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Technology Stocks : The New Qualcomm - a S&P500 company -- Ignore unavailable to you. Want to Upgrade?

To: SKIP PAUL who wrote (2134)	10/10/1999 11:22:00 AM
From: Ruffian	Read Replies (1) \| Respond to of 13582

Telecom 99 Globalstar> Article for QUALCOMM Incorporated (NASDAQ NM:QCOM) 9:58 AM most recent headlines next article: TELECOMS-Globalstar sees profit in 2001 SUNDAY, OCTOBER 10, 1999 9:58 AM - Reuters (NASDAQ:GSTRF) By Kirstin Ridley GENEVA, Oct 10 (Reuters) - Satellite phone group Globalstar Telecommunications Ltd said on Sunday it expected to reach quarterly, net profit by early 2001, when it hoped to have wooed around one million subscribers onto its network. "We're expecting net profitability by the fourth quarter of 2000 or the first quarter of 2001," said a spokesman for Loral Space & Communications (NYSE:LOR), the U.S. group that leads the international consortium. But having watched two of its rivals crash, the group is adopting a cautious approach when it unveils a limited rollout of services on Monday at Geneva's vast Telecom 99 trade fair, backed by an initial six-month, $18 million marketing offensive. Satellite telecoms, which are supposed to get the whole world talking, have proved a risky business. Crippling debts have already forced Iridium LLC (NASDAQ:IRIQE) and ICO Global Communications (NASDAQ:ICOGF) to file for bankruptcy protection. But Globalstar's President Anthony Navarra said he planned a full commercial launch in the first quarter of next year -- and insisted revenues would come on stream after mid 2000. "By the time we get to the summer, we'll probably have around 40 or 50 countries in service," he told Reuters in an interview. "So as the service begins to roll out through the first and second quarters of 2000, so will the revenues. "We'd hope to see about one million subscribers in the first quarter of 2001." MANUFACTURERS RAMP UP PRODUCTION Globalstar plans to ship 50,000 handsets by the end of the year and Navarra said peak handset production from its three manufacturers -- Ericsson AB (ST:LMEb), Telital Srl and Qualcomm Corp (NASDAQ:QCOM) -- could reach 60,000 per month. The group, one of a clutch of firms hoping to make money by linking cellphones with dozens of satellites, has delayed its launch by over one year as it tests its systems. But under the banner "Above and Beyond," the group says initial services will now be launched in North America, Europe, China, Russia, South America, South Africa and Korea. Armed with around $3.9 billion in funding from bank loans, an equity listing and vendor funds to launch and support a 48-satellite constellation, Globalstar says it has secured the bulk of its needs and is "in great shape" until revenues start flowing. However, some $2.5 billion of the funds have come from bank loans, and the group said it would have to start paying around $200-$300 million in interest per year from summer 2000. KEEPING IT IN THE FAMILY Globalstar's phones, which initially hunt for terrestrial signals before automatically linking with overhead satellites, will cost up to $1,500. The group will charge its 12 service providers, which will sell the phones and include shareholder Vodafone AirTouch (LSE:VOD), around 35-50 U.S. cents per minute for the service. Retail customers in Europe are likely to pay around $1.50 per minute, of around $3.0 per minute for a global roaming deal. Globalstar is hoping customers will talk for between 100 to 500 minutes per month. Fixed satphone payphone booths are expected to generate 800-1,000 call minutes per month. Navarra helped set up the Globalstar consortium of what he calls "family members" in 1991. "It's almost like having children that are beginning to mature," he said. "You take them from when they're infants to becoming teenagers." But he disputed that shareholders might be at that squabbling stage. "No, no, they're well past teenage, well into college, they're about to get their graduate degrees," he laughed. "It's a group of people who are not only professionals but personal friends -- and I think that's a theme that's going to make us more successful." .