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

To: Cellme who wrote (500)	3/16/1998 11:13:00 AM
From: Valueman	Read Replies (1) \| Respond to of 29987

You need to do more research on G* my friend. If you are going to make an argument, it can't be done simply by showing that you have done research on Iridium and you know nothing about G. When you can go through each area where G operates and tell me what the service provider there is doing, let me know.

To: Cellme who wrote (500)	3/17/1998 8:34:00 PM
From: Maurice Winn	Read Replies (2) \| Respond to of 29987

Hello Cellme and thanks for the comments. We can muck about with the details, but your central theme of the importance of marketing is correct. I believe the Globalstar people have focused on the technical side to the detriment of the marketing. Fortunately, they have such a big technical advantage they can be quite wasteful in the marketing side and still come up highly profitable. For example, this latest business of the handset holder paying! That will kill it stone dead if competitors don't have such a policy. That would be a total marketing failure. On pr---ing, Readware says: ----------------------------------------------------------------- As far as how does G* know how to price calls at various times so as to prevent market overload: G* is charging a flat $.47/minute (US dollars) to the telcos. G* does not set the varying rates (the mark-ups) for satcom phone time to the customer. That will be up to the telco partners. G* does not then set the different prices that varying times during the day will see. Their price is always the same-- $.47/minute. [Editor: Not so, Globalstar can agree with their local provider to reduce prices if the local provider wishes to and that was always planned] In system overuse prices rise to discourage, in system underutilization prices decline to encourage. I do not believe that in the first two or three years the telcos will have the problem you suggest of having customers switch to another system if they can't use the G* system because of sytem overuse. There will not be enough capacity to handle the switch. That does not mean the telcos are not aware of the problem you raise. [Editor {that's me!} No, they won't have a problem in the first two or three years because they are planning such a lethargic buildup of subscribers. The constellation will die half used according to their plans. To then depend on having subscribers unable to change due to not enough capacity to handle the switch is typical of centrally planned economies like the Globalstar system modelled on the USSR 5 year plan] Obviosuly they are very aware. The question of pricing vs. usage has been run in simulated usage models to try to maximize both user usage and satisfaction with revenue flows. You are correct, the last thing a customer wants is a busy signal. It is not in the telco's interest to have busy signals. You will recall, in this regard, that they have committed to one billion minutes of time to G* over the life of generation 1. They did not do that, one may reasonably infer, without knowing that customer satisfaction with them has to be maintained. The good thing about the issue you raise is that there will be a ramp-up (learning curve) where some of the high usage times will be known before the system is completely in use, and the telcos will thus have empricial evidence to adjust their pricing schedules more efficiently for both customer satisfaction and revenue maximization. ------------------------------------------------------------- True enough that they can use the ramp-up period to understand the ebb and flow in demand patterns that will start to emerge, but these ebbs and flows are not a regular pattern - they are variable like weather patterns. Yes, it is usually wet in winter and dry in summer, but sometimes you do get rain in summer. Sometimes even really heavy demand! Surprisingly so. What will they do then? Run some more computer models? Oh well, as long as they don't pretend to be the model of marketing genius and just stick with their more valid claim to fame of being great satellite launchers. But back to your comments Cellme, Iridium doesn't win on all marketing fronts. Price remains a factor in the world of the "moronic businessman who cares not a whit about costs" as claimed by so many avid supporters of the more expensive Iridium system. Also, your probably inadvertent support for tribalism, protected borders and the like which I derive from your claims that Hyundai wouldn't have a clue about marketing in Finland or such-like is given the lie by a fairly successful global flow of goods and services from everywhere to everywhere. Not knowing who will build the Globalstar handsets shows a fairly superficial understanding of Globalstar. Orbitel, now owned by Ericsson is one of the three as explained by Valueman. Globalstar really has got few problems compared with Iridium which has the biggest one of all - a pricing problem. They will have an even worse problem that Globalstar - when Iridium is full, nobody anywhere in the world will be able to connect. Now that will be a problem. At least Globalstar will only be full on a single satellite [or two]. Think about that one! It's nice to see Readware starting to think about the problem. Maurice