Here's one for you GG~
telecomdirect.pwcglobal.com.
Satellite Calls To Drop to 50 Cents After Three-Way Merger
Posted on March 1, 2000
A three-way merger between satellite operators ICO, Iridium and Teledesic would see satellite call charges for the newly-formed operator, tumble to the level of US mobile rates, around $0.50 per minute. A move that would place heightened pressure on new market entrant Globalstar to follow suit.
Speaking to TPB, Mark Anderson, president Technology Alliance Partners, said that as soon as Craig McCaw, founder of Teledesic, completes his take-over of the bankrupted ICO and Iridium groups, satellite charges - which can be several dollars per minute - will be slashed "pretty much immediately".
"McCaw will be able to unclog prices, which basically means that he'll be able to charge less. The new retail rates will come down to about 50 cents per minute as soon as the merger goes through," Anderson predicted.
However, managing director of C.E.Unterberg Towbin, William Kidd, believes it is impossible to pick prices at this stage. "In some ways it isn't pricing that's hurting the system," he told TPB. "The quality of the distribution channel is more important. I also think it's futile to cost it out in terms of price per minute because that fails to take into account other costs, such as the cost of the handset," he added.
Nevertheless, if call rates drop to the extent Andersen believes - if a three-way merger takes place - this could spell trouble for Globalstar, which had its commercial 'soft' rollout in October last year. Globalstar's wholesale satellite call rate is $0.47 per minute. |
