Ask Me Anything! with Chet Kanojia, CEO of Starry

Ask Me Anything! with Chet Kanojia, CEO of Starry Banner Image

May 13, 2022

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About Our Distinguished Guest

Chaitanya “Chet” Kanojia is co-founder and CEO of Starry Group Holdings, Inc., a next generation licensed fixed wireless technology developer and internet service provider. Starry has re-imagined how broadband networks are built and how consumers connect to the internet by developing a full-stack technology that dramatically reduces the cost of connecting homes to fiber-quality connectivity. Starry is currently serving customers in the Boston, New York City, DC, Los Angeles, Denver, and Columbusmetro areas, with an expansion and spectrum access roadmap that covers more than 40 million households nationwide. In 2022, Starry was named to the second annual TIME100 Most Influential Companies list.

Prior to Starry, Chet was founder and CEO of Aereo, Inc., the groundbreaking online television platform that enabled consumers to record and watch live HD broadcast television on virtually any type of Internet-connected device via a cloud-based OTA antenna and DVR.

Previously, Chet was the founder and CEO of Navic Networks. Like Aereo, Navic Networks addressed the challenges of today’s highly fragmented media landscape. Under Chet’s leadership, Navic Networks grew to be the undisputed industry leader in advanced television advertising and was acquired by Microsoft in 2008.

Chet holds more than 31 patents in fields ranging from robotics to data communications systems and is an innovative leader known for pushing beyond the conventional and developing breakthrough solutions. He has been recognized as one of the "Top Disruptors of 2013" by Forbes magazine, noted as part of Vanity Fair's 2013 "Next Establishment List” and named one of Inc. Magazine’s 2013 “Entrepreneurs of the Year.”  Aereo's technology was also named one of TIME magazine's Top 50 Best Websites (2012) and a Top 50 Technology (2013) by MIT Technology Review.  In 2019, Chet was honored with Public Knowledge’s IP3 Award for Internet Protocol for his years of work developing technology in the interest of competition and consumer choice.

Chet holds a master's degree in Computer Systems Engineering from Northeastern University in Boston and a bachelor's degree in Mechanical Engineering from the National Institute of Technology in Bhopal, India.

Event Transcript

Jase Wilson: Hey, Ben, thank you. Thanks everybody, Broadband Money community for making time. It's a real honor today to be hanging out with Chet. He's the founder and CEO of Starry Internet.

Chet Kanojia: Hey guys, nice to be here.

Jase: Hey Chet. Great to have you on. You built one of the fastest growing ISPs, and one of the coolest branded ISPs of all time. So it's a real honor to get to hang out with you, and the community's got a ton of questions for you, and so do I. I just asked you "How's the weather in Boston?" If we could just follow up on that, you were saying that it's finally spring, is that right? 

Chet: Finally getting warm, it's 70-ish degrees. It's one of those days where the office is colder than the outside, so.

Jase: Oh, awesome.

Chet: Somebody needs to start a movement to... 'Cause it just sort of feels like in this country, everything is over air conditioned. And you can't be on a plane without freezing, you can't be on a train without freezing, you can't be in an office without freezing.

Jase: Yeah. Maybe... Chet, if you consider it, maybe it's you. Maybe you're just cool. Maybe you're just so cool that it's frosty like that, I don't know.

Chet: Lack of hair on my head doesn't help either.

Jase: Oh, yeah, yeah! You got really good radiation.

Chet: Exactly, yeah. Lot of surface area.

Jase: Well, Chet, it's a real honor. I've been a fan for a long time. I know that the community has a lot of questions for you, and you've got... You've built something pretty amazing with Starry. And you've done that, and I have so many questions about why. Starting with why. What drew you into connectivity? And I know that you're a disruptor, and we're gonna get into some of the awesome stuff that you've done. But what drew you to it and why are you working on helping people connect to broadband? 

Chet: It's kinda interesting when you think about it. It's such an essential service, and will be for the foreseeable... Forever and ever, it sort of seems like it. But it's a pretty monopolistic sort of system. And I just know from my personal experience, you know, customer experience is just so terrible. I mean, the entire sector is like this, right? So, a funny story. I have a iPhone 12, I think I'm still on 12 or 13, I forget which one. And the reason is because I have... I run a dual SIM. And so I have a number for work, which we give out to our customers and whatnot, and one is my personal thing.

Chet: And I still have... I'm on an upgrade plan, that annual upgrade plan that Apple has. And I still haven't upgraded my phone after a year, mainly because it's brain damage to go deal with Verizon just to do an upgrade or just to swap a bloody SIM. It's like... You can't walk into... Well, [A], you got a store, but the process is fucked up. And then on top of that, as soon as you walk in, the guy's trying to hock you like rando 5G, this, that, whatever. It's like "Dude, I just want to fix this one thing." So that's the whole experience. And I live in an area outside of Boston where we don't have Starry. But... Every time we deal with Verizon, or... I won't even call Comcast because it's just like... There's no telephone number, you just... "Package it, you want this bundle or that bundle?" And it's like, "I just want basic internet, I don't need some... "

Jase: Yeah, dude.

Chet: "Peacock or randomness, or whatever shit that you're selling." It's just like... And so that was really the origin, was like... Look, it's such an important thing, totally non-competitive, 65%, 67%, of the country has got a... Basically gotta run some provider, like a true broadband provider. And so to me it was... It's a great business, once you get to a certain scale. Margins are fantastic, you're helping people, you're doing the right thing. You can set the standard for good care, and good experience, and... So it sort of felt like there was an opening in the market with that...

Jase: Understood.

Chet: And despite the great innovations that come out of Silicon Valley, or the startup ecosystem, this is unfortunately an area that nobody wants to invest in, in an early stage, just because it's a lot of capital you gotta find and raise, put to work, the technology, government regulatory stuff. So it sort of felt like it's an area that I was well-suited for, given the intersection of various things I've done. More importantly, the team, that has a mix of capabilities in engineering, software, hardware, chip design, operational muscle that we built up over the last three years, government affairs, regulatory, ability to participate in auctions. It's big boy stuff that is hard to do as a startup. So it felt like, the chances of Fred in a Shed coming after you after you've done that is kinda low. The big guys are gonna sit there and lose share for a while, because they're more interested in profits than customer experience. So it had...

Jase: I see.

Chet: You're doing something really, really hard, but the barriers are pretty low, if you will. And if you've got the wherewithal to do it.

Jase: That's fantastic, Chet. So, and you... Real quick, you've got this awesome shirt. Can you show us that shirt? It says "Internet for All," right? 

Chet: Yeah.

Jase: Which is awesome. That's something that we really value at Broadband Money, and we're trying to help local providers. You're getting to the point where you're gonna... In a few years, you're gonna be the incumbent monopoly in a lot of places, and we're gonna talk trash on you.

Chet: Well, A lot of local providers... Actually, we're beginning to get a lot of interest from international providers as well to license some of that technology. And I think ultimately, I wanna open that technology stack up to local providers here as well, and package that with some of the spectrum we have, and technology, and create sort of a whole ISP in the Cloud that people could just sort of turn on. And I think ultimately crypto might play a role in financing some of these things as well, because you can finance a lot of these things in a decentralized fashion, ultimately. So, there's a ton of interesting stuff that I think is gonna happen, and... I'm glad I met this community because I had no idea.

Jase: Yeah, we're likewise glad Chet. It's a real honor. We're trying to help local providers get to the things that they need to connect more families and businesses to better broadband, and Starry you've built some really innovative stuff and that toolkit sounds exciting as hell. We'd love to stay in touch on that. And then you were just talking about government relations there briefly, and today's a really big day, Chet. Not just because you and I are hanging out talking about the weather, but over the internet, by the way.

Jase: But it's also the day that the National Telecommunications and Information Administration released the Notice of Funding Opportunity for the Broadband Equity Access and Deployment, Alphabet Soup NTIA. I forgot Infrastructure Investment and Jobs Act, right? So the NTIA drops the IIJA BEAD NOFOs, and it's Friday the 13th, which I thought was pretty awesome. You know, that they had the sense of humor about this type of thing. Their statute gave them until Monday. They said, no, Alan Davidson and team, you know, we're gonna go ahead and get this done on... Because it's a spooky amount of cash. We're gonna do it on Friday the 13th. But Chet, what about Starry? Like y'all won some awesome stuff in RDOF. What are you thinking? Like what's next? Let's talk about that for a little bit.

Chet: Yeah, same here as well. That'll be a big focus for us. And not just solo, but you know, want to kind of be part of an ecosystem to partake in that. And, look, I mean, I think, you know, mission first for us, which is affordability is a critical component.

Jase: Yes sir.

Chet: I mean, this is kind of the nonsense that's going on, right? I mean, there's all this hullabaloo in wall street and investors and all this other stuff about TMO doing fixed wireless, this, that whatever, or Verizon or this or that, or, but when you take a step back and you start adding it up, basically these guys wanna make 500 bucks a family a month, between broadband and mobility and this package and that package and...

Jase: Yeah.

Chet: Which is kind of in the nonsensical territory now. And I think, you know, hopefully what Starry is doing sets an example. I think there's an opportunity for somebody to come in with an elevated brand on prepaid mobile too, because you know, who died and made all these guys kings that, you know, suddenly it's, you know, that we're gonna pay 500 bucks? It's nuts.

Jase: Spot on Chet. And to that point you're right, that...

Chet: And I think our focus, to answer your other question, is gonna be more on segments to drive affordability as well.

Jase: Yeah. There's some exciting stuff around affordability. You've been doing affordability by the way since before it was cool. Like now it's really cool. COVID, EBB comes out. It's like, you know, there's some money for families in need for a month, which is awesome. Thank you, for doing that. But, ACP is now sort of formalizing that and it's great. Thirty bucks a month per subscriber per household, or 75 a month for tribal. We've got our own turnkey ACP system that is helping providers turn that on, but it's like, you've been doing that crap since like, before anybody was even thinking about it.

Chet: Yeah, since 2019. Yeah.

Jase: Yeah. Well, there's a TechCrunch article on you doing it in '18.

Chet: Yeah. Late '18 we started. '18 was kind of... Through '18 and into '19 was a lot of sort of beta work we were doing.

Jase: Why? Why not rip their face off? You know, you could make a 500 a month per household, come on. So you were doing that before it was on people's minds. Why? 

Chet: It goes back to the mission, which was, look, it's an economic opportunity. And I think... There was a lot of debates we had internally, and in particular during the Black Lives Matters movement. And you know, there was a lot of employee sentiment around here, we gotta do something and, my view was like, look, we've gotta be authentic to what we are gonna be doing. And being authentic meant like, I mean, I don't have a standing in making commentary around what racial equality or not, or this or that or whatever. I've been a pretty fortunate human being, but what I can do is put my resources to work and, you know, provide connectivity, which will be... It's an economic opportunity for people. And so the origin was, look, it's an economic opportunity for folks. It's an economic opportunity for Starry and I think good things happen when you sort of combine incentives along those lines.

Jase: Yeah.

Chet: And, I mean, you know, a lot of these folks were... I was, it was actually interesting. We do a lot of work in Los Angeles, for example, in public housing and affordable housing. And I was out there, a month and a half ago or something like that with the mayor. And very early on we had made an approach that said, we're not gonna ask for credit checks. And part of it was driven by my personal experience when I first came to the United States, you know, as a foreign student, you don't have credit. So a lot of things you don't get. So for example, even the first like mobile phones that were out, you couldn't get them because you didn't have credit.

Chet: So, we said, look, these people have a good ability to pay. They are non-migrant, they're static, they're there. So let's take the credit requirement away because you know, it's not that they're not trying to jib us for 50 bucks or 30 bucks or whatever it is. They just need the barrier to be lowered. So a lot of those things. So for us, it was a combination of it's good for moving the community forward and it's good business.

Jase: Totally dig it. You are... You say as you do and do as you say, huge respect for that. So, Chet, we have a ton of questions from the community.

Chet: Yep.

Jase: But I wanna start us off with one from me, which is like, what are you doing in, not next week, but the week after? Really wish you could go to Mountain Connect and... You know about this conference.

Chet: Where is it? I may actually be out...

Jase: It's in Keystone.

Chet: Keystone. Got it.

Jase: Keystone, Colorado, the beautiful Rockies. May 24th and 25th. Alan Davidson, the head of the NTIA is gonna be the opening keynote. Right. And we're...

Chet: I'm supposed to be out in Denver for... It's not firmed up yet. On the 24th.

Jase: Just drive up, we'll come down and get you. Like, we'll go up there.

Chet: The problem is on the 25th I've got a board meeting, my second quarter board meeting here back in Boston.

Jase: Yeah, well, that should be quick. Starry's up, so it's just...

Jase: Just text them, send them a screenshot of, Starry, the only stock that's up in a market that's... Did you see that the world melted down by the way? I don't know. Anyway this should be awesome.

Chet: Funny story I walked out of the stock exchange after we opened and I deleted the stock tracker app on my phone and I don't watch it because I would've gone bat shit crazy, looking at it oscillating every which way.

Jase: My bad, I didn't mean to jinx you or anything.

Chet: Nah, it's alright.

Jase: Hey, yeah, May 24th you come up to Keystone, Mountain Connect, Alan Davidson, head of NTIA is the opening keynote. And then we've got a session that we're doing... Actually we're serving ice cream that afternoon too, the reasons keep stacking up for why you should go up there, but and then three...

Chet: If I decide to make it, I'll put in a request for, because my favorite ice cream in the summer tends to be strawberry.

Jase: Interesting. Okay.

Chet: Me and every 13 year old kid.

Jase: Broadband Money team listening, make sure you make a note of that. Anyhow, there's also gonna be a panel on national, the digital inclusion movement. It's something that I really value about Starry is, you all don't just do internet service, you have explainers. It's like, well, what does it mean? You could have all this fancy internet with really good throughput and stability and devices and it means absolutely nothing if you don't know, what is it and what can you do with it? That's gonna be a panel that, it's gonna be awesome to go to as well.

Chet: That's great. We're lucky, we have a partnership with Microsoft that helps us on some of those things as well and in particular devices. And again, in the same visit when I was with Garcetti in LA, we were talking about stuff and what they've been doing is this idea of a digital ambassadors, which are basically kids, which are digital native, helping parents, grandparents, aunts, uncles, whatever broader community because that's where, people trust each other and could be pretty helpful. So, interesting stuff.

Jase: Awesome Chet. Okay. So I wanna dive into some community questions, okay? This is a question from TJ York, how do you feel your experience in broadcast translates to work with broadband? And I didn't know that you're in broadcast. It was when you were trying to do like up in the cable companies, just thinking about...

Chet: When the Aereo thing... Yeah, yeah, broadcasters. Yeah.

Jase: Yeah.

Chet: It's kind of, I'll be candid here, right? For example and this is not that I'm better or anything than anybody, but if today, a young entrepreneur, an entrepreneur walks into a venture capitalist and say "Hey, I wanna start a service provider," people laugh you out of the room. Right? And... Or frankly, even if you walk in and say "Hey, I wanna build this technology that I will sell to service providers." People laugh you out of the room because nobody makes money doing that. I don't think I would've had the opportunity to do Starry if we hadn't done Aereo, just because that showed a lot of the world that, people that have a good sort of foundational idea and an ability to execute can really make a huge dent.

Chet: And all of those investors rolled into Starry and we raised obviously a lot more capital beyond that. But the other thing that we really learnt was kind of the dissatisfaction part on the overall experience that people had with traditional cable and all kinds of funny anecdotes come out of that too. Where we would get, for example, back in 2013, I wanna say somebody would be... A customer might call and say "Hey, this is buffering or this or that or whatever." And we were like "Well, we've kind of checked your connection all the way through, it's not the internet, you should be fine. Our service is fine."

Chet: And it took us two months of thrashing around to figure out what was really going on was, and the community will get the joke out of this, right? 2.4 unlicensed WiFi back then, 802.11b, AC wasn't quite out yet, 5 gigahertz didn't really exist. And your microwave, your home microwaves, if it is not properly shielded, its radiation can interfere with WiFi. That was an aha moment of like "Oh, shit, if we're gonna do this broadband company, we've gotta do a fully managed WiFi solution as part of that," because ultimately it doesn't matter how good your network is. If the customer experience sucks, then...

Jase: Doesn't matter.

Chet: Doesn't matter. Also with the fully managed WiFi, we can help a customer with their Nest that may or may not be connecting or a VPN problem they may have or anything else just because we know at every hop kind of what's going on. The idea of building telemetry all the way through originated out of, during our Aereo days as I started.

Jase: Yeah. You all have done some pretty innovative stuff in that space. And let's stick with that theme for a minute. Like TJ also asked, what challenges did you not foresee while developing a full stack technology for building an ISP? 

Chet: The basis for our approach was to say, hey, can you actually heterodox? For the folks that are not engineers in the room, what Starry does is we take the output at an intermediate frequency, which is typically 5 gigahertz or baseband coming out of the WiFi chipset. And we make a bunch of modifications to the Mac, which is the controlling software on it. And then basically take the output and run it at the licensed frequency. The process of translation of the frequency is a really complicated process because you have to do it at a very low noise figure. You have to basically preserve the wave forms and all this other stuff.

Chet: The first three years of the company, that was it. And I remember Joe, who's our CTO on the engineering side saying when we first successfully ran an air-link across, fully up and down converted, and back then, by the way, the base station prototype was, I don't know, $5 million or something like that. Just the sources that we were using, like $2 million each.

Chet: So that cost reduction journey was pretty... I wouldn't say nothing that we didn't anticipate. We all knew, but it was a lot of unknowns, so just grinding through that takes forever and ever and ever. The biggest pain in the butt that we had... We still do every now and then is if you're gonna get a 16 inch or a 20 inch snowstorm and your radios are gonna get covered in, you don't have a recovery path for that. So how do you design radomes that can shed snow and control the droplet size for the snow melt that might accumulate because even if you add a heater, it's like the litany of shit that we had to do was just going on and on and on and on, and it still does, so... But it's fun engineering, it's really difficult, but really fun.

Jase: Y'all seemed like you had fun. It seemed like you had a culture of problem solvers.

Chet: Very much so. The whole idea is put the customer first, and then... And that applies in hardware, that applies in software, that applies in the aesthetics of the device, that applies in how we're delivering power to the device, all of those things center around like customer first, and then basically, everybody has a license to just take action. I've never had to authorize, for example, or... Our front line care people have all of the flexibility to say "You know what? I'm really gonna make you happy, this customer, and I'll do whatever... X, Y, Z." I have full authorization to do that, so.

Jase: I dig it, Chet. Thank you. So in the same vein, sticking to tech for a minute, popping over to protocols, this question is from Community Member Dave Todd. He says, how are you doing on delivering IPv6 secure routers and better latency under load? And then he asks, how well does your typical affordable connection do on the latest speed test app for iOS and Android? 

Chet: Yep. So I will defer on the IPv6 comment because I actually don't know the exact status of where we are at on those things. I can check and post something back to you guys. So the latency thing is... So latency tends to be a function of... A combination of subscriber terminals and a load on the network, obviously, so we strive towards about 10-13 milliseconds, we've had a... Actually, there's a couple of areas in which, geographically, we are not... We've maintained that latency, but we've gotten... There may be an artifact where we see a spike or something along those lines, so it's like a... It's a live near real-time process for monitoring what aggregation integrals we wanna apply.

Chet: And typically in this kind of a thing, because we are a TDD system, return channel traffic tends to cause more of the problems in terms of collisions and things like that, so that's where the modifications we've made in the Mac and then continue to make improvements on that is helpful. But basically, the goal, and I think we published this, is, on a quarterly basis, I think somewhere between 10 and 15 milliseconds of round trip latency to the cloud.

Chet: Now, for RDOF and other things, they're are obviously for voice in particular. VoIP as you and I sort of... We all use it normally, those latency figures don't really matter, but when the government defines what latency means for VoIP, it's a different thing. So for those particular things, we have different standards that we follow for more predictable latency. And I think the interesting observation I've had in this latency thing has been, it is sort of less relevant what the absolute number is, what is more relevant is the fluctuation of that because consumer perception is tied to the fluctuation as opposed to what the absolute number tends to be.

Chet: Now, clearly there are cases in which... Let's assume if you're running a satellite connection or whatever else, latency in particular in uplink will be quite jittery, or I shouldn't combine the two stats, but you'll have a lot more jitter on your return channel, on, for example, things like that.

Jase: Experience would suck.

Chet: It does. Actually, I was on a call with somebody yesterday... Well, the good news is that the individual used to have 2 megabit DSL, so he got a Starlink thing, and unfortunately, he had to terminate the call because it crashed four times, but it was new for him, so I'm sure it was a little kinda thing. All these technologies tend to mature a little bit over the next, in a couple of years kind of thing, but from an interface perspective, basically the way you wanna control latency is by making it more predictable.

Chet: On the other question that was there on the speed testing. Most cases we monitor... So we run a speed test on a consumer device, we used to run once every hour, which we then wised up that that was a waste of bandwidth, electricity, and everything else, so we... But we do run every, I think twice in every 24 hours a full speed test, because we have an Ookla app built into the router, and so the...

Jase: Per customer twice a day? 

Chet: Yeah. And now, I don't know if the individual that's asking the question has a specific question around because I think...

Jase: It's loaded latency. So Dave, I've seen his work before. He's with the Broadband Internet Technical Advisory Group, and they've been working on... In particular, he's been working on Bufferbloat and the concept of true latency, and to your point about the quality of experience so...

Chet: Right. So then there's lots and lots of tricks we do at the Mac layer, for example. From what our queue sizes look like, it's 11ax, so we have quality of service on a queue by queue basis, it's all FDMA on the uplink, so you can just carrier level isolation, there's like bajillion things that are going on to manage that experience all the time.

Jase: Yeah. So you know all the ins and outs, Chet, of building this business, you know the tech, the protocols, you know all this stuff. I'm gonna switch gears with you real quick, ask if you were to...

Chet: I just want to clarify. I don't, but a lot of people in the company do, so they're good at...

Jase: It seems like you do. I disagree, I think you do. I think maybe you're being humble. But let's switch gears for a second, 'cause I'm gonna show the community this is the range of amazing things in Chet's brain here. This question is from postgres Faloon, it's on the financial side, right? Because, you built and scaled Starry, one of the fastest growing ISPs of all time. You overcame, out of escape velocity, you're able to put together some early money, and you eventually took that Public via SPAC, one of the few successful SPACs in the books right now. And, so this question is from postgres Faloon and it says, Chet, what advice do you have for other operators who might be contemplating taking on private equity to potentially match government funding? 

Chet: Yeah. It's a pretty dangerous game. And I'll be... The problem with private equity is... Okay. There are a lot of them that are friends of mine, so [chuckle] I wanna be careful here. And the problem is, they're in the business of making money with money. And we, the collective here, likely is in the business of making money by providing services and being good citizens, and those things can conflict. So one advice I would have is, in particular, as you're thinking about government money, and by the way, I mean, I have plenty of criticism of the government structure too in this sense because, for example, this whole idea that you're going to... This is how fucked up this whole thing is, right? So you're going to, I'm gonna give you, let's say, a million dollars in subsidy, but you need to put up...

Jase: Two hundred and fifty thousand.

Chet: Two hundred and fifty thousand dollars with a letter of credit, which by the way, I'm gonna go to a private equity shop, that's gonna want to make 7%-9% off of that, which is like mind-bogglingly idiotic to me, because they're taking the government's money at low things, tacking something on top of it, and then loaning it back, which you're then putting in a bank, it's like, stupid. We're gonna put off the... I'm gonna pick a number in the RDOF thing, right? It was like, whatever the clearing ultimately was, like, $10 billion, $12 billion, which is great, it's gonna go to work. But the problem is, by the time, you put all of the stack up together, 10 other people are making money before the poor customer even gets the service, right? That's silly.

Chet: So we had talked about it at one point saying, you know what? The Treasury should have a function, where if you're an operator, they're providing you a loan to offset that letter of credit, because assuming it's a different part of the government, or whatever it is. So we used to call it, BOB, Broadband Opportunity Bank, [laughter] we're floating this whole thing. So, on the private equity side, I'd be very cautious. Even though that may be the only source of capital. The way to think about that might be to put containers around it. So for example, you could say "Hey, I'm gonna create a subsidiary, that I'm gonna have constrained around a particular geographic area. There, I will take private equity money, but I won't let it creep up."

Jase: Okay, wonderful.

Chet: And do geographic area by geographic area, that may be an interesting way to do it. And because, most of these guys, right? I mean, it's like, they're gonna value you at like some stupid multiple of EBITDA or this or that, or whatever it is. And half the time, it doesn't make any sense, because what they're really trying to do is make 40% IRR. And you're trying to be in the business of providing service and having a good job and series of jobs for your employees. And so there's a huge conflict in those things.

Jase: Well said, Chet. Yeah. I really appreciate your perspective there. So let's switch gears again. This is from Tara Whipple, she has asked Chet, many of Starry's customers live in, multi-dwelling units, apartments and such, MDUs in the industry lingo. Are there any unique issues for serving this demographic that you can talk about today? And then I'm sure this is like you've solved for a bunch of really awesome engineering feats that help you get good service inside of these types of...

Chet: One of the biggest problems... And, by the way, the FCC needs, you know this, I think should be commended for a lot of constructive rulemaking they've done around access, around tiered revenue share arrangements, around exclusivity, around all of these things. So the FCC and across the board, right? Multiple generations, different administrations, all that stuff. So I think, the FCC has been super constructive, but I'd say in the multifamily segment of the market, and we started there just because that's where technologically we were at, from a cost perspective, that it made sense to do it.

Chet: The challenges range from, how do you get access, convincing a landlord that you're a good provider and etcetera, etcetera, coming in. So when we started the process, it took us, I don't know a good year to get our first building, in seven months, anyways. And just to put in perspective, now we do, and that was probably like 80 or so apartments. And now we do about 10,000-15,000 apartments a month. It was kind of funny. I was trying to pump the team up before the earnings call. And I was like, remember, three years ago, it took us 10 months to get the first apartment building. And now we do at this rate.

Jase: Incredible.

Chet: But it's possible and it really comes down to finding the right partners there. So, we took investment from related companies, they've been a great partner, and then we've expanded those relationships to lots of people, so that's one. Second is in-building wiring. How do you manage propagation of the in-building plant is, can be challenging because if there's an existing provider, that maybe is using the coax or they may or may not be ethernet in there. So we've been deploying technologies like Wave 2, Wave 3, which allow us to use category three wiring... Cat 5, Cat 6, coax.

Chet: So we've kind of gotten to the point where we are media independent in terms of what propagation methodology we're using within buildings or apartments. That was a huge risk factor that we had to sort of overcome. Marketing is, I think, well suited too, for small companies in the multifamily segment, largely because they're very much a tactical door hangers, flyers in the lobby, those kinds of things. And our marketing group did a, I thought phenomenal job in terms of starting with even the name, but the design, the branding, all that stuff's friendly.

Jase: What's the name mean? What's the name mean? Starry.

Chet: It was, thank God, I didn't come up with it. We had to hire a naming consultant...

Jase: It's a cool name, it's a cool name. It evokes dreams and...

Chet: Big dreams, exactly...

Jase: A sense of awe and...

Chet: We also didn't want a masculine name. We wanted sort of a very neutral name in that sense because... And that's why a lot of the branding is very non masculine in that sense, we use sky colors, for example, or...

Jase: Right. And astronauts, too.

Chet: Yep.

Jase: Yeah, I remember vividly, like a homie from KC that had moved to New York many, many years ago, this is many years ago. He's like, he knew I'm a nerd and I love internet crap, like my baby boy's initials are www for example, for why wouldn't they. He's like, "Dude, Starry is the future, you gotta check out Starry." He is sending me all these texts and all this crap, I was like, I'm pretty busy. But let's check it out. And I was okay, that's really awesome. It's like astronauts and just fun... It was fun. This whole impression is fun.

Chet: In fact, when we were trying to come up with a tagline too, so we use happy internetting. Right, which is like, the kind of core theme is going back to my Verizon experience. What I was saying... It's so painful dealing with things. And so there's these certain negative relationships you have in your life.

Jase: Yeah.

Chet: And I think healthcare, for example, used to be this pain in the butt where doctor's always late, and you got to make it blah, blah, blah, blah, all this sort of stuff. That's dramatically improved now and you used to have... Insurance was another one, right? It was like this negative experience that you had, but telecommunications has historically been a negative experience. And it comes from the origins which is government monopolies. Right? And so it was... And it's not a US thing. It's globally. It's the same thing.

Jase: Yeah, you have a track record as a disrupter, right? Like pre-Starry, you doing Aereo and taking on cable monopolies... Did you ever think like... Did you ever worry that like Brian or maybe John Malone would like show up at your door and be like "Hey, knock it off, stop trying to take us out?" Because that's pretty ballsy, to take on cable.

Chet: I mean, look man, here's sort of the reality. None of us are getting out of here alive.

Jase: Ah, that's true. Yeah.

Chet: It doesn't matter how much money you have or not have, you're still dying and going... Getting buried or burned...

Jase: Might as well do something awesome.

Chet: Do something fun at least when you're sitting around with your buddies or family or whatever, at least you got stories that are not common, right? So...

Jase: Okay, that's awesome. Yeah. We'll get back to the community questions, Chet. I got some of my own questions for you dude, but maybe we'll catch up up in Mountain Connect in week after next but... Next question is also MDU related, from Riley Hite, it says, Chet, in an effort to unlock broadband competition. I don't know why there are sarcastic quotes around it... For multi-tenant buildings, in February, the FCC announced that it would prohibit broadband providers from entering into rev share agreements with landlords, do you view this as a step in the right direction? If so, why? 

Chet: So the rev share, I don't think the FCC and I'm not fully up to speed, I'm sure my government affairs folks do, it's not that you can't have a rev share. You can't have graduated rev share.

Jase: Oh, so the specific mechanism of rev share.

Chet: Exactly. And what would happen is in a graduated rev share thing, the rev share will increase as the number of customers in the building would increase and that would disincentivize the landlord from saying "I want somebody new in." Because if the rev share is universal, then the landlord's like, "Whatever I'm indifferent." The graduated part is what screwed up the whole thing and that I think is...

Jase: Interesting...

Chet: Very positive. Really good thing long term.

Jase: Wonderful. Let's see, we have some more questions coming in, and Jacob Sproon asks, what do you use to serve old MDUs? And I'm assuming he's kind of getting back into like something that you...

Chet: Into the why... Yeah. So we run Wave 2 and hopefully soon Wave 3 on... And that's media independent, so we can run it on phone lines. And we probably have, I don't know, 5000, 7000 customers, I don't know, I'm making up a number. But a lot of the early stuff we did was on... And especially in Boston, where you will have older apartment buildings that are... I mean, I know the first one that we did was actually using the twisted pair for the intercom system. And we were running Wave 2 on twisted pair intercom and doing 500 Megs kind of a thing.

Jase: That's funny. That's an interesting take on VoIP. Or I don't know. That's really fascinating. I'm trying to make a joke.

Chet: And for the technical nerds in the audience, so Wave 2, so we typically done like the 0-200 megahertz part of the wire originally on the coax side, and then on twisted pair, it actually works really, really well because a lot of the advanced echo cancellation techniques that have been developed. You don't wanna run it more than probably, 200 feet or 300 feet, but with that works fine in a building. But you wanna constrain it.

Chet: Now the same protocol runs on either coax where you can go 300 meters, it will run on... So for example, in certain cases, what we're doing is putting a receiver on a utility pole, picking up the signal and serving the neighborhood with wired coax off of that. So everybody's contributing power to the receiver and, the receivers can be basically just split passively with coax. Just $2 splitters that you can buy whenever you want. So it's just, we built up a whole widget toolset of solutions that are focused on which I think the community will care about, which is all about cost.

Jase: Yep. I dig it, for saying like you're not the guy that knows this stuff you seem to know your shit, so let's keep going. I'm gonna keep trying to challenge you here. So far, I'm not having any luck, but Dan Grossman asked, you mentioned selling equipment internationally into small providers. I understand that Starry has its own US based manufacturing and its own chipsets. How do you get enough economies of scale without selling equipment outside Starry? 

Chet: Yeah, it's kinda interesting. So what we did was, you wanna find this like happy medium between what is globally sourceable that is at low cost, which is why the baseband that we use is WiFi, where you can buy those chipsets for, low cost relatively speaking. The area that Starry builds chips in or other things is on the front end part and then do the frequency translation part, things are good. So for example, again, if there're old wireless folks, listening or watching or whatever, you know, we've built really, really high performance mixers on just board level art or just, art on the piece of gam. And, those, you can, those are dirt cheap because it's like 2 millimeter by 2 millimeter and, that's like a dollar a mil kind of thing.

Chet: So we've done all kinds of clever shit, too, but the expensive things that you don't want to do is like make the whole CPU, right? Those things we buy. So, and we don't actually have US based manufacturing. We manufacture the PCBs overseas. We do the final test assembly and validation and calibration in the US. Mainly because, anybody who's worked in high frequency systems knows this, that it's like assembling jewelry, it's very sensitive and you have to have test and validation, every radio is cal'd differently, every component is cal'd. So it's just easier to do it here.

Chet: And then we don't need to make, as we open up the equipment to either domestic or local potential partners, you know, we're not trying to make money off that equipment, basically just have a licensing fee on intellectual property or whatever else. And it's not just the radios. So if you think about... Actually it was funny, we had a visitor from South Africa today and, you know, it's interesting when you sort of think about, like all of the amount of software we've written that ranges from the network monitoring systems to element management, to propagation analysis, to subscriber management systems, fully integrated in, so when a customer calls, our rep can basically look at every level of the device they have.

Chet: When we send a rep out, when we send an installer out to install the radio, for example, they carry an iPad that has propagation base at 1 meter square illuminated areas on where the best signal propagation is gonna be on the roof. So all that stuff, it's packaged in, it's like a cloud native sort of system that we built. You could potentially accuse us of making too much shit, but there's a philosophical view in that, which is we try not to buy anything that is going to be a per customer charge...

Jase: I see.

Chet: That's from a third party, because that obviously, reduces the amount of overall leverage in the business and margin and things like that. So we tend to buy only things that scale without a subscriber penalty to them. And if there's a subscriber based cost, then we will build it ourselves. So managed WiFi is a good example or network monitoring is a good example where I'm sure, and we got, tens and thousands of these terminals running around, or more than that. Plus on top of that, every WiFi router is metered by us.

Chet: So once you start looking at, million plus devices that you're monitoring at any given time in near real time, there aren't a whole lot of, for example, network monitoring systems that do that, right? Because network monitoring systems historically, have been, there's like, hey, there's an SNMP MIB sitting there and I'd suck up the MIB every now and then when I want to look at it. My goal was we need to know what's going on in the network before anybody else does.

Jase: Right.

Chet: And it's a hard challenge, right? Because, it's a machine learning challenge, for example, where, we have customers that are, that turn their WiFi off at night, 'cause they don't want whatever they don't want. We have customers who've asked and we built these features where they have a new child and they wanna be able to turn WiFi off when the child is sleeping. I don't know if it matters or not, but whatever, the customers want it, so we build it.

Jase: Fibo at least. Yeah.

Chet: So, we actually can turn the radio... The PAs off in the WiFi router, for example.

Jase: So what do the others that don't have your brilliant team of engineers do? Do the competition, do they just, should they just be terrified of you and, they're screwed, and Starry is gonna take over with all these like kick-ass tools and smart people...

Chet: I don't know, I mean, I think, we... Look, despite all of this stuff, it's a hard business, right? And let's not forget about it. And I think everybody on the call probably knows this because, it's a combination of execution, capital, marketing, Starry... It's like more complicated by making the technology itself, but the first enough is complicated enough. So I think, look, I think we're gonna be, as this plays out, we are gonna be a pretty meaningful provider in the country, but that doesn't mean that there will be no others.

Jase: Right.

Chet: But my goal is to say... Okay, where we are not going to be able to get to in a rational period of time, let's enable others to do it.

Jase: Awesome. So on that point, Chet, you recently, you took Starry public via SPAC, put in like 450 million and or so in cash. And part of the Use of Proceeds said nationwide, right? So you're currently in east coast and some sprinklings here and there. Is there anything that you can share with the community about like how that map spread works? 

Chet: There's gonna be clustering for, as a start. So we'll sort of edge out from the clusters we are in. So, the west will get, you know, operated out of LA, which is a very rapidly growing market for us. New York's sort of hitting its stride and they're growing very rapidly as well. So there'll be clustering as a start. We won't really announce specific markets just because things will move around and there's no point in sort of announcing something and then changing whatever you're doing.

Jase: Understood. Good deal. Okay. Next question is from Bernie Arnason of Telecompetitors, he says "Chet, I'm curious how you view rural markets. Do you see opportunity there? If so, why?" And you listed LA, New York and all these like amazing towns.

Chet: Yeah. So it's a function of what frequencies you're using. I mean, ultimately I'm optimistic that the government's funding and resources that are being plowed in will lead to a lot of fiber connectivity in rural parts of the country, which is critical. And in those areas, for example, there are parts of the RDOF footprint that we are in, some are quite dense where the fixed wireless parts that we are using with millimeter wave makes sense. Some are not where we will be doing some fiber as well. So I think on the rural side, it's really a function of what spectrum is available to you.

Chet: And I think for the community, something to be in mind and both from a regulatory perspective as well, that if you look at, for example, the 12 gigahertz band, which is, today part of a, you know, satellite downlink, there is, there are terrestrial rights associated with that as well. That could be a frequency that's very compelling for rural applications because you will be able to get the sufficient amount of propagation, 5, 6, 7 kilometers off of that to be able to provide good, good service.

Chet: I'm not a big believer personally on sub-6 frequencies for fixed applications, just the return isn't there because the amount of dollars you need to buy that spectrum just, you can't provide a return. Maybe if you're a mobile operator, you can opportunistically add customers to it. Especially if in an area that they're not gonna consume a lot of mobile capacity, but just from a band harmonization perspective, you kind of nationwide rolled out, you know, whether it's C-band or 2.4 or whatever it is, or 2.5, but ultimately I think, if you look at, I mean, a Starry customer today is consuming on average as of end of Q1, 580 gigabytes a month, I wanna say, downlink and probably ballpark of 50% about on an uplink.

Jase: Wow.

Chet: And then the top 15%, 20% are over a terabyte and a quarter. So that's a lot of capacity. Right? And, and to recreate that capacity with mobile spectrum is, I mean, remember what these guys do today, right? They'll sell you unlimited, but there's zero rate after whatever 30 gigs or whatever it is.

Jase: Yeah. Spot on, Chet. So I'm still trying to stump you. I'm gonna keep spinning around and talk like switching topics on you and it's not working so far, but, uh, Dan Lubar asks, ask Chet what he might do instead of the broadband opportunity bank thing if you were in charge. And I'm assuming he means of the country like the president, like actually, you know what, you'd make a good president.

Chet: I hope that's true.

Jase: A business savvy techie would make it, you'd make a damn good president in fact.

Chet: Well, that's a debate that I think I have with a lot of native Americans, not native Americans, like Americans that are, you know, didn't grow up.I am a citizen. So it's interesting, in certain countries, technocrats tend to be politicians, like India, China. You're a engineer, or you're a doctor, or something along those lines. In our country it's lawyers only. I don't get that.

Jase: What's up with that? 

Chet: Yeah. I know, we gotta change that. Ain't gonna be me.

Jase: Well, but to Dan's question though, like however you define it, you had an interesting concept with this, the broadband opportunity bank, we're like, what would you do? 

Chet: I would, I think, you know, despite none of us wanna look at the French for inspiration, but a pretty cool thing happened where they pooled all of the guys, like Voda and Orange and, and Free, and all these guys banded up and they have a common conduit. So if you, I mean, to me, the way to fix this would be a common conduit throughout the country.

Jase: Whoa.

Chet: Then after that, if you are a service provider and you want to have skin in the game, you can pull your own fiber, but all the nonsense you have about make ready this, make ready that, and like, you know, 10,000 variables, then Comcast sues the government or, you know, whatever it is, municipality, because they didn't really have the right regulations and all that stuff, you would just throw out and say, "You know what, I'm gonna common conduit everywhere."

Jase: All public backbone, public middle, and then providers go do. Awesome.

Chet: Just the shelf. We just said, conduit, and I'm gonna carry, you know, I'm gonna have sufficient conduit for, let's just say, 512 strands.

Jase: Interesting take.

Chet: And first come first serve, you put up money and you rent it from the government. And...

Jase: That's a very workable model, Chet. What about open access? What are your thoughts on open access? I know there's a bunch of different flavors of it, but...

Chet: Never a big fan of open access, and the reason is... This is a personal view of mine, mainly because there's too many negative incentives to fuck with you.

Jase: Yeah, right.

Chet: You can have a deceptive cool brand but ultimately you're relying on somebody else's network, that somebody else's network is terminating in some other pop. There's a charged line item for each one. I mean, this is what the government tried to do when the whole dereg happened in the telecommunications act, and it didn't quite work. And what they should have done was, the hardest part is the carrier part of it, just the physical infrastructure part of it. But let's just... Let's create an empty shell so that anybody who first in, first out, they can rent it and pay the government, but let them put their skin in the game.

Chet: So I think a combination makes sense, a state-owned enterprise just to me it doesn't compute, because the incentives aren't there. Because guys like us will always do crazy things, bend over backwards for our customers to distinguish ourselves, innovate because we wanna make more profit, whatever it is, but there should be like an enabling platform, and I don't think open access is that, any country that, it's marginal in my view.

Jase: I dig it. We've seen some weird stuff with the sort of Race to Zero problem, to your point about negative incentives, 18 providers and they pay you to take a gigabit of service.

Chet: It's like the UK. The BT is still doing fine. The customers are still getting shitty DSL for all intents and purposes, unless there is a private provider that's doing fiber or whatever it is.

Jase: This is amazing. So Chet, we have two more minutes. Real quick, everybody. Let's try to get Chet up to Mountain Connect. May 24th, 25th, I know you're gonna be out in the Denver area. So come on out, hang out.

Chet: If I am, I will.

Jase: We got ice cream, and Alan Davidson's gonna be doing the keynote. And there's all kinds of awesome shit going on up there. And then I wanna close out with one last question for you, Chet, is, what the fuck is the Internet? What is it like to you? Not in general, no technical speak, but what is it? We've talked to Vint Cerf, we've had on really amazing people that have their own interpretation, but it's like... What it means, the internet to you, like Chet? 

Chet: I don't know, I'm not that philosophical. I'm a pretty simple guy. Look, I mean I look at that in more literal terms. It's the equivalent of new roads. And I'm not a big fan of all this Silicon Valley metaverse thing, but there is certainly an aspect of some of those technologies that are pretty compelling, whether you look at... Healthcare is a good example, education is a good example and those things. Let's not talk about games or Grand Theft Auto or whatever, but just otherwise there's really powerful benefits for that. So I think it's really a way to collapse.

Chet: If you think about it, the world started and then you have airlines would collapse the world, because suddenly you could conduct business, you could visit family, or whatever. And when you have the internet, the world collapses even more where you can talk to anybody, any time, like playing game, education, exchanging ideas, all of those things, and it wouldn't be possible without the internet. But here's the thing, that ultimately technology is deflationary no matter how you look at it, and that's what gets my goat is technology is deflationary, we all see the same cost curves come down, but why are the prices going up. That makes no sense to me.

Jase: We could spend another three hours, we have three more seconds, so, but Chet, it's been a real honour.

Chet: Thank you, I loved it.

Jase: Yeah, thank you for making time. I hope you come out to the Broadband Money, join the community, I'm gonna send you a sticker and then get you some ice cream at Mountain Connect, some strawberry ice cream for you. So, get on out. It's good to see you, Chet.

Chet: Same here, thank you guys.

Jase: Let's have a good one.