• An artificial intelligence is about to get 5x to 10x more powerful…
  • Airline travel is about to get a major upgrade…
  • Mastercard moves into the cryptocurrency market…

Dear Reader,

5G wireless coverage in U.S. airports is about to improve dramatically.

Earlier this year, I wrote about a major drama that had unfolded between the U.S. aviation industry and the wireless industry. The dispute also ensnared both respective regulatory agencies, the Federal Aviation Administration (FAA) and the Federal Communications Commission (FCC).

It also involved the National Telecommunications and Information Administration (NTIA), a division of the U.S. Department of Commerce, whose purpose is to avoid these kinds of disputes in the first place.

Sadly, that didn’t happen.

At the core of the issue was the aviation industry’s claims that 5G wireless services deployed in C-band spectrum could possibly interfere with older radar altimeters (radalt) when used in low-visibility conditions.

Radar altimeters are pretty simple devices that are a bit smaller than an average shoebox. They transmit a signal to the ground, which bounces back up to the altimeter, and then pilots can understand their altitude with respect to the ground. They’re particularly useful at night and in bad weather when ground visibility isn’t as good.

Despite the FAA and the aviation industry knowing that 5G was coming nearly a decade in advance, it oddly waited until last year to raise a red flag on the possible effects of 5G on radar altimeters.

The FCC, however, was steadfast in its position that there wasn’t a problem to solve. Its position was that C-band deployments of 5G wouldn’t interfere with the altimeters.

Standing in stark contrast to the aviation industry’s position was one simple fact: 5G wireless technology deployed in C-band frequencies had already been deployed around airports in foreign countries without incident.

Even more conspicuous is that U.S. airlines have been flying into those international airports with their altimeters every day. Again, without incident.

So what’s the game? 

It’s pretty simple. And unsurprisingly, it comes down to money.

Running an airline is a tough business. The capex requirements are massive, margins are small, and bad years can bankrupt even the best of them. And U.S. airlines in particular often compete against international airlines that receive large subsidies from their governments.

To save on capex, it’s not uncommon to see aircraft in service for 20, or even 30, years. Older aircraft in particular require a lot of maintenance and upgrades. That’s expensive.

As the aviation industry looked on at the FCC auctions – which generated more than $100 billion of revenue from spectrum auctions to wireless carriers – the aviation industry saw dollar signs.

Even more alluring was watching the wireless carriers paying billions more to other companies to shut down their use of certain C-band services ahead of schedule, so that 5G services could be deployed faster. After all, when the three major wireless carriers have spent $100 billion-plus, they want to monetize that spectrum ASAP.

And as a reminder, the C-band spectrum is the ideal spectrum for 5G. Those frequencies provide a reasonable balance between the cost of infrastructure to deploy the wireless networks and the kind of 5G performance that makes it such a radical improvement over 4G.

So the aviation industry wanted its cut. This “dispute” has been nothing more than an attempted shakedown. The industry has been trying to “force” the wireless carriers to put up billions to offset aviation upgrades, in particular to older aircraft. 

Smartly, the wireless industry stood steadfast – standing by the physics of wireless technology – and said: “No.” The only thing it agreed to do was delay the deployment of 5G wireless services around U.S. airports until a study was done.

That day has come. The NTIA just released its study, and it shows that due to the filtering technology used on both 5G base stations, there’s only a “low level” of unwanted emissions in the spectrum band used by the altimeters.

The report also outlines how those low-level emissions can be further reduced by controlling the angle of transmission of the base stations, as well as by retrofitting older altimeters with more robust filters. 

It’s also worth noting that the research didn’t discover any evidence whatsoever that the 5G emissions caused altimeters to malfunction.

In other words, the game is up.

While wireless carriers will continue to “collaborate” with the FCC, NTIA, FAA, and the airline industry, it’s full steam ahead with 5G.

And that’s great for anyone who travels. After all, 5G really shines in high-traffic areas like airports. Its additional bandwidth, throughput, low latency, and ability to dynamically slice up spectrum to manage extremely high levels of utilization are the whole point of 5G.

While it won’t happen overnight, wireless carriers will rush to “turn on” their 5G C-band networks at airports around the country as quickly as they can in the coming months. And for those of us who travel frequently, we’ll enjoy the end result. 

What would you do with $101 million?

We’ve been talking quite a bit about generative artificial intelligence (AI) in The Bleeding Edge. It’s rare to see an industry come to life as quickly as what we’re watching in real time.

Most recently, we discussed how text-to-image AI quickly transformed into text-to-video AI. This is AI that can produce lifelike videos based on just a text prompt.

Well, one of the major companies in this space is on the move.

Stability AI just raised $101 million at a $1 billion valuation. Talk about a huge round. This is akin to the kinds of rounds that we saw in the blockchain industry at the peak of optimism. But I have to say that the path toward utilization and profitable business models is a lot clearer when it comes to AI.

This level of investment shows us just how much excitement there is around generative AI technology. And Stability AI has a great plan for turning this tech into a business opportunity.

Almost as impressive as how quickly generative AI technology is advancing is how quickly Stability AI has come to life.

This is its first major round, and the company has been around for less than two years. Its technology platform is called Stable Diffusion. And the tech it developed is on par with what we’ve seen from Google, Meta, Midjourney, and OpenAI.

And Stability AI is taking generative AI a step further. Its business will center around training AIs for corporations and governments… on any subject matter.

In fact, Stability AI has already conceptualized a suite of training service offerings. Here they are:

Stability AI Tools

Source: Stability.ai

Click to Enlarge

Here we can see a variety of offerings. Stability has a specific program for non-profits and biotechnology companies. It has a program that teaches AI to produce music. There’s training focused on automation, COVID-19, multimodality, and more.

So there’s pretty much something in here for everyone.

For example, municipalities could contract with Stability AI to optimize bus and train schedules. Companies could utilize Stability’s training to improve their self-driving technology. Or optimize their supply chain. Or implement automation into their businesses.

There are an endless number of applications here.

And get this: Stability AI is already spending $50 million a year running its own cluster of about 5,000 NVIDIA graphics processing units (GPUs) to do all the training.

The company essentially cobbled together its own supercomputer. And it’s focused exclusively on training AIs. That means Stability AI is ready for business right now. Any entity can hire this company to train its AIs and optimize its business.

But this funding round is transformational for the company.

The intended use of funds is to multiply the scale and power of its supercomputer by a factor of 5x to 10x within a year compared to what it has today. Just imagine what that will mean in terms of technological development of its AI!

Needless to say, this is one to watch.

Starlink is about to eat the incumbent’s lunch…

SpaceX’s Starlink division just announced a new product line. It’s called Starlink Aviation. It’s going to bring high-speed satellite internet connectivity to commercial airlines.

Again, as a frequent traveler, I’m very excited about this one.

Anyone who has attempted to use WiFi on a plane knows that the existing service tends to be awful. The service doesn’t turn on until reaching 10,000 feet, and it shuts off at the same altitude on the way down. And the more people there are on the plane, the worst it gets.

As I’m sure many have experienced, most of the time airplane WiFi is only good for email and limited internet browsing. Even then, there are lots of delays. And the WiFi often stops working mid-flight.

That’s because the airlines currently utilize services from legacy incumbents Gogo, Viasat, and Intelsat. They each use older satellites that are geostationary. And the satellites are at incredibly high altitudes. Typically it’s around 22,000 miles high.

Naturally, that distance between the satellites and the planes makes the quality of service poor. The bandwidth is limited, and due to the distance, there’s a lot of latency when transmitting and receiving. That’s why it’s slow – and that’s why more people on the flight results in a worse performance.

As regular readers already know, SpaceX launches smaller satellites into low-Earth orbit. That’s roughly 340 miles in altitude. And SpaceX now has over 3,000 of these satellites. Each one is always moving. This provides constant connectivity to nearly every location on Earth.

The low-Earth orbit means that Starlink satellites aren’t just closer to planes – they’re also closer to Earth.

That dramatically reduces the latency of the internet service. And it also means that airlines can start offering internet service on the flight the moment that its customers step onto the plane. There’s no more need for the 10,000-foot “rule.”

Starlink claims it can deliver speeds up to 350 megabits per second (Mbps) to planes. That’s faster internet than many consumers have in their homes right now.

Theoretically, this will enable streaming services to be possible through Starlink when in flight. Video calls would also be a snap (although I have to admit that I’d prefer if video calls weren’t allowed, as they’re very disruptive to surrounding passengers). 

But aside from what’s technically possible, the key point is that the quality of internet service for email and internet will be radically different with Starlink Aviation compared to what we’re all used to.

SpaceX will begin deploying Starlink Aviation next year. The largest commercial airline to adopt it so far is Hawaiian Airlines. Flights to and from Hawaii are going to become much more pleasant.

A regional U.S. flight service called JSX has also been testing Starlink Aviation on its business jets. I suspect it will adopt the service next year as well. From there, it’s only a matter of time before the big airlines jump on board. Starlink’s service is just too big of a jump in quality for them to ignore.

I, for one, look forward to having better WiFi on the plane. It will be a huge productivity booster for me. And I’m sure many other consumers will agree.

And bigger picture, Starlink continues to make great strides as a business. We’ll continue to track it closely in these pages.

Mainstream finance is going big on crypto…

Credit card giant Mastercard just unveiled a new program. It will help financial institutions offer cryptocurrency trading to their clients.

This is a bit of a surprise. We wouldn’t expect a traditional credit card company to get into crypto trading services. Especially not at a time when the digital asset markets have struggled like they have this year.

But here we are. Mastercard is positioning itself as the middleman between banks and cryptocurrency trading platform Paxos.

Paxos is a crypto-native company that’s been around since 2013. Those were the early days for the blockchain industry. So it already has all the trading infrastructure in place.

As for Mastercard’s role, it will focus on regulatory compliance and security. These are the items that have largely kept legacy financial institutions out of the crypto space thus far.

So this is a big deal. Mastercard will take on the regulatory burden on behalf of those banks that want to move into cryptocurrency trading.

This will no doubt expose a wave of new consumers to crypto. Investors who have avoided digital assets because they couldn’t buy them through a traditional institution are now going to be in the game.

Of course, this is very bullish for the digital asset space overall.

The asset class will become widely available to the entire consumer market thanks to Mastercard’s involvement. What we’ll keep a close eye on is which direction financial services organizations lean toward when enabling transactions in digital assets. 

Will they lean into partners like Mastercard that represent the old school? Or will they look to partner with more crypto-native firms born and bred in the world of Web 3.0?


Jeff Brown
Editor, The Bleeding Edge