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Microcap & Penny Stocks : Globalstar Telecommunications Limited GSAT -- Ignore unavailable to you. Want to Upgrade?

To: Rocket Scientist who wrote (5486)	7/1/1999 3:54:00 PM
From: Valueman	Read Replies (3) \| Respond to of 29987

RS: I respect what you say, but just when should we react? The price is what is being quoted to solicited callers at this time. This is the initial marketing step. Iridium will sell you a phone for $1000. They will sell you minutes for $1.35. Those are the rates TODAY. I have confirmed those prices. If I am a potential customer who would know that, and I call 1-877-SATPHONE, I am told I can have service in December for prices more than Iridium and with a phone costing 50% more than an Iridium phone. When should I react to that? Next month? Next year when G* has no cash in the coffers and is in Iridium's shoes? The Iridium path is there for them to see and avoid, not to match the footprints. What did you mean by Airtouch not being able to control pricing?

To: Rocket Scientist who wrote (5486)	7/1/1999 4:25:00 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 29987

RS, there is a risk of under-reacting. Panic in humans is an evolutionary advantage so that the right steps, big long ones, are taken very quickly when danger threatens. There is nothing surer than a politician or 'important person' telling everyone to 'keep calm' to cause a stampede. The time to react is early. I've been reacting for three years, but while everyone lived in the dreamworld of plenty of LEO customers for everyone to get really rich, nobody was interested. Now that Iridium has been slamscraggled, with NO competition, people are starting to wake up. Unfortunately, behind big secure gates, in multistorey, double glazed buildings, with expense accounts and important job titles, it's easy to take an unruffled approach to things. AirTouch doesn't care much about Globalstar - it's just a boost to their terrestrial business. They probably will keep it just for them so they can claim to be the only one with total coverage. In the space business, a calm, deliberate approach is pretty much essential. One can't be designing, building and launching satellites without a very precise plan, with totally intricate engineering detail, scientifically proven and controlled with multivariate analysis. [Which is being a bit generous to the engineers when you count the dead satellite bits splattered around the earth, many of which tried to get up on Zenit]. In the marketing business however, we are dealing with those wet and wild things called people. Feral Marketing is the way to get things happening. That means getting out in the jungle. AirTouch and other telecom companies enjoy an undeserved reputation for being great marketers. They are not. They have had a protected environment and only in the past few years has competition become significant. Sure, there have always been competitive elements, but the duopoly cellular businesses and monopoly wireline services have not been competitive. The LEO business is fully competitive. We have Iridium, ICO, Geos, Ellipso, terrestrial wireless, wireline, IP and other stuff all trying to get their bit of the action. The usual electronics consumer products idea of starting high in price and coming down is no good for Globalstar. It is okay for the handset side of the business, where there is competition for limited supply and large marginal costs incurred every time a handset is sold. But every time a minute is sold, there is ZERO marginal cost. There will be 10bn Globalstar minutes rotting in space in a few months. Globalstar should give a unilateral price cut as an introductory special and leave the service providers to compete among themselves to get those customers while the bargain is on offer. If handsets are in too short supply and their 'street price' is over $2000, then sure, Globalstar could increase the minute price so that handset prices stay around $2000 or maybe even $3000 to really get things moving [the price would only be that high if there is wild demand for minutes]. Maybe service providers [some of them] will take the price cut and still try to sell at $2 per minute. Good luck to them and they'll lose market share to service providers who are competitive. Valueman is definitely not over-reacting. Everyone else is asleep at the wheel. Having the still warm Iridium corpse as a warning is very convenient, but seems to be ignored. Sure, Globalstar voice quality is better, but that is not a big deal for $1 per minute. Remember, there are not as many rich, stupid business people as Iridium thought, who want a big ugly phone which they can't use many places, gets a flat battery in hours and costs heaps. Oh yes, you can't use it under trees, in buildings, cars or anywhere other than wide open areas. Globalstar should cut the price to all the service providers as an introductory special. 1 billion free minutes to the first ones to use them. On your marks, get set, go! That should get things moving. Then make the second billion minutes really cheap too. Increase it a bit for the third billion. A bit more for the fourth billion. Etc. Then launch Constellation2 and do a half price special for the first year of that! Price, price price. That's what it's all about. Cheap cheap cheap. That's what will sell. To get it all moving fast. The tricky dicky sectorization, vertical and horizontal markets and all that jazz can come later. Maurice