It assumes $44/kg to launch into orbit. Idk where that came from if it's a musk claim or what but it's ludicrous against current costs. Currently still at thousands/kg and dropping but nowhere near $44 and I haven't heard anyone claim that's likely who isn't selling a rocket company.

That seems pretty cheap, like, can I launch my cat's ashes into space or something for $50?

Musk is deliberately creating a business that needs high volume low cost launch services because in order to get low cost launch high volume is needed, and in order to get high volume a customer is needed. In the same way that Starlink launches were used to create the Falcon 9 economies of scale, the orbital AI will be used to create the Starship economies of scale. He also wants to bet the whole company on this which creates pressure to deliver and not just coast on what they've already accomplished. There are a bunch of related high risk bets but they ultimately connect back to bringing Mars within reach with frequent low cost launch capability.

The plan is to launch from Earth in the beginning stages and then switch to launching from the Moon which has no atmosphere so you don't need rockets and can use an electromagnetic gun instead. That requires satellite manufacturing on the Moon and I guess the minerals required will come from asteroid mining.

That's my understanding of what Elon said about how it's going to work.