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

To: Kunal Taravade who wrote (8952)	12/28/1999 6:04:00 PM
From: Maurice Winn	Respond to of 29987

Kunal, true enough, the upfront cost of a phone can be a disincentive to many people and it's better to hide the handset cost in the minute cost with a minimum minutes per month purchased and a minimum contract of 2 years for those people. They then have a revenue item instead of a capital item, which suits some too. A sort of lease-to-buy approach. But $1500 might be too cheap. We should hope that $1500 is too cheap. If all the handsets sell out and there is a shortage, that means the handsets are too cheap. We want them to sell out to people who will use huge amounts of minutes. Qualcomm is out to make money too don't forget, so they will price them to match demand. If demand is huge, expect a price increase. They won't make them for $400 and have the service providers selling them for $2000 [whether the service providers hide that price in the minutes or not]. The thing that SHOULD be cheap is the minutes, not the handsets. The way to boost minute demand is to cut the price of the minutes. It's a price-elastic business as the terrestrial cellphone providers have figured out. Terrestrial demand has zoomed as prices have hit the right spot. The same would happen for Globalstar - fortunately, the service providers can cut the price a long way and still make vast profits. Maurice