Valueman,
You are right, Globalstar's will be cheaper, but far more expensive than $0.45 someone mentioned. I think the big question is how much cheaper, considering the telco'stail charges which G will have in excess than Iridium, the service provider markups and the gateway owners markup???
And then you said:
" Satellite life must be taken into account also. Minimum life for G* is 7 1/2 years, Iridium is 5 years. That is a 33% difference--that is significant. Realize that once Iridium turns on service, some of the satellites will already be 20% used. They must immediately start on the next generation, which will eat into cash flow. G* has less pressure to do so" .
Satellite life must be taken into account, yes, but there are some drawbacks on a longer sat life: technology evolves extremely fast these days and equipment becomes obsolete fast (by the way, the bent-pipe tech Globalstar uses is already outdated) and must be replaced fast to keep competitiveness. Outdated sat tech means worse service and less clients, less revenue.
Also, a 33% difference means only that Globalstar has a theoretical lower cost, which may not be true if the time it foresees for its second generation is as tight as it looks. Globalstar has the same pressure to put up its second generation because 1)its technology is outdated (not the CDMA part, of course); 2)It intends to put up its second generation at the same time Iridium does.
The 2,5 years span is therefore a hoax. Globaltar's cost should be reviewed, therefore.
Iridium's Macrocell - the second generation - is planned be fully operational six years after unconditional license - which it could perhaps obtain in two years - 2000 - it would be fully operational therefore in 2006. As Globalstar's second generation will want to be fully operational together with (or before?) Iridium's, the pressure is really on Globalstar, not on Iridium...
With a full operational second generation in 2006, I cannot see how it will eat into Iridium's cash flow.
All of this is based on the assumption that the second generations both systems filed are really intended to go up and not only to get frequencies at WRC 97 and 99... |
