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

To: John Stichnoth who wrote (5517)	7/2/1999 9:51:00 PM
From: Maurice Winn	Respond to of 29987

To buy or not to buy, that is the question... <...when the decision is to buy or not to buy, price can be (is frequently?) the determining factor. We are faced, in the G situation with this latter decision...> On a metaphysical level, the question to buy or not to buy is very close to being or not. In a more prosaic sense, we can talk about price elasticity. As the terrestrial providers are finding, there is a tsunami effect at the right, lowish, combination of functionality and price. Nearly everyone would like to have a Globalstar phone if it is free with free minutes. Many products can be free and few people would want them, so it is not as obvious as it seems. So the question is at what price per minute will the handset production lines be running red hot? As you quite rightly point out, price is the deciding factor for nearly everyone in regard to Globalstar [since only a very few people are expected to make the "buy" decision]. So the marketers who put price at the bottom of the list obviously don't understand what they are dealing with here. The only real question is at what minute prices will revenues be maximized over the long run? This will be the 'red hot production line' price per minute. AirTouch seems to think it is near $2. If that is true, it is interesting that they don't put their money where their mouth is and order 500,000 handsets for delivery this year. They are using the Iridium model for maximizing revenue. I say it is variable. To maximize revenues, there needs to be massive incentive [cheap minutes] initially, then market rates as the system fills. I should put in BIG writing - for the particular case of Globalstar. This is not the case for all products or services. Usually, it would be high to start then cheaper with time and this applies to the handsets which should be high to start and cheap after 5 years when minutes should be more expensive. This will also skoosh Iridium and get ICO to put off their plans for another year or three, by which time Globalstar might copy ICO with 8 satellites in two 10,000 km 45 deg. orthogonal orbits [4 in each] to fill in all the gaps making a gateway in NZ [and other marginal gateways] irrelevant. It will boost capacity hugely. The soft handoff function of Q! CDMA will make it easy to do in conjunction with the existing constellation. P-----gly yours. Let's see 2x10K orbits. Maurice TWO FREE-TRADE LEGS OF LAMB WITH EACH GLOBALSTAR HANDSET*