Well, Maurice, at the risk of boring our colleagues here, I'm going to go one more round with you:
" Fear of lack of demand is the only reason to give such tiny orders for
handsets. If demand is believed to be huge, then orders and incentives for
handset production would be huge."
The premises behind this statement are really weak, IMO. By "tiny order" do you mean the 300K unit order, or are you extrapolating from the Quentin Hardy piece which said the y/e subscriber target was only 10K people? If the latter, even assuming the author accurately recorded what BLS said, and even assuming BLS isn't just setting up a lower expectations bar to jump over, there's no credible connection between the 10K and an absence of handsets, let alone an absence of handset orders. A lot of things seem to be slipping marginally to the right: gateways, primarily, in my view, and, maybe, handsets. It would be better if we knew why these slips are occurring, and get some reassurance that the lost time will be made up by improved quality when the system finally goes live. But to jump to the conclusion that handsets aren't being built because G* or SPs haven't ordered them because they "fear lack of demand" is really a stretch, in light of all known facts.
What's important long term is not whether G* has 10K or 20K users by y/e 99: what's important is that nine months or so from now, we're adding users at a rate of 100K/month. That means making the first 10-20K users ecstatic with the product, and learning from them so that every little thing that's not perfect for the first 10K is perfect for the next 100K. I don't care if that happens a month or two later than forecast, as long as it happens.
There are several standards against which we can measure management's effectiveness: against some personal standard of perfection, against mgmt's stated busines plan, and against mgmt's competition. I prefer to forego the first approach, because, (1) nobody's perfect and (2) my standards of perfection are likely be different and maybe worse from what's really best for the company's shareholders. Against the second metric, BLS et al deserve at least a B+, IMO. Since Zenit, I never expected that the space segment would be ready before 1/00. They managed to accomplish that, and I believe the ground segment is only 1-2 months late. Not bad, in my book. And compared to the third standard, it's pretty obvious that the MSS business is more difficult to enter than anyone imagined. Irid and ICO are down, and we're still standing, in good enough financial shape, as far as I can tell, to permit a judiciously paced rollout; one of the most serious of Irid's many mistakes was rushing out a product that wasn't working quite right, and was missing key accessories. Apparently it had to do this, to have a chance of making it's loan covenants. Thanks to BLS and Loral, G* won't be under that kind of pressure. |
