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Technology Stocks : Loral Space & Communications

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To: RMiethe who wrote (5636)	3/29/1999 6:55:00 PM
From: Rocket Scientist	Read Replies (2) of 10852

RMiethe: Regarding G* subscription rate and breakeven point: I think the 200K subscribers at 110 min/month breakeven point is with respect to EBITDA. But G* will have to depreciate the system at about 500M$ per year over 7.5 years plus pay interest expense which will initially be around 300M$ per year. So to have a positive net, if the 110 min/month is correct, it will need something like 1.6M subscribers, which I hope it will have by 2001, or about 15 months after start of service (actually, I think it'll have fewer subscribers, but more CM/M/subcriber). Comments? PS, the problem that caused the Telstar 6/7 delay wasn't a component shortage, but latent defects in some parts. T6 was actually at the launch site and had to be recalled for retrofitting; T7 was well along in production at SS/L and was delayed for repairing of the same problem. There was a press release about this last Fall. Regards, RS

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