Palantir's Web 3: Warp Core and the Space Race

Palantir recently announced a contract extension with U.S. Space Systems Command, signaling the maturity of their space data offering.

Palantir's Web 3: Warp Core and the Space Race
Photo by NASA / Unsplash

Space is the next frontier for governments and the private sector. Palantir recently announced a $43 million contract extension with U.S. Space Systems Command. Their space data platform, Warp Core, will continue to provide data analysis and mission planning for the U.S. government. We believe that Palantir will continue to grow this critical business in the future. Their expansion into space and its endless frontier provides excellent value for the public and private sectors.

Space-based assets generate mountains of data. The number of commercial satellites grows substantially every year and offers near-instantaneous imagery of vast swaths of the earth. No human could process all that data. Warp Core provides a critical service because it automates the analysis of the data and most likely queues human attention only to important events the AI is trained to find. Man-machine teaming saves time and energy while making the organizations that use it more effective.

How did Warp Core come to be?

Few public records exist, but we have formulated our own estimate of the platform’s genesis. In 2021, Palantir piloted a program with BlackSky, a geo-imagery company specializing in applying artificial intelligence to its satellite imagery and other sensor data feeds. Their work enabled government agencies to predict events based on the massive amounts of data procured through BlackSky and analyzed with Spectra, Blacksky's AI.

The pilot program succeeded, so Palantir invested in BlackSky and expanded its partnership. We believe that BlackSky built Spectra on Palantir's Apollo AI platform, or at least they may host it there now. This hypothesis is not confirmed. It would make sense, however, based on the sequence of events and Apollo's position in Palantir's software stack.

The implications of Warp Core are staggering. Suppose Palantir and BlackSky grow their offerings and codebase using government contract funding. In that case, they could quickly transfer the functionality to commercial offerings in the private sector. Now, let’s examine three examples of how the platform could add value and solve problems.

1. PG&E, an existing customer of Palantir, should use Warp Core for predictive analytics of wildfires. Real-time imagery should enable more judicious electricity routing around threats and automatically shut down powerlines. PG&E could even work with an insurance company to develop targeted wildfire insurance using Warp Core and BlackSky's data. By underwriting insurance with real-time analytics, the insurance provider could gain a massive competitive advantage.

2. NGOs working to prevent deforestation in the Amazon rainforest could use Warp Core to analyze areas of concern. Logging and illegal slash and burn agriculture destroy ecosystems. Knowing where that happens allows NGOs to work with law enforcement and vector scarce resources onto the worst offenders.

3. Chicago's commodity traders looking to build crop yield predictions would benefit from Warp Core and BlackSky by running AI models based on rainfall, weather reports, and current crop imagery across the Midwest.

We think that the use cases are limitless and that innovative businesses will fold space data into their decision-making processes to enhance the speed and quality of their business models.

We even see Palantir putting data on-chain as an oracle for DeFi smart contracts in the far future. Blockchains use oracles as data sources for smart contract adjudication. Technical limitations on data sizing make this a challenge. Still, we think that using private chains and layer 2 smart contracts could overcome any of these problems.

If you are bullish on Palantir, you can invest in $PLTR through your brokerage. If you are bearish, you can short the stock. Read more of our Palantir analysis here.

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I am not a financial advisor. This article is for educational purposes only. You should do your own independent research before making any investment decisions.

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