Iridium Africa says parent?s bankruptcy shouldn?t affect permit award
September 9, 1999
By Sara Frewen
JOHANNESBURG, South Africa?Iridium L.L.C.?s recent financial
restructuring and voluntary bankruptcy filing are not expected to have a
financial impact on Iridium Africa, said Iridium Africa?s Chief Operating
Officer Thomas Alabakis. Iridium Africa is an independent company
wholly owned by the Mawarid Group and is financially unaffected by
Iridium L.L.C.?s actions.
Iridium Africa, not Iridium L.L.C., holds the licenses to provide Iridium
L.L.C.?s services in more than 50 countries in Africa, as well as in Turkey
and Cyprus.
Iridium Africa is confident there will be no disruption to its service, no
matter what the outcome of the Iridium L.L.C. financial restructuring.
Motorola Inc., Iridium L.L.C.?s largest shareholder, has publicly indicated
it would continue its full operational support for Iridium L.L.C., the
gateways and all current and future subscribers during the reorganization
process.
In addition, Motorola said it would continue to invest in the technology, is
actively developing the next generation of Iridium products and remains
optimistic about the long-range future of satellite-based communications.
Alabakis assured all Iridium Africa customers there would be no lapse in
the services provided by the company.
??We will continue to work with our service providers to sell the Iridium
product and service throughout Africa,?? he said. ??We have a solid
business plan, a sound financial structure and a satisfied customer base.
??During the month of July, Iridium Africa enjoyed its highest percentage
of subscriber growth to date indicating acceptance of our new lower
airtime rates and decreased equipment costs,?? continued Alabakis.
Iridium Africa also said it does not believe the current financial
restructuring of Iridium L.L.C. should have any impact on its ability to
obtain a commercial license in South Africa.
The licensing delays in South Africa are not only affecting Iridium
Africa?for satellite-based phone services?but also could affect
Globalstar?s plans to begin operating in South Africa in October. A
Globalstar spokesperson in South Africa maintains, however, that the
service will be technically ready by October, testing trials will be
conducted starting in November and the system will be fully ready for
commercial launch by February 2000.
ICO Africa at this stage cannot comment on how South African-based
operations would be affected by the financial problems of its parent
company.
The deployment of global mobile personal communications services
(GMPCS) in South Africa will, however, still be affected by the delay in
issuing GMPCS licenses. The South African Regulatory Authority
(SATRA) has recommended that Iridium Africa be granted an interim
license to provide services. It is the only service to be granted this license.
The regulatory body has drawn up the licensing conditions for GMPCS
and forwarded them to the Department of Communication for approval.
However, the Department of Communication has expressed its concern
about granting such a license. The department believes the
Telecommunications Act No. 103 of 1996 does not specifically provide
for this kind of license, and the GMPCS service or technology is not
defined in the Telecommunications Act. It has been reported that the
Department of Communications is seeking legal advice on whether the act
allows this type of license to be issued, or whether the act needs to be
rewritten.
Iridium Africa is currently working with SATRA and the Department of
Communication to clarify the issues.
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September 13, 1999
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