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To: Rocket Scientist who wrote (7942)	10/21/1999 4:33:00 PM
From: Geoff Goodfellow	Respond to of 29987

Dear RS: Thanks for the note! Let me attempt to address your counterpoint issues: AMSC and INMARSAT h/w is "luggable" but not really mobile and h/w costs are at least 2X what G's suggested retail price for a handset; as a GEO based provider they have latency effects that can't be eliminated. I've seen Mini-M quoted at $1.7K USD according to the WSJ 04/27/1999 article "Glitches Surface as Iridium Phones Go to War in Kosovo" and I've seen offers on the net for $1.8K USD from Satellite Warehouse (http://www.satphone.net) and COMSAT (http://www.comsat.com) with bundles of 300 minutes included in the $1.8K purchase price -- however neither of these sites has the prices posted at the moment. With respect to the size/weight/hassle factor issues, the early "Car Phone" mobiles, such as the one i purchased in 1978 suffered from the same weighty, bulky and costly issues. After getting my "Car Phone", i wanted a "portable" for trips and went out and bought a briefcase mobile phone (a Livermore LAP) for another $2.5K that i still have to this day as a museum piece. It allowed me to fly to another city and with an external mag mount unity gain antenna receive and place calls from rental cars with the aid of a cigarette lighter adapter. You could also use it stand-lone with the antenna build into its lid and its internal batteries that would keep it going for nearly a day. Of course when cellular came around, I was the first in line and spent 4K on the Motorola DynaTAC 8000X handheld unit to replace my "luggable" briefcase phone. Cost was not the issue of the h/w or of the service, it was need driven by demand. And talk about quality! Oh boy a scratchy, staticy party line that anyone could listen in on, let alone barge in on (and did). I don't believe for a minute that the lack-of demand for MSS is predicated on such things as "luggable", expensive h/w costs or GEO based latency effects. We had all these issues and more with pre-cellular mobile telephony and it sure couldn't be supplied in enough quantity even given the marginal quality. Given the limitations of pre-cellular systems, even with these expensive and burdensome take-it-or-leave-it constraints, demand far outstripped supply. The cellular operators were standing by ready for the killing when they turned up their networks. Many phones were pre-sold, pre-installed, ready and waiting for the day the networks went live. There is even a great story about the Chicago AT&T market trial system that had several hundred customers on it -- with thousands more on a waiting list. In the trail days the cellular antenna (it was diversity, so there were two elevated feeds on each car trunk lid of the test customer) were a Very Well Known sight around Chicago. One day, some gangster who was also a trial customer got "hit" -- his car riddled with bullet holes and he was killed in the ambush. That night on the evening news they showed a picture of his bullet ridden car -- which also showed the trunk with the two well known cellular antenna's on it. The next day Ameritech (the cellular trial host carrier) was SWAMPED with calls: Given that Mr. Gangster was dead, was his number/slot on the trial system available?? Sure haven't seen this kind of take up in any of the extant MSS offerings... Inmarsat's price of 3$ (I've never seen anything less than that, btw) is substantially higher than G for the types of (regional) calls that G* expects to be by far the most common. If the 1.50 price you mention is really available from INMARSAT, fully terminated, then I suppose for international calls it may be cheaper than G, but how often do people make international calls on their cellular phones? At Telecom 99 i was informed by a representative in the Inmarsat booth that if you shopped around you could find Mini-M for $1.50/min for fully terminated calls. Here on the net I have found it as low as $1.60 at Glocall (http://www.glocall.com). However, I don't believe, as indicated in my previous missive that the $1.50/min price (or even a $1.60 per min) has anything to do, or will have anything to do, with the lack of take up. How much does Inmarsat charge it's distributors (i.e., how much profit incentive/pricing flexibility do they have). In G's case we know that the difference in G*'s price to the GWs and the suggested retail price to consumers is about 1$ (to be split between GW and retailer). Out of that 1$, 0.7-0.8 is almost certainly pure profit. Message: the retailers and GW operators will have plenty of incentive to push the service, and room to reduce rates if necessary to attract customers. I don't have a clue into the inner business workings and relationships between Inmarsat and its distributors. But what I can tell you from the pre-cellular mobile telephone days is the mobile phone system operators (generally the RBOC's as we know them today) didn't pay a penny of commission to the dealers who put customers on their systems. All the distributors profit was made from equipment and accessory sales, installation charges and FCC license administrative license fee's. Yet, demand totally outstripped supply... Best regards, Geoff

To: Rocket Scientist who wrote (7942)	10/21/1999 5:07:00 PM
From: John Stichnoth	Respond to of 29987

RS--It seems that Mr. Goodfellow has ignited quite a discussion. Maybe it can help us put some meat behind our "expectations" of a large market. I can think of the following potential market segments. Can we think of any others, and can we put up some reasonable estimates of their size (worldwide, unless noted)? Remote villages without any telephone service--250,000(?) Vertical industry fixed remote locations Exployers, surveyors, geologists, Disaster relief agencies Fishing Boats Yachts and Other Small Craft Long-haul truckers--US Long-haul truckers--Other International Travelers Remote residential locations Individuals on the edge of cellular networks General Aviation Planes From one of the G* distributor sites: Q: Who will use Globalstar? A: For handheld and mobile services, users of Globalstar will include international travelers whose business takes them to areas where cellular coverage is poor or non-existent; Long haul commercial vehicle operators traveling nationally and internationally: fishing boats, yachts and other small craft. Explorers, geologists, field scientists, civil engineers and disaster relief agencies could all make use of Globalstar phones. For developing economies around the world, recognition of the fact that modern telecommunications is critical and fundamental to nation building is quickly growing, as is the realization that wealth does not create telephone density, but that telephone density creates wealth. The introduction of Globalstar's affordable fixed site telephones will rapidly advance telecommunications in the developing world and bring the progress necessary for effective internal and external development.

To: Rocket Scientist who wrote (7942)	10/21/1999 5:11:00 PM
From: John Walliker	Respond to of 29987

Rocket, ...but how often do people make international calls on their cellular phones? Often, on my Orange phone (GSM1800). Because its cheaper than using BT on a fixed line (unless I sign up for special discount schemes, in which case its about the same). Disclosure: I did buy as many Orange shares at IPO as I was allowed - and held them:-) John

To: Rocket Scientist who wrote (7942)	10/21/1999 8:43:00 PM
From: djane	Read Replies (1) \| Respond to of 29987

tele.com. ICO To Get Cash Infusion [Interesting references to G*] teledotcom.com ?October 21, 1999 ? By John Blau SEVERAL KEY shareholders of ICO Global Communications Ltd. (London)agreed this week to give the bankrupt satellite venture a second chance. The group has pledged $225 million in non-binding letters of intent In a first fund-raising tranche since the satellite company filed Chapter 11, the bankruptcy code that protects distressed businesses from their creditors, earlier this year. A company spokesman said ICO expects the letters of intent to be converted into binding contracts within the next few weeks. The troubled satellite phone provider hopes to raise the remaining $975 million it requires to stay in business with two additional rounds of financing scheduled in the months ahead. ICO has already raised some $3 billion from more than 60 strategic investors as well as another $120 million on the Nasdaq market. The financial upheavals have forced ICO to delay its first satellite launch from this month to January or February next year, with commercial service slated for 2001. Initially, ICO planned to launch 12 satellites enabling customers to make phone calls virtually anywhere in the world. But the company said this week that it may consider scaling back the number, possibly to 10. Two satellites had been planned as backups. Two fewer satellites would save around $600 million in construction, launch and maintenance costs. The fall of ICO followed an earlier failure by Iridium LLC (Washington, D.C.),which also filed for Chapter 11. News of ICO?s cash injection comes as a surprise to many skeptics in the industry. Philip Kendall, senior industry analyst at Strategy Analytics Ltd. (London), calls the satellite phone service "a very niche market," which essentially "is trying to walk outside the GSM footprint." The footprint covered by cellular networks based on the global system for mobile communication (GSM) is big and growing. There are currently 390 GSM operators offering service in 141 countries. And many of their customers are already easily roaming between and among local networks. There were 400 million roaming calls in August, up from 300 million just three months earlier, according to the GSM Association (Dublin), which represents the interests of GSM mobile operators. The ICO announcement comes just days after Globalstar L.P. (San Jose, Calif.) launched a commercial global mobile satellite service and amidst rumors that ICO and Iridium are considering merging. Whether or not Teledesic LLC, the planned "Internet-in-the-sky" venture, will buy into one or more of these satellite ventures remains to be seen. Bill Owens, Teledesic?s co-chief executive officer and vice chairman, doesn?t rule out such an investment, although it doesn?t appear to be one of the company?s first choices. Owens was quoted incorrectly in an earlier interview saying that Teledesic had definitely decided against investing in one or more of the satellite phone ventures. He said the company isn?t "particularly sure" it would invest in these satellite phone ventures. "We are seriously considering early-entry opportunities that involve both non-geostationary systems as well as geostationary systems," a company spokesman said. "It?s possible that we?ll end up pursuing more than one system in more than one category." In an interview at the Telecom 99 trade show in Geneva, Owens said Teledesic "the planned $10 billion, 288-satellite high-speed wireless Internet venture "does not intend to scrap its strategy but, instead, is looking at opportunities to enter the market sooner than 2004, when the venture plans to begin offering commercial service. Owens said "recent satellite failures have changed the market significantly," creating "a range of opportunities" that the company is currently exploring. Those opportunities, he said, included doing "something with the legacy GEO satellites operating in the KU band." Speaking at Telecom 99 in Geneva, Pekka Tarjanne, former ITU secretary-general and now with Project Oxygen, the group that is building a global bandwidth network, said continuous growth of bandwidth does not "obliterate the need" for satellite projects, such as Globalstar and Teledesic. Questions or comments on this story? Letters to the Editor

To: Rocket Scientist who wrote (7942)	10/22/1999 1:36:00 AM
From: John Stichnoth	Respond to of 29987

On market size--Have found some indication of the sizes of a couple of the segments mentioned in my earlier post. General Aviation--187,000 planes in the US in 1996. Trucking--There were 70,000,000 million trucks in the US. Most of these were light trucks, and therefore probably irrelevant to our focus. There seem to be about 5 to 7 million non-light trucks in the US. (The target market is intercity trucks, which form a portion of the heavy truck segment). Merchant Shipping--There were 26,858 merchant ships worldwide in 1997. (NB: This is not the target market, I believe, and does not include pleasure craft and fishing boats). A start, giving the broad dimensions of the market. Especially in the trucking numbers, it would seem that the issue is NOT the size of the market. The issue is penetration of the market--i.e., execution by the SP's. Best, JS