Globalstar Telecommunications Limited GSAT Message Board

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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT

GSAT 61.46

+1.3%

11:41 AM EST

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To: djane who wrote (6442)	8/12/1999 11:24:00 AM
From: djane	Read Replies (1) of 29987

Rusch bearish comments on MSS Top>Business & Finance>Investments>Sectors>Services>Communications Services>GSTRF (Globalstar Telecommun.) More from Rusch by: bo_rlab 9585 of 9590 12 August 1999 Yesterday marked a sad event for the entire communications satellite industry. It recorded the first default by the largest commercial satellite project that has ever been deployed. Iridium was a huge undertaking which stimulated the imagination of the investment community. Iridium was the premier product of a post cold-war aerospace mentality. Manufacturers needed colossal projects to replace the revenue from Star Wars. Executives were willing to suspend business reality to win an order for dozens of satellites. But its failure was inevitable. Constellations of LEO satellites cannot provide high quality or cost effective telephony that will attract millions of customers. There may be some schaddenfreude now that Iridium is suffering. Competitors should take no joy in this event. There are several conclusions that can be drawn that are not entirely encouraging. The market is much smaller than expected. Shareholders will lose most, if not all, of their investment. Iridium may soon be a debt free project able to offer services at much lower prices. We must emphasize that commercial communications by satellite can be highly profitable and vigorous. Inmarsat was the first worldwide mobile satellite service. It has made a profitable business by serving mobile customers worldwide for 20 years. We must therefore conclude that the mobile satellite business can be successful. The reality is that the demand is much smaller than many had hoped. DirecTV and Echostar are demonstrating that Direct to Home broadcasting is a cost effective satellite service that will thrive. This is a growing business which demonstrates the important role of commercial satellites Broadband satellite services are the next opportunity that can be successful. Satellites already provide data services to five times as many customers as Inmarsat, Iridium, and the others combined. Well design broadband satellite systems will play an important role by providing high speed internet access to anyone in the world. The future for communications satellites remains bright as long as we focus on the service business and not our immediate profits. Roger J. Rusch TelAstra, Inc. P.O. Box 4620, Palos Verdes, CA 90274, USA Telephone: 310-373-1925 FAX: 310-373-5539 RogerRusch@aol.com Posted: 08/12/1999 11:04 am EDT as a reply to: Msg 9574 by SephardicDave

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