📡 Starlink’s subsidy snafu

Back down to Earth... Regulators are pulling the plug on an $886M subsidy for SpaceX's Starlink after the satellite-internet biz failed to reach America’s most isolated areas. ICYMI: the FCC dished out over $9B worth of subsidies to broadband providers in 2020 to help connect millions of remote households and small businesses (see: Rural Digital Opportunity Fund). Now:

• The deal: Starlink was originally awarded $886M over 10 years (one of the largest FCC grants) in hopes of becoming a one-stop internet shop for rural areas. But its high-speed service has slowed from Q4 of last year to now.
• The fallout: Regulators nixed the award Wednesday, blaming Starlink's “still developing” tech and pricey subscription for the reversal.
• The status: Starlink has nearly 2K low-Earth-orbiting satellites providing internet to 400K+ people worldwide. The basic service costs $110/month, plus a one-time $600 satellite fee.

America’s digital divide… is growing wider. About 21M Americans — or 1 in 15 people — still don’t have access to high-speed internet. It’s worse in rural areas (think: small towns, farmlands) where more than half of residents have bad service. Some families have had to sit in parking lots to do remote work, job search, and attend online classes. The FCC’s subsidies could help with that:

• OG internet provider Charter received $1.2B in government subsidies and is investing an additional $3.8B of its own money to expand its broadband network in 23 states.

This year’s been a roller coaster… and Six Flags is starting to feel queasy. Yesterday, shares of the theme-park giant plunged 18% after the biz reported a 22% drop in attendance last quarter compared to last year. While Six Flags’ attendance is 35% below prepandemic levels, Disney’s US theme-park visitors have rebounded.

• Off theme: Unlike Six Flags, Disney, SeaWorld, and Cedar Fair all posted record theme-park sales last quarter, thanks to rising prices and eagerly returning visitors.
• A big drop: Six Flags’ quarterly sales fell 5% from last year, though spending per visitor jumped. Meanwhile, Disney’s parks reported a whopping 72% increase.

More like Five Flags… Actually, Six Flags got what it wanted: fewer visitors. It had recently hiked prices to reduce the number of people in its parks and improve the “guest experience.” Read: fewer visitors, but ones who spend more. The strategy seems to have worked too well:

• Higher rollers: Six Flags wants to boost sales while limiting visitors. Fewer people = happier visitors + lower costs.
• They wanted a drop… but not that big a drop. The Flags’ CEO said attendance numbers were 10%+ lower than targeted.
• The ride’s not over: Six Flags visitor spending jumped 23% last quarter, and it's up 50% from prepandemic levels (think: pricier tix + more merch and food sales).

• Percy: Quirky glasses seller Warby Parker slashed its sales forecast for the year despite reporting a smaller-than-expected quarterly loss. Retailers have been growing more cautious as the econ outlook gets foggy.
• Pills: Walgreens is offering pharmacists signing bonuses of up to $75K to attract healthcare professionals during a worker shortage that’s led to lower drug sales and overworked employees.
• Breathe: Selena Gomez’s “mental fitness” startup, Wondermind, raised $5M at a $100M valuation in a round led by Serena Williams’ VC firm. Mental-health startups have seen a boom in funding since the pandemic.
• Coin: Investment titan BlackRock is offering direct bitcoin exposure to institutional clients (think: funds, banks). Despite crypto’s fall, BR said institutionals are expressing “substantial” crypto interest.
• Extra: New York Times shares jumped almost 11% after activist investor ValueAct disclosed a nearly 7% stake in the media company. ValueAct reportedly wants NYT to focus on expanding subscriber-only bundles.

• Earnings expected from Spectrum Brands

Authors of this Snacks own: bitcoin and shares of New York Times and Disney

ID: 2350931