Silicon Investor (SI) -- The First Internet Community

STOCKTALK

We've detected that you're using an ad content blocking browser plug-in or feature. Ads provide a critical source of revenue to the continued operation of Silicon Investor. We ask that you disable ad blocking while on Silicon Investor in the best interests of our community. If you are not using an ad blocker but are still receiving this message, make sure your browser's tracking protection is set to the 'standard' level.

Technology Stocks : Nokia (NOK) -- Ignore unavailable to you. Want to Upgrade?

To: Maurice Winn who wrote (3185)	1/4/2000 12:38:00 PM
From: tero kuittinen	Read Replies (4) \| Respond to of 34857

That "GSM overlay" angle was a lot more credible before this year's GPRS investment boom. Mobile operators have voted with their wallets. They do not want to wait until W-CDMA either because - they think it's coming too late to meet the existing demand for mobile data services - they think it's too expensive to implement outside of major cities, at least during until mid-Zils. - they think that consumer demand for expensive W-CDMA/GSM dualmode handsets is smaller than for reasonably priced GPRS/GSM handsets - they think that if most PC owners are willing to tolerate 56 kbps data transfer speed, they are certainly willing to tolerate the same speed with handsets which have 30 times smaller displays That's why they're investing in GPRS - which costs only 30% of the initial mobile network investment. You can claim that even this is expensive - but guess what? Most GSM operators can afford that, because they're already solidly profitable. As far as Globalstar is concerned - deep in your black little heart you know the truth, Maurice. The piece I wrote in July claimed that: - Ericsson is badly late with their handsets - Even US service won't start anywhere near the promised launch date - the price of the handset will be around 1'500 dollars; wildly above the 700 dollar retail price mooted by many commentators in June - per minute costs will be far higher than the 70 cent figure widely cited in many articles - GSM worldphone models will be shortly available Guess what? It happened. Globalstar is late; it's expensive; it's far, far short of the "40 000 subs by the end of 1999" projection. Motorola's Timeport offering GSM 900/1900 coverage is one of Europe's most hyped phone models this month. What nobody could foresee is that despite all this, GSTRF can retain its ability to screw investors coming and going. They can miss all the targets that mattered in July - and people are still willing to clap their hands to keep Tinker Bell alive. This ties up to the market psychology - the general unwillingness of tech investors to confront the concept of risk. I'm not into auguring Wall Street's psychopathology. Sooner or later the reality will dawn on even the most solipsistic Pollyannas. We will get some actual numbers on Globalstar's monthly billing soon enough. Let's see whether the Wall Street can hold on to its happy thoughts then. It should be 160 minutes per month at 1.50 dollars per minute, right? And about 500 000 subs by year's end? Hold that thought. Tero