<... sold at 1'200 bucks, charging 1,50 for domestic calls is a luxury. If it were a necessity, Iridium would be doing gangbuster business after the price cuts....>
Tero, the Iridium price cuts don't do it because people who might spend $1500 on a handset for a going concern are less likely to do it for a company in bankruptcy. There are also the technical demerits of the Iridium system. Such as the very large handset, call quality and stuff. Also, having failed as a premium product, it is now seen as a lemon, so nobody wants to be a sucker and suck a lemon. To attract them, the price has to be much lower than would otherwise be the case.
This is the danger Globalstar faces. They must succeed first go and if they start too cheap, there is no risk, but if they start too dear, it might be "Oh Dear!" with an Iridium style mess to clean up [but with the ability to cut prices all the way to 20c retail it wouldn't lead to bankruptcy]. 10c for Globalstar, 10c for the Service Provider and it still wouldn't go broke. That would stimulate demand really fast.
Sprint only gets 10c a minute and has to provide infrastructure, so Airtouch would do well even at 10c per minute from Globalstar.
Whether something is a need, want or luxury depends on the buyer's point of view and the words are intangible. So okay, let's call a Globalstar phone a luxury if you like. So's my car. I could always walk. Making a Globalstar call to get a helicopter to pick you up after doing some geophysical investigation is maybe a luxury too. Same with getting a tow truck. Same with making an appointment change. Personally, they look closer to needs than either wants or luxuries.
$100 a glass champagne is a luxury in my book. But I guess they'd consider that an essential part of doing business.
Maurice
PS: Gee Tero, I didn't see a personal attack and fancy Michael Allard apologizing for nothing! I guess Americans are scared of litigation from offended people screeching 'defamation'. Imagine how Bill Frezza feels, being dragged out and flogged every month! Now THAT's a personal attack. Now, if you'll just hold still there Tero, take this, and THAT..and mmphhhh...that...and you were wrong wrong wrong on the wonderful and all conquering Mighty Q! and CDMA!!! Coming here hoping to gain a cheap win is going to get you in more trouble. Globalstar is going to be an amazing success. Maybe there'll be a bit of a scramble at the start, but don't short this baby below $15 and you better hope for a market crash to take it there.
Qualcomm right now on $193. Nokia struggling around at $84. Wow you must be impressed by Q! |
