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

To: dougjn who wrote (175)	12/17/1997 7:07:00 PM
From: Jim Parkinson	Read Replies (2) \| Respond to of 29986

Seems to be some large blocks crossing in the last couple of days. Although I am in this for the long term and therefore not supposed to be concerned with day-to-day trades, I must admit I liked it better when we were trading in the 50's on up markets. Something is holding G* down right now. Anyone have any ideas?

To: dougjn who wrote (175)	12/17/1997 8:03:00 PM
From: E Haiken	Read Replies (1) \| Respond to of 29986

Globalstar is managed by extremely intelligent & knowledgeable people, including Bernard Schwartz, who is as good a business man as exists on this planet. I have total confidence that they will come up with a very well thought out pricing plan that will increase the shareholder value. This is one of the main reasons I own this stock. The pricing decisions are not made by the participants on this board, but by people with all the facts, plus good judgement.

To: dougjn who wrote (175)	12/18/1997 5:01:00 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 29986

Well Doug, you ought to know that an obsessed wacko won't sit idly by while you make the argument for a centrally planned economy with rationing by the commissars. Satellites cover a wide area and travel around the world in 100 minutes, day, night, day, night, battery charged, discharged, over busy cities for 10 minutes then deserts and oceans. A limiting factor according to a designer of the system is electron volt availability. There will be big peaks and troughs in demand. What that means is that there is only so much energy available. We have had conflicting reports on this from those who claim to know such things, so although some trust was expressed in the great and wonderful ability of the Globalstar people to attain Nirvana with their system, I want to make sure they aren't shooting themselves in the foot and making a hole in my cash flow forecasts. A subscriber out in the ocean off the coast of Japan in a sinking yacht won't be amused when he gets a continuous busy signal because the system is full of chattering Chinese and Japanese. The way to allocate scarce resources is by price. It is a novel capitalist invention which has been found to be effective. Executives and companies unfamiliar with the practise or unable to manage such a situation would find themselves needing a different price plan from a variable one. They could simply pay a flat monthly rate, which would necessarily be much higher than the variable price plan. Their outgoings would be very high, but they would be happy in the knowledge that they could have a set amount to budget for. Of course better managed businesses would undercut them so they'd risk going out of business, but that is the rule of the jungle. You suggested: "And even off peak area rates. If G* is initially little utilized in Africa, e.g., give Africa an extended period introductory rate." That was exactly what I'd suggested for New Zealand a couple of years ago, but the design guy I spoke to told me that they couldn't do that because the limit was power supply and they would prefer to keep the power for the busy high priced areas like Japan, USA. No need to sell it off cheaply in the boondocks. But that argument was refuted by some others who claim to know these things; they claimed power was unrestricted. Who are we to believe? But we know that there is some limit and if power is unlimited, then it is space for another call. What you are suggesting, and what I'd initially thought, won't work in practise. Satellites cover a wide area of rich and poor people, low and high demand simultaneously. Micromanaging this area, that area, who has a fixed phone and who is GPS fixed on that side of an arbitrary line is impossible if a fully used and revenue optimized system is wanted. The only way to do it is by price auction. The caller sets the price by pushing SEND or not in response to the level of demand as displayed by price. Early adopters and speed of adoption? Sure, as you say, early adopters will pay more. They do this by buying an expensive handset. The speed of adoption would be most affected by price. Make it $0.10 per minute and see how many hundred million people start clammering at the door. There is a fashion in marketing these days to avoid talking price at all costs - usually the cost of loss of business! The fact is that customers measure the benefits against the cost. Sure, the marketing needs to be excellent to ensure the benefits are clear. But price has to be right up there too. You wouldn't want people wrongly thinking it was $5 per minute and not even bother looking at it if it is actually only $1 or $0.50 per minute. Then the crux: "The idea of introductory come on deals is familiar, and well accepted. But the idea of prices which could be massively raised from time to time, in a manner the customer will perceive as arbitrary or motivated by naked American greed, is problematic." Well, well, well. The land of free enterprise and capitalism is turning to mush. Microsoft is being harrassed by Janet Reno's gangstas. Qualcomm is being harrassed because they charge royalties for their decades of hard work. Now we have to give Globalstar service away cheaper than somebody else will pay. Moan groan! If they don't like it Doug, they could buy a fixed price per minute contract, say $5 per minute or $2 depending on how sales are going that year. Then watch their friend's monthly bill be way lower than theirs! What backlash anyway? Will they buy an Iridium phone instead? As prices increase over a two year period, they might prefer it not to be, but after looking around at options, they'd see that it was still the best deal. You say introductory deals are well accepted. Well, this would be a huge year long introductory offer. Very cheap minutes. If Globalstar price-gouged, they would get fewer subscriber minutes and a relatively disused system. Not too smart and since Bernie is apparently a demigod, he would not do that. All very simple really. Except that I bet the demigods have mucked up the contracts with Hyundai, AirTouch etc and the pricing is set in a Russian central planning mode. So I suspect a greatly underused system will be the outcome. Then there will be dead people who tried to phone for help but they got a busy signal or satellite battery flat signal. But wow, these guys are great! Mqurice