 --> 0:19:59.760 Governments and countries like South Africa where there is no 0:20:00.320 --> 0:20:05.120 licensing agreement with Starlink then they have issued the Telecoms 0:20:05.400 --> 0:20:09.080 Regulator has issued clear warnings against people using this because 0:20:09.119 --> 0:20:09.680 it's illegal. 0:20:09.960 --> 0:20:13.040 Let's talk about the implications of this, Especially in a 0:20:13.080 --> 0:20:16.439 conflict like the Russia Ukraine War. Starlink can have a 0:20:16.440 --> 0:20:21.480 massive impact on battlefield communications. What role has starlink played 0:20:21.520 --> 0:20:23.399 already in the Ukraine Russia War. 0:20:23.520 --> 0:20:27.000 At the onset of the war. Back in February twenty 0:20:27.200 --> 0:20:30.879 twenty two, Elon Musk offered the starlink system to the 0:20:31.000 --> 0:20:34.800 Ukrainian government military, which they were obviously more than happy 0:20:34.800 --> 0:20:39.000 to accept. There was subsequently a deal done between the 0:20:39.040 --> 0:20:42.520 Pentagon and the Ukrainians, and in terms of that were 0:20:42.560 --> 0:20:47.480 never made public. But nevertheless, we've seen plentiful evidence that 0:20:47.560 --> 0:20:51.359 Starlink terminals are used in Ukraine. But what is new 0:20:51.600 --> 0:20:56.040 is that as of February this year, the Ukrainians said 0:20:56.080 --> 0:20:58.159 that Russia is now starting to use it as well, 0:20:58.520 --> 0:21:02.280 which would be very much against US sanctions. And Musk 0:21:02.440 --> 0:21:06.880 said on X his social media platform that they were 0:21:06.880 --> 0:21:11.239 not knowingly selling any terminals to Russia. But nevertheless, there 0:21:11.240 --> 0:21:16.240 are posts on Twitter or video of Russian soldiers opening 0:21:16.280 --> 0:21:20.520 Starlink kits. It's impossible to verify these, but the point 0:21:20.600 --> 0:21:23.400 is that it's a widespread phenomenon. 0:21:23.680 --> 0:21:26.560 Finding the technology and shutting it down is one thing, 0:21:26.840 --> 0:21:30.000 but any attempt to systematically address the problem could mean 0:21:30.040 --> 0:21:32.399 dealing with the big man at the top. When we 0:21:32.480 --> 0:21:37.280 come back, how SpaceX's controversial CEO Elon Musk factors into 0:21:37.320 --> 0:21:43.520 any attempts to rein in Starlink's black market boom. 0:21:43.800 --> 0:21:44.280 We're back. 0:21:44.560 --> 0:21:48.119 Bloomberg Senior editor Alan Crawford has been telling me about 0:21:48.160 --> 0:21:51.080 how Starlink kits have been circulating in countries where the 0:21:51.119 --> 0:21:54.600 system doesn't have agreements in place, and efforts to rein 0:21:54.640 --> 0:21:58.119 that in haven't been wholly successful. But there's one person 0:21:58.280 --> 0:22:01.360 we haven't really talked about much yet who's a big factor, 0:22:01.840 --> 0:22:05.959 Elon Musk himself. He's the CEO and founder of SpaceX, 0:22:06.119 --> 0:22:09.879 the private company behind the Starlink satellite system. Here's what 0:22:09.960 --> 0:22:11.320 Alan had to say about Musk. 0:22:11.560 --> 0:22:15.240 Musk is known to weigh in on not just the 0:22:15.280 --> 0:22:19.160 war in Ukraine caused by Russia's invasion, but on various 0:22:19.200 --> 0:22:23.359 different aspects of US foreign policy, and that's what gets 0:22:23.440 --> 0:22:26.840 to some of the concerns that we heard voiced. There's 0:22:26.920 --> 0:22:31.480 the perception of a potential conflict of inter interest because 0:22:31.480 --> 0:22:35.480 Elon Musk is a private sector he is a supplier 0:22:35.680 --> 0:22:39.159 of services to the US government, not to play NASA, 0:22:39.760 --> 0:22:44.520 and he's taking these satellite payloads for the US government 0:22:44.560 --> 0:22:49.879