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

To: WR who wrote (11294)	3/27/2000 11:55:00 AM
From: Rocket Scientist	Respond to of 29986

News from Russia, courtesy Yahoo poster kyleherring: messages.yahoo.com Moscow Times article on Globalstar by: kyleherring (40/M/Seabrook, TX) 3/27/00 10:14 am Msg: 32296 of 32344 SATELLITE PHONE FIRM READIES LAUNCH > Moscow Times > 25/3/00 > Satellite telecommunications firm Globaltel has completed construction of a Moscow station and will soon extend its reach to three other regional centers in time for Russian operations to start in May or June, company officials said Friday. "Preliminary tariffs have been set at dollars 1.50 to dollars 2 per minute," said Tatyana Shakhnazarova, executive director of Globaltel. Globaltel is the Russian arm of GlobalStar, a low-earth-orbiting satellite-based digital telecommunications system that will offer wireless handheld telephone and other telecommunications services worldwide. The local subsidiary is jointly owned with Rostelekom, which has a 51-percent stake in the project. GlobalStar will have 17 stations operating throughout the globe by the end of March in a venture valued at about dollars 4 billion, company officials said. The Russian part of the project will be worth dollars 100 million and it could break even with as few as 20,000 subscribers, Prime-Tass quoted GlobalStar vice president Terry Evans as saying. Globaltel expects to have 5,000 to 7,000 clients before year-end, Shakhnazarova said. GlobalStar's expansion is proceeding despite the failure of Iridium, an international consortium that was forced to end operations a week ago in the wake of a ruling by the U.S. bankruptcy court. Iridium, which operated a global personal mobile satellite communications system, defaulted on credits worth dollars 1.5 billion last year. However, Rostelekom remains upbeat on Globaltel's prospects. "We do not think that our money will be wasted," said Alexander Vyshlov, deputy director of Rostelekom. "Satellite connections are necessary even though the parallel growth of cellular communications poises some threat." Vyshlov said attracting 20,000 clients throughout the whole country should not be a problem while the cost of billing is lower than the dollars 3 per minute charged by cellular operators in the early 1990s. Globaltel was not discouraged by the Khrunichev Space Center's failure to recover the dollars 82 million it plowed into the development of the Iridium network. The center owned a 4.3-percent state in the project and had signed up some 100 clients through Iridium-Eurasia, a local segment of the global network. Iridium's total losses in Russia were around dollars 150 million to dollars 170 million, Iridium-Eurasia president Spartak Kurilov said Friday at a news conference. It is believed the Khrunichev center had to cut staff and reportedly lost one contract last year as a result of two abortive Proton rocket launches that further aggravated Iridium's losses. The telecommunications industry is no longer bullish about the prospects for satellite telecommunications networks. "There could be a mistake in estimating the customer base for the [GlobalStar] project, as there was in Iridium's case," said Konstantin Chernyshov, head of research with NIKoil brokerage. Chernyshov said Rostelekom could end up losing money, unless GlobalStar found a rich international sponsor, such as the United Nations, that could finance the project for political reasons. "Demand is low, but GlobalStar's project is the least ambitious of all projects of a similar nature," said an analyst at one of the Moscow-based consultancies, who asked not to be identified. He added that there was only one attractive handset available for satellite telephones and Globaltel might struggle to get it registered in time for operations to start. All other satellite telephone handsets were bulky so registering the user-friendly one would be a boon to Globaltel's efforts to attract customers, the analyst said.