Tahoetech> I've given that a lot of thought...why would Chris Gent ever think G* could, or would, be a threat to his cellular business if, AND since, Vodaphone stood to reap such a profit from from the system?
The mobile telephony environment in the early and mid 90's (when the SP partnership agreements were being developed )was quite different. Globalstar was seen as an in fill peripheral system, complementary to cellular.
Since then, several factors have made Globalstar's and cellular operators interests diverge.
Ask any cellular subscriber what their top five gripes are and you are likely to hear: no service, dropped calls,and high roaming charges. Operators have been making a killing with roaming charges, the associated costs of which are not all that great. Roaming is just an excuse to rip off customers. In the same manner, operators are taking advantage of people with dodgey credit or temporary business travelers to offer them a "prepaid solution" which is more of an overpaid problem. When I call during the hours of 8-20, I get charged 1.5DM per minute (I am temporarily in Germany and have a prepaid plan), which is about $0.75. Just the other day, I called my friend in Italy and used up my 50DM prepaid credit in about 15 minutes!
Anyway the point is operators, particularly in Europe, are making immense profits from prepaid customers (whose acquisition costs are close to zero) and from obscene roaming charges. And they do this without even having high quality or dependable service. Quite unlike Globalstar. Globalstar, if priced correctly, would eat into the establishment's roaming revenues, obviate the need for prepaid for a certain business segment and do so with a quality and grade of service superior to that of cellular.
In this new context, I think there is some reason to believe that Chris Gent is in fact "keeping his friends close and his enemies even closer". Vodafone and SP cellular providers are afraid that Globalstar will erode their most profitable segment. They would be better off realizing that the battle of LEO economies of scale cannot be won, and keep the profits in the family by allowing Globalstar to cannibalize their high end segment. But I can imagine Vodafone executives turning blue at any suggestion of a Globalstar reduction in MOU price.
I do not think it was a complete coincidence that Vodafone announced a pan European Monetary Union one rate plan of $0.75 on Jan 16. And it happens now just when the last rites are being administered to Globalstar? Interesting.
rf_hombre |
