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

To: Maurice Winn who wrote (111)	10/27/1997 7:41:00 PM
From: Maurice Winn	Read Replies (1) \| Respond to of 29987

techstocks.com More on pricing! It seems that people are starting to realize that when a system is built like Globalstar and Iridium and the marginal cost of a new minute of use is zero, and a new subscriber can be put on the system for no cost to the system [the subscriber buying the handset], the price that needs to be charged is very low. Nearly all businesses have operated from a base of significant marginal costs to instal a new customer. Only with the advent of software has the marginal cost shrunk. Even there, it is not zero as there is shrink wrapping and retail costs. On-line software is closer to zero, but there is still server time consumed to handle a marginal downloader. There is also no payment system for downloading which can handle a few cents auction price. Unlike phone systems with built in billing. Even where there might be zero marginal cost, there is not an auction process available in the absence of distributed microprocessors to handle the auction process at zero cost. So not until the advent of cdmaOne has there been the ability to use a fully subscriber priced auction system to maximize use of resources and profitability. The processing power in base stations and handsets and zero marginal cost of a new minute of use in a partly used system means that pricing can be auctioned. This article at least recognizes, though LarryL is still singing the get rich quick unlimited manna from heaven mantra, that there WILL be price competition and as for all other businesses, only the fit survive and prosper. There is big money to made. But only if the business is operated properly. Subscriber-priced networks are the answer. Globalstar and cdmaOne systems are the best places to apply the solution. They also benefit from technical advantages of cell shrinking avoidance, call dropping, battery life protection and call quality maintenance. Initially there will be no handsets and $3bn in satellite system sitting unused. If handsets were free, you would produce 10 million of them now and have them waiting for the system to start up, then people could instantly fill the system and bid for call space. But handsets are about $600 to produce, so to make enough to totally fill the system will cost $5bn or so. Since that exceeds the capital value of the system, it is plainly uneconomic to make them all yet, [unless subscribers are expected to pay a fortune to use the network!]. There will be an optimum phase in period which will involve enormously rapid handset production in the first year or two, starting from early 1998 with the system being filled by 2001, by which time handset stockpiling for the next constellation launch in late 2001 should start. VERY fast handset production is going to be needed. But it is subscribers who should set the pace to maximize value. They should set the pace by bidding on handsets and network time. Handsets should start off expensive [$3000] and calls free and shift as the system fills to $500 handsets and calls $3! Fixed price plans for the nervous should be offered too. Watch THAT space! MIW.

To: Maurice Winn who wrote (111)	1/19/2001 11:28:41 PM
From: Maurice Winn	Respond to of 29987

I feel sick... <... the most important issue. I've tried to explain the subscriber pricing by auction concept but I don't think anyone understands what I mean or sees the absolute need for it. Buyers decide the price by accepting what is offered or rejecting it. This is a fundamental principle in all transactions other than those created by governments at the point of a gun through taxes. If there is a disagreement on value, the seller has to either lower their price or stop producing the goods. Globalstar can't stop producing the goods. Once the satellites are up, they are there. Therefore, the price gets set by the buyers in competition with each other. The best way to do that is to give them free rein - not restrict them to some set price. There is NOT manna from heaven. There is no cargo cult worth following. Priced incorrectly, Globalstar and Iridium can BOTH fail.> And so they did! I guess they weren't interested in what I was writing. Mqurice PS: I notice that post is number 111, which is the emergency services number in New Zealand! Ominous.