Rocket Lab Test Flight Launches Three CubeSats to Orbit

The launch company Rocket Lab has amusing names for its missions. The first, in May, was called “It’s a Test” (it was). When the staff debated what to call the second launch of their diminutive Electron rocket, so sized (and priced) specifically to carry small satellites to space, they said, “Well, we’re still testing, aren’t we?”

They were. And so “Still Testing” became the name of Rocket Lab’s second launch, which took place on January 20, at around 8:45 pm Eastern Standard Time. In December, the company canceled multiple attempts before rescheduling the launch window for 2018. The livestreamed rocket lifted off from the Mahia Peninsula in New Zealand, headed for someplace with an even better view.

Despite the uncertainty surrounding the launch (or any test launch, for that matter), the rocket was carrying real payloads for real customers: three small satellites, one for a company that images Earth and two for one that monitors weather and ship traffic. But why on Earth would a satellite company choose a rocket-in-progress when there are so many reliable launchers out there? After all, even established rockets blow up sometimes.

Rocket Lab

The short answer is that smallsats—which the Electron was built to transport, exclusively—are by nature expendable. Smallsat makers like Planet and Spire, the two clients on this mission, have ever-growing, genetically similar populations of orbiters. So losing one or two in a less-than-successful test flight? Probably worth the risk. Smallsat companies are willing to put their hardware on this particular liftoff line because the Electron is poised to be the first commercially bookable rocket built specifically for small payloads, which typically have to piggyback on big, expensive rockets with big, expensive payloads that don’t launch often enough and aren’t always headed to their orbit of choice. In the next decade, 3,483 small satellites (between 1 and 100 kilograms) will go to space, generating just over $2 billion of launch revenue, according to the Small Satellite Markets, 4th edition report, which research and consulting firm Northern Sky Research released last month. In this future world where thousands more smallsats provide environmental, economic, and even political intelligence, as well as Earth-covering internet, the test-steps necessary to get on up to space quickly, cheaply, and precisely seem worth the risk not just to Planet and Spire but, perhaps, to you and me.

But boy, was there risk. While Rocket Lab’s first Electron didn’t explode and did reach space—and so gets at least an A- for its first attempt—“It’s a Test” didn’t quite get to orbit. After an investigation, Rocket Lab determined that, four minutes post-blastoff, ground equipment (provided by a third party) temporarily stopped talking to the rocket. When communication breaks down, Official Procedures demand that safety officials stop the flight. And so they did..

But the rocket itself, according to the same investigation, was sound—so the company moved on to a test delivery. “It’s really the next logical step,” says Peter Beck, Rocket Lab’s founder.

Beck seems uncannily logical about the risks his young company is taking. When asked about his feelings about launching actual stuff on “Still Testing,” he replied that doing so certainly involved extra actual tasks. “I’m not sure if you can become extra nervous or extra excited,” he said. That sentiment fits with the launches’ pragmatic names. And those fit with New Zealanders’ general pragmatic streak, says Beck (he cites some of the country’s names for flowing water: “River One,” “River Two,” “River Three”).

For their part, Planet and Spire are here for that no-nonsense-ness. Planet already has around 200 satellites in orbit, so adding one to its flock of so-called “Doves” would be good but not critical. Besides, says Mike Safyan, Planet’s director of launch, “we picked one we wouldn’t miss too much”: a sat named Pioneer. It’s a double meaning, says Safyan. First, it’s an homage to NASA’s old missions, on whose shoulders they stand.

Second meaning: They are pioneers. “There is this New Space wave that Planet is very much at the forefront of and Rocket Lab is very much at the forefront of,” says Safyan.

This is what the forefront looks like, by the way: You can book space on an Electron rocket online—just click the size of your smallsat!—the same basic way you’d book a bunk on Airbnb.

Spire, too, is into it. Jenny Barna met Peter Beck before she had her current job, as the director of launch at Spire, whose satellites aim to keep track of aeronautical and nautical-nautical traffic, as well as weather. Back in her days at SSL, which makes spacecraft and communications systems, a coworker invited her to a presentation Beck was giving on-site. She listened to Beck describe Rocket Lab’s technology, and his vision for a vehicle that provided frequent, affordable launches just for little guys—in an industry that caters to huge sats, and makes smallsats second-class passengers—and she was intrigued. “I remember sitting there thinking how lucky I am to be working at this industry at this time,” she says. And after she moved to Spire, she led the company to sign on as one of Rocket Lab’s first customers. It’s currently contracted for up to 12 launches.

That’s a lot! But Spire has to launch a lot. The company wants access to space every month, so they can produce their satellites in small batches, send them up, iterate, and launch the next generation. So far, Spire has launched 40 satellites. They’ve done it on the rockets of Russia (Soyuz and Dnepr), Japan (H-IIB), and India (PSLV), and the rockets of the US’s Orbital (Antares) and ULA (Atlas V). And now, they’ll ride with Rocket Lab, picking on a rocket of their own satellites’ size.

But that doesn’t mean they’ll ever only use Rocket Lab. Or Orbital. Or ULA. They plan to keep their eggs distributed—partly because even when it’s not just a test, rockets still blow up, the eggs breaking along with them. “It’s just part of the industry,” says Barna.

When Barna spoke of “Still Testing” a few days before the initial launch window, she was straight-up about the possibility that this particular rocket wouldn’t carry the eggs safely to space. “We know that a million things have to go perfectly for this to be successful,” she said. “We hope they make history.”

They did, and deployed the three-satellite payload into orbit. And pending analysis of this seemingly successful test, Rocket Lab will skip its planned third test and jump straight into official operations, in early 2018. “We’ve got a lot of customers that need to get on orbit,” says Beck.

Suggestion for the third flight’s name: “This Is Not a Test.”

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Netflix Earnings Preview: What Analysts Are Saying

Netflix reports its fourth-quarter earnings on Monday afternoon, and Wall Street will be paying close attention to any blip in the streaming entertainment giant’s growth.

For instance, Netflix’s latest price increase—the cost of standard plans jumped $1 per month, to $10.99—went into effect during the fourth quarter. If the price hikes slowed Netflix’s subscriber growth in the final months of 2017, then history shows the company’s share price will likely suffer. For what it’s worth, though, Netflix’s stock rose after the company announced its price hike in October because many investors bet on higher revenues.

Later in October, Netflix reported its third-quarter earnings, showing nearly $3 billion in revenue for that period and 5.3 million net subscriber additions. The company’s stock has remained on a tear to start 2018 and it currently sits near an all-time high, above $220 per share.

The consensus from Wall Street analysts is that Netflix will report fourth-quarter revenue of about $3.28 billion on Monday, while Netflix’s own guidance last October predicted an additional 6.3 million global streaming subscribers over that same period. Here’s what some of the analysts following Netflix are expecting from the streaming service’s quarterly update on Monday.

Justin Patterson, Raymond James

Raymond James analysts sent a mixed message about Netflix’s upcoming earnings. On one hand, “Netflix has rarely increased prices without experiencing some impact on the business,” they wrote, while also raising concerns about Walt Disney’s planned acquisition of 21st Century Fox assets could create more competition in the streaming market.

However, Patterson and other analysts at Raymond James also said they would maintain their “outperform” recommendation for Netflix shares (raising their target price for Netflix shares from $220 to $260) while projecting fourth-quarter revenue of $3.3 billion that would beat Wall Street expectations by 1%. Raymond James expects Netflix’s success in international markets and its overall depth of content—from an $8 billion annual programming budget and global hits like the series Stranger Things and The Crown—to keep attracting new subscribers. The analysts predict that Netflix will beat its own estimate of 1.25 million new domestic subscribers in the most recent quarter, with Raymond James expecting roughly 1.32 million net adds in the U.S.

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Mark Mahaney, RBC Capital Markets

Meanwhile, RBC is expecting “no significant reaction to [the] pending price increase” in Netflix’s upcoming quarterly report. Mahaney and the analysts at RBC cite their own survey results showing that 56% of U.S. respondents watched Netflix during the fourth quarter, up from 53% in September, with the “lead widening vs. YouTube and Amazon.” RBC predicts that Netflix added 6.3 million new streaming subscribers in the fourth quarter, which is in line with Wall Street’s forecast. “We believe that Netflix has achieved a level of sustainable scale, growth, and profitability that isn’t currently reflected in its stock price,” the RBC report says.

David Miller, Loop Capital Markets

Miller praised Netflix’s performance so far in 2018 (the stock is already up more than 13% this year), and he believes the company’s shares still have room for growth as Netflix “remains one of the only true large-cap growth stories in media.” He expects Netflix to have finished 2017 with 23.3% subscriber growth overall, including 6.4 million new streaming subscribers in the fourth quarter between the U.S. and international markets (which does not count losses among DVD-only members, whose subscriptions have been steadily declining).

Jeff Reeves,

Reeves expects Netflix to beat its earnings guidance “in a big way,” he told Fortune. “They put up record numbers in October, guidance was strong for the current report, and there’s a lot of momentum there for shares,” he said. However, Reeves threw in some caution for the coming months, adding that he’s “seriously concerned” about how Netflix fares after March as expectations continue to grow while the company faces obstacles like its negative operating cash flow and growing competition from companies like Walt Disney.

Tim Nollen, Macquarie Capital

Macquarie upgraded Netflix shares from “neutral” to “outperform” earlier this month as the firm undergoes a “broad realignment of views on media, where we prefer companies with subscription over ad-driven content, and scaled distribution with an international presence.” The analysts’ report credits Netflix for changing how people watch TV while also expanding further into the movie market. “Consumers’ increasing lack of tolerance for advertising drives them to subscription OTT services, and Netflix is miles ahead of peers,” the report says, using industry lingo for streaming. Macquarie also adds that Disney’s planned streaming push is still far off, which gives Netflix an advantage with its already strong (and growing) subscription base.

Barton Crockett, B. Riley FBR

B. Riley’s Crockett is a bit more cautious with Netflix than most other analysts, as the group’s latest report maintains a “neutral” rating on Netflix stock. The analysts wrote on Friday that they believe Netflix can beat its guidance and Wall Street forecasts for fourth-quarter subscription growth with the addition 6.32 million global streaming subscribers in its most recent quarter. However, the B. Riley analysts’ caution is based on concern that Netflix faces a “notable execution risk in the need to continually develop more impactful content to keep boosting subscriber growth.” In other words, Netflix relies on continued impressive subscriber growth to boost revenue amid increasing costs for programming, which means that the streaming service faces the daunting task of constantly rolling out more and more popular TV series and films to satiate its growing subscriber base’s appetite for new, compelling video content.

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Facebook, Twitter Take New Steps to Combat Fake News and Manipulation

Facebook and Twitter both revealed on Friday more about how they plan to deal with the spread of fake news and propaganda on their services.

Facebook said that it would ask its users to tell it which news sources they read and trust to help it decide which ones should be featured more prominently. These responses will help “shift the balance of news you see towards sources that are determined to be trusted by the community,” CEO Mark Zuckerberg explained in a Facebook post.

Meanwhile, Twitter said in a blog post that it would email nearly 678,000 users that may have inadvertently interacted with now-suspended accounts believed to have been linked to a Russian propaganda outfit called the Internet Research Agency (IRA).

The announcements come amid intense scrutiny by U.S. lawmakers over both Facebook and Twitter’s role in letting Russians and others spread misinformation during the 2016 presidential election. The goal, according to U.S. intelligence agencies, was to divide Americans on politically charged issues like race, religion, and gun control.

Zuckerberg announced the Facebook news just days after his company said it would revamp its news feed to show users more family-friendly posts from friends or acquaintances that Facebook believes will spur more user interaction.

“There’s too much sensationalism, misinformation and polarization in the world today,” Zuckerberg said about the polling of users about the sites they have confidence in. “Social media enables people to spread information faster than ever before, and if we don’t specifically tackle these problems, then we end up amplifying them.”

He added: “This update will not change the amount of news you see on Facebook. It will only shift the balance of news you see towards sources that are determined to be trusted by the community.”

It’s unclear how Facebook’s shift will solve the problem of so-called filter bubbles, in which people only see information that aligns with their existing beliefs. Some raised the possibility that crowd sourcing the list of credible news outlets could be manipulated.

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For its part, Twitter minimized the impact of the Russian-linked accounts, saying that they merely represented “two one-hundredths of a percent (0.016%) of the total accounts on Twitter at the time.”

“However, any such activity represents a challenge to democratic societies everywhere, and we’re committed to continuing to work on this important issue,” Twitter said.

Twitter has said that it had discovered 3,814 IRA-connected accounts in total, including 1,062 accounts that it uncovered just recently. It said it had also identified 50,258 bot accounts linked to the Russian government that spread misinformation during the 2016 election, including 13,512 accounts found just recently.

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China targets cryptocurrencies in online pyramid scheme crackdown

(Reuters) – China will crack down on online pyramid schemes, including speculation masked as cryptocurrencies and online games, the public security ministry said on Friday.

The ministry will act jointly with the industrial and commercial department to stamp out pyramid-type schemes, besides punishing those who swindle students and vulnerable groups, the ministry said in a statement on its website.

Chinese regulators have moved to rein in financial risks associated with virtual currency trades and pyramid schemes.

A court this month sentenced two people to life imprisonment for fraud in a pyramid scheme involving 15.6 billion yuan (1.75 billion pounds) that sucked in more than 200,000 people.

Reporting by Hong Kong newsroom; Editing by Clarence Fernandez

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