MB, Steve:
Share your views re. MOT. Aside from the fact that virtually all product lines are in trouble, there is also the BIG problem, namely Irridium. We've called this a "farm bet" in earlier posts. When you bet the farm, the cards had better be good. Unfortunately, this multi-billion dollar bet is coming up two's and three's,.....particularly with respect to customers. The system is due to be up and running this fall. At the moment, there aren't enough clients to pay the electricity bill. Our analysis suggests that there are precious few who need or can afford satellite phone service. Additionally, it competes with an already multi-layered mobile communications environment as well as other space-bound competitors. The carry costs on this system are massive, so if the customers don't show up in droves, it won't take long for the worry beads to appear. We're recommending puts for the fall.
Best, Earlie |
