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[RUSH TRANSCRIPT BELOW] Declan Ganley’s company, Rivada Networks, is developing a technology that may revolutionize global connectivity and security—and it appears that the Chinese communist regime is desperately seeking to gain control of it.

As much as 99 percent of global internet traffic today relies on a series of subsea fiber-optic cables around the world that are vulnerable to natural disasters and attacks. Chinese cable-cutting incidents have shown how easily they can be sabotaged.

Ganley is working on something called the Outernet, a constellation of 600 Low Earth Orbit (LEO) satellites that would make up the world’s first self-contained communications network.

Unlike traditional satellite networks that route data back to Earth repeatedly, the satellites are interlinked by high-speed lasers and advanced onboard routers, making it possible for data to travel directly through space, touching the Earth only at the start and the final destination.

But progress has been slow. Why? Ganley refused to partner with Chinese companies on the project.

“They decided to launch a torrent, a tsunami of lawsuits that were baseless, that were unwinnable, that were almost cartoonish in their flakiness—but in the full knowledge that we would have to spend money to defend against these insane lawsuits,” he says.

So far, he and his company have already had to spend $36 million to defend against a flurry of lawsuits across multiple jurisdictions.

Nonetheless, he believes it’s a battle worth fighting.

“I know what the Outernet can do. I would rather burn it down than have the Communist Party of China have the Outernet. Our way of life could depend on them not having the Outernet,” Ganley said.

Ganley was one of the very early voices warning about the dangers of Chinese technology in Western telecommunications networks: “I know how dumb governments are. I saw them implement policies and regulations that allowed Huawei and China to dominate the global wireless industry and literally deploy 5G networks in Western democracies.”

“We have absolutely handed them data network dominance on a plate, and now they want this Outernet. Why do they want it? Because they want the fastest network in the world, the lowest latency network in the world, the most secure network in the world,” Ganley added.

Views expressed in this video are opinions of the host and the guest, and do not necessarily reflect the views of NTD.

RUSH TRANSCRIPT
Jan Jekielek:

Declan Ganley, such a pleasure to have you on American Thought Leaders.

Thanks for having me, Jan.

So, over the last two-and-a-half years, you’ve had to spend over $36 million on legal fees against Chinese Communist Party-affiliated entities. How is this even possible? Explain this to me.

The project that I am leading is to build and deploy what we’re calling the outer net. So, it is a satellite constellation in low Earth orbit that is different from Starlink, very different from Starlink. It’s approximately 600 satellites in polar orbits, but with a spectrum, radio spectrum that links from the ground up to the satellite and back again, that has high priority. So, it’s an important block of spectrum and the technology and architecture that is unique.

Without explaining technically how that’s done, not because I’m not willing to do it, it’s just that it would take too long, it will create the world’s first completely self-contained global communications network. So, every other global communications network that you’ve ever heard of is actually a patchwork quilt of other people’s stuff stitched together, and you are always going through networks that are attached to other people’s networks.

So, even say if you take OneWeb or Starlink, when you’re on Starlink, but when you go into a ground gateway and that signal is being carried to its end destination over subsea cables and everything else, it’s carried over the internet. So, these are internet services, ultimately, internet networks. And that data is carried over a kind of public highway, if you will.

The outer net is a completely closed, non-public highway that is completely self-contained, that does not touch the internet. And so, you can join any point on the planet to any other point on the planet without touching anybody else’s network, infrastructure, ground relay station, subsea cable, etc. What that nets out to mean is that it is inherently the most secure, truly global communications network that will be in existence. Over about 4,000 kilometers or greater, it will be the fastest network in existence with the lowest latency, and you will be able to guarantee data sovereignty.

So why does any of that matter? Because if you are a government, if you are a bank, if you are a large enterprise for whom ultra high speed, low latency, and complete data security, so avoiding the public internet, that matters. That’s a very important and valuable capability to have. And it’s a capability that, on a global basis, you cannot get anywhere else. So, it’s a combination of different ingredients that creates a completely unique thing that, if you’re a government or a large enterprise, is a game changer.

It’s a game changer. And it strikes me that this is something that the Chinese Communist Party would be incredibly interested in.

They are, and you’re not wrong about that. This comes back to your first question—why? Why have we had to spend $36 million defending against the Chinese? What possible interests could they have in controlling the outer net? Well, the answer would be very significant. And they have gone to bat to try and take control of and ownership of the outer net. And they’ve done that in a number of ways.

When I refused to sell out to them to take their money and walk away, which it seems that they are quite accustomed to people doing, they decided to launch a torrent, a tsunami of lawsuits that were baseless, that were unwinnable, that were almost cartoonish in their flakiness, but in the full knowledge that we would have to spend money to defend against these insane lawsuits. And we can get into the details of how they did it and what they did.

But ultimately, the idea is to make your life and your corporate life and your personal life as difficult and stress-filled as possible, while at the same time dangling a carrot of saying, you know what, we’ll buy you out, we’ll give you a lot of money, and this stick that is beating you on this side can be massively outweighed by this carrot that we’re dangling in front of you. Take the carrot, and the stick will stop. And that’s ultimately what they did. So, we’ve had $36 million of stick, and we’re not taking the carrot, and we will never take the carrot. And they don’t like that.

Incredible, because it sounds so much like other scenarios that perhaps on a smaller scale that I’ve heard about with respect to how the Chinese Communist Party works. Let’s go back. Tell me a little bit about yourself. How is it that you came to be constructing the outer net?

I’m a telecommunications entrepreneur. I’ve been in the wireless industry really since I was 19-years-old. I’m now 57, so I’ve been in it for a while. And I have built a number of businesses and developed a lot of intellectual property and technology over the course of the last several decades. I have built a team since the mid-1990s of engineers, PhDs, and people with a really unmatched track record in the wireless technology sector and developed new technologies that are applied in areas like 5G and 6G to come.

And we have had our battles with Huawei for many, many years. I was one of the very early voices warning about the threat to Western telecommunications networks from compromised Chinese communist  supplied equipment. I feel that we were very vindicated in that. So, we had quite a lot of form. We clashed with them all over the world.

And then after I had been involved in the satellite industry very early on in my career, I stepped out of satellites to focus on terrestrial wireless technology. In 2005, I slowly started to move back into areas that had to do with satellite technology and then encountering an opportunity that was coming with new spectrum that was going to be allocated by the ITU [International Telecommunications Union], which is the UN-affiliated body that licenses satellite spectrum globally, saw an opportunity to develop what is now the outer net.

And my concern there was for years, I was watching the concentration risk of subsea cables, that there were so few of these arteries that connect the internet globally. And it struck me that it would be very easy to take down the global internet by targeting those subsea cables and that we needed a network that was completely independent of those subsea cables, and frankly, the internet.

It would not replace it, but that would be available and would survive the internet being taken out by taking out the subsea cables or a massive cyber attack or whatever else. That there was no truly global data network that was an alternative if we lost the internet. So, the need for that was very obvious to me. And I focused my teams, my brilliant engineering and research teams on solving that. And presto, we came up with the outer net.

So, just very briefly, before I started talking about TikTok possibly being a more potent weapon of the Chinese Communist Party against its adversaries, I was talking about Huawei as being possibly the Chinese Communist Party’s most potent weapon against everybody. What’s the problem with Huawei?

You have an entity that has to comply, even if we look at what’s on the surface, what we know and is indisputably verifiable. They are legally required as a Chinese company to provide intelligence access and information to the Communist Party of China. They actually have no choice. That’s not to suggest they’re doing it unenthusiastically. I believe they’re very enthusiastic in what they do.

I’m on record for years talking about this threat because you have data networks that are providing regular communications for everybody, for people that are watching this show, whatever their walk of life, for businesses, for governments, for the installed everyday communications base, for the Internet of Things, for cars, for everything operating over these wireless data networks, and for everything from all the way out to the eNodeB. This is the final cell that touches your phone wirelessly and with which your phone is communicating, where that eNodeB is being patched and updated with software from China every day because the contract with the carrier allows and requires that they do this. We have handed over the keys to the kingdom.

When you have an intelligence gathering tool that operates at that level, it’s going to know more about what is going on in a given place than the government of that given place can possibly know itself. Because you can get as granular as knowing how many people are in that apartment, on that floor, at that moment. Where did they come from? Where did they go to? Who is it? Who did they text or email while they were there or on the way or on the way back?

We’re relying on encryption to protect messages that are going over these networks, but the ability of the Communist Party to decrypt these messages is immense. Then if you apply AI to that and you use AI to do the data mining, good AI will be able to answer a question like, you know, what did John Smith do on the 23rd of October 2022? Where was he that evening? Was John with his wife or was he with somebody else? Who was it? What were they doing?

The level of information that you can extract from that data pool using AI is, we’ve never seen that level of information in history. There would be no TikTok from China if it hadn’t been for the way that the West so mishandled its allocation of radio spectrum because it made. Carriers, mobile carriers, are dependent upon Chinese financing and technology because Communist China was willing to subsidize Huawei and other Chinese equipment to be deployed into these countries.

So now you see Germany that has a 5G network and many, many other countries with a 5G network of Huawei equipment, which they now want to rip and replace. But that equipment was financed. It was discounted. I mean, the Communist Party of China made sure that those networks were put everywhere, but they were put everywhere because the way we allocate radio spectrum in Western countries requires massive upfront payments to governments for spectrum licenses.

When those companies make those upfront payments, the offer of soft Chinese financing and equipment is too irresistible. The price of a gigabyte of data in America or in Canada is up here. It’s amongst the very highest and most expensive data in the world on a wireless network, whereas in China it is a tiny fraction of the price.

So because you have a low barrier to entry to the price of data, if you’re building an app like TikTok, young people can afford the data. And so all of these new apps get developed in China first because the price barrier to entry to using them and getting rapid scale adoption, which is what you need for these apps, shifts to China and out of the United States and the Western countries.

And that’s what’s happened. If we had had a healthier system of how we allocate radio spectrum, TikTok would have been invented in the United States years ago, and it would be an American innovation.

Are you basically saying that it doesn’t matter if Huawei has towers in your country or in your region or whatever, these patches that you’re describing are still coming in because of contracts?

Yes. The governments don’t even know this, right? The way that the governments got suckered was, up until 5G, they talked about the core, that the core of the network, which was like the data centers, the computers, if you will, that ran the network, the brains of the network, were in one place or a small number of places. And the servers that ran these networks, everything was taken back to what they called the core.

So they would say, well, Huawei isn’t allowed to have the core. They’re going to just do the edge of the network. The thing is that in 5G, one of the great innovations of 5G, and that you have in 6G, is that it moved the brains of the network away from the core and out to the edge. It’s spread out across all of the network edge. And it’s done to increase speed and efficiency of processing. And the patches for those edge networks are, in many cases, done under contract from China.

The sales pitch to those carriers, those mobile carriers, was you can reduce your overhead. You can reduce your workforce. You know, you’re not going to have these big payroll bills for doing this stuff. We can run the software updates and the patching from China. And those are sometimes subcontracts, but they bypass reference to the core, but those updates are being done daily and they’re being done in many cases from China itself.

That’s an astonishing reality.

There is a story that came out a few days ago about, I think it was Norway and Denmark shutting down, removing communications chips from their buses because they realize that these buses could be harnessed from China. Well, guess what? That’s true for so many devices and so many things. And, you know, the potential to actually harness a vehicle is one thing, but the potential to gather the information and the data is another.

And I mean, the other thing that I’ve just been recently through some interviews becoming aware of is that, you know, there’s an astonishing amount of this kind of data available just in the public domain, never mind that deeper level of penetration that you’re describing. I mean, I remember there’s one case, I believe that one of these, you know, people in the know was able to demonstrate the locations of, for example, Delta Force members just through triangulating around certain educated guesses about what they might be doing. And people were stunned. And this was open source. This is someone that could do it with AI. Presumably they fixed that now.

So you know about Salt Typhoon. Anywhere where there is Chinese, and by the way, remember, Salt Typhoon is in networks that aren’t Huawei.

Of course. But what strikes me, I was thinking about Salt Typhoon as you were describing these patches that are basically going into this whole edge of the 5G network. You could kind of imagine that we even know that the compromises were possibly in those patches, right? So you could have, you know, the hackers and the patchers working. I mean, there are all sorts of opportunities here, aren’t there?

Yes, and we’ve talked about some of them, but there are more, and there is no halfway measure or, you know, well, what can we do that’s enough? It’s really, you know, on or it’s off. There isn’t a halfway measure here. You cannot allow this stuff into your country. You have to keep it out. You have to know what your supply chain is, the vulnerabilities of these networks.

And by the way, how we got here is a whole other story. I touched on it a bit because this did not have to happen. This did not have to happen. This was indolence. It was frankly a failure of regulatory failure and regulatory capture. And it was a lot of, and we’re seeing it now, a lot of trying to close the stable door after the horse has bolted.

Let’s talk about the lawfare because I think you’ve painted a very compelling picture of why the CCP [Chinese Communist Party] would really want to get its hands on an outernet or make sure that one doesn’t exist without it having that special access that it seems to have to all the other networks.

What we’ve talked about is really the internet, right? This is internet and terrestrial wireless networks. Yes, the outernet is the thing that survives if you take all that other stuff out, and it does the most critical data communications. It can do them, and you’re absolutely right. So they either want to have it or they want to make sure that nobody else has it, and that would be sort of choice number two. And we’ve heard anecdotally that that’s actually what they’re looking for.

But just one thing, you know, if they were to cut those undersea cables, I’ve heard this discussed as a kind of an early, you know, if they were to make an acute military move beyond this unrestricted warfare they’ve been waging, but actually, you know, go into full kinetic.

Yes.

But wouldn’t that cut them off as well?

Yes, but they’re ready for that, I would argue. So if you know you’re going to do that and you have your own closed network on a continental terrestrial network, and you are planning for an event like that and you have stockpiled things that are resilient enough to operate without the internet, you could do that.

Look, if the internet goes out today and it goes out globally, then approximately 550 global subsea cables were cut, the internet goes down. The existing satellite systems that you’ve heard about go dark. They won’t work because they all use ground gateways and ground relay systems that ultimately require and rely on these subsea cables.

So you will have this cascading domino effect where your smartphone will not work. Your TV will not work because the IP-based signals that are producing that TV show and putting it onto your TV, that’s going to all fail. The logistics systems that the wholesalers use to supply supermarkets will also fail.

There will be no flights. Aircraft will be grounded because of the IP-based systems that they rely upon. Gas stations will not be able to get refueled because of the supply. When that happens, if that happens, the last thing anybody’s going to be thinking of in Poughkeepsie, N. Y. is that  Taiwan is being invaded right now, and they’re not going to think about it or care about it probably for months because they’re not even going to know it happened for at least days and probably longer.

The first thing that will work reliably will be a transistor radio, and everybody should have one. But there’ll be guys in bootstrapping radio stations to get some of the older stuff turned back on so that they will be able to broadcast. And that scenario is not some dystopian, oh gosh, it would be so hard to do.

Approximately, and I know I’m safe with this number, $60 million will do the job to take out the global subsea cables. That’s how pathetically vulnerable the global subsea cable infrastructure is, because it’s just so big. It’s so vast that you cannot protect it all.

And it’s not academic. I mean, we saw these ships, you know, basically dragging anchors and destroying these cables. We already see how it can be done.

That was a very public taunt for those people that understand what they’re looking at, when that Chinese ship cut that cable and then couldn’t be boarded. afterwards because it stayed in international waters, they stopped it, but they were able to stop it from being boarded and inspected. At the same time, they released into the public domain a patent application in China for an anchor system that was specifically designed to cut subsea cables. That was a taunt.

That was going on there, I believe, is that they were testing response times and reactions, and who responds. They know how many subsea cable repair ships there are, and there aren’t many. They know who the people are that can actually fix these things. Talking about the granularity of being able to follow data, they know where they live, they know who they’re married to, they know where they work.

They are mapping these response times, what happens when 20 subsea cables get cut? What happens when 50 subsea cables get cut? What’s the point where they can’t possibly fix these things in a realistic enough time to get the internet back on for a month, two months, six months, a year, two years?

There’s answers to all of those things. And the cost of doing that is frighteningly low. It sounds like you’ve been war gaming these scenarios somehow. People looking at this will be saying, Declan Ganley’s got a dog in this fight. He’s got a vested interest. He wants to get the outer net adopted and everything else.

Yes, I do. But what I’m saying here on camera with you is that it’s so much worse than what I’m saying, the vulnerabilities. I’m not going to tell people how you do this, but we needed the outer net yesterday. It’s needed immediately. And that’s not to say that a determined actor like communist China could even destroy the outer net, but not quickly. And the thing is, and they certainly couldn’t do it covertly. You would know it was them. And the data network that can stay up the longest and that can survive that initial event is a highly prized thing.

And that’s why they went to lawfare, to war by use of the law, which is China’s People’s Liberation Army [PLA] published doctrine. They have published it. It’s in their doctrine that you use the laws and regulatory aspects available in other countries against those target interests. And they wanted this and they wanted to control it. And we wouldn’t sell it to them. So now we have 158 different legal actions and counting, all of which they lose. They are willing to lose as long as it’s making us spend money.

Well, spend money and distraction. I mean, that’s with a little bit of experience with lawfare. It’s not just the money. It’s also a focus.

Of course. And here we are. And this is what we’re talking about, right? And the outer net is a phenomenal piece of technology, a remarkable piece of global infrastructure that will change the world for the better and will make the democracies much more secure than they are, and large enterprises in the banking system and the payment systems and everything else. But instead of talking about that, we’re going to be talking about and are talking about these utterly frivolous, flaky, Chinese-backed lawsuits that have had us as a new, post-startup, but pre-revenue, largely pre-revenue company in terms of the internet anyway, have to spend $36 million of cash that we have to raise from investors.

Before we dive into a bit of this lawfare, we’re not going to be able to look at all 158 scenarios. So we talked about the stick here, but what about the carrot? What was the carrot?

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