In the face of Maurice's very busy day, I'd like to support the "don't worry" element (although of course there is cause for worry--it just shouldn't be controlling).
Anyone investing in this stock is looking out to a future at least a year away for positive cash flow projections. We have a long term outlook. In fact, I'd suggest that our outlook should be longer than a year. It should be 5 years--the time to get to the second generation of sats and handsets/base terminals. Yes we can make nice money if we have a splashy launch that creates a hot product and quickly becomes a desired service.
But, doing anything that increases the risk of failure jeopardizes the ultimate goal--i.e., to begin to generate sufficient cash to fund a second generation of sats. Trying to launch in the face of all the current reports of irid's demise would appear to be bad from a marketing standpoint. Can you imagine a telecomm vice president at a timber company going into his company's boardroom to get authorization to order 1,000 G* handsets right now? The only board member who knows anything about the product will go, "Satellite phone? forget it! They won't be around in a year!" Great start to the VP's presentation! Answer by the board. "Wait 6 months." Therefore, it is absolutely appropriate to allow slippage to the right, to make sure the gateways you want to be up are up, and to get a few extra handsets available. And, along the way, maybe to make a couple of high profile sales.
For those familiar with The Gorilla Game, we are entering the Chasm. The Technology Enthusiasts have already bought--Iridium--and have been burned. The key is to find enough corporate Visionaries to move to the Bowling Alley, and create the Tornado. (And how's that for a bunch of defined terms in one sentence!)
I am not disagreeing with the disappointment expressed that the gateways weren't finished, or that more handsets aren't ready. I am saying that, given the situation, it is correct to let the rollout slide. (If that means some dilution in 6 months, as further financing is needed, so be it, if it protects the company's position as a going concern).
The money to be made servicing data needs makes the voice portion of any communication service chump change. The goal is to get to the point where G* can participate in the data transmission business meaningfully. Any action by management that reduces short term risk, so that we can get to the long term still in business, is the proper action.
Best,
JS |
